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If You Understood A Business Perfectly And The Future Of The Business, You Would Need Very Little In The Way Of A Margin Of Safety. So, The More Vulnerable The Business Is, Assuming You Still Want To Invest In It, The Larger Margin Of Safety You'd Need. If You're Driving A Truck Across A Bridge That Says It Holds 10,000 Pounds And You've Got A 9,800 Pound Vehicle, If The Bridge Is 6 Inches Above The Crevice It Covers, You May Feel Okay, But If It's Over The Grand Canyon, You May Feel You Want A Little Larger Margin Of Safety.

-Warren Buffett

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If You Understood A

Warren Buffett

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If You Understood A Business Perfectly And The Future Of The Business, You Would Need Very Little In The Way Of A Margin Of Safety. So, The More Vulnerable The Business Is, Assuming You Still Want To Invest In It, The Larger Margin Of Safety You'd Need. If You're Driving A Truck Across A Bridge That Says It Holds 10,000 Pounds And You've Got A 9,800 Pound Vehicle, If The Bridge Is 6 Inches Above The Crevice It Covers, You May Feel Okay, But If It's Over The Grand Canyon, You May Feel You Want A Little Larger Margin Of Safety.

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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.

Buy A Business, Don't Rent Stocks.

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.

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

Generally Speaking, Investing In Yourself Is The Best Thing You Can Do. Anything That Improves Your Own Talents; Nobody Can Tax It Or Take It Away From You. They Can Run Up Huge Deficits And The Dollar Can Become Worth Far Less. You Can Have All Kinds Of Things Happen. But If You’ve Got Talent Yourself, And You’ve Maximized Your Talent, You’ve Got A Tremendous Asset That Can Return Ten-fold.

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.

We Make Investment Decisions Based On Our Evaluation Of The Most Profitable Combination Of Probabilities.

I Would Push Purchasing Power - You Push Out $1,000 Of Purchasing To Those People, It's Going To Get - It's Going To Get Spent. And It Needs To Be Spent. They Need It. And It Should Come, To Some Extent, From Guys Like Me.

There's Always A Mismatch. I Mean, You Know, As The Economy Evolves, It Reallocates Resources. Now, The Real Problem, In My View, Is - This Has Been - The Prosperity Has Been Unbelievable For The Extremely Rich People. If You Go To 1982, When Forbes Put On Their First 400 List, Those People Had $93 Billion. They Now They Have $2.4 Trillion, 25 For One. That Is - This Has Been A Prosperity That's Been Disproportionately Rewarding To The People On Top.

In The End, Alchemy, Whether It Is Metallurgical Or Financial, Fails. A Base Business Can Not Be Transformed Into A Golden Business By Tricks Of Accounting Or Capital Structure. The Man Claiming To Be A Financial Alchemist May Become Rich. But Gullible Investors Rather Than Business Achievements Will Usually Be The Source Of His Wealth.

A Fool And His Money Are Soon Invited Everywhere.

We Enjoy The Process Far More Than The Proceeds.

I Don't Measure My Life By The Money I've Made. Other People Might, But Certainly Don't.

A Market Downturn, Doesn't Bother Us. For Us And Our Long Term Investors, It Is An Opportunity To Increase Our Ownership Of Great Companies With Great Management At Good Prices. Only For Short Term Investors And Market Timers Is A Correction Not An Opportunity.

I Don't Need 15 Houses. Owning Real Estate Doesn't Mean Much To Me. I Don't Like To Think About Things Like That. I Don't Need 12 Boats, Or Even The World's Largest Boat With A Crew Of 80. I'd Have To Take Care Of Them, To Worry About Them. I Get A Lot More Fun Out Of Life Without All The Bells And Whistles.

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

I Don't Have My Diploma From The University Of Nebraska Hanging On My Office Wall, And I Don't Have My Diploma From Columbia Up There Either-but I Do Have My Dale Carnegie Graduation Certificate Proudly Displayed.

I Bought My First Stock In 1942, In The Summer Of '42. I Was 11 Years Old. And So 75 Years Have Gone By. And I Have Never Known What The Market's Going To Do The Next Day. And That's Not My Game. My Game Is To Decide Whether I'm In The Right Economy, Which America's Definitely Been Ever Since That Time. The Dow Has Gone From 100 To 21,000 During That Time. And No Matter What The Headlines Say, Or Terrible Things Are Happening - We Were Losing The War In The Pacific When I First Bought Stocks.

No Formula In Finance Tells You That The Moat Is 28 Feet Wide And 16 Feet Deep. That's What Drives The Academics Crazy. They Can Compute Standard Deviations And Betas, But They Can't Understand Moats.

We Always See Shifts In Employment. If You Think About It, If You Go Back To 1800, It Took 80 Percent Of The Labor Force To Produce Enough Food For The Country. Now It Takes Less Than 3 Percent. Well, The Truth Is That Market Systems Move People Around.

It's Almost Impossible To Overpay The Truly Extraordinary Ceo... But The Species Is Rare.

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.

It's Very Important That The Determination Of The Us Congress To Do What Is Is Needed Be Made Evident This Week And By The Actions Of Most Of The Members. I Mean, You're Not Going To Get Total Assent.

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.

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.

Success In Investing Doesn’t Correlate With I.q. Once You Are Above The Level Of 25; Once You Have Ordinary Intelligence, What You Need Is The Temperament To Control The Urges That Get Other People Into Trouble In Investing.

Games Are Won By Players Who Focus On The Playing Field -- Not By Those Whose Eyes Are Glued To The Scoreboard.

There Are Three Important Principles To Graham's Approach. [the First Is To Look At Stocks As Fractional Shares Of A Business, Which] Gives You An Entirely Different View Than Most People Who Are In The Market. [the Second Principle Is The Margin-of-safety Concept, Which] Gives You The Competitive Advantage. [the Third Is Having A True Investor's Attitude Toward The Stock Market, Which] If You Have That Attitude, You Start Out Ahead Of 99 Percent Of All The People Who Are Operating In The Stock Market - It's An Enormous Advantage.

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

Today People Who Hold Cash Equivalents Feel Comfortable. They Shouldn't. They Have Opted For A Terrible Long-term Asset, One That Pays Virtually Nothing And Is Certain To Depreciate In Value.

We've Seen What Can Be Accomplished When We Use 50% Of Our Human Capacity. If You Visualize What 100% Can Do, You'll Join Me As An Unbridled Optimist About America's Future.

The Rich Invest In Time, The Poor Invest In Money.

Words Of Wisdom

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.

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.

Whatever You Like To Do, Make It A Hobby And Whatever The World Likes To Do, Make It A Business.

Never Risk What You Have And Need For What We Don't Have And Don't Need.

Possessing A Powerful Worldwide Brand Is Essential For Sustained Success.

Banking Is Very Good Business If You Don't Do Anything Dumb.

The Fed Is The Greatest Hedge Fund In History.

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

You Get In A Lot Of Trouble When You Start Putting Fictitious Numbers.

As An Investor With Small Capital, One Should Prefer Businesses That Have High Returns On Capital And That Require Little Incremental Investment To Grow.

In Looking For People To Hire, Look For Three Qualities: Integrity, Intelligence And Energy. And If They Don't Have The First, The Other Two Will Kill You.

I Make No Effort To Predict The Course Of General Business Or The Stock Market. Period. However, Currently There Are Practices Snowballing In The Security Markets And Business World Which, While Devoid Of Short Term Predictive Value, Bother Me As To Possible Long Term Consequences.

It Is Easier To Rationalize Than It Is To Be Rational.

Basically, The Single-most Important Decision In Evaluating A Business Is Pricing Power.

Important Decisions

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

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.

When You Get To My Age, You’ll Measure Your Success In Life By How Many Of The People You Want To Have Love You Actually Do Love You. That’s The Ultimate Test Of How You’ve Lived Your Life.

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.")

I Find That The Standard Of Living Does Not Go Up In Proportion With The Cost Of Living. The Trick In Life Is To Do Things That Are Fun All The Time.

Who Would Think Of Buying Or Selling A Private Business Because Of Someone's Guess On The Stock Market? The Availability Of A Quotation For Your Business Interest (stock) Should Always Be An Asset To Be Utilized If Desired. If It Gets Silly Enough In Either Direction, You Take Advantage Of It. Its Availability Should Never Be Turned Into A Livability Whereby Its Periodic Aberrations In Turn Formulate Your Judgements.

The Truth Is That I've Got All My Net Worth Safely In Berkshire And I Will Never Sell A Share So There Is No One More Concerned About What Happens After My Death Than I Am.

Aig Would Be Doing Fine Today. It Was One Of The Ten Largest Companies In The United States In Terms Of Market Value, Over 200 Billion, The Most Respected Insurer And Everything In The World.

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

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

We've Got A Wonderful Economic Formula In This Country.

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

When The President Of The United States Goes Out At, You Know, 8:00 O'clock In The Morning And Then His Own Party Votes Gets Him 2 To 1 In The House, You Know That Somehow A Message Isn't Getting Out. It Takes Real Leadership.

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

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

It Makes A Difference Who The Treasury Secretary Is.

Making A Difference

Never Give Up Searching For The Job That You're Passionate About.

Doing What You Love

Never Invest In A Business You Don't Understand.

Do What You Love And Work For Whom You Admire The Most, And You've Given Yourself The Best Chance In Life You Can.

A Hyperactive Stock Market Is The Pickpocket Of Enterprise.

I Don't Want To Give A Lecture To This Body That's Out There. You Know, I Mean, Having Had The Heart Attack, I Want To Get It Back Functioning. And As A Practical Matter, I Mean If You Were Bear Stearns, And You Were A Shareholder, You Know, You Lost 90 To 95 Percent Of Your Money. A Good Many Lost Their Jobs. They Lost Very Cushy Lives, Many Of Them.

Returns Decrease As Motion Increases.

If You've Got A Good Enough Business, If You Have A Monopoly Newspaper, If You Have A Network Television Station - I'm Talking Of The Past - You Know, Your Idiot Nephew Could Run It. And If You've Got A Really Good Business, It Doesn't Make Any Difference.

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

Making Money Isn't The Backbone Of Our Guiding Purpose; It Is The By-product Of Our Guiding Purpose.

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 You've Been Playing Poker For Half An Hour And You Still Don't Know Who The Patsy Is, You're The Patsy.

If You Do Smart Things And Use Leverage And Do One Wrong Thing Along The Way, It Could Wipe You Out, Because Anything Times Zero Is Zero. But It's Reinforcing When The People Around You Are Doing It Successfully, You're Doing It Successfully, And It's A Lot Like Cinderella At The Ball.

An Ounce Of Prevention Is Worth A Pound Of Cure Understated.

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

I Understand Goldman Sachs Businesses. We Do Lot Of Business With Him, And Ge Has Been - I Think It's The Longest Running Stock In The Dow Jones Industrial Average. It Will Be 100 Years Now It Will Be Around. I Hope I'm Around Then, Too. And It Was An Attractive Investment. And We Have Had A Lot Of Money Around, Over The Last Two Years, And We're Seeing Things That Are Attractive Now.

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

I Just Think That - When A Country Needs More Income And We Do, We're Only Taking In 15 Percent Of Gdp, I Mean, That - That - When A Country Needs More Income, They Should Get It From The People That Have It.

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

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.

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

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

It Isn't Given To Man To Be Able To Run A Financial Institution Where Different Interest-rate Scenarios Will Prevail On All Of That So As To Produce Kind Of Smooth, Regular Earnings From A Very Large Base To Start With.

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.

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.

I Think You'll Have Plenty Of Scrutiny As How The Money's Invested. I Mean, Just Like The Rfc. When The Rfc Operated, People Knew Which Institutions They Were Buying Preferred Stock In. And It Worked Very Well.

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?

When People Tell Me They've Learned From Experience, I Tell Them The Trick Is To Learn From Other People's Experience.

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.

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

Investing Money

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.

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.

In The Great Majority Of Cases We Simply Do Not Know Enough About The Industry Or Company To Come To Sensible Judgments-in That Situation We Pass.

Cash Never Makes Us Happy, But It's Better To Have The Money Burning A Hole In Berkshire's Pocket Than Resting Comfortably In Someone Else's.

When We Own Portions Of Outstanding Businesses With Outstanding Managements, Our Favorite Holding Period Is Forever.

Investing Money

When Forced To Choose, I Will Not Trade Even A Night's Sleep For The Chance Of Extra Profits.

A Great Investment Opportunity Occurs When A Marvelous Business Encounters A One-time Huge, But Solvable Problem.

The Best Education You Can Get Is Investing In Yourself, And That Doesn't Mean College Or University.

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

Investing Money

When Berkshire Buys Common Stock, We Approach The Transaction As If We Were Buying Into A Private Business.

The Dumbest Reason In The World To Buy A Stock Is Because It's Going Up.

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.

Only Buy Something That You'd Be Perfectly Happy To Hold If The Market Shut Down For 10 Years.

I Sent One E-mail In My Life. I Sent It To Jeff Raikes At Microsoft, And It Ended Up In Court In Minneapolis, So I Am One For One.

Knowing The Edge Of Your Competency Is Important. If You Think You Know More Than You Do, You Will Get In Trouble.

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.

The First Rule Is Not To Lose. The Second Rule Is Not To Forget The First Rule.

I Look At Everything. That's My Job. I Really Do, Every Day. I Think About Everything.

During Inflation, Goodwill Is The Gift That Keeps On Giving.

Mental Toughness

I'm Putting All My Money In The Chinese Toy Market.

One’s Objective Should Be To Get It Right, Get It Quick, Get It Out And Get It Over. Your Problem Won’t Improve With Age.

I Make Plenty Of Mistakes And I'll Make Plenty More Mistakes, Too. That's Part Of The Game. You've Just Got To Make Sure That The Right Things Overcome The Wrong Ones.

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

That's The Reality Of What They're Going To Sell Them To The Treasury For.

Beware [of] The Investment Activity That Produces Applause; The Great Moves Are Usually Greeted By Yawns.

The Smarter The Journalists Are, The Better Off Society Is. For To A Degree, People Read The Press To Inform Themselves - And The Better The Teacher, The Better The Student Body.

Getting Fired Can Produce A Particularly Bountiful Payday For A Ceo. Indeed, He Can 'earn' More In That Single Day, While Cleaning Out His Desk, Than An American Worker Earns In A Lifetime Of Cleaning Toilets. Forget The Old Maxim About Nothing Succeeding Like Success: Today, In The Executive Suite, The All-too-prevalent Rule Is That Nothing Succeeds Like Failure.

I Know The Country Works Extremely Well. You Know, But When It Isn't Clogged Up.

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 You Are A Professional And Have Confidence, Then I Would Advocate Lots Of Concentration.

Have Confidence

The Smartest Side To Take In A Bidding War Is The Losing Side.

I Tell College Students, When You Get To Be My Age You Will Be Successful If The People Who You Hope To Have Love You, Do Love You.

I'll Tell You Why I Like The Cigarette Business. It Cost A Penny To Make. Sell It For A Dollar. It's Addictive. And There's A Fantastic Brand Loyalty.

I Have No Idea On Timing. It’s Easier To Tell What Will Happen Than When It Will Happen. I Would Say That What Is Going On In Terms Of Trade Policy Is Going To Have Very Important Consequences.

The Greatest Investment A Young Person Can Make Is In Their Own Education, In Their Own Mind. Because Money Comes And Goes. Relationships Come And Go. But What You Learn Once Stays With You Forever.

[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).

Let Blockheads Read What Blockheads Wrote.

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

That Goes Back To 1932, Although It Was Really Implemented In '33 Under Jesse Jones, And It Invested In Mostly Banks Initially And Preferred Stock And That Sort Of Thing. So There Are Two Things Needed In The System, The One That's Needed Overwhelmingly Is Liquidity. I Mean, When People Are Trying To [unintelligible], There Has To Be Somebody There To Buy.

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.

Look For 3 Things In A Person. Intelligence, Energy, & Integrity. If They Don't Have The Last One, Don't Even Bother With The First Two.

Never Lie Under Any Circumstances.

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.

I Mean, Hank Paulson Is In There [ Treasury] At The Wrong Time, Probably Shouldn't Have Taken The Job. He's A Friend Of Mine. But He Knows Markets, He Knows Corporations' Work, He Knows Money, And He's Got The Interests Of The Country At Heart.

Your Money Can Be Inflated Away But Your Knowledge And Talent Cannot.

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

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

You Pay A Very High Price In The Stock Market For A Cheery Consensus.

The Future Is Never Clear; You Pay A Very High Price In The Stock Market For A Cheery Consensus. Uncertainty Actually Is The Friend Of The Buyer Of Long-term Values.

A Stock Doesn't Know That You Own It.

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

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 Best Business Returns Are Usually Achieved By Companies That Are Doing Something Quite Similar Today To What They Were Doing Five Or Ten Years Ago.

In A Commodity Business, It's Very Hard To Be Smarter Than Your Dumbest Competitor.

Buy A Cross Section Of American Industry, And If A Cross Section Of American Industry Doesn't Work, Certainly Trying To Pick The Little Beauties Here And There Isn't Going To Work Either.

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

Intensity Is The Price Of Excellence.

Valuing A Business Is Part Art And Part Science.

I Think You Are Out Of Your Mind If You Keep Taking Jobs That You Don't Like Because You Think It Will Look Good On Your Resume. Isn't That A Little Like Saving Up Sex For Your Old Age?

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.

Investing In Yourself Is The Best Thing You Can Do. If You've Got Talents, No One Can Take Them From You.

Problems In A Company Are Like Cockroaches In The Kitchen. You Will Never Find Just One

I Try To Buy Stock In Businesses That Are So Wonderful That An Idiot Can Run Them. Because Sooner Or Later, One Will.

Investing Money

You Have To Understand Accounting And You Have To Understand The Nuances Of Accounting. It's The Language Of Business And It's An Imperfect Language, But Unless You Are Willing To Put In The Effort To Learn Accounting - How To Read And Interpret Financial Statements - You Really Shouldn't Select Stocks Yourself

In The Long Run Managements Stressing Accounting Appearance Over Economic Substance Usually Achieve Little Of Either.

In One Way, I'm Sympathetic To The Institutional Reluctance To Face The Music. I'd Give A Lot To Mark My Weight To 'model' Rather Than To 'market.'

Larger Sums May Be An Advantage At Some Cases And A Disadvantage At Others.

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

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

I Did Not Think I Would See The Day When, You Know, An Aig Would Not Be Able To Have Its Checks Clear.

In Our View, Derivatives Are Financial Weapons Of Mass Destruction Carrying Dangers That, While Latent, Are Potentially Lethal.

Mass Destruction

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.

It's Never Paid To Bet Against America.

[people] Have Seen The Credit Market Seize Up. They're Worried About Money Market Funds, Although The Latest Proposition From Government Should Take Care Of That. They've Seen Eight Percent Of The Bank Deposits In The United States Get Moved Very Skillfully, I Might Say, Within The Last Couple Of Weeks From Institutions That They Thought Were Fine A Few Months Ago To Other Institutions. They Are Not Wrong To Be Worried.

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

Writing A Check Separates A Commitment From A Conversation.

I Would Rather Sustain The Penalties Resulting From Over-conservatism Than Face The Consequences Of Error, Perhaps With Permanent Capital Loss, Resulting From The Adoption Of "new Era" Philosophy Where Trees Really Do Grow To The Sky.

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

Investors Should Remember That Their Scorecard Is Not Computed Using Olympic-diving Methods: Degree-of-difficulty Doesn't Count. If You Are Right About A Business Whose Value Is Largely Dependent On A Single Key Factor That Is Both Easy To Understand And Enduring, The Payoff Is The Same As If You Had Correctly Analyzed An Investment Alternative Characterized By Many Constantly Shifting And Complex Variables.

I Don't Think It Would Be Crazy To Have A Model Or An Entity Model On The Reconstruction Finance Corp.

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

By Periodically Investing In An Index Fund, The Know-nothing Investors Can Actually Outperform Most Investment Professionals.

If You Have A Great Manager, You Want To Pay Him Very Well.

Part Of Making Good Decisions In Business Is Recognizing The Poor Decisions You've Made And Why They Were Poor. I've Made Lots Of Mistakes. I'm Going To Make More. It's The Name Of The Game. You Don't Want To Expect Perfection In Yourself. You Want To Strive To Do Your Best. It's Too Demanding To Expect Perfection In Yourself.

If I Taught A Class, On My Final Exam I Would Take An Internet Company And Ask, 'how Much Is This Company Worth?' Anyone Who Would Answer, I Would Flunk.

The Key To Investing Is Not Assessing How Much An Industry Is Going To Affect Society, Or How Much It Will Grow, But Rather Determining The Competitive Advantage Of Any Given Company And, Above All, The Durability Of That Advantage.

The Obligation Of A Society As Prosperous As Ours Is To Figure Out How Nobody Gets Left Too Far Behind.

What The Human Being Is Best At Doing Is Interpreting All New Information So That Their Prior Conclusions Remain Intact.

The Much-maligned Idle Rich Have Received A Bad Rap: They Have Maintained Their Wealth While Many There Is Scarcely An Instance Of A Man Who Has Made A Fortune By Speculation And Kept It. Andrew Carnegie Of The Energetic Rich, Aggressive Real Estate Operators, Corporate Acquirers, Oil Drillers, Etc. Have Their Fortunes Disappear.

The Ability To Say No Is A Tremendous Advantage For An Investor.

We Say We Are Trying To Buy Into Businesses With Excellent Economics, Run By Honest And Able People At A Decent Price. We Buy Very Few Securities, So We Look At It As "focused" Investing.

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

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.

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

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

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

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.

... The Best Way To Own Common Stocks Is Through An Index Fund.

Active Management

Our Leaders Have Asked For “shared Sacrifice.” But When They Did The Asking, They Spared Me. I Checked With My Mega-rich Friends To Learn What Pain They Were Expecting. They, Too, Were Left Untouched.

I Checked The Actuarial Tables, And The Lowest Death Rate Is Among Six-year-olds. So I Decided To Eat Like A Six-year-old.

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.

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

I've Never Been Very Fully Employed Either.

Investment Students Need Only Two Well-taught Courses - How To Value A Business And How To Think About Market Prices

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

Economic Medicine That Was Previously Meted Out By The Cupful Has Recently Been Dispensed By The Barrel. These Once Unthinkable Dosages Will Almost Certainly Bring On Unwelcome After-effects. Their Precise Nature Is Anyone's Guess, Though One Likely Consequence Is An Onslaught Of Inflation.

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