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Warren Buffett doesn't support legalizing sports betting

Daniel Roberts
Senior Writer

The NCAA men’s basketball tournament starts on Thursday, and March Madness, as it’s called, is always a time of big betting.

Geoff Freeman, president of the American Gaming Association, tells Yahoo Finance that March Madness provides an annual opportunity for the gaming community “to point out the demand that’s out there for Americans to bet on these sports, to be engaged, to want to be invested.”

The AGA, which lobbies on behalf of casinos and gaming companies, has been leading the charge to kill PASPA (the Professional and Amateur Sports Protection Act of 1992), the federal statute that essentially banned sports betting everywhere in the US but Nevada. And Freeman says there is a “perfect storm coming together” in America right now in favor of legalizing sports betting.

But Warren Buffett isn’t in favor.

Few executives show more public passion for March Madness than the Berkshire Hathaway (BRK-A) CEO, whose contest for Berkshire employees this year offers a prize of $1 million per year for life for correctly predicting the Sweet Sixteen, or $1 million for nailing the first 32 games, or $100,000 to the person whose bracket remains perfect the longest.

In an interview on Tuesday with Yahoo Finance about his March Madness contest, Buffett also addressed fantasy sports and sports gambling.

Since he loves running a March Madness pool and following the bracket, has he tried fantasy sports, which are more popular than ever? “I’ve never done it, but I’ve heard a lot about it,” Buffett says. “I have trouble remembering the name I sign into on my computer, I’m not what you call advanced. I’ve got a flip phone. I know how popular it is… All my sports activity has been a fantasy. Ever since my shooting percentage was about .100 or something.”

Fantasy sports, especially the rise of “daily” fantasy sports (DFS) companies like DraftKings and FanDuel, is thought to be one of the factors driving the momentum toward repealing PASPA. Freeman, of the AGA, points to DFS as a major factor. And MLB Commissioner Rob Manfred, at a Yahoo Finance summit last month, said that DFS baseball has been a boost to fan engagement, called DraftKings and FanDuel “survivors,” and said that MLB is “re-examining our stance on gambling.

So, what does Buffett think about the momentum toward legalizing sports betting?

“I probably would be against that, personally,” he says. “We’ve got casinos in Iowa, right across the river from Omaha, and the argument [in favor of changing the law], which is persuasive, is that Nebraskans go over there and deposit all their money in Iowa. But I still oppose legalizing gambling in Nebraska.”

Warren Buffett at a Fortune conference in 2016 (Paul Morigi/Getty Images for Fortune/Time Inc)

Why does he oppose it?

“If you don’t have a team in a game, it is definitely more fun to have five bucks on it with the guy sitting next to you, there’s no question about that,” he says. “But I generally don’t think there’s a lot to gain by having a country where lots of people are going to be losers. If they’re making a bet with the guy next to them, that’s one thing, but if they’re doing it against a sportsbook, they’re going to lose money all the time. And gambling is addictive, so I’m negative on it.”

“Basically,” he joked, bringing the conversation back to the lucrative Berkshire Hathaway employee March Madness contest, “the way to do it is to just work for Berkshire.”

Daniel Roberts is a writer at Yahoo Finance, covering sports business and technology.

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