1994: What should people do with their blue chip stamps?

AUDIENCE MEMBER: This one is real easy. My wife was a collector of Blue Chip stamps for many, many years. And she brought some stamps with her. What should she do with them?

WARREN BUFFETT: Well, that — we can give you a definitive answer to that. Charlie and I entered the trading stamp business to apply our wizardry to it in what, 1969 or so, Charlie?

CHARLIE MUNGER: Yes.

WARREN BUFFETT: We were doing what then, about 110 million?

CHARLIE MUNGER: No, it went up to 120.

WARREN BUFFETT: OK. And then we arrived on the scene and we’re going to do what, about 400,000 this year?

CHARLIE MUNGER: Yes.

WARREN BUFFETT: Yeah. (Laughter)

That shows you what can be done when your management gets active. (Laughter)

CHARLIE MUNGER: We have presided over a decline of 99 1/2 percent. (Laughter)

WARREN BUFFETT: Yeah. Yeah. But, we’re waiting for a bounce — (Laughter)

I would say this. The trading stamp business, as those of you who have followed all know, it only works because of the float.

I mean, there — a very, very high percentage of the stamps in the ’60s were cashed in. We have some years that we’ve gone up to 99 percent, I believe — we sampled the returns — because they were given out in such quantity.

But, our advice to anyone who has stamps is to save them because they’re going to be collector’s items, and besides if you bring them to us we have to give you merchandise for them.

Tell her to keep them. They’ll do nothing but gain in value over years. (Laughter)