저자: WarrenBuffett·CharlieMunger · 외국인
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버크셔는 재투자 수익률이 주주 입장에서 배당보다 높다면 배당을 하지 않는 것이 낫다는 원칙을 설명하고, 이익을 효율적으로 쓸 곳이 없으면 배당이나 자사주 매입을 해야 한다고 말한다. 자사주 매입은 주가가 내재가치보다 낮을 때만 합리적이며, 배당세 감면은 부유층에게만 큰 혜택을 준다고 비판한다. 금리는 단기금리보다 높은 최소 수익률 기준을 두고 투자 여부를 정한다고 설명한다. 자산 가격에 대한 단기 방향 예측은 없다.
다듬은 글
The um well the answer is I do believe in dividends and in a great many situations including many of the ones that companies in which we own stock. The test about whether to pay dividends is whether you can con continue to create more than $1 of value for every dollar you retain. And there are many business we take Seas Candy which we own.
Seize Candy has paid everything virtually out to us that they've earned because they do not have the ability within Seas Candy to use large sums which they earn uh intelligently in their business. So it'd be an enormous mistake for Seas Candy to retain money. So they distributed Bergkshire and we hope that we move that around in some other area where that dollar becomes worth a$110 cents or a$120 cents in terms of present value terms.
If we do that, the shareholder, whether they're taxable or whether they're not taxable, whether they're a foundation or whether they're living on income even, they are better off if if we retain the money because if in if they were going to get a dollar in dividends and it became worth a$110 or a$120 in market value immediately on a present value basis, uh they're better off selling a small percentage of their stock and and realizing uh the require ired amount that way and they will have more money when they get all through doing that than if we paid it in dividends.
But if the time comes uh and it will come someday when the if the time comes when we don't think we can use the money effectively to create more than a dollar of market value per dollar retained um then it should be paid out and like I say we do that individually within Bergkshire but because we have this ability to redistribute money uh in a taxefficient way within the company uh we probably had more we had more reason to retain all of our earnings.
If if Sees Candy were a standalone company, we would simply pay out a lot of the the earnings practically all of the earnings and dividends just like we do now except it goes to Bergkshire that we like our we like the companies in which we have investments to pay to us the money they can't use efficiently in their own business.
In some cases, that's 100% of what they earn. In some cases, it's 0% of the earn. We own some stocks that don't pay any dividends. Big opportunities in life have to be seized. Uh we don't do very many things, but when we get the chance to do something that's right and big, we've got to do it. And even to do it in a small scale is just as big a mistake almost as not doing it at all.
I mean, you've really got to you got to grab it when they come. And because they you're not going to get 500 great opportunities. You would be better off if when you got out of school here, you got a punch card with 20 punches on it. And every big financial, every financial decision you made, you used up a punch.
You'd get very rich because you'd think through very hard each one of them. You went to a cocktail party and somebody talked about a company you didn't even understand what they did or couldn't pronounce the name, but they made some money last week and another one like it. You wouldn't buy it if you only had 20 punches on that card.
There's a temptation to dabble if uh particularly during bull markets uh uh in stocks is so easy. You know, it's easier now than ever because you can do it online. You know, just you click it in and maybe goes up a point and get excited about that and you buy another one the next day and so on. You can't make any money over time doing that.
But if you had a punch card with only 20 punches, you weren't going to get another one the rest of your life. You would think a long time before every investment decision and you would make good ones and you'd make big ones. and you probably wouldn't even use all 20 punches at uh in your lifetime, but you wouldn't need to.
Hi, I'm uh Steve Casbell from Atlanta. Um my question involves interest rates. Uh when you calculate the intrinsic value of a business and a period of low interest rates like we have currently, do you use a higher discount rate to factor in higher rates in the future? And also um when do you ever look at a company's free cash flow yield relative to current rates?
And if I could also get your thoughts on the uh dividend tax cut, if by some miracle the politicians think logically and get rid of the dividend uh taxes, would Bergkshire ever pay a dividend? The question on discount rates, we u we use the same discount I mean in theory we would use the same discount rate across all securities because if you really knew the cash they were going to produce you know that would that would take care of we may be more conservative in estimating the returns of cash from some but the the discount rate we would use as a constant.
Now, in terms of where we commit, you know, we don't want to use the fact that short-term rates are one and a quarter percent to think that something that yields us 3% or 4% is a good deal. So, we sort of have a minimum threshold in our mind about which we're below which we're unwilling to commit money and we're unwilling to commit it whether interest rates are six or 7% or whether they're three or 4% or whether they're on a short-term basis 1%.
We just we don't want to get hooked into long-term investments at low rates just because they're a little bit better than than short rates would be or or low government rates would be. So we we we have minimum thresholds in our mind. I can't tell you precisely what they are, but they're uh they're a whole lot higher than present government rates would be.
And at other times, we'd be very happy owning governments just because we feel that they offer attractive enough rates. Uh um I would when we're looking at a business, we're looking at holding it forever and and we want to be sure we're getting an adequate return on capital. We don't regard what we can get on short-term rates now as adequate, but we'll still sit bend, you know, a little bit and start settling for lower rates for 30 years because rates for 30 days are so low.
we would rather just sit it out and wait a while. Um, the tax on dividends, uh, you know, I've used this illustration before, but I'm paying about the same percentage of my income to the federal government as my secretary does. Now, I pay more in income tax rates than she does. I pay a higher marginal tax rate by some margin than she does, but she pays way more in social security taxes than I do because I only pay on the first whatever it is 70 or 80,000 of income.
And so she is paying between what we pay at the company for and what she pays. We're paying 12 or 13% or whatever it is of that. So we both end up paying fairly similar percentages of our income to the federal government every year. If Berkshire were to declare a billion dollar dividend and my share of it was 330 million and it were tax-free uh as the Bush people originally suggested and it would be taxree.
I mean we have lots of taxable earnings at Bergkshire you know I might be paying onetenth of the rate to the federal government of my income that she would be. Now, I can make the argument about the fact that structure shouldn't govern tax rates that that subchapter S and subchapter and chapter C and partnerships and all of these things that the tax code should be neutral between them.
And I've made those kind of arguments in the past. But I can make no argument in my mind that says that I with everything that you know all the luck I've had in life, you know, I was wired a certain way at birth that enabled me to make a lot of money. And frankly, it was better to be born a boy than a a girl in terms of money-making possibilities in 1930 and probably still is, but not to the same degree.
I mean, the fact that that I would send onetenth the portion of my income in a year to the federal government that my secretary would I it just it screams at injustice to me in in terms of what the society gives back to me. So, so I am not I am not for the I'm not for the Bush plan. Charlie, well, I I agree with you.
Even if you assume that that the whole economy would work better if we'd never gotten into this double taxation system on corporate earnings, which I don't think is a clear thing anyway, but even if you even if you assume that, I think you live in a democracy where there's lots of envy and resentment and what have you, to have the absolutely most fortunate people paying practically no income taxes, I I just think it's unacceptable.
I think there has to be some fairness in in uh in some of these arrangements. Uh even if there's some theoretical argument that the economy might work a little better some other way. Yeah, there are IAS now obviously that work very well for people with modest amounts of dividends that they they're getting tax deferred for a very long period of time which has huge benefits.
the big benefits of exempting dividends would go to fellows like me and Charlie, you know, and that's not going to stimulate the economy, it's going to stimulate us, but uh and it's going to result in us sending a very small percentage of the income of our income to Washington compared to what the people, you know, working in our shoe factories send.
And uh that you know when somebody says you know what did you do during the war grandpa I'm not sure that's what I want to explain to them. Number three. Hi my name is Charlie Rice and I'm a stockholder from St. Louis Missouri. Appreciate hearing your comments on publicly held companies using their cash for uh dividends versus stock buybacks.
Well, we the equation is pretty simple, but the practice doesn't necessarily follow logic. The it's obviously as long as you're telling the truth to your shareholders about what's going on so that you aren't manipulating the stock downward or something. When a stock can be bought well below its business value, uh that probably is the best use of cash.
It's something the Washington Post did on a huge scale back in the 1970s. Telodine may have bought 90% or something or close to it of their stock back. And that was the reason mo a very significant percentage of companies bought stock back in the past because they actually thought it was selling for less than it was worth.
Uh like I say that that can be abused if you do various things to bury your stock in one way or another. But but that wasn't the usual case. Um, it stock repurchases were relatively unpopular in those days. They've become quite popular now and and and to the extent that I've been around a good number of them and and been able to pick up on what I thought was the underlying rationale, if not the professed rationale, you know, I think it's often done for people that that are hoping that it causes their their stock price not to go down and uh and they're and and often done at prices that don't really make a lot of sense for continuing shareholders.
Um, if we wanted to return a bunch of cash to shareholders, we would if our stock was undervalued, we would we would uh we would go to the shareholders and say we think it's cheap and and we think that this cash can be better used by you than by us. And we will therefore have be repurchasing at what we think is a discount intrinsic value.
And the people that remain will be better off. the people to get out will get out at a little bit better price than they would otherwise. Um, in terms of dividends, you get into an expectational situation. And for most companies that follow a that pay a cash dividend, it doesn't make sense to be to bounce around the dividend from year to year.
Although private companies frequently do that and we do it ourselves with our subsidiaries. some subsidiary can pay us a lot of money one year and not so much money the next year. Uh but with public companies people do a lot of people do buy stocks to obtain dividends and they hope for regularity and there's a signaling aspect to it and everything.
So I would I would say that once you establish a dividend policy with a public company you should think a long time before you change that policy in any material way. But I think the best use of cash if you don't have a good use for it in the business if the stock is underpriced is to repurchase it.
And if it's overpriced, you got no business buying in a single share. But uh a lot of companies do it. Charlie, yeah, dividends are a very interesting subject. If you count the unnecessary stock trading and the cost of investment advice and the cost of making a lot of errors and the trading costs in and out, I don't think it would be too extreme to say that now the total amount that's paid out in dividends is roughly equal to the amount that is wasted in all this trading and investment advice.
So that the net dividends that come to the shareholders are approximately zero. This is a very peculiar way to run a a republic and very few people comment about it. Yeah, actually I did in an article some time ago and fortune the frictional costs to American shareholders in sort of changing shares uh for all American business as a whole.
Those frictional costs are probably not much different than the entire amount paid out by American corporations. So, uh, but getting to the individual corporation level, a company that expects to regularly earn more than it than it can profitably employ in its business should be paying out dividends.
Take a subsidiary of ours like Seas Candy. We would love to expand Seas Candy to double or triple its present size, but it doesn't work. We've tried it a lot of different ways. So, it should be paying out its earnings. If it was a public company and it was at one time, you know, you could argue that something approaching a 100% payout would would make sense there.
But most managements worrying about earnings falling off at sometime in the future would rather establish a lower level and and and and therefore ensure regularity of dividends uh by by going with a conservative level. Uh uh I uh you know we it's obviously something we think about at Bergkshire when we have 30 odd billion dollars around if we can't figure out a way to employ that over time you know it's it's a mistake to keep it in corporate form but we have this expectation and I think it's a reasonable expectation that we get to put it to work.
If we ever came to the a different conclusion, if our stock we thought our stock was significantly undervalued, we'd probably figure in terms of dispersing it through repurchases, particularly where now dividends and capital gains are are neutral for for individuals. Uh and um if our stock was not underpriced and we fell, we we would we would probably do something by a dividend. It's not going to happen soon.
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