Nicknamed the "Oracle of Omaha" or the "Sage of Omaha", Warren Edward Buffett is an American investor, businessman and philanthropist.

Warren Buffett displayed an extremely keen understanding of business and mathematics at a young age, easily doing complex mathematical computations in his head. He was also known as a bookworm who displayed an insatiable hunger for knowledge pertaining to business and capital markets.

Warren Buffett has amassed an enormous fortune from astute investments, particularly through Berkshire Hathaway. In 1965, Buffett acquired the textile manufacturer Berkshire Hathaway and became (1970) chairman and CEO. Through judicious investments and acquisitions of insurance companies and manufacturing and service firms, Warren Buffett has transformed Berkshire Hathaway into a large conglomerate, and his investments have made him one of the wealthiest people in the world.

With an estimated current net worth of around US$62 billion, Warren Buffett, America's most beloved investor, is now the world's richest man ranked by Forbes magazines as of March 2008, ahead of Carlo Slim and Microsoft chairman Bill Gates.

Warren Buffett is known for his unconventional style and frugality despite his immense wealth. His 2006 annual salary of about $100,000 is tiny by the standards of senior executive remuneration in other comparable companies, and when he spent $9.7 million of Berkshire's funds on a business jet in 1989, he jokingly named it "The Indefensible" because of his past criticisms of such purchases by other CEOs. He continues to live in the same house in the central Dundee neighborhood of Omaha that he bought in 1958 for $31,500, today valued at around $700,000.

In addition to Buffett's iconic stature in the business and investment world, he is a noted philanthropist. In 2006, he announced a plan to give away his fortune to charity, with 83% of it going to the Bill and Melinda Gates Foundation. The donation was valued to approximately US$31 billion, at the time of the announcement enough to more than double the size of the foundation. Warren Buffett's donation was the largest act of charitable giving in United States history. In 2007, Buffett was listed among Time's 100 Most Influential People in The World.

A recent interview (February 07, 2008) with the Financial Post, Warren Buffett, chairman of Berkshire Hathaway Inc., answered questions from some of Bay Street's top investor relations professionals. He shared more on his views on the markets, politics and the economy.

Q: What are your views on the credit crunch?

Warren Buffett: Credit has been repriced, but it has not become unavailable. There is repricing of risk and an unavailability of what I might call "dumb money," of which there was plenty around a year ago.

We first noted it big in the mortgage field. You had a situation a couple of years ago where virtually every American believed that house prices would do nothing but go up. If you've got every American believing that about any asset class, they're going to get more and more enthused about it, and borrow more and more money against it. And the lenders believed it, as well. And then you had Wall Street repackaging mortgages into unfathomable instruments that people bought to get a little bit extra yield, and now we are finding out what they own.

You've had the same thing in corporate finance, in what used to be called "LBOs," but has taken on a name with somewhat less stigma, "private equity." All of a sudden, the mortgage thing is starting to spread to some pretty big institutions.

I've said in the past, it's only when the tide goes out you see who is swimming naked. Well, the tide is now out, and it's not been a pretty sight.

Q: You made a bet against the U.S. currency. The dollar's come down substantially. Where do you see it going now?

Warren Buffett: At Berkshire, at the peak we had about US$22-billion of foreign-currency positions -- some of it was in the Canadian dollar, and I want to thank everybody here. There's no royalty though.

We have tried to emphasize businesses with earnings in other currencies --Coca-Cola, for example. That, to me, would be a superior way to bet on other currencies.

The only currency we hold now is the Brazilian real. If you grew up like I did, then having a holding in Brazilian currency you would have been committed someplace. In the last 100 years, five Brazilian currencies have gone to confetti. Wealthy people in a country like that would often stash their currency in another country like Switzerland or some place like that.

In the last five years the Brazilian real has doubled in value against the U.S. dollar, so if you were a Brazilian and you put your money in the American dollar, you lost half your net worth in your home country. And the outstanding thing about that is that during much of that period the Brazilian central bank was supporting the U.S. dollar.

Insanity consists of doing the same thing over and over again and expecting the same result. In the United States the cause, in my view, of the declining dollar is the current-account deficit, and the trade deficit being the biggest part of that.

We still, in the United States, are force-feeding about S$2-billion to the rest of the world. People will become a little reluctant over time to continue holding dollar-denominated assets. In the future, I would predict that the U.S. dollar will decline. I don't know what it will look like in the short term, but force-feeding the rest of the world US$2-billion a day is inconsistent with a stable dollar.

Q: It seems like short-term borrowing costs are almost nil. What's your view on inflation and whether the Fed is doing the right thing?

Warren Buffett: The fed has to balance a couple of things. I would not second-guess the Fed; they have a tough job, they can't win every war. They are focusing on expansion right now and they probably have some problems with inflation.

I was asked a couple of years ago [that] if John Kerry gets elected and asked you to be chairman of the Fed, what would you say? And I said I would tell him to ask Jimmy Buffett. Not a job I'd love. The inflation problem, in my view, is very real.

If you build up more and more debts outside of the country and you really do send a couple of billion dollars a day out, and people are left to take IOUs around the world, the natural tendency is a lot of people are not going to want to take them back in currency that is less valued than the currency where the country borrowed the money.

I would say that inflation has been more or less in remission. It never goes away as long as you have politicians and the desire to print money to temporarily solve their problems. I wouldn't be surprised if it becomes more of a factor again.

Q: What is your general advice for public investors in turbulent markets?

Warren Buffett: Most investors are not going to spend the time to be able to evaluate businesses themselves. My job is evaluating businesses. That means evaluating the management that goes with them, the economic characteristics of the business they are in, where they are likely to be in five or 10 or 20 years.

I'ma professional asset-allocator, a professional investor. Just as in other fields, you shouldn't try to compete with the pros. That doesn't mean you can't become one yourself, if you want to spend the time and effort to do it. But, fortunately, there's a perfect alternative, which basically is to buy an index fund, or the equivalent of an index fund, with very low costs, and not throw all your money in at one time. So you're diversified both in businesses and in time in which you invest. And you'll get a very decent result.

You won't get a result as [a professional investor]. And that means, you don't even think about it. If you buy a farm as an investment, do you sit there and watch the Farm Channel on television all day, as they tell you corn went up a penny or something like that? You buy the farm and figure it is a good investment over a period of time.

But in stocks, you have so much information thrown at you all the time. You have it in print, you have it on the tube, so you think you have to do all these things all the time or form opinions. The truth is, you don't have any business-forming opinions and you don't need to. All you have to do is sit there and ride a good asset over a long period of time.

The Dow Jones [Industrial] Average started the 20th century at 66 and it ended at 11,400. That is not a bad train to be on. How could anybody lose money on something that went from 66 to 11,400? Well, a lot of people lost a lot of money in stocks because they come in at the wrong time, and they get out at the wrong time, and they buy the wrong things, and they get excited, and they get greedy when others get greedy, and fearful when others get fearful.

I say you should get greedy when others are fearful and fearful when others are greedy, but that's hard for most people to do.

It is much easier to buy and buy and buy little pieces of a wonderful group of American businesses, and you'll do fine over time and you'll keep your costs low. If you try to be a little bit smarter, you'll probably end up being a lot dumber.

US$62B - The net worth of Warren Buffett, the richest man in the world, according to Forbes magazine as of March 2008.

$16.9B - The net worth growth of Berkshire Hathaway in 2006 alone -- a record for any U.S. business, M&As excluded.

21.4% - The compound annual return based on the book value of one Berkshire Hathaway share -- its assets minus liabilities or the ultimate value of a share in liquidation -- starting at US$19 in 1964 and rising to US$70,281 in 2006. That compares with 10.4% for the S&P 500, including dividends.

US$31B - The estimated amount of Warren Buffett's donation after he announced in 2006 that he would give away most of his fortune, the bulk of it to the Bill and Melinda Gates Foundation. The gift doubled the size of the foundation, already the largest of its sort in the world.

6.2% was Berkshire Hathaway's biggest annual drop in book value. It occurred during the 2001 market meltdown compared with a 11.9% slide for the S&P 500.

59.3% was Berkshire's biggest annual gain. It occurred in 1976.

5 cans of Cherry Coke Warren Buffett reportedly drinks each day. Berkshire is Coca-Cola's biggest shareholder.

200M of Coca-Cola shares Berkshire Hathaway holds, about 8.6% of the company.

US$210B - Berkshire Hathaway's market capitalization, which makes it more valuable than Google, IBM and Procter and Gamble. Berkshire Hathaway is also one of only a handful of companies to hold a AAA-credit rating from Standard & Poor's.

US$30M - If you had invested US$10,000 in 1965 in Berkshire Hathaway, US$30M is what your investment would be worth today. That same investment in an S&P 500 stock index would be worth US$500,000 today.

US$4.4B - Berkshire Hathaway was set to pay US$4.4B in federal income tax on 2006 earnings, more than half a day's worth of expenditures for the U.S. government.

42% - Policies signed rose 42% between 2003 and 2006 at Geico, its auto insurer.

The following conversation is an excerpt of the interview with Warren Buffett and Bill Gates from SkyQuestCom.

Warren Buffett and Bill Gates are 2 of the most outstanding business leaders of our time. Together, they share their personal experiences in an extraordinary conversation about personal success…

Warren Buffett: Well, I can certainly define happiness. Because that’s what I am. (Audience laugh) I get to do what I like to do every single day of the year and I get to do it with the people I like. I don't have to associate with someone who causes my stomach to churn. (Audience laugh) And the only thing in my job I don't like, and it only happens in about 3 or 4 years, is that occasionally I have to fire somebody. I don't like that. It is the only thing, other than that, I tap dance to work.

And I get down there, I think I am supposed to lie on my back and paint the ceiling, that’s the way I feel! It's tremendous fun. They say success is getting what you want and happiness wanting what you get. Well, I don't know which one applies in this case but I do know I wouldn't be doing anything else. I do advise you to go work for an organisation you admire, with people you admire, because it will turn you on and you ought to be happy at where you are working.

I always worry about people who say, “I’m going to do this for 10 years, even though I don't like it very well but I will do 10 more years of this.” I mean that's little like saving up sex for your old age. (Audience laugh hard) It’s not a very good idea, so get right into what you enjoy and you will be successful at it! (Audience laugh hard) You really will, you wouldn't be able to miss.

I don't regard what I do is the most important thing in the world but it's right for me. I happen to be wired in a certain way in that what I do works in this. It lasts about 10 minutes and that's true for a lot of things. But luckily I kind of stumbled on the thing I do best and it's worked out.

Bill Gates: I find that the key point is that you’ve got to enjoy what you do everyday. For me, that's working with very smart people. It's working on new problems. You know every time we think, “Hey we have a little bit of success”, we are pretty careful not to dwell on it too much because the bar gets raised, as do people's expectations of the products. We always get customer feedback telling us that machines are too complicated, they are not natural enough.

And the competition, the breakthroughs, the research, make the field I'm in, which I think is the most exciting field there is. There's another good field- biotechnology is a good field because it is changing the world of medicine and health. But the computer industry, in particular software, I think is the most exciting. I think I have the best job in that business.

Warren Buffett: (Quips jokingly) Don’t you think Dairy Queen is more important? (Audience laugh)

Bill Gates: You can manage Dairy Queen. I'll go and buy the Dilly bars.

Warren Buffett: I'm counting on it. We'll raise the price when you come. (Audience laugh and clap)

Bill Gates: (Replies jokingly) Ok.

Warren Buffett: I have turned down business deals that were otherwise decent deals because I don't want to deal with people I don't like to work with. I didn't see any sense pretending it and to take it on, to get involved with people who cause your stomach to churn. I say it’s a lot like marrying for money. It's probably a bad idea under any circumstances but it's absolutely crazy if you're already rich, right?

The is only the tip of the iceberg of the 54 minutes conversation with Warren Buffett and Bill Gates...

If you would like to learn more from Warren Buffett and Bill Gates, more can be found at SkyQuestCom ...

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