Now that dividends receive favorable tax treatment, how do you feel about the possibility of declaring a dividend?
WB: Dividends are lightly taxed now. But as we’ve said in the past, event if dividends weren’t taxed at all, we wouldn’t pay a dividend. If we can retain a dollar and have it be worth more than that in present-value terms, we’ll hold that dollar. With as much cash as we have now, that’s not easy. The burden of proof on the dividend issue may shift in a few years if things don’t change, though. As we get bigger, it could be that we should pay a dividend—maybe even a large one. So far, though, we feel our dividend policy has been right. But if we sit here a few years from now and still haven’t deployed our cash, the burden of proof will be on us. Q: How far down do you think the dollar will go? WB: The trade deficit is at $618 billion, and the current account deficit is also huge. As big as the U.S. is, something could happen in a big way to get things back in balance. Some economists say that a soft landing is likely. I don’t know how that is. I don’t know why or how the numbers will co
