Berkshire Hathaway Chairman and CEO Warren Buffett has predicted that stocks are going to be a better investment choice compared to bonds over time as long as the interest rates and corporate tax rates are low.

In a letter released to his company’s shareholders on Saturday, Buffett contended that stocks are still a “much better” choice for investors, despite fluctuations in share prices, if the current tax and interest rates remain low.

“If something close to current rates should prevail over the coming decades and if corporate tax rates also remain near the low level businesses now enjoy, it is almost certain that equities will over time perform far better than long-term, fixed-rate debt instruments,” the letter stated, according to CNBC.

Equities have become a better option for investors as low interest rates from the Federal Reserve boosted the market and pushed bond yields lower.

At the end of 2017, the market got another boost after the Trump administration cut down the corporate tax rate from 35 percent down to 21 percent.

The annual letter, which is widely anticipated at Wall Street and Mainstreet, includes personal finance tips for investors as well as a report on the financial health of Buffett’s conglomerate.

The 89-year-old CEO contended that the combination of low interest and corporate tax rates, along with the “American Tailwind,” will make “equities the much better long-term choice for the individual who does not use borrowed money and who can control his or her emotions.”

Buffett, however, warned that his forecast is not foolproof. “Anything can happen to stock prices tomorrow,” he said. He further noted that there will be occasional “major drops in the market, perhaps of 50% magnitude or even greater.”

Berkshire Hathaway, which owns a conglomerate of businesses ranging from insurers to railroads to retailers, has reported a profit of $29 billion in the fourth quarter.

The company has significant investments in Apple, Coca-Cola, Wells Fargo and American Express. The company’s earnings amounted to $81.4 billion in 2019, according to USA Today.

Buffett’s letter also indicated that he and Berkshire Vice Chairman Charlie Munger will not be taking questions at the company’s annual meeting in May. He noted that the questions at the meeting will be answered by Berkshire executives Ajit Jain and Greg Abel, who were both promoted in 2018.

Investors looking forward to details about Buffett’s succession plan were disappointed as the letter did not provide any information regarding the matter. The Berkshire CEO, however, assured the investors that the conglomerate was “100% prepared” for the eventual departures of himself and the 96-year-old Munger.

CNBC reported that Buffett has hinted at the possibility of promoting either Jain or Abel to replace him. Jain is currently responsible for handling Berkshire’s insurance-related investments, while Abel takes care of the non-insurance operations.

Buffett assured investors that the company’s managers and board members will protect the conglomerate after he and Munger step down.

We possess skilled and devoted top managers for whom running Berkshire is far more than simply having a high-paying and/or prestigious job,” he wrote. “Finally, Berkshire’s directors — your guardians — are constantly focused on both the welfare of owners and the nurturing of a culture that is rare among giant corporations.”