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Buffett sees third quarter profits triple

THE world&rsquo;s second-richest man, Warren Buffett, has seen profits for his investment vehicle Berkshire Hathaway almost triple in the third quarter to $3.2bn (&pound;1.9bn).<br /><br />Strong markets and derivatives gains in the three months to September, up from $1.1bn for the same period last year, have caused the improvement. It marks a strong recovery from a 9.6 per cent slump in value in 2008, which was Berkshire Hathaway&rsquo;s worst year since Buffett took over 44 years ago.<br /><br />The resurgent company recorded over $1.1bn in accounting gains on derivatives during the quarter, against losses of just over $1bn for the period last year. Much of this came from Berkshire Hathaway&rsquo;s portfolio of more than $30bn of credit default swaps, which rose in value as perceived risk decreased.<br /><br />Revenue rose seven per cent to $29.9bn, but excluding derivative and investment gains, the company&rsquo;s operating profit of $2.06bn beat analysts&rsquo; expectations, while still underperforming last year.<br /><br />The news comes days after Buffett announced his biggest deal to date, the $44bn purchase of North America&rsquo;s second-largest railway, Burlington Northern Santa Fe, which is not included in the third-quarter results. Credit-rating agency Standard &amp; Poor&rsquo;s has threatened to remove Berkshire Hathaway&rsquo;s triple-A credit rating, and a shareholder lawsuit has also been launched.<br /><strong>WARREN BUFFETT<br />HEAD OF BERKSHIRE HATHAWAY</strong><br />WARREN Buffett filed his first income tax return working as a newspaper delivery boy at the age of 13, deducting his bike and watch as expenses for $35. <br /><br />He has since ended Bill Gates&rsquo; 13-year position as Forbes&rsquo; richest man in the world, this year slipping back to second with a net worth of $37bn (&pound;22.3bn), almost double that of Lakshmi Mittal.<br /><br />His first investment, aged 15, was a $25 pinball machine which he placed in a Washington DC barber shop, before buying two more machines soon after. <br /><br />While working as a stockbroker in the 1950s, he took a course in public speaking and taught night classes on investment principles at the University of Nebraska. <br /><br />He bought his five-bedroom stucco house in Omaha for $31,500 in 1957 and still lives there today.<br /><br />Buffett became a millionaire in January 1962, and began investing in Berkshire Hathaway.<br /><br />He took control of the company three years later, and as chairman, chief executive and primary shareholder in Berkshire Hathaway he has transformed the one-time textiles manufacturer, which as of 31 December 2008 had the highest-priced shares on the New York Stock Exchange.<br /><br />The annual shareholders&rsquo; meetings in Omaha, Nebraska &ndash; known as &ldquo;Woodstock for Capitalists&rdquo; &ndash; are routinely visited by 20,000 people. <br /><br />The meetings are known for starting with short, specially-made films, featuring actors such as Arnold Schwarzenegger and Jamie Lee Curtis.<br />