Every year since I started this column, I have written with bated breath about Warren Buffett, chairman of Berkshire Hathaway (BRK/A:NYSE). It's a little bit late this year, but his annual letter to, and interviews with, shareholders are still genuine nuggets of investing experience. Like many in his age group (73) , he has survived and thrived through many market slides, endless personal image scrutiny, and scorn from those investors who think they know better, but really don't.

And once again, he has had his own last words.

"To the shareholders of Berkshire Hathaway (BRK:NYSE):

The results for the 2003. Our gain in net worth was 13.6 Billion, which increased the per-share book value in both Class A and B shares by 21 percent, more than 11.8% better than the S& P 500 index. Over the last 39 years, our per share book value has grown from $19 dollars to $50,498, a rate of 22% compounded annually.

The format of each annual report is similar, interspersed with sly zingers that take twice to read to have an effect.

He always apologises for his mistakes, laying them out for all to see in a homely little book.

Without gloss or glitz, this year it is printed in plain Easter egg purple. Berkshire's cumulative performance (1964-2003) is an astonishing 259,485 percent (that's two hundred and fifty-nine thousand, four hundred eighty-five percent) versus 4,743 percent in the S&P 500.

Nonetheless he intones, "Long-term performance versus the S&P remains all-important. Unless we continue to achieve gains that outperform, Charlie (Munger) and I will be adding nothing to what you could not accomplish on your own." Warren, as CEO, is paid little, $100,000 per year in compensation. All of his wealth is tied up in his original Berkshire stock, none of which he has sold.

Read on for excerpts of his succinct and timely Comments:

On the sheer difficulty of trading large sums of money in capital markets: investment managers who are piling up profits in very large mutual funds rather than handling them well, while insisting that increased funds don't hurt performance, better "watch out, his/her nose is about to grow."

On being taken to task by Pamela Olson, Asst Secretary for Tax Policy in her words for playing the US tax code "like fiddle. " BRK paid 2.5 percent of the total income tax paid by all US corporations, while BRK's market valuation is only 1 percent of all American corporations. Indeed, if only 540 taxpayers paid the same amount BRK will, pay no other individual or corporation would have to pay anything to Uncle Sam. BRK's 2003 tax return was 8,905 pages, creating a tower seven feet high. While tax breaks for corporations (and their investors) were a major part of Mr. Bush's initiatives, if class warfare is being waged in America, my class is clearly winning. Today, many large corporations - run by CEO's whose fiddle playing talents make your chairman look like he is all thumbs - pay very little in comparison. BRK will continue to pay its fair share of taxes, because this means we are prospering, but we hope the rest of corporate America antes up along with us. We suggest that this might be a project for Ms Olson to work on."

On Lax (or negligent) Board of Director Oversight of mutual fund manager malfeasance. "Despite the lapdog behaviour of independent fund directors, they are not bad people, just suffering from the effects of boardroom atmosphere sedating their fiduciary genes. In contrast, the bottom line for BRK directors (who carry no directors & officers' liability insurance and are paid a nominal fee), "you win, they win big; you lose, they lost big."

General Re Securities- too lengthy for this column, a confession and apology again for not spotting the problems in this company and on the magnitude of unwinding 23,218 derivative tickets with 884 counterparties, a process still ongoing after two full years.

Reserving the most advice for his beloved country, he admits that he has been increasingly bearish on the US dollar, entering the foreign currency market for the first time. BRK owns Euros and has been shorting the US dollar.

At year end 2003, BRK had 12Billion dollars in open foreign exchange contracts spread across five currencies.

Other financial commentators after reading his letter have been surprised at his stance - that the American trade deficit has been force-feeding huge amounts of claims on, and ownership in, America to the rest of the world.

Late in 2002, the world began to choke on this diet and the dollar's value began to slide against major currencies.

Where this will end up is anyone's guess, he muses. This week the US trade deficit hit a new high.

At the end of the day, however, he admits that "when there is nothing exciting in which to invest, his default position is always US Treasuries, because he and Charlie detest taking small risks (unless adequately compensated)."

About as risky as they will get is to occasionally eat cottage cheese a day after the expiration date.

To fully appreciate the genius at work, read this 23-page letter in full at www.berkshirehathaway.com

Recently, Bloomberg Markets March 2004, featured Warren Buffett on the cover.

Financial analysts still rates BRK as reasonably priced 29 percent less than intrinsic value. BRK meets its own criteria. Class A shares was trading this week at about $87,380 each.

One share anyone, or will one-thirtieth do you?

Martha Harris Myron CPA/PFS CFP? is a Bermudian, and VP, Investment Centre, Bank of Bermuda member HSBC Group, providing investment advisory services and financial planning. She also holds a NASD Series 7 licence, and formerly owned a US financial services practice meeting the needs of 400 individual and corporate clients. She can be reached at 299-5578, or confidential email can be directed to marthamyron@northrock.bm

The article expresses the opinion of the author alone, and not necessarily that of Bank of Bermuda. Under no circumstances is the content of this article to be taken as specific individual investment advice, nor as a recommendation to buy or sell investment products, nor as a promotion for financial plans.