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Ben's Mr. Market Allegory May Seem Out-of-date In Today's Investment World, In Which Most Professionals And Academicians Talk Of Efficient Markets, Dynamic Hedging And Betas. Their Interest In Such Matters Is Understandable, Since Techniques Shrouded In Mystery Clearly Have Value To The Purveyor Of Investment Advice. After All, What Witch Doctor Has Ever Achieved Fame And Fortune By Simply Advising 'take Two Aspirins'?

-Warren Buffett

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Ben's Mr. Market Allegory

Warren Buffett

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Ben's Mr. Market Allegory May Seem Out-of-date In Today's Investment World, In Which Most Professionals And Academicians Talk Of Efficient Markets, Dynamic Hedging And Betas. Their Interest In Such Matters Is Understandable, Since Techniques Shrouded In Mystery Clearly Have Value To The Purveyor Of Investment Advice. After All, What Witch Doctor Has Ever Achieved Fame And Fortune By Simply Advising 'take Two Aspirins'?

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The Only Time To Buy These Is On A Day With No 'y' In It.

Diversification Is Protection Against Ignorance. It Makes Little Sense If You Know What You Are Doing.

If You're In A Card Game And You Can't Figure Out Who The Patsy Is, You're It.

I Choose To Work With Every Single Person That I Work With. That Ends Up Being The Most Important Factor. I Don't Interact With People I Don't Like Or Admire. That's The Key. It's Like Marrying.

If At First You Do Succeed, Quit Trying On Investing.

The Business Schools Reward Difficult Complex Behavior More Than Simple Behavior, But Simple Behavior Is More Effective.

If You're An Investor, You're Looking On What The Asset Is Going To Do, If You're A Speculator, You're Commonly Focusing On What The Price Of The Object Is Going To Do, And That's Not Our Game.

As I Have Mentioned Before, We Cannot Make The Same Sort Of Money Out Of Permanent Ownership Of Controlled Businesses That Can Be Made From Buying And Reselling Such Businesses, Or From Skilled Investment In Marketable Securities. Nevertheless, They Offer A Pleasant Long Term Form Of Activity (when Conducted In Conjunction With High Grade, Able People) At Satisfactory Rates Of Return.

I Wouldn't Want To Manufacture Cigarettes. But If I Owned - We Do Own Costco. Do They Sell Them? Yes. So I Don't Have A Problem Owning Stock In That. But I Just Wouldn't Want To - I Wouldn't Want To Do It Myself. I Basically Think, If Anything Is Sufficiently Antisocial, Society Should Do Something About It. But That's A Separate Question. But - And I Don't Think There's Any Company That I Have Seen That's 100 Percent Pure.

The Big Question About How People Behave Is Whether They've Got An Inner Scorecard Or An Outer Scorecard. It Helps If You Can Be Satisfied With An Inner Scorecard.

Anything Can Happen In Stock Markets And You Ought To Conduct Your Affairs So That If The Most Extraordinary Events Happen, That You're Still Around To Play The Next Day.

The Patient That's On The Floor With The Cardiac Arrest Is Not Wall Street. It's The American Economy.

We Really Can Say No In 10 Seconds Or So To 90%+ Of All The Things That Come Along Simply Because We Have These Filters.

You Can't Stand To See Your Neighbor Getting Rich. You Know You're Smarter Than He Is And He's Doing These Things And He's Getting Rich.

Mr. Market Is Kind Of A Drunken Psycho. Some Days He Gets Very Enthused, Some Days He Gets Very Depressed. And When He Get Really Enthused You Sell To Him, And If He Gets Depressed, You Buy From Him. There's No Moral Taint Attached To That.

Most Business Mistakes Are Irreversible Setbacks, But You Get Another Chance. There Are Two Things In Life That You Don't Get Another Chance At - Marrying The Wrong Person And What You Do With Your Children.

People Who Watch Their Weight, Golf Scores, And Fuel Bills Seem To Shun Quantitative Evaluation Of Their Investment Management Skills Although It Involves The Most Important Client In The World-themselves.

Be Fearful When There Is Greed And Be Greedy When There Is Fear.

You Don't Ever Ask A Barber Whether You Need A Haircut.

The Time To Buy Stocks Is Consistently Over Time. You Should Never Buy Your Investments With The Idea, 'i Have To Get A Certain Return.' You Should Look At The Best Return Possible And Learn To Live With That. But You Should Not Try To Make Your Investments Earn What You Feel You Need. It Doesn't Work That Way. The Stock Doesn't Know You Own It.

Investors... Can't Pick Stocks That Are Better Than Average. Stocks Are A Good Thing To Own Over Time. There's Only Two Things You Can Do Wrong: You Can Buy The Wrong Ones, And You Can Buy Or Sell Them At The Wrong Time. And The Truth Is You Never Need To Sell Them.

The Only Way To Get Love Is To Be Lovable. It's Very Irritating If You Have A Lot Of Money. You'd Like To Think You Could Write A Check: "i'll Buy A Million Dollars' Worth Of Love." But It Doesn't Work That Way. The More You Give Love Away, The More You Get.

The Most Common Cause Of Low Prices Is Pessimism - Sometimes Pervasive, Sometimes Specific To A Company Or Industry. We Want To Do Business In Such An Environment, Not Because We Like Pessimism But Because We Like The Prices It Produces.

Like Most Trends, At The Beginning It's Driven By Fundamentals, At Some Point Speculation Takes Over. What The Wise Man Does In The Beginning, The Fool Does In The End.

For Some Reason, People Take Their Cues From Price Action Rather Than From Values. What Doesn't Work Is When You Start Doing Things That You Don't Understand Or Because They Worked Last Week For Somebody Else. The Dumbest Reason In The World To Buy A Stock Is Because It's Going Up.

The Latter Qualification Brings To Mind A Fellow Who Applied For A Job And Stated He Had Twenty Years Of Experience-which Was Corrected By A Former Employer To Read "one Year's Experience-twenty Times.

Valuing A Business Is Part Art And Part Science.

When A Management With A Reputation For Brilliance Tackles A Business With A Reputation For Bad Economics, It Is The Reputation Of The Business That Remains Intact.

We Don't Get Paid For Being Busy, We Get Paid For Being Right.

I Never Invest In Anything That I Don't Understand.

Fear Is The Foe Of The Faddist, But The Friend Of The Fundamentalist.

Ben's Mr. Market Allegory May Seem Out-of-date In Today's Investment World, In Which Most Professionals And Academicians Talk Of Efficient Markets, Dynamic Hedging And Betas. Their Interest In Such Matters Is Understandable, Since Techniques Shrouded In Mystery Clearly Have Value To The Purveyor Of Investment Advice. After All, What Witch Doctor Has Ever Achieved Fame And Fortune By Simply Advising 'take Two Aspirins'?

We Set No Volume Goals In Our Insurance Business Generally-and Certainly Not In Reinsurance-as Virtually Any Volume Can Be Achieved If Profitability Standards Are Ignored.

One Observer Commenting On Security Analysts Over Forty Stated: "they Know Too Many Things That Are No Longer True." As Long As I Am "on Stage", Publishing A Regular Record And Assuming Responsibility For Management Of What Amounts To Virtually 100% Of The Net Worth Of Many Partners, I Will Never Be Able To Put Sustained Effort Into Any Non-bpl Activity. If I Am Going To Participate Publicly. I Can't Help Being Competitive. I Know I Don't Want To Be Totally Occupied With Out-pacing An Investment Rabbit All My Life. The Only Way To Slow Down Is To Stop.

It's The Deleveraging That's Going On Right Now That Has Caused The Credit Crisis.

Consciously Paying More For A Stock Than Its Calculated Value - In The Hope That It Can Soon Be Sold For A Still-higher Price - Should Be Labelled Speculation

Observing That The Market Was Frequently Efficient, Emt Adherents Went On To Conclude Incorrectly That It Was Always Efficient. The Difference Between These Propositions Is Night And Day.

Does The Business Have A Consistent Operating History?

If I Got Any Good Ideas Out Of That Or I Think They're Good Ideas, I'll Be Glad To Contribute Them But The System Will Probably Overdo Some Other Things.

John Maynard Keynes Essentially Said, Don't Try And Figure Out What The Market Is Doing. Figure Out A Business You Understand, And Concentrate.

I've Never Been Very Fully Employed Either.

Wall Street Makes Its Money On Activity. You Make Your Money On Inactivity.

One Of The Ironies Of The Stock Market Is The Emphasis On Activity. Brokers, Using Terms Such As 'marketability' And 'liquidity,' Sing The Praises Of Companies With High Share Turnover... But Investors Should Understand That What Is Good For The Croupier Is Not Good For The Customer. A Hyperactive Stock Market Is The Pick Pocket Of Enterprise.

If You Own A Wonderful Business...the Best Thing To Do Is Keep It. All You're Going To Do Is Trade Your Wonderful Business For A Whole Bunch Of Cash, Which Isn't As Good As The Business, And You Got The Problem Of Investing In Other Businesses, And You Probably Paid A Tax In Between. So My Advice To Anybody Who Owns A Wonderful Business Is Keep It.

Never Get Too Hung Up On Mistakes.

It's Nice To Have A Lot Of Money, But You Know, You Don't Want To Keep It Around Forever. I Prefer Buying Things. Otherwise, It's A Little Like Saving Sex For Your Old Age.

You Have To Turn Over A Lot Of Rocks To Find Those Little Anomalies. You Have To Find The Companies That Are Off The Map - Way Off The Map.

The Best Asset Is Your Own Self. You Can Become To An Enormous Degree The Person You Want To Be

When Somebody Makes It Very Easy For You To Do It By Saying You Don't Really Have To Put Up My Money, You Can Lie About Your Income A Little, Or We'll Give You 100 Percent Mortgage, You're Going To Do It, Because Everybody That's Done It Has Been Proven Right. You Have Social Tools, And You're Going To Feel Like An Idiot If You Didn't Do It, Because The House Cost More.

Time Is The Friend Of The Wonderful Business. It's The Enemy Of The Lousy Business. If You're In A Lousy Business For A Long Time, You're Going To Get A Lousy Result, Even If You Buy It Cheap. If You're In A Wonderful Business For A Long Time, Even If You Pay A Little Too Much Going In, You're Going To Get A Wonderful Result If You Stay In A Long Time.

Somebody's Buying These Treasury Bills At 1/20th Of One Percent. Consuming About $2 Billion A Day Of Goods And Services Beyond What We're Producing. In Other Words, The Rest Of The World Sends About $2 Billion A Day Net Of Something.we Got To Send Them Something In Return, Don't We. So We Send Them Little Pieces Of Paper.

Should You Find Yourself In A Chronically Leaking Boat, Energy Devoted To Changing Vessels Is Likely To Be More Productive Than Energy Devoted To Patching Leaks.

Investing Money

Investment Success

I’ve Never Believed In Risking What My Family And Friends Have And Need In Order To Pursue What They Don’t Have And Don’t Need.

Family And Friends

Can You Know You Can Have Institutions That Put Curbs On That In Various Ways, And Actually What The Banks, You Know, They Have Various Capital Ratios And That Sort Of Thing, But The Banks Got Around Them, I Mean, They Set Up Sieves And That Sort Of Thing Just To Get More Leverage. People Love Leverage When It's Working. I Mean, It's So Easy To Borrow Money From A Guy At X And Put It Out At X.

I Would Say The Biggest Single Cause Was We Had An Incredible Residential Real Estate Bubble.

Don't Settle For Anything Other Than Your Passion - If You're Lucky Enough To Find It.

The Key To Life Is To Figure Out Who To Be The Batboy For.

Managers That Always Promise To 'make The Numbers' Will At Some Point Be Tempted To Make Up The Numbers.

The Idea That You Try To Time Purchases Based On What You Think Business Is Going To Do In The Next Year Or Two, I Think That's The Greatest Mistake That Investors Make Because It's Always Uncertain. People Say It's A Time Of Uncertainty. It Was Uncertain On September 10th, 2001, People Just Didn't Know It. It's Uncertain Every Single Day. So Take Uncertainty As Part Of Being Involved In Investment At All. But Uncertainty Can Be Your Friend. I Mean, When People Are Scared, They Pay Less For Things. We Try To Price. We Don't Try To Time At All.

You Need A Lot Of Curiosity For A Long, Long Time.

Honesty Is A Very Expensive Gift, Don't Expect It From Cheap People.

For Some Reason People Take Their Cues From Price Action Rather Than From Values. Price Is What You Pay. Value Is What You Get.

Personally, I Really Hope I Can Treat Everyone Equally. I Think I Have Done A Pretty Good Job So Far But I Know I Can Do It Better.

People Do, As Long As You Have Markets, You'll Have Excesses.

I Would Say The Most Satisfying Thing Actually Is Watching My Three Children Each Pick Up On Their Own Interests And Work Many More Hours Per Week Than Most People That Have Jobs At Trying To Intelligently Give Away That Money In Fields That They Particularly Care About.

The Good Thing Is, We Have Household Formation In This Country.

You Don't Want 300 Million Americans Putting Their Money Under The Mattress.

As One Of My Older Friends Says, "nostalgia Just Isn't What It Used To Be." Let's Take A Stab At It, Anyway.

When We Really Sit Back With A Smile On Our Face Is When We Run Into A Situation We Can Understand, Where The Facts Are Ascertainable And Clear, And The Course Of Action Obvious.

I Think That Both Parties Should Declare The Debt Limit As A Political Weapon Of Mass Destruction Which Can't Be Used. I Mean, It Is Silly To Have A Country That Has 237 Years Building Up Its Reputation And Then Have People Threaten To Tear It Down Because They're Not Getting Some Other Matter.

Buy Into A Company Because You Want To Own It, Not Because You Want The Stock To Go Up.

Investing Money

In The End We Must Have People To Match Our Principles, Not The Reverse.

If You Can't Communicate And Talk To Other People And Get Across Your Ideas, You're Giving Up Your Potential.

Our Investments Continue To Be Few In Number And Simple In Concept: The Truly Big Investment Idea Can Usually Be Explained In A Short Paragraph. We Like A Business With Enduring Competitive Advantages That Is Run By Able And Owner-oriented People. When These Attributes Exist, And When We Can Make Purchases At Sensible Prices, It Is Hard To Go Wrong (a Challenge We Periodically Manage To Overcome).

The Typical Large Company Has A Compensation Committee, They Don't Look For Dobermans On That Committee, They Look For Chihuahuas.

The Plan Itself Is Opportunism. There Is No Plan Before That.

I've Often Felt There Might Be More To Be Gained By Studying Business Failures Than Business Successes.

Business Success

The Rich Are Always Going To Say That, You Know, Just Give Us More Money And We'll Go Out And Spend More And Then It Will All Trickle Down To The Rest Of You. But That Has Not Worked The Last 10 Years, And I Hope The American Public Is Catching On.

Of Our 49 Billion, We Haven't Moved Any To Bitcoin

If You Expect To Continue To Purchase Stocks Throughout Your Life, You Should Welcome Price Declines As A Way To Add Stocks More Cheaply To Your Portfolio.

Take The Job You Would Take If You Were Independently Wealthy. You're Going To Do Well At It.

Our Future Rates Of Gain Will Fall Far Short Of Those Achieved In The Past. Berkshire's Capital Base Is Now Simply Too Large To Allow Us To Earn Truly Outsized Returns. If You Believe Otherwise, You Should Consider A Career In Sales But Avoid One In Mathematics.

If You Understood A Business Perfectly And The Future Of The Business, You Need Very Little In The Way Of A Margin Of Safety.

Well, It May Be All Right In Practice, But It Will Never Work In Theory

A Diamond Cannot Be Polished Without Friction, Nor A Person Perfected Without Trials. Someone Is Enjoying Shade Today Because Someone Planted A Tree A Long Time Ago.

We Don't Have To Be Smarter Than The Rest. We Have To Be More Disciplined Than The Rest.

Successful Investing

You Can't Buy What Is Popular And Do Well.

A Pin Lies In Wait For Every Bubble. And When The Two Eventually Meet, A New Wave Of Investors Learns Some Very Old Lessons: First, Many In Wall Street (a Community In Which Quality Control Is Not Prized) Will Sell Investors Anything They Will Buy. Second, Speculation Is Most Dangerous When It Looks Easiest.

If You Knew What Was Going To Happen In The Economy, You Still Wouldn't Necessarily Know What Was Going To Happen In The Stock Market.

It Is Not Necessary To Do Extraordinary Things To Get Extraordinary Results.

The Dominant Factors Affecting Control Valuations Are Earning Power (past And Prospective) And Asset Values.

Money Will Not Change How Healthy You Are Or How Many People Love You.

We Don't Read Other People's Opinions. We Want To Get The Facts, And Then Think.

I Don't Want To Be On The Other Side Of The Table From The Customer. I Was Never Selling Anything That I Didn't Believe In Myself Or Use Myself.

Lethargy, Bordering On Sloth Should Remain The Cornerstone Of An Investment Style.

Enjoy Your Work And Work For Whom You Admire.

The Most Important Investment You Can Make Is In Yourself... Nobody Can Tax It Or Take It Away From You.

Success Is Having People Love You That You Want To Have Love You.

The True Investor Welcomes Volatility ... A Wildly Fluctuating Market Means That Irrationally Low Prices Will Periodically Be Attached To Solid Businesses.

In Some Corner Of The World They Are Probably Still Holding Regular Meetings Of The Flat Earth Society. We Derive No Comfort Because Important People, Vocal People, Or Great Numbers Of People Agree With Us. Nor Do We Derive Comfort If They Don't.

If You Invested In A Very Low Cost Index Fund - Where You Don't Put The Money In At One Time, But Average In Over 10 Years -you'll Do Better Than 90% Of People Who Start Investing At The Same Time.

Our Approach Is Very Much Profiting From Lack Of Change Rather Than From Change.

Investing Money

What's Going To Happen - Things We're Doing Are Going To Have Some Inflationary Consequences.

The Only Question Is Whether You’re Going To Do It Today Or Tomorrow. If You Keep Saying You’re Going To Do It Tomorrow, You’ll Never Do It. You Have To Get On It Today.

Intrinsic Value Can Be Defined Simply: It Is The Discounted Value Of The Cash That Can Be Taken Out Of A Business During Its Remaining Life. The Calculation Of Intrinsic Value, Though, Is Not So Simple. As Our Definition Suggests, Intrinsic Value Is An Estimate Rather Than A Precise Figure, And It Is Additionally An Estimate That Must Be Changed If Interest Rates Move Or Forecasts Of Future Cash Flows Are Revised.

Focus On Your Customers And Lead Your People As Though Their Lives Depend On Your Success.

Investors Should Be Skeptical Of History-based Models. Constructed By A Nerdy-sounding Priesthood Using Esoteric Terms Such As Beta, Gamma, Sigma And The Like, These Models Tend To Look Impressive. Too Often, Though, Investors Forget To Examine The Assumptions Behind The Models. Beware Of Geeks Bearing Formulas.

When The Brothel Burns Down, Even The Pretty Girls Have To Run Out.

Do Not Take Yearly Results Too Seriously. Instead, Focus On Four Or Five-year Averages.

There Are 309 Million People Out There That Are Trying To Improve Their Lot In Life. And We've Got A System That Allows Them To Do It.

I Never Try To Predict The Market.

If You Don't Make Mistakes You Can't Make Decisions.

Uncertainty Is The Friend Of The Buyer Of Long Term Values.

Time Is The Friend Of The Wonderful Company, The Enemy Of The Mediocre.

It Is Unquestionably True That The Investment Companies Have Their Money More Conventionally Invested Than We Do. To Many People Conventionality Is Indistinguishable From Conservatism. In My View, This Represents Erroneous Thinking. Neither A Conventional Nor An Unconventional Approach, Per Se, Is Conservative.

My Friends And I Have Been Coddled Long Enough By A Billionaire-friendly Congress.

If Horses Had Controlled Investment Decisions, There Would Have Been No Auto Industry.

Intensity Is The Price Of Excellence.

Knowing What To Leave Out Is Just As Important As Knowing What To Focus On.

We Want To Use Cash. The Reason We Haven't Used Our Cash Two Years Ago, We Just Didn't Find Things That Were That Attractive. But When People Talk About Cash Being King, It's Not King If It Just Sits There And Never Does Anything. There Are Times When Cash Buys More Than Other Times, And This Is One Of The Other Times When It Buys A Fair Amount More, So We Use It.

What We Learn From History Is That People Don't Learn From History.

If You Lose Money For The Firm, I Will Be Forgiving. If You Lose Reputation, I Will Be Ruthless.

Just Look At That Forbes 400. Takes A Billion Three To Get On The Forbes 400 This Year. And The Aggregate Wealth Is Just Staggering. And Those People Are Paying Less Percentage Of Their Total Income To The Federal Government Than Their Receptionists Are. [...] I'll Bet A Million Dollars Against Any Member Of The Forbes 400 Who Challenges - Me That The Average For The Forbes 400 Will Be Less Than The Average Of Their Receptionists.

We Enjoy The Process Far More Than The Proceeds.

In My View, [the Trade Deficit] Will Create Political Turmoil At Some Point...pretty Soon, I Think There Will Be A Big Adjustment.

Either They're Trying To Con You Or They're Trying To Con Themselves.

Your Premium Brand Had Better Be Delivering Something Special, Or It's Not Going To Get The Business.

The Stockmarket Is A Semi-psychotic Creature Given To Extremes Of Elation And Despair.

The Fundamental Basis Of Above-average Performance In The Long Run Is Sustainable Competitive Advantage.

I Mean, In Terms Of Alternatives, Some People Have Suggested For Example That Why Don't We - Why Isn't America Doing What Berkshire Hathaway Is Doing? Why Isn't That A Better Deal For America?

Someone's Sitting In The Shade Today Because Someone Planted A Tree A Long Time Ago. The Person Sitting In The Shade Now Should Be Grateful For The Person Who Planted And Tended That Tree. That Includes All Those Benefactors Of Humanity Throughout History That Created, Invented, Financed, Produced, Maintained And Improved All That We Enjoy Today.

Market Prices For Stocks Fluctuate At Great Amplitudes Around Intrinsic Value But, Over The Long Term, Intrinsic Value Is Virtually Always Reflected At Some Point In Market Price.

Intrinsic Value

Cultivate Curiosity And Strive To Become A Little Wiser Every Day.

Stocks Are The Only Thing That People Are Happy To Buy When The Price Goes Up.

I Don't Think You Can Have A Better Secretary Of The Treasury Than Hank Paulson.

I Have Never Been Able To Understand Why The Tax Comes As Such A Body Blow To Many People Since The Rate On Long-term Capital Gain Is Lower Than On Most Likes Of Endeavor (tax Policy Indicated Digging Ditches Is Regarded As Socially Less Desirable Than Shuffling Stock Certificates).

I Have Always Cautioned Partners That I Considered Three Years A Minimum In Determining Whether We Were "performing".

You're Dealing With A Lot Of Silly People In The Marketplace; It's Like A Great Big Casino And Everyone Else Is Boozing. If You Can Stick With Pepsi, You Should Be Ok.

Investing Money

If You Want A Government That's Going To Do The Things We Ask Our Government To Do, You've Got To Get It From Somebody.

I Knew A Lot About What I Did When I Was 20. I Had Read A Lot, And I Aspired To Learn Everything I Could About The Subject.

I Have No Views As To Where It Will Be, But The One Thing I Can Tell You Is It Won't Do Anything Between Now And Then Except Look At You. Whereas, You Know, Coca-cola (ko) Will Be Making Money, And I Think Wells Fargo (wfc) Will Be Making A Lot Of Money And There Will Be A Lot - And It's A Lot - It's A Lot Better To Have A Goose That Keeps Laying Eggs Than A Goose That Just Sits There And Eats Insurance And Storage And A Few Things Like That.

In Fact, In My Adult Lifetime, I Don't Think I've Ever Seen People As Fearful Economically As They Are Right Now.

I Don't Read Economic Forecasts. I Don't Read The Funny Papers.

In The 20th Century, The United States Endured Two World Wars And Other Traumatic And Expensive Military Conflicts; The Depression; A Dozen Or So Recessions And Financial Panics; Oil Shocks; A Flu Epidemic; And The Resignation Of A Disgraced President. Yet The Dow Rose From 66 To 11,497.

Investing Is Forgoing Consumption Now In Order To Have The Ability To Consume More At A Later Date.

Government Can't Deliver A Free Lunch To The Country As A Whole. It Can, However, Determine Who Pays For Lunch. And Last Week The Senate Handed The Bill To The Wrong Party... The Poor And Middle Class.

What's Hot Today Isn't Likely To Be Hot Tomorrow. The Stock Market Reverts To Fundamental Returns Over The Long Run. Don't Follow The Herd.

I Have Worked With Investors For 60 Years And I Have Yet To See Anyone - Not Even When Capital Gains Rates Were 39.9 Percent In 1976-77 - Shy Away From A Sensible Investment Because Of The Tax Rate On The Potential Gain.

Life Is Like A Snowball. The Important Thing Is Finding Wet Snow And A Really Long Hill.

Writing Checks To The Irs That Include Strings Of Zeros Does Not Bother Me ... Overall, We Feel Extraordinarily Lucky To Have Been Dealt A Hand In Life That Enables Us To Write Large Checks To The Government Rather Than One Requiring The Government To Regularly Write Checks To Us-say, Because We Are Disabled Or Unemployed.

Focus Alone Is Not Enough; Putting In The Time To Commit Is Also Crucial To Achieve Success.

The Thing To Do Is To Keep Your Mind When The World Around You Is Losing Theirs.

The Three Most Important Words In Investing...margin Of Safety.

Investors Should Remember That Excitement And Expenses Are Their Enemies.

Investing Money

Investment Success

To Invest Successfully, You Need Not Understand Beta, Efficient Markets, Modern Portfolio Theory, Option Pricing Or Emerging Markets. You May, In Fact, Be Better Off Knowing Nothing Of These. That, Of Course, Is Not The Prevailing View At Most Business Schools, Whose Finance Curriculum Tends To Be Dominated By Such Subjects. In Our View, Though, Investment Students Need Only Two Well-taught Courses - How To Value A Business, And How To Think About Market Prices.

Accounting Consequences Do Not Influence Our Operating Or Capital-allocation Decisions. When Acquisition Costs Are Similar, We Much Prefer To Purchase $2 Of Earnings That Is Not Reportable By Us Under Standard Accounting Principles Than To Purchase $1 Of Earnings That Is Reportable.

Failure Comes From Ego, Greed, Envy, Fear, Imitation. I Have Success Not Because I Am Smart, But Because I Am Rational.

My Father Was The Best Person I've Ever Known.

Sound Investing Can Make You Very Wealthy If You're Not In Too Big A Hurry

Wide Diversification Is Only Required When Investors Do Not Understand What They Are Doing.

We Have Embraced The 21st Century By Entering Such Cutting-edge Industries As Brick, Carpet, Insulation And Paint. Try To Control Your Excitement.

Never Give Up Searching For The Job That You’re Passionate About. Try To Find The Job You’d Have If You Were Independently Rich. Forget About The Pay. When You’re Associating With The People That You Love, Doing What You Love, It Doesn’t Get Any Better Than That.

Doing What You Love

My Idea Of A Group Decision Is To Look In The Mirror.

I Mean, You May Be Very Mad At Some Guy That Walked Away With A Huge Golden Parachute, But That Really Isn't The Important Thing.

The 19th Century Belonged To England, The 20th Century Belonged To The U.s., And The 21st Century Belongs To China. Invest Accordingly.

Trust Is Like The Air We Breathe--when It's Present, Nobody Really Notices; When It's Absent, Everybody Notices.

Read 500 Pages Every Day. That's How Knowledge Works. It Builds Up Like Compound Interest.

Investors Should Remember That Excitement And Expenses Are Their Enemies. And If They Insist On Trying To Time Their Participation In Equities, They Should Try To Be Fearful When Others Are Greedy And Greedy Only When Others Are Fearful.

Investing Money

I Mean You Know At Midnight Everything Is Going To Turn To Pumpkins And Mice; Right? But If The Evening Goes Along, I Mean, You Know, The Guys Look Better All The Time, The Music Sounds Better, It's More And More Fun, You Think Why The Hell Should I Leave At Quarter Of 12. I'll Leave At Two Minutes To 12. But The Trouble Is, There Are No Clocks On The Wall. And Everybody Thinks They're Going To Leave At Two Minutes To 12.

Our System Works. Over Time, People Will Live Better And Better. We Have A System That Unleashes Human Potential, And Now China Has A System That Unleashes Human Potential. We Will Have Interruptions. We Overshoot And Undershoot Sometimes, But Your Kids And Grandkids Will Live Better Than You. Over Time, We Move Ahead At A Pretty Damn Rapid Rate.

I Think The Biggest Thing We Need Is To Unclog The Credit Markets, And We May Need Another Stimulus - If We Do, It's - It Should Go To The Lower And Middle-income People.

We've Used Derivatives For Many, Many Years. I Don't Think Derivatives Are Evil, Per Se, I Think They Are Dangerous.

I Measure Success By How Many People Love Me. And The Best Way To Be Loved Is To Be Lo Veable.

Measure Of Success

The American Economy Is Going To Do Fine. But It Won't Do Fine Every Year And Every Week And Every Month. I Mean, If You Don't Believe That, Forget About Buying Stocks Anyway... It's A Positive-sum Game, Long Term. And The Only Way An Investor Can Get Killed Is By High Fees Or By Trying To Outsmart The Market.

Activity Is The Enemy Of Investment Returns.

Other Guys Read Playboy. I Read Annual Reports.

You Should Look At Stocks As Small Pieces Of Business.

But, Surprise - None Of These Blockbuster Events Made The Slightest Dent In Ben Graham's Investment Principles. Nor Did They Render Unsound The Negotiated Purchases Of Fine Businesses At Sensible Prices. Imagine The Cost To Us, Then, If We Had Let A Fear Of Unknowns Cause Us To Defer Or Alter The Deployment Of Capital. Indeed, We Have Usually Made Our Best Purchases When Apprehensions About Some Macro Event Were At A Peak. Fear Is The Foe Of The Faddist, But The Friend Of The Fundamentalist.

You Can Be Sure That Over The Next 10 Years, You'll See Something That You Did Not Think Was Possible.

I Think The Congress Will Do The Right Thing. I Think That They've - You Know, They Got Into Certain Arguments And They Start Worrying About Assessing Blame, And There Is A Little Demagoguery, But In The End, Something This Important, They'll Do The Right Thing. So This Really Is An Economic Pearl Harbor. That Sounds Melodramatic, But I've Never Used That Phrase Before. And This Really Is One.

When You're Associating With The People That You Love, Doing What You Love, It Doesn't Get Any Better Than That.

Doing What You Love

I Know What I Want To Do And It Makes Sense To Get Going.

With Housing It's Something Even More Dramatic Than That, Because Most People Aspire To Own Their Own Home.if You Really Think That Houses Prices Are Going To Go Up Next Year And The Year After, You Feel If I Don't Buy It This Year, I'm Going To Have To Buy It Next Year.that's Not True Of An Internet Stock. But It's True Of A Home.

Things You Like To Do Should Be A Hobby Of Yours, But Things The World Does Should Be A Business Of Yours.

Bull Markets And Bear Markets Can Obscure Mathematical Laws, They Cannot Repeal Them.

When You Combine Ignorance And Leverage, You Get Some Pretty Interesting Results.

Investing Money

When You Listen To Tax-cut Rhetoric, Remember That Giving One Class Of Taxpayer A Break Requires - Now Or Down The Line - That An Equivalent Burden Be Imposed On Other Parties. In Other Words, If I Get A Break, Someone Else Pays. Government Can't Deliver A Free Lunch To The Country As A Whole. It Can However, Determine Who Pays For Lunch.

It Makes No Difference To A Widow With Her Savings In A 5 Percent Passbook Account Whether She Pays 100 Percent Income Tax On Her Interest Income During A Period Of Zero Inflation Or Pays No Income Tax During Years Of 5 Percent Inflation. Either Way, She Is 'taxed' In A Manner That Leaves Her No Real Income Whatsoever. Any Money She Spends Comes Right Out Of Capital. She Would Find Outrageous A 100 Percent Income Tax But Doesn't Seem To Notice That 5 Percent Inflation Is The Economic Equivalent.

The Market System Rewards Me Outlandishly For What I Do, But That Doesn't Mean I'm Any More Deserving Of A Good Life Than A Teacher Or A Doctor Or Someone Who Fights In Afghanistan.

I Think The Rest Of The Country Should Be Paying Less, The 95 Percent That [barack] Obama Talks About Or Maybe Even A Little Higher Than That.

The Value Of Market Esoterica To The Consumer Of Investment Advice Is A Different Story. In My Opinion, Investment Success Will Not Be Produced By Arcane Formulae, Computer Programs Or Signals Flashed By The Price Behavior Of Stocks And Markets. Rather An Investor Will Succeed By Coupling Good Business Judgment With An Ability To Insulate His Thoughts And Behavior From The Super-contagious Emotions That Swirl About The Marketplace.

Investment Success

Cash Combined With Courage In A Time Of Crisis Is Priceless.

Americans Are In A Cycle Of Fear Which Leads To People Not Wanting To Spend And Not Wanting To Make Investments, And That Leads To More Fear. We'll Break Out Of It. It Takes Time.

Lethargy Bordering On Sloth Remains The Cornerstone Of Our Investment Style. The Exception Was Wells Fargo, A Superbly-managed, High-return Banking Operation In Which We Increased Our Ownership To Just Under 10%, The Most We Can Own Without The Approval Of The Federal Reserve Board.

If I Knew Where I Was Going To Want To Live The Next Five Or 10 Years I Would Buy A Home And I'd Finance It With A 30-year Mortgage... It's A Terrific Deal.

So Smile When You Read A Headline That Says "investors Lose As Market Falls." Edit It In Your Mind To "disinvestors Lose As Market Falls-but Investors Gain." Though Writers Often Forget This Truism, There Is A Buyer For Every Seller And What Hurts One Necessarily Helps The Other. (as They Say In Golf Matches: "every Putt Makes Someone Happy.")

Take The Probability Of Loss Times The Amount Of Possible Loss From The Probability Of Gain Times The Amount Of Possible Gain. That Is What We're Trying To Do. It's Imperfect, But That's What It's All About.

Energy Deregulation Will Be The Largest Transfer Of Wealth In History.

The Less Prudence With Which Others Conduct Their Affairs, The Greater The Prudence With Which We Should Conduct Our Own Affairs.

We Try To Buy Businesses With Good-to-superb Underlying Economics Run By Honest And Able People And Buy Them At Sensible Prices. That's All I'm Trying To Do.

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Simon Mainwaring

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