Both predict the S&P 500 will perform below a 10% average per year over the next 7 years. From Gates:
This desire to have high absolute returns–and seeing that places like Harvard University were cleverly in alternative assets–has led to this thought that “Okay, there must be something out there returning 10%. I just haven’t found it yet.” So the fact that expectations of returns exceed reality, that’s still true today.
Gates on Economics:
It’s too bad that economics isn’t taught or a hobby for lots of people, because you do run into those who seem to say, “There’s only a certain number of jobs.” That’s not the case. Let’s say tomorrow we could decide that everyone in India is as rich as we are. Would the world be a better place? Certainly. Would the U.S. thrive more because of the great products and work that would be done over there? Absolutely. The world getting richer is a great thing. It has been a great thing. It will continue to be.
Buffet on leaving money to your own kids:
…It’s interesting that the same people who talk about the terrible cycle of dependency that welfare brings will then hand their kids when they emerge from the womb a lifetime supply of food stamps. But some poor woman who’s had two pregnancies by the time she’s 17, they say, Oh, this is terrible to give her anything.
Buffet on Taxes:
We have, in my view, a taxation system that’s much too flat already. If you look at the payroll tax–which is over 12% now, and that applies on the first $80,000 or $90,000 of income–Bill and I pay practically none of that in relation to our income. For the people that work for us, their tax rate in many cases is the same or even higher than my own, since the rate on capital gains and dividends was cut to 15%. What has gone on in this country in recent years is a huge benefit to the very rich and not that much relief to people down below. Frankly, I think that Bill and I should have a higher tax rate on the income we get. We pay less than half the rate that I was paying 25 years ago when I was making a lot less money. They have really taken care of the rich.