If you’re wondering what ultra-low or even negative interest rates will do to the financial markets, you are not alone. Warren Buffett is wondering too. To be clear though, he’s not particularly freaked out. Vexed, but not freaked.

As yields on U.S. Treasury securities fall to record lows — the 10-year Treasury yield (^TNX) dropped to 0.398% at one point this week — many worry that negative interest rates, already prevalent in Japan and Europe, will soon arrive on our shores. If that were to be the case, what the heck would it mean?

I asked Warren Buffett about negative rates last week during an interview at Berkshire Hathaway (BRK-A, BRK-B) headquarters in Omaha.

First, Buffett conceded that in general the bond market with its super low rates, and wildly swinging yield curve, “is really crazy.” But then he made it clear that neither he nor his partner Charlie Munger have any expertise or any interest in predicting where interest rates are headed.

“Charlie and I focus on what's knowable and important,” he said. “Now, interest rates are important, but we don't think they're knowable.”

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Buffett talked to me about his circle of competence: “My circle of competence doesn't include the ability to predict interest rates a day from now, or a year from now, or five years now. Can I function without knowing that? It's the same way as predicting what business is going to do, what the stock market's going to do. I can't do any of those things. But that doesn't mean I can't do well investing over time.”

“The most important question in the world”

As for negative rates per se, Buffett says the situation is “unbelievable.”

When I asked Buffett specifically what are the actual implications of negative rates, he went positively Yoda on me.

“I would say that's the most important question in the world,” said the Oracle of Omaha. “And I don't know the answer. Now, if we knew the answer, it wouldn't be the most important question.”

Ohhhh....

Me: “I don't like that.”

Buffett: “No, but it's true.”

Another question to Warren: Has investing in equities changed given the interest rate environment?

“It reduces the hurdle rate,” he says. “That's why they [business people, investors, governments] like to decrease it. It pushes asset values higher.”

Final question: “Do negative rates scare you, Warren?”

“They puzzle me,” Buffett said. “But they don't scare me.”

That’s an answer which should give us some, but not total, comfort.

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Andy Serwer is editor-in-chief of Yahoo Finance. Follow him on Twitter: @serwer.

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