Background Image

...

I Think That They Hoped The Private Sector Would Come In. And The Private Sector Tried To Come In Until They Saw The Size Of The Problem. I Mean, From Were People On That Weekend That Thought They'd Had A Solution. And Then The Hole Kept Getting Bigger And Bigger. And All Of A Sudden Became Apparent That 20 Billion Wouldn't Do It And 30 Billion Wouldn't Do It And 40 Billion Wouldn't Do It. So It Got Beyond Anybody's Ability To Certainly To Do It In A Short Period Of Time.

-Warren Buffett

...

Please Wait....
Translating....

I Think That They

Warren Buffett

...

I Think That They Hoped The Private Sector Would Come In. And The Private Sector Tried To Come In Until They Saw The Size Of The Problem. I Mean, From Were People On That Weekend That Thought They'd Had A Solution. And Then The Hole Kept Getting Bigger And Bigger. And All Of A Sudden Became Apparent That 20 Billion Wouldn't Do It And 30 Billion Wouldn't Do It And 40 Billion Wouldn't Do It. So It Got Beyond Anybody's Ability To Certainly To Do It In A Short Period Of Time.

Views: 6

Topic

More From Warren Buffett

Diversification May Preserve Wealth, But Concentration Builds Wealth.

Concentration Of Wealth

A Low-cost Index Fund Is The Most Sensible Equity Investment For The Great Majority Of Investors. My Mentor, Ben Graham, Took This Position Many Years Ago, And Everything I Have Seen Since Convinces Me Of Its Truth.

An Argument Is Made That There Are Just Too Many Question Marks About The Near Future; Wouldn't It Be Better To Wait Until Things Clear Up A Bit? You Know The Prose: "maintain Buying Reserves Until Current Uncertainties Are Resolved," Etc. Before Reaching For That Crutch, Face Up To Two Unpleasant Facts: The Future Is Never Clear And You Pay A Very High Price For A Cheery Consensus. Uncertainty Actually Is The Friend Of The Buyer Of Long-term Values.

None Of This Means, However, That A Business Or Stock Is An Intelligent Purchase Simply Because It Is Unpopular; A Contrarian Approach Is Just As Foolish As A Follow-the-crowd Strategy. What's Required Is Thinking Rather Than Polling. Unfortunately, Bertrand Russell's Observation About Life In General Applies With Unusual Force In The Financial World: "most Men Would Rather Die Than Think. Many Do."

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.

Shares Are Not Mere Pieces Of Paper. They Represent Part Ownership Of A Business. So, When Contemplating An Investment, Think Like A Prospective Owner.

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.

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.

The Most Common Cause Of Low Prices Is Pessimism - Some Times Pervasive, Some Times 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. It's Optimism That Is The Enemy Of The Rational Buyer.

Don't Pass Up Something That's Attractive Today Because You Think You Will Find Something Way More Attractive Tomorrow.

The Noah Rule: Predicting Rain Doesn't Count; Building Arks Does.

Failing Conventionally Is The Route To Go; As A Group, Lemmings May Have A Rotten Image, But No Individual Lemming Has Ever Received Bad Press

Credit Worthiness Is Like Virginity, It Can Be Preserved But Not Restored Very Easily, So It Is Crazy To Play Around With It.

Only When You Combine Sound Intellect With Emotional Discipline Do You Get Rational Behavior.

I Think It Will Get Moving Faster. I Mean Once You Get It Off The - Once Credit Flows - Now The Recession Is Going To Get Worse.

The Problem With Commodities Is That You Are Betting On What Someone Else Would Pay For Them In Six Months. The Commodity Itself Isn't Going To Do Anything For You....it Is An Entirely Different Game To Buy A Lump Of Something And Hope That Somebody Else Pays You More For That Lump Two Years From Now Than It Is To Buy Something That You Expect To Produce Income For You Over Time.

A Prediction About The Direction Of The Stock Market Tells You Nothing About Where Stocks Are Headed, But A Whole Lot About The Person Doing The Predicting.

In Other Words, The Percentage Change In Book Value In Any Given Year Is Likely To Be Reasonably Close To That Year's Change In Intrinsic Value.

An Investor Should Act As Though He Had A Lifetime Decision Card With Just Twenty Punches On It.

Risk Comes From Not Knowing What You Are Doing So Wide Diversification Is Only Required When Investors Are Ignorant. You Only Have To Do A Very Few Things In Your Life So Long As You Don't Do Too Many Things Wrong.

If You Gave Me The Choice Of Being Ceo Of General Electric Or Ibm Or General Motors, You Name It, Or Delivering Papers, I Would Deliver Papers. I Would. I Enjoyed Doing That. I Can Think About What I Want To Think. I Don't Have To Do Anything I Don't Want To Do.

We Have Provided Capital Here With A Couple Of Institutions Recently. The Federal Government Did That In The '30s For The Rfc And I Think There Could Well Be A Proper Role For Government In That.

[w]e Think The Very Term 'value Investing' Is Redundant. What Is 'investing' If It Is Not The Act Of Seeking Value At Least Sufficient To Justify The Amount Paid? 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 Labeled Speculation (which Is Neither Illegal, Immoral Nor -- In Our View -- Financially Fattening).

They [goverment] Take From The Woman Who Comes In And Takes The Wastebaskets Out.

House Prices Just Soared Beyond - Beyond Reason In Many Places And They Got Financed In Silly Ways, And People Lied About Loans, All Kinds Of Accesses Entered Into It. But That Is What - That Is The Single Biggest Cause Of Why We're Here.

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.

I Have Got This Letter Which Actually Goes Out The Day After I Die. It Has Already Been Written. And It Says That: "yesterday I Died". And Then It Says: "that's Bad News For Me, But It's Not Bad News For You, The Shareholders Of Berkshire". And Then I Go On And Explain What Is Going To Happen. I Know That Is One Time When They Will Be Really Interested In Hearing From Me.

As Far As You Are Concerned, The Stock Market Does Not Exist. Ignore It.

And People Really Behaved In A Fraudulent Way Or Something, We'll Go Back And Find The Culprits Later On. But That Really Isn't The Problem We Have. I Mean That's Where It Came From, Though. We Leveraged Up And If You Have A 20 Percent Fall In Value Of A $20 Trillion Asset, That's $4 Trillion. And When $4 Trillion Lands - Losses Land In The Wrong Part Of This Economy, It Can Gum Up The Whole Place.

The American Worker Is More Productive Than He's Ever Been.

American Workers

In The Search [of A Deal], We Adopt The Same Attitude One Might Find Appropriate In Looking For A Spouse: It Pays To Be Active, Interested, And Open-minded, But It Does Not Pay To Be In A Hurry.

The Banking Business Is No Favorite Of Ours. When Assets Are Twenty Times Equity - A Common Ratio In This Industry - Mistakes That Involve Only A Small Portion Of Assets Can Destroy A Major Portion Of Equity. And Mistakes Have Been The Rule Rather Than The Exception At Many Major Banks.

Do Not Put All Your Eggs In One Basket.

Investment Success

Cash, Though, Is To A Business As Oxygen Is To An Individual: Never Thought About When It Is Present, The Only Thing In Mind When It Is Absent... When Bills Come Due, Only Cash Is Legal Tender. Don't Leave Home Without It.

Would You Rather Be The World's Greatest Lover, But Have Everyone Think You're The World's Worst Lover? Or Would You Rather Be The World's Worst Lover But Have Everyone Think You're The World's Greatest Lover? Now, That's An Interesting Question.

It's Class Warfare, My Class Is Winning, But They Shouldn't Be.

If You Get To My Age In Life And Nobody Thinks Well Of You, I Don't Care How Big Your Bank Account Is, Your Life Is A Disaster.

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

We Will Only Do With Your Money What We Would Do With Our Own.

It Irritates The Hell Out Of Me But You Can't Buy Love.

My Rather Puritanical View Is That Any Investment Manager, Whether Operating As Broker, Investment Counselor Of A Trust Department, Investment Company, Etc., Should Be Willing To State Unequivocally What He Is Going To Attempt To Accomplish And How He Proposes To Measure The Extent To Which He Gets The Job Done.

You Know, With Your Money And My Brains, I Mean, There's No Telling How Far We'd Go.

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.

I Will Do Anything That Is Basically Covered By The Law To Reduce Berkshire's Tax Rate. For Example, On Wind Energy, We Get A Tax Credit If We Build A Lot Of Wind Farms. That's The Only Reason To Build Them. They Don't Make Sense Without The Tax Credit.

I Would Say That Life At 84, I Am Having As Much Fun As I've Ever Had In My Life. I Mean I Get To Do What I Love Every Day With The People I Love-and It Just Doesn't Get Any Better Than That.

Rule No.1: Never Lose Money. Rule No.2: Never Forget Rule No.1.

The (stock) Market Is There Only As A Reference Point To See If Anybody Is Offering To Do Anything Foolish. When We Invest In Stocks, We Invest In Businesses.

Investing Is Laying Out Money Now To Get More Money Back In The Future.

You Have To Be Able To Communicate In Life And Probably Schools Underemphasize That. If You Can't Talk To People Or Write, You're Giving Up Your Potential.

The Most Important Thing In Terms Of Your Circle Of Competence Is Not How Large The Area Of It Is, But How Well You've Defined The Perimeter.

If You Gave Me $100 Billion And Said Take Away The Soft Drink Leadership Of Coca-cola In The World, I'd Give It Back To You And Say It Can't Be Done.

Investors Have To Remember: Corporate Profits Are Going Up, But Stocks Are Going Up Faster. How Can That Continue Indefinitely? Investors Can Only Earn What Companies Themselves Can Earn; The Government Or The Markets Themselves Don't Kick Anything In. How Can You Get Anything More Out Of A Farm Than What It Grows?

Too Often, Executive Compensation In The U.s. Is Ridiculously Out Of Line With Performance. That Won't Change, Moreover, Because The Deck Is Stacked Against Investors When It Comes To The Ceo's Pay. The Upshot Is That A Mediocre-or-worse Ceo - Aided By His Handpicked Vp Of Human Relations And A Consultant From The Ever-accommodating Firm Of Ratchet, Ratchet And Bingo - All Too Often Receives Gobs Of Money From An Ill-designed Compensation Arrangement.

A Bull Market Is Like Sex. It Feels Best Just Before It Ends.

You Should Be Unconcerned About Short-term Price Action When You Own The Securities Directly, Just As You Were Unconcerned When You Owned Them Indirectly Through Bpl. I Think About Them As Businesses, Not "stocks", And If The Business Does All Right Over The Long Term, So Will The Stock.

I Think Confidence Will Come Back.

We Have Long Felt That The Only Value Of Stock Forecasters Is To Make Fortune-tellers Look Good.

There Are Three Kinds Of People: 1. Innovators. 2. Imitators. 3. Idiots.

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

I've Read About All The Sales Today. If You're An Auto Dealer, You're Feeling It. If You're A Furniture Retailer Like We Are, You're Feeling It. If You're A Jewelry Retailer, You're Feeling It. I Know Some Of These Businesses Because We're In Them. Yeah, It's Being Felt, But It Will Be Felt Big Time More If We Don't Do Something About It, What's Going On.

Of One Thing Be Certain: If A Ceo Is Enthused About A Particularly Foolish Acquisition, Both His Internal Staff And His Outside Advisors Will Come Up With Whatever Projections Are Needed To Justify His Stance. Only In Fairy Tales Are Emperors Told That They Are Naked.

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?

You Could Take All The Gold That's Ever Been Mined, And It Would Fill A Cube 67 Feet In Each Direction. For What That's Worth At Current Gold Prices, You Could Buy All -- Not Some -- All Of The Farmland In The United States. Plus, You Could Buy 10 Exxon Mobils, Plus Have $1 Trillion Of Walking-around Money. Or You Could Have A Big Cube Of Metal. Which Would You Take? Which Is Going To Produce More Value?

Someone Is Sitting In The Shade Today Because Someone Planted A Tree A Long Time Ago.

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

Does The Business Have Favourable Long Term Prospects?

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.

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.

[the U.s. Treasury] Can Borrow Basically Unlimited Amounts. They Can Stay There For Years And Years. These Assets Will Be Worth More Money Over Time. So When Merrill Lynch Sells A Bunch Of Mortgage-related Assets At 22 Cents On The Dollar Like They Did A Month Or So Ago, The Buyer Goes - Is Going To Make Money, And He's Going To Make A Lot More Money If It Happens To Be An Institution Like The U.s. Government Which Has Very, Very Cheap Borrowing Costs.

I've Made Money Over The Years By Buying Into Good Companies, Run By Good People, At Attractive Prices. And I Don't Try And Make It Out Of Buying Into The Market At One Point And Selling At Another Point.

While The Poor And Middle Class Fight For Us In Afghanistan, And While Most Americans Struggle To Make Ends Meet, We Mega-rich Continue To Get Our Extraordinary Tax Breaks.

Money To Some Extent Sometimes Let You Be In More Interesting Environments. But It Can't Change How Many People Love You Or How Healthy You Are.

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.

When People Talk About Cash Being King, It's Not King If It Just Sits There And Never Does Anything.

I'm Just Lucky To Have Been In The Right Place At The Right Time. Another Place, Another Time, I Wouldn't Have Been As Successful. Society Enabled Me To Make My Money And My Money Should Go To Society.

In Earlier Years, A Lesser Effort Produced Literally Dozens Of Comparable Opportunities. It Is Difficult To Be Objective About The Causes For Such Diminution Of One's Own Productivity. Three Factors That Seem Apparent Are: (1) A Somewhat Changed Market Environment; (2) Our Increased Size; And (3) Substantially More Competition.

It Is Obvious That The Performance Of A Stock Last Year Or Last Month Is No Reason, Per Se, To Either Own It Or To Not Own It Now. It Is Obvious That An Inability To "get Even" In A Security That Has Declined Is Of No Importance. It Is Obvious That The Inner Warm Glow That Results From Having Held A Winner Last Year Is Of No Importance In Making A Decision As To Whether It Belongs In An Optimum Portfolio This Year.

The Secret Is To Find What You Love To Do.i Mean, I Tell The Students Look For The Job That You Would Take If You Didn't Need A Job. I Mean, It's That Simple. And I Was Lucky Enough To Find It Very Early In Life. And Then The Second Thing Is To Have People Around You That Make Feel Good Every Day, And Make You A Better Person Than You Otherwise Would Be.

It's Just That I Landed Up In A Terrific Capitalist System. One That Pays People Who Allocate Capital Extraordinarily Well. Intrinsically, I'm Not Worth As Much As Somebody Who Invents Something That Could Improves People's Life, Or Health Or Whatever.

We've Used Up A Lot Of Bullets. And We Talk About Stimulus. But The Truth Is, We're Running A Federal Deficit That's 9 Percent Of Gdp. That Is Stimulative As All Get Out. It's More Stimulative Than Any Policy We've Followed Since World War Ii.

The Managers At Fault Periodically Report On The Lesson They Have Learned From The Latest Disappointment. They Then Usually Seek Out Future Lessons.

Resolution Trust Company Was Set Up To Liquidate A Bunch Of Assets That The Government Had Inherited Because The Savings And Loans Went Broke.

I Put Heavy Weight On Certainty. It's Not Risky To Buy Securities At A Fraction Of What They're Worth.

Never Get Too Hung Up On Mistakes.

I'm Always Interested In Understanding The Math Of Things And Understanding As Much As I Can About All Aspects Of Business. And What I Learn Today May Be Useful To Me Two Years From Now. That's Really The Wonderful Thing About Investments Is Your Knowledge Is Cumulative.

If You Have A Harem Of 40 Women, You Never Get To Know Any Of Them Very Well.

Wild Swings In Share Prices Have More To Do With The "lemming- Like" Behaviour Of Institutional Investors Than With The Aggregate Returns Of The Company They Own.

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

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

There Is No Substitute For A Local Newspaper That Is Doing Its Job.

In Our View, Though, Investment Students Need Only Two Well-taught Courses-how To Value A Business, And How To Think About Market Prices. Your Goal As An Investor Should Simply Be To Purchase, At A Rational Price, A Part Interest In An Easily-understandable Business Who's Earnings Are Virtually Certain To Be Materially Higher Five, Ten And Twenty Years From Now.

If You Don't Know Jewelry, Know The Jeweler.

The Only Way To Be Loved Is To Be Loveable, Which Really Irritates Me.

We've Had Public Companies In The Past In That Business And They Bleed. We've Got A Lot More Blood Than They Do.

The Financial Calculus That Charlie And I Employ Would Never Permit Our Trading A Good Night's Sleep For A Shot At A Few Extra Percentage Points Of Return. I've Never Believed In Risking What My Friends And Family Have And Need In Order To Pursue What They Don't Have And Don't Need.

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.

We Would Do Best In A Market Where Everyone Acted Foolishly.

A Company Should Be Viewed As An Unfolding Movie, Not As A Still Photograph

I Mean The Truth Is, I've Never Had It So Good In Terms Of Taxes. I Am Paying The Lowest Tax Rate That I've Ever Paid In My Life.

The Smarter The Journalists Are, The Better Off Society Is.

There Is Seldom Just One Cockroach In The Kitchen. You Know, You Turn On The Light And, All Of Sudden, They All Start Scurrying Around.

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

Growth And Value Investing Are Joined At The Hip.

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.

If This Is A War, My Side Has The Nuclear Bomb. We Have K Street. We Have Wall Street. Debbie Doesn't Have Anybody. I Want A Government That Is Responsive To The People Who Got The Short Straw In Life.

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

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.

Charlie [munger] And I Are Not Big Fans Of Resumes. Instead, We Focus On Brains, Passion And Integrity.

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

Continually Challenge And Be Willing To Amend Your Best Loved Ideas.

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 Think That Actually People In My Situation Should Be Paying More Tax.

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.

The Line Separating Investment And Speculation, Which Is Never Bright And Clear, Becomes Blurred Still Further When Most Market Participants Have Recently Enjoyed Triumphs. Nothing Sedates Rationality Like Large Doses Of Effortless Money. After A Heady Experience Of That Kind, Normally Sensible People Drift Into Behavior Akin To That Of Cinderella At The Ball.

Investing Money

Do What You Would Do For Free, Having Passion For What You Do Is The Most Important Thing.

Passion For What You Do

You Should Invest In A Business That Even A Fool Can Run, Because Someday A Fool Will.

Managers And Investors Alike Must Understand That Accounting Numbers Are The Beginning, Not The End, Of Business Valuation.

The Difference Between Successful People And Really Successful People Is That Really Successful People Say No To Almost Everything.

If I Subscribed To The Efficient Market Theory I Would Still Be Delivering Papers

What You Really Want To Do In Investments Is Figure Out What's Important And Knowable. If It's Unimportant Or Unknowable You Forget About It.

What Motivates Most Gold Purchasers Is Their Belief That The Ranks Of The Fearful Will Grow. During The Past Decade That Belief Has Proved Correct. Beyond That, The Rising Price Has On Its Own Generated Additional Buying Enthusiasm, Attracting Purchasers Who See The Rise As Validating An Investment Thesis. As 'bandwagon' Investors Join Any Party, They Create Their Own Truth - For A While.

Equities Will Do Well Over Time - You Just Have To Avoid Getting Excited When Other People Are Getting Excited.

You've Got The Right - You've Got A Wonderful Person With Sheila Bair, Most Of The Viewers Have Never Heard Of Sheila Bair. [she] Has Taken Eight Percent Of The Deposits In The United States And Seamlessly Moved Those Over To Sound Institutions Which In Turn Have Gotten More Capital, Ended Up, It's Been A Magnificent Job.she'll Never Get A Golden Parachute Or Any Severance Pay Or Anything. She's Done A Great Job. We've Got Some Great Public Servants. We Have I Think The Right People In There To Get The Job Done, And Then They Need More Tools.

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.

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

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.

Although We Deal With Probabilities And Expectations, The Actual Results Can Deviate Substantially From Such Expectations, Particularly On A Short-term Basis.

A Public-opinion Poll Is No Substitute For Thought.

What Motivates Most Gold Purchasers Is Their Belief That The Ranks Of The Fearful Will Grow ... As 'bandwagon' Investors Join Any Party, They Create Their Own Truth - For A While.

Take The High Road; It's Far Less Crowded.

Taking The High Road

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.

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.

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.

It's Just That Right Now The Athlete's On The Floor. But We - This Is A Super Athlete.

Like I Say, I Don't Think It'll Be Done Perfectly. Maybe We'll End Up With A Little Bit Better [economy] System.

We Need A Tax System That Essentially Takes Very Good Care Of The People Who Just Really Aren't As Well Adapted To The Market System But Are Nevertheless Doing Useful Things In The Society.

There's No Use Running If You're On The Wrong Road.

The Best Investment You Can Make Is In Yourself.

Investment Success

Gold Has Two Significant Shortcomings, Being Neither Of Much Use Nor Procreative.

Never Depend On A Single Source Of Income.

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

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.

You Know ... You Keep Doing The Same Things And You Keep Getting The Same Result Over And Over Again.

Never Count On Making A Good Sale. Have The Purchase Price Be So Attractive That Even A Mediocre Sale Gives Good Results.

Unless Your Answers Are Clearly Better, Copy The Answers Of Your Betters.

Risk Is A Part Of God's Game, Alike For Men And Nations.

I Believe The Chance Of Any Event Causing Berkshire To Experience Financial Problems Is Essentially Zero. We Will Always Be Prepared For The Thousand-year Flood; In Fact, If It Occurswe Will Be Selling Life Jackets To The Unprepared.

We Will Continue To Ignore Political And Economic Forecasts, Which Are An Expensive Distraction For Many Investors And Businessmen. Thirty Years Ago, No One Could Have Foreseen The Huge Expansion Of The Vietnam War, Wage And Price Controls, Two Oil Shocks, The Resignation Of A President, The Dissolution Of The Soviet Union, A One-day Drop In The Dow Of 508 Points, Or Treasury Bill Yields Fluctuating Between 2.8% And 17.4%.

There Are Certain Things That Cannot Be Adequately Explained To A Virgin Either By Words Or Pictures.

Why Not Invest Your Assets In The Companies You Really Like? As Mae West Said, 'too Much Of A Good Thing Can Be Wonderful'.

Businesses Always Have Opportunities To Improve Service, Product Lines, Manufacturing Techniques, And The Like, And Obviously These Opportunities Should Be Seized. But A Business That Constantly Encounters Major Change Also Encounters Many Chances For Major Error

Never Lie Under Any Circumstances.

You Can't Help Some Increase From This Point. I Don't Want Any Viewer To Go Away Think A Magic Wand Exists In Congress. So They're Going To See Some More Bad News. But If We Do This, We're Doing The Right Thing.

I Mean There Is No Capital Requirements To It Or Anything Of The Sort. And Basically, I Said There Were Possibly Financial Weapons Of Mass Destruction, And They Had Them. They Destroyed Aig. They Certainly Contributed To The Destruction Of Bear Sterns And Lehman. Although Lehman Had Other Problems, Too.

Mass Destruction

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

I Learned To Go Into Business Only With People Whom I Like, Trust, And Admire.

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.

Confidence In Markets And In Institutions, It's A Lot Like Oxygen. When You Have It, You Don't Even Think About It. It's Indispensable. You Can Go Years Without Thinking About It. When It's Gone For Five Minutes, It's The Only Thing To Think About.

Stop Trying To Predict The Direction Of The Stock Market, The Economy Or Elections.

Most Investors, Both Institutional And Individual, Will Find That The Best Way To Own Common Stocks (shares') Is Through An Index Fund That Charges Minimal Fees. Those Following This Path Are Sure To Beat The Net Results (after Fees And Expenses) Of The Great Majority Of Investment Professionals.

When I Take A Look At A Company's Annual Report, If I Don't Understand It, They Don't Want Me To Understand It.

Returns Decrease As Motion Increases.

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

The Single Most Important Decision In Evaluating A Business Is Pricing Power.

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

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.

Charlie And I Have A Number Of Filters That Things Have To Get Through Before We'll Think About Them.

The Fact That People Will Be Full Of Greed, Fear, Or Folly Is Predictable. The Sequence Is Not Predictable.

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. You May Find Local Companies That Have Nothing Wrong With Them At All. A Company That I Found, Western Insurance Securities, Was Trading For $3/share When It Was Earning $20/share!! I Tried To Buy Up As Much Of It As Possible. No One Will Tell You About These Businesses. You Have To Find Them.

We Always Live In An Uncertain World. What Is Certain Is That The United States Will Go Forward Over Time.

If Aig Had Tried To Unwind Their Derivatives Books. I Don't Know. It Would Have Hit Every Institution In The World.

We've Got More Productive Capacity Now Than We Ever Have.

I Am A Huge Bull On This Country. We Will Not Have A Double-dip Recession At All. I See Our Businesses Coming Back Almost Across The Board.

Double Standard

But 300 Million Americans, Their Lending Institutions, Their Government, Their Media, All Believed That House Prices Were Going To Go Up Consistently. And That Got Billed Into A $20 Trillion Residential Home Market. Lending Was Done Based On It, And Everybody Did A Lot Of Foolish Things.

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

I Don't Try And Guess When To Get In And Out Of The Market. I Have Owned Stocks Consistently Since 1942. I Owned The - I Was Buying Stocks The Day Before The Election. I Was Buying The Same Stocks The Day After Election. And If Hillary Had Been Elected, It Would Have Been The Same Thing.

We Also Believe Candour Benefits Us As Managers. The Ceo Who Misleads Often In Public Eventually Misleads Himself In Private.

I Can't Promise Results, But I Can Promise A Common Destiny.

I Like To Buy Things I Can Understand. I Do A Lot Of Research On Things.

It's Never Paid To Bet Against America.

Inactivity Strikes Us As Intelligent Behavior.

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.

Long Ago, Sir Isaac Newton Gave Us Three Laws Of Motion, Which Were The Work Of Genius. But Sir Isaac's Talents Didn't Extend To Investing: He Lost A Bundle In The South Sea Bubble, Explaining Later, 'i Can Calculate The Movement Of The Stars, But Not The Madness Of Men.' If He Had Not Been Traumatized By This Loss, Sir Isaac Might Well Have Gone On To Discover The Fourth Law Of Motion: For Investors As A Whole, Returns Decrease As Motion Increases.

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

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

Investing Money

I'll Bring My Tax Returns; You Bring Yours. I'll Meet You Anytime Anywhere.

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.

If You Look At The Forbes 400, They Are Paying A Lower Rate, Accounting Payroll Taxes, Than Their Secretary Or - Whomever Around Their Office.

If You Don’t Feel Comfortable Making A Rough Estimate Of The Asset’s Future Earnings, Just Forget It And Move On. No One Has The Ability To Evaluate Every Investment Possibility. But Omniscience Isn’t Necessary; You Only Need To Understand The Actions You Undertake.

As Of 1992, In Fact-though The Picture Would Have Improved Since Then-the Money That Had Been Made Since The Dawn Of Aviation By All Of This Country's Airline Companies Was Zero. Absolutely Zero.

Airline Business

We Do Not Have, Nor Have Had, And Never Will Have An Opinion About Where The Stock Market, Interest Rates, Or Business Activity Will Be A Year From Now.

The Best Thing That Happens To Us Is When A Great Company Gets Into Temporary Trouble...we Want To Buy Them When They're On The Operating Table.

Investing Money

Every Company That Has An Economist Working For Him Has One Employee Too Many.

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.

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.

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.

The Value Of A Business Is The Cash It's Going To Produce In The Future.

I Would Say That An Rfc-like Thing Might Make Sense. I Probably Would Do It Myself. But I Don't Think Trying To Combine That With What's Going Through Now, I Think What Is Needed Now Is Liquidity.

What The Wise Do In The Beginning, Fools Do In The End.

I've Seen More People Fail Because Of Liquor And Leverage -- Leverage Being Borrowed Money. You Really Don't Need Leverage In This World Much. If You're Smart, You're Going To Make A Lot Of Money Without Borrowing.

Investing Money

Trending Author

Alexander Hamilton

Persis Khambatta

Category