NEW YORK (CNN/Money) -
When Warren Buffett's letter to shareholders comes out each year, investors around the world sit up and listen.
After all, the "Oracle of Omaha" has been writing letters to Berkshire Hathaway shareholders for 38 years and over that time, he's become the world's second-richest man and one of its most widely followed investors.
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Click on the picture for more on Buffett's letter
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In this year's letter, to be found exclusively at Fortune.com, Buffett says he's nervous about derivatives -- he calls them "time bombs" -- and says he hasn't invested much money in stocks over the past year. He also talks about where his Omaha, Neb.-based holding company is putting its money now.
Specifically, Buffett discusses the difficulties of leaving the derivatives business after his 1998 purchase of General Re, the insurer. And he says the explosion in derivatives contracts may have created serious risks for the nation's financial system.
For more on Buffett's letter, click on these links to Fortune.com:
- Avoiding a 'mega-catastrophe' - Buffett says derivatives like rate swaps and futures and options -- tools used by many professional investors -- are latent dangers that could become lethal.
- Buffett on stocks today - "Unfortunately, the hangover from [the market bubble] may prove to be proportional to the binge."
- Berkshire Hathaway and junk - Buffett's holding company has been making what he calls "sensible investments" in a few junk bonds and loans.
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