Uh, this is a question from Mark Bonnke and Helen Friedrien in Rapid City, South Dakota. As the US dollar quickly loses value in relation to other foreign currencies in 2025, is Berkshire Hathaway taking steps to minimize this currency risk and its impact on quarterly and annual earnings? If so, please explain.
And I I'll just add from Mary Chang, another shareholder. Berkshire currently borrows in Japanese yen to offset its currency risk and its Japanese stock investments. In the future, will you invest in foreign currency denominated assets unhedged?
Yeah. Well, we always have um pretty much uh the Japanese situation is different because we we do intend to stay so long with that position and the funding situation is so cheap that u we essentially have have attempted to some degree to to match purchases against yen denominated of funding. Uh but that's not a policy of ours.
In fact, that's the first time we we've we've done that. And and we've owned lots of securities of uh of of in in foreign currency. So uh we do nothing in in u in terms of the question about its impact on quarterly and annual earnings.
uh we don't do anything based on its impact on quarterly and annual earnings. I mean there's never been a board meeting I can remember where I or a conversation I had with Charlie when I said where I say if we do this our annual earnings will be this you know and therefore we ought to whether it's accounting or whe anything uh we just you know the the number will turn out to be what it'll be what counts as where we are five or 10 or 20 years from now and and if you start focusing on what number you're going to produce. Uh you will quickly get tempted, at least based on the experience I've seen from viewing 20 companies, you will get so you'll one way or another uh play around with the numbers and sometimes seriously play around with the numbers.
And uh uh I've seen people that that you know I trust him in all kinds of other ways but they regard playing around with numbers is perfectly okay and that's just not something you know we just don't think about that. So uh actually then the uh the end um um uh the relationship of the end behavior of the end in the last quarter you know resulted in certain gap charges and uh but it doesn't make it it doesn't make any difference. it'll change next, you know, next month or next year.
And and obviously, we wouldn't want to be owning anything that we thought was in a currency that was really going to hell. And that's the big thing we worry about with the United States currency. I mean it the the tendency of a government to want to debase its currency over time is there's no system that beats that.
You you can pick dictators, you can pick representatives, you can do anything. But but the people there there will be a a push toward weaker currencies. And of course that is I mentioned very briefly in the annual report that that the that fiscal policy is what scares me in the United States because it's it's made the way it is and uh and uh all the motivations are to doing a lot of things that will cause can cause trouble with with money.
But that's not limited to the United States. It's all over the world and some places it gets out of control regularly as I know they know they know know they uh they devalue at rates that are breathtaking and that's con that's continued. I mean, and you people can study economics and you can have all kinds of arrangements, but in the end, if you've got people that control the currency, uh you can you can issue uh paper money and you will or you can engage in clipping currencies like they used to do centuries ago.
or there will always be people and it's the nature of their job. I don't I don't I'm not singling them out as particularly evil or anything like that, but the natural course of government is to is to make the currency worthless uh over time and uh and that's got important consequences. And it's very hard to build checks and balances into the system to keep that from happening.
And uh we've had a lot of fun here in the last either the first 100 days or the last 100 days, whatever you want to call it. the uh uh watching what happens when people try to make sure that they aren't running fiscal risks and uh that game isn't over and it never will be over, you know, in finality. If you look if you look up in in search the great inflations of post World War II, it's just a list that goes on forever and the same names keep popping up and everything.
So currency is a the value of currency is a scary thing and and uh uh we don't have any great system for beating that we do in this particular Japanese position because expect to hold it for 50 or 100 years or more and we will be owning something that's denominated in the end and easily predictable and we'll just as long as the the carry on it is right and everything will will uh will attempt to issue uh Japanese denominated liabilities but that that's not because of anything we care about in terms of quarterly or annual earnings. Greg, do you have anything to say on that? I was just going to say that relative to the question that there's no question we were fundamentally very comfortable with investing in the five Japanese companies and recognizing we're investing in yen.
The fact we could then borrow in yen was a almost just like a nice incremental opportunity. But we were very comfortable both with the Japanese companies and with the currency we would ultimately realize i. e.
In the yen.
