Inaugurated on sunday next on the agenda, in france, two rounds of parliamentary elections in june. We should mention the jueuro jumping to sixmonth highs. Youre looking at european markets right now, across the board, they are down. In large part, they had risen, of course, on friday in expectation ever this news. In asia, japan rising 2. 3 overnight. The hang seng was slightly higher. U. S. Equity futures up right right now. Standing basically, marginally down about 23 points. S p 500 call it virtually on the nasdaq off by a point. In corporate news, sources telling cnbc that comcast and Charter Communications plan to announce a Wireless Partnership as soon as today. The partnership is aimed at cutting costs, as well as speeding up entry into the wireless market. As part of the agreement, Neither Company will make any deals in the Wireless World for the next year without the others consent. The move is renewing speculation that the two cable giants could make a play for a wireless carrier company. The Cable Company has been looking at wireless to retain existing customers, as well as make their bundles more attractive to new customers. A quadruple play, i guess it would be. Wireless. Yeah, it makes it harder to believe that after this if it would be the way theyre talking about, makes it harder to believe there could be a combination with verizon which is the the partner that comcast has. But to the extent that theres speth las veg speculation that they could potentialmly merge. But comcast is using their back cone, thats what time did you get in . I got in at about 8 00. That just perfect for. You. Perfect. Good enough to see the kids and to give them little dolls of warren wuf fetwar Warren Buffett. I went and bought dolls of Warren Buffett. To becky got with the doll Warren Buffett but the real thing. These arent voodoo dolls right . No, i dont know the secret millionaire ones, right . They talk, they have a dvd. Were going to watch the cartoons and my kids are going to learn about money from Warren Buffett. Warren, im going to see if it works. Im going to stick a needle into one of these. See if you feel anything. I actually dont have one. But im going to try that. How much do you get for each i bet you he makes money on each one of those, right . You can never have enough, right, warren. Youll get the voodoo doll joke. Ive got a special one for you. Starting on you early, warren. I know. Youre vulnerable. All right. Well, guys, lets jump into this right now with both feet. Warren buffett is our guest this morning, hes the chairman and ceo of Berkshire Hathaway, this is his first interview since sitting down he spoke to 40,000 or so berkshire shareholders over the weekend just across the street here. Warren, thank you very much for joining us this morning. Ive been kind of thinking back, its been years now since the annual meeting. And the annual meeting has changed over this course of time. What did you think . People continue to have fun. Its half mardi gras and half annual meeting when they come, and we see thousands them in the steakhouse last night. A couple hundred there, theyre all smiling. You know, there were planes that didnt fly, a few things, but a few inconveniences, but they had fun. And they meet a lot of people that that they saw in the previous year. As a matter of fact, we went to the steakhouse, the directors all went there, the same guy that picked up our check has probably picked up for ten straight years. Im trying to today so that you can buy him lunch or that you can show up and get another free lunch . Everybody is in a good mood. Theyre clapping at the steakhouse. And they come because they expect to have a good time there. And we try not to disappointment them. Well, we watched a lot of Different Things and heard so much from the q a this weekend. I was trying to figure out a few myself. One of the themes that stuck out with me is technology. And how much that was discussed this weekend. For a guy who claims hes not really a technology guy, in fact doesnt even own a smartphone. You spent a lot of time talking about Technology Investments that you made or didnt make that you missed out on. I was thinking in particular about apple. You that talked quite a bit about why you got into that. Ibm. Why youre selling some of that stake. But you also talked about of the Companies Like google where you said you missed it. Maybe you can tell us about that. Well, i did miss it. Charlie brought up the fact that we missed it, too. Google, i should have had some insight into it. Here we saw value at that time, i have no idea what we were paying for put now. We were paying 10 or 12 per put. And were going to keep seeing that. I should have had more insight into that. Whether bing was going to come along or other people were going to take away the market, thats another question. Whether you had source of a first user advantage would be what would prevail. And theres a lot of technology with it. Somebody could have come along with a better technological product that i would not have had insights into that. I think laser surgery or Something Like that, i think it may have sold for 60 or 70 bucks or something. Thats completely omaha. I dont know what it brings now. Just imagine having something every time theres a click on a Cash Register somewhere out in california. It was an an extraordinary business and it had some aspects of a snarl anomaly. Its very easy for me when i go to a computer. Ive worked with google before. But im looking for information for the annual report. I used to have to mail away to federal agencies or go to the public library. Now, i can get it in ten seconds. So it improves to be valuable advice which the other guy pays for. The user of the computer doesnt. The answer is, we missed it. Sergei and larry came to you. And actually eric did, too, i liked them. When you say you missed it, that suggests its now at a valuation you understand the company, its now a valuation that doesnt make sense to you. Why dont you just buy it now . If i was forced to buy it id buy it, same way with amazon. I can just tell you psychologically, its harder when you looked at it in the first place and passed. And then buy it, it cost a lot of people money at berkshire. And i just said if it ever gets back there, ill buy it. Thats a terrible way to think. Train what is left the station . Iyeah. How come you dont feel about that about shares at apple . How come you feel thats a different story . Well, the shares were a lot more reasonable. Apple didnt have to do as a lot better in the future than they did over a period of time. Youre paying for the future more. That may be more than justified. But apple, i wouldnt say understand that google now perhaps or amazon now certainly would have been five years ago. Its amazing where apple or yeah, apple ended up with the consumer. I can very easily determine the Competitive Position of apple now. And whos trying to chase them. And how easy it is to chase them. We happen to be well situated in terms of massive Home Furnishing stores. And i can learn very easily how consumers react to Different Things there. Probably easier than i can trying to pick up whats is really happening at amazon at any given time. So, you use your research at the Nebraska Furniture Mart to tell you that consumers prefer apple over samsung . What type of thing are you using . Well, interesting thing is if you come in to buy a tv set at furniture mart, price is extremely important. Now, obviously, picture, theres all those great pictures sitting up there. You can have samsung, all of these different ones. And if you put on a sale and you bra drop the price of samsung 10 , we can fill that department for people to come out for it. You cant move people by price in the smartphone market. Remotely like you can move appliances or all kind of things. People want the product. They dont want the cheapest product. And the royalty is usually how that doesnt mean somebody cant come along with a product thats theres jumps in the field or something. Once you have a product to a degree that controls your life, its a very, very valuable product for people who build their lives around it. Thats true of 8 year olds and 80yearolds. People who question apples future saying people are paying 800 for a smartphone. And the other reality in technology is that prices eventually come down. Unless youre adding more and more value to that product, the price will come down. So what happens if people i guess the question is, will people always be willing to pay 800 or more for a phone . Or will that wind up being a cost that comes down and down . Well it can be that way. Usually its because of theres competition between products. Some manufacturers say they cant beat apple on their own terms so they drop their product down to 100 bucks or 200 bucks. Some products are susceptible, some are not. So far, youve had big differences in products. People come back in if they had an. Le beforapple youre going to h much cheaper selling smartphone right next to it. And theyll look at it. You have a cheaper tv, and youre looking at it saying whats the difference . Right. And you buy the cheaper tv. And thats true. Its not to say that apple doesnt have somewhat the same prices but very little. Some of that comes along and leapfrogs in the way of technology and adds benefits that would be the more competitive threat to me than price competition, it would be benefit competition. I dont know what that is. But apple gave me a whole lot of things that i never realized until in the end. Lets talk about just the stock price again. You said it made sense to you when you started buying into it. Shares have appreciated. Thats the problem. Im cheap. And theres always an anchoring problem with buying stocks. Its just harder to buy them at harder prices. So does that signify that youve stopped buying in apple because of where prices are . Well, maybe not. But, you slithered in there. Okay. I guess when you say the earnings that came out, you werent bothered or disappointed by the earnings when you see the stock price pull back, you probably like it at that point . Yeah. Apple was a nonnew product if they sold Something Like this. Thats a lot of units to sell, 700. A lot of those are going to people who are actually replacing a present apple. But they do know that a new product is going to be out in six months or something. Who knows maybe they got promised an apple for their birthday or graduation. I would be tempted if i were going to buy one, what do i lose by doing this . Its a lot of product to sell with a new model coming outside. Weve talked to you pretty extensively about ibm. Andrew and i got a chance to ask questions from the stage at the Shareholder Meeting this weekend. We only asked about six questions and we got thousands of questions from shareholders. One question that did come in from a shareholder that i didnt get a chance to ask you. One was about ibm and watson. Using geico, you wonder if your sale of ibm was related in way to the performance of watson . No. Weve been experimenting in a lot of possibilities with watson at geico. And weve experimented with various different possibilities. So far, its done certain things and it hasnt done certain things. But that same kind of scompae t experimentation is going on in hospitals. H r block works with it this were. And watson, a Pretty Amazing invention it has. And it is getting put into use, a lot of places. So, its a really interesting product. And im sure the revenue is growing very significantly, but from a very small base. But i would say youve got other very smart people and give them some time to work on other products. And i would say when you get into that area, if you do have to worry, even more than with the phone, worry about somebody jumping a utility or Something Like that. Where it really becomes valuable, i mean, obviously valuable, to be able to look at trades and that sort of thing much faster than humans can. And read all of the pages and all of that. I would think the biggest value will come in when it actually replaces human labor. I mean that is so quantifiable. And machines dont come around annually and ask for higher wages. They dont need health care and maintenance. Butful they replace if they replace people in a big way, it would have a lot of value. Unless somebody else has some other product to do this kind of thing. So its artificial intelligence, but its very much so in the artificial emphasis on artificial in that sense . Yeah, i think theyll call it something slightly different. You and i in common language would call it artificial intelligence. And it is intelligence. The question is, how much better results can you get with it than using human beings . Or human human beings you can displace in getting it . Or can you get some entirely new form of information that humans are actually incapable of getting so they cant keep any word thats been written about Prostate Cancer or something in their minds and theyve Read Everything up to what was published yesterday. I mean, its got great potential. It has not come along as fast commercially, as you would have hoped on that. Its probably going at a very fast rate. But the base is probably really small. Andrew and joe, were going to have much more with mr. Buffett today. But right now, well send it back to you for a quick update as well. Okay. Warren hasnt seen any actual indications of any malevolent intent from watson, has he . Just the idea of watson i just remember what happened to those astronauts. You know, the ones that were actually in the you know, slowly how it turns down all the life support. You have seen that, yet, war re . Thats what i worry about with watson . Does he seem like a nice guy. I spent hours with him sand i kept an eye on him. If you dont need us you said it health care, we ask for raises. We ask for food. Were pretty superfluous to some extent. I dont trust watson but he probably has a pretty large server, right . Well, we all know what happened to hall in space odyssey. Actually, i talked to some very smart people not at ibm. Just about the whole idea of artificial intelligence. And you know, they all go Different Directions on this. But its not about watson specifically, about the whole subject of artificial intelligence. Youve read about it, too. Yes. Some people are worried. Genuinely worried. Genuinely. Some people are worried down the road, we probably do need to think about it, you know . Ive got the cure for it. Ive got the cure for it. Dont worry as much under those circumstances. Yeah. Thank you for doing this. We were just talking about what an amazing what you do for three or four days is like super human almost. Three or four days a week three or four days a year i work. When i work, i make sure is going and then i disappear. Okay, warren, were going to come back to you in just a couple minutes. Im going to try to get you a warren doll. I think you need one. Warren, thank you, well come back to you in a second. Quick many practicing note, tomorrow on power lunch, you wont want to miss this, wilfred frosts exclusive interview with the ceo loyal blankfein. 2 15 on power lunch. We return with Warren Buffett in just a moment. I am benedict arnold, the infamous traitor. 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Well take 2 [ laughing ] xfinity x1 gives you exclusive access to the best of the Billboard Music awards just by using your voice. The Billboard Music awards. Sunday, may 21st eight seven central only on abc. Hey, coming up, much more from Berkshire HathawaysWarren Buffett after the break. Programming note tomorrow on squawk box, well be joined by real estate magnate sam zell. It will be fun. Heres a look at last weeks s p 500 winners and losers. Good week for the s p. Everything is running smoothly. Im sorry, im afraid i cant do that. S was built with passion. But i keep it growing by making every dollar count. Thats why i have the spark cash card from capital one. With it, i earn unlimited 2 cash back on all of my purchasing. And that unlimited 2 cash back from spark means thousands of dollars each year going back into my business. Which adds fuel to my bottom line. Whats in your wallet . The power of 100 of the worlds top companies. The power of a proven 15year track record. The power of an etf. The power of qqq. The thinking we put in, clients get out. Power your clients portfolio at powershares. Com qqq. Before investing, consider the Funds Investment objectives, risks, charges and expenses. Call 8009830903 for the prospectus containing this information. Read it carefully. Distributed by invesco distributors inc. Live from the beating heart of business, new york city, this is squawk box. Good morning. U. S. Equity futures at this hour continue to trade lower. Not a complete surprise, i guess, after the markets basically now up on the s p, up 2. Nasdaq up 4. About the same with the markets probably happy about what happened in france. But it was such of a large win. And the polls were 20 plus