8. Buffett recalled this, and said, "I think somebody even may have bought a car just because they ran out of rental cars."

9. According to "Killtown's: Where Was Warren Buffett on 9/11?" (www.killtown.911review.org/buffett.htm), referencing rushlimbaugh.com from July 5, 2005.

10. Interview with Bob Nardelli.

11. Interview with Tony Pesavento.

12. Buffett told the author this in 2001, shortly after the terrorist attack.

13. The term "unforeseeable" as an explanation for large losses was virtually universal after 9/11 in the insurance industry.

14. Grace Shim, "Warren Buffett, Others Speak About Terrorism at Omaha, Neb., Event."

15. Interview with Susie Buffett Jr.

16. This initial estimate was revised to $2.4 billion in the December 31 annual report.

17. Charles R. Morris, The Trillion Dollar Meltdown. New York: Public Affairs, 2008.

18. Leading to reforms such as not allowing analysts to be compensated based on investment-banking work, and setting up "firewalls" between analysts and investment bankers.

19. For $835 million.

20. For just under $1 billion. Kern moved 850 million cubic feet of gas a day from the Rocky Mountains to Las Vegas and California.

21. This pipeline moved 4.3 billion cubic feet of gas per day. Berkshire bought it for $928 million, after Dynegy had gotten it for $1.5 billion when Enron went bankrupt and NNG was being held as collateral (both had assumed $950 million of NNG's debt). After MidAmerican's two pipeline deals in 2002, it transported 8% of the gas in the U.S.

22. Berkshire joined with Lehman and Citigroup to lend $2 billion to Williams at a 20% interest rate.

23. Pre-9/11, Munich Re and AXA struck a derivatives deal valued at $50 million with Berkshire Hathaway Group to reinsure against an earthquake canceling 2002's FIFA World Cup in South Korea and Japan. BRK would pay regardless of the actual cost of the loss, if the tournament was postponed or canceled because of an earthquake of a certain magnitude. Separately, after 9/11, AXA pulled out of insuring the tournament, and on October 30 National Indemnity stepped in to insure it, allowing the World Cup to proceed.

24. Berkshire Hathaway letter to shareholders, 2007.

25. Interview with Frank Rooney.

26. Gifts of more than $12,000 are subject to this tax.

27. Source: IRS, Statistics of Income Division, March 2007; Joint Committee on Taxation, Description and Analysis of Present Law and Proposals Relating to Federal Estate and Gift Taxation, Public Hearing Before the Subcommittee on Taxation and IRS Oversight of the Senate Committee on Finance, March 15, 2001.

28. In 2007, over 8% of the federal budget, or $244 billion, was interest on federal debt. That is almost exactly ten times the amount collected through the estate tax.

29. "I Didn't Do It Alone," a report by Responsible Wealth, describes the role of public investment, family, colleagues, luck, and grace in creating wealth. Organizations like United for a Fair Economy publish research on tax fairness, as do organizations such as the libertarian Cato Institute.

30. "Defending the Estate Tax," New York Times, February 16, 2001. In this article, Mr. Bush's own director of Faith-Based and Community Initiatives, John DiIulio, told the Times that charitable contributions would likely decrease if the estate tax were repealed. "I don't want to be the skunk at the picnic," he said. "But no, I don't think the estate tax should be eliminated-modified, maybe, but not eliminated."

31. See, for example, Melik Kaylan, "In Warren Buffett's America..." Wall Street Journal, March 6, 2001; John Conlin, "Only Individual Freedom Can Transform the World," Wall Street Journal, July 26, 2001; Steve Hornig, "The Super-Wealthy Typically Do Not Pay Estate Taxes," Financial Times, June 15, 2006; Holman W. Jenkins Jr., "Let's Have More Heirs and Heiresses," Wall Street Journal, February 21, 2001.

32. Warren Buffett letter to Senator Ken Salazar, June 8, 2001.

33. William S. Broeksmit, "Begging to Differ with the Billionaire," Washington Post, May 24, 2003.

34. Daft had options to buy 650,000 shares, initially estimated as worth $38.1 million to $112.3 million in 2015, depending on how much the stock appreciated. He also got $87.3 million in restricted stock awards, totaling 1.5 million shares. Henry Unger, "If Coca-Cola Chief Daft Fizzles, He'll Lose Millions," Atlanta Journal-Constitution, March 3, 2001.

35. The CEOworker pay gap of 411-to-1 in 2001 was nearly ten times as high as the 1982 ratio of 42-to-1. "If the average annual pay for production workers had grown at the same rate since 1990 as it has for CEOs, their 2001 average annual earnings would have been $101,156 instead of $25,467. If the minimum wage, which stood at $3.80 an hour in 1990, had grown at the same rate as CEO pay, it would have been $21.41 an hour in 2001, rather than the current $5.15 an hour." Scott Klinger, Chris Hartman, Sarah Anderson, and John Cavanagh, "Executive Excess 2002, CEOs Cook the Books, Skewer the Rest of Us, Ninth Annual CEO Compensation Survey." Institute for Policy Studies, United for a Fair Economy, August 26, 2002.

36. Geoffrey Colvin, "The Great CEO Pay Heist," Fortune, June 25, 2001. A 2001 option grant later became the subject of controversy in the 2007 stock-option backdating scandal.

37. Warren Buffett, "Stock Options and Common Sense," Washington Post, April 9, 2002.

38. Two other companies, Winn-Dixie and Boeing, had earlier started treating stock options as an expense. But they had nothing like Coca-Cola's clout.

39. Warren Buffett, "Who Really Cooks the Books?" New York Times, July 24, 2002.

40. Warren Buffett, Securities and Exchange Commission's Roundtable on Financial Disclosure and Auditor Oversight, New York, March 4, 2002.

41. Berkshire Hathaway letter to shareholders, 2002.

42. David Perry, "Buffett Rests Easy With Latest Investment," Furniture Today, May 6, 2002.

43. He didn't really want her to come back either, although he looked tempted a few times.

Chapter 57.

1. This portrait of Susie in the late 1990s and early millennial era is based on comments from more than two dozen sources who knew her well but cannot be identified by name.

2. Interview with Susan Thompson Buffett.

3. Interview with Howie Buffett.

4. Interest rates, which had been falling since 9/11, hit a low of 1% in June 2003 and remained there until June 2004.

5. This is a shorthand description for investors' limited risk aversion during this period.

6. In "Mortgage Market Needs $1 Trillion, FBR Estimates," Alistair Barr (MarketWatch, March 7, 2008) recaps a Friedman, Billings Ramsey research report that estimates that of the total $11 trillion U.S. mortgage market, only $587 billion was backed with equity-meaning that the average U.S. home had scarcely more than 5% equity. Before long, half of all CDOs would be backed by subprime mortgages (David Evans, "Subprime Infects $300 Billion of Money Market Funds," Bloomberg, August 20, 2007).

7. In The Trillion Dollar Meltdown (New York: Public Affairs, 2008), Charles Morris explains that because the typical credit hedge fund was leveraged 5:1, the 5% equity was reduced to 1%-a 100:1 leverage ratio, or $1 of capital supporting $100 of debt.

8. He used derivatives himself, but as a borrower, not a lender. Therefore, if things went wrong, he did not have to collect from anyone else.

9. Part of Berkshire Re's reported profits since 2002 are derived from General Re.

10. Alan Greenspan gave a speech on May 8 at the 2003 Conference on Bank Structure and Competition where he voiced his opinion on derivatives. Ari Weinberg, "The Great Derivatives Smackdown," Forbes, May 9, 2003.

11. For example, he was called "The Alarmist of Omaha" by Rana Foroohar in Newsweek on May 12, 2003.

12. Buffett lent $215 million to Oakwood in debtor-in-possession financing. Through Berkadia (see note 13), he bid $960 million for Conseco Finance. Berkadia representatives left before the auction was over, and were outbid by a consortium that offered $1.01 billion. Berkadia objected to these proceedings and raised its offer to $1.15 billion after it was over, but this effort was rejected by the bankruptcy court judge. The credit bubble for manufactured housing and subprime lenders like Conseco deflated by 2004, more than a year before the broader housing bubble peaked.

13. This deal resembled in some ways another deal he had done two years earlier, partnering with Leucadia National to form Berkadia LLC, which provided a $6 billion secured five-year loan to the bankrupt FINOVA so it could pay down its debt.

14. In First a Dream, Jim Clayton recounts that Michael Daniels, an intern who had "tolerated" him through the six-month final edit of the book, got him to autograph a copy to give to Buffett. When he graduated and went to work for UBS, Daniels handed the book over to the next intern, Richard Wright, for delivery. "The Ballad of Clayton Homes" (Fast Company, January 2004) claims that the Claytons used Wright to send a message to Buffett.

15. In his memoir, Jim Clayton says people find it hard to believe that he did not return Buffett's call himself. He says it never occurred to him to do so, and he and Buffett have never called each other about business. During the months that the deal was in negotiation and litigation, the author observed that Buffett dealt only with Kevin Clayton.

16. Interview with Kevin Clayton.

17. Jim Clayton, Bill Retherford, First a Dream. (Tennessee: FSB Press, 2002.) The 2004 revised edition gives an account of Berkshire Hathaway's fight for Clayton Homes.

18. Buffett had spent only $50 million in April to purchase PetroChina stock, but that brought Berkshire's ownership to $488 million and over the limit that required disclosure to the Hong Kong Stock Exchange.

19. Buffett said he would buy foreign stocks under the right circumstances; e.g., in the United Kingdom or a newspaper in Hong Kong. However, he did not spend time seriously studying foreign stocks until opportunities in the U.S. began to thin.

20. Warren Buffett, "Why I'm Down on the Dollar," Fortune, November 10, 2003.

21. From unpublished coverage of the 2003 Berkshire Hathaway annual meeting, courtesy of Outstanding Investor Digest.

22. A major advantage of the deal was Berkshire's access to and low cost of funds. With its AAA credit rating, it could borrow at a far lower rate than any other manufactured-home maker and thus not only survive credit droughts but make money under conditions where Clayton's competitors could not survive.

23. Speaking at the New York Public Library, June 25, 2006.

24. Andrew Ross Sorkin, "Buffett May Face a Competing Bid for Clayton Homes," New York Times, July 11, 2003.

25. "Suit Over Sale of Clayton Homes to Buffett," New York Times, June 10, 2003. Gray alleged that previous shareholder meetings electing directors had taken place without proper notice. In June the Delaware Chancery Court ruled that Clayton had technically not met the notice requirement, but since the meeting was so well attended by shareholders, the mistake was only technical and results of the meeting would not be overturned.

26. Jennifer Reingold, "The Ballad of Clayton Homes."

27. At its peak before the death of Susan T. Buffett, the foundation spent $15$30 million per year in total, mostly on reproductive rights.

28. If Buffett had paid dividends and used them for the donations, the whole point would have been moot.

29. Douglas R. Scott Jr., president, Life Decisions International, letter to Warren Buffett, September 26, 2002.

30. The number came from Cindy Coughlon, a Pampered Chef consultant who organized the boycott. Nicholas Varchaver, "Berkshire Gives Up On Giving: How a Pro-Life Housewife Took On Warren Buffett," Fortune, August 11, 2003.

31. Compiled from various interviews.

32. Pro-life activists, according to the U.S. National Abortion Federation, have committed 7 murders, attempted 17 other murders, made 388 death threats, kidnapped 4 people, committed 41 bombings, 174 instances of arson, and 128 burglaries, attempted 94 bombings or arsons, made 623 bomb threats, committed 1,306 instances of vandalism, made 656 bioterror threats, and committed 162 instances of assault and battery. These numbers exclude stalking, hoax device/ suspect packages, hate mail, harassing phone calls, trespassing, invasion, Internet harassment, and other less serious incidents. The pro-life movement's activities have resulted in 37,715 arrests as of 2007. Most mainstream pro-life organizations reject the terrorist wing of the movement, some vocally.

33. Berkshire Hathaway press release, July 15, 2003.

34. Under Delaware law, only shareholders in attendance were eligible to vote on a recess.

35. Jim Clayton, Bill Retherford, First a Dream.

36. Interviews with Kevin Clayton and John Kalec, executive vice president and CFO of Clayton Homes.

37. The suit, filed on July 25 by Milberg Weiss Bershad Hynes & Lerach, LLP, initially claimed that Kevin Clayton had asked Janus Capital to continue to support the deal even though it had sold the stock. In court, no evidence of this was found and the case was dismissed.

38. Jennifer Reingold, "The Ballad of Clayton Homes."

39. Jim Clayton cites these figures in First a Dream, indicating he could not confirm them.

40. Cerberus memorandum, "For Discussion Purposes," reprinted in Jim Clayton, First a Dream.

41. In a few instances, such as NetJets, private-company owners sold to him at lower prices than they could have obtained elsewhere because they wanted Berkshire as an owner.

42. Jim Clayton, Bill Retherford, First a Dream.

43. Interview with Kevin Clayton.

44. By 2006, manufactured-home shipments had fallen to 117,510 units and were still declining at an average rate of 32% in 2007 despite a temporary bump in 2005 from Hurricane Katrina. (Source: Manufactured Housing Institute.)

Chapter 58.

1. Interview with the Reverend Cecil Williams. Buffett participated in two live auctions for Glide before the first eBay auction.

2. Interview with Kathleen Cole.

3. Interviews with Kathleen Cole, Susie Buffett Jr.

4. Interview with Howie Buffett.

5. Interviews with Howie Buffett, Susie Buffett Jr.

6. Interview with Kathleen Cole.

7. Ibid.

8. www.oralcancerfoundation.org.

9. Oral Cancer Foundation.

10. Interviews with Kathleen Cole, Ron Parks.

11. Interviews with Marshall Weinberg, Walter and Ruth Scott, Lou Simpson, George Gillespie.

12. Interview with Susie Buffett Jr.