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Long Ago, Ben Graham Taught Me That "price Is What You Pay; Value Is What You Get." Whether We're Talking About Socks Or Stocks, I Like Buying Quality Merchandise When It Is Marked Down.

-Warren Buffett

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Long Ago, Ben Graham

Warren Buffett

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Long Ago, Ben Graham Taught Me That "price Is What You Pay; Value Is What You Get." Whether We're Talking About Socks Or Stocks, I Like Buying Quality Merchandise When It Is Marked Down.

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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.

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If You Aren't Willing To Own A Stock For Ten Years, Don't Even Think About Owning It For Ten Minutes. Put Together A Portfolio Of Companies Whose Aggregate Earnings March Upward Over The Years, And So Also Will The Portfolio's Market Value.

I Mean, If Pearl Harbor Came Along, You Could Have Said The Planning Was Wrong By The Military Ahead Of Time Or Maybe The Battleships Shouldn't Have All Been In The Harbor And All That Kind Of Thing.

If You Can't Read The Scoreboard. You Don't Know The Score. If You Don't Know The Score, You Can't Tell The Winners From The Losers.

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

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

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.

Learning How To Live Is Much More Important Than Learning How To Make A Living.

Inspirational Life

Never Test The Depth Of River With Both The Feet.

The Rest Of The World Really Likes Our Stuff Pretty Well. It's Just We Buy So Damn Much Of What They Produce.

If Knowing History Made You Rich, Librarians Would Be Billionaires.

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.

I've Argued With The Senators And Congressmen I've Talked To. You Don't Want To Be Too Little Too Late. If You Buy Them At The Right Price, You May Be Buying Two Trillion Of Face Value.

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.

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

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.

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

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.

The Power Of Unconditional Love. I Mean, There Is No Power On Earth Like Unconditional Love.

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

If I Were The Treasury Secretary Or Head Of The Fed, You Know, I Would Try To Scare The Hell The Out Of The Private Sector And Say, You Better Save This Because You're Going Down With The Ship.

I Buy Expensive Suits - They Just Look Cheap On Me.

In Economics, You Always Want To Ask 'and Then What?'

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

You Don't Need To Be An Expert In Order To Achieve Satisfactory Investment Returns. But If You Aren't, You Must Recognize Your Limitations And Follow A Course Certain To Work Reasonably Well. Keep Things Simple And Don't Swing For The Fences.

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

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

We're Still In A Recession. We're Not Gonna Be Out Of It For A While, But We Will Get Out.

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.

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.

You're Neither Right Nor Wrong Because Other People Agree With You. You're Right Because Your Facts Are Right And Your Reasoning Is Right - That's The Only Thing That Makes You Right. And If Your Facts And Reasoning Are Right, You Don't Have To Worry About Anybody Else.

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

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

The Trick Is, When There Is Nothing To Do, Do Nothing.

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

What We Really Want To Do Is Buy Businesses That We Would Be Happy To Own Forever.

When You Build A Bridge, You Insist That It Can Carry 30,000 Pounds, But You Only Drive 10,000-pound Trucks Across It. And That Same Principle Works In Investing.

At This Point, When Treasury Bills, Seven Day Treasury Bills At 1/20th Of One Percent, It's Not Because People Want To Earn 1/20th Of One Percent, It's Because They Trust The Fact The Treasury Will Give It Back To Them Next Week.

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.

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

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.

Investing In A Market Where People Believe In Efficiency Is Like Playing Bridge With Someone Who Has Been Told It Doesn't Do Any Good To Look At The Cards.

We've Long Felt That The Only Value Of Stock Forecasters Is To Make Fortune Tellers Look Good. Even Now, Charlie And I Continue To Believe That Short-term Market Forecasts Are Poison And Should Be Kept Locked Up In A Safe Place, Away From Children And Also From Grown-ups Who Behave In The Market Like Children.

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

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.

I Have Pledged - To You, The Rating Agencies And Myself - To Always Run Berkshire With More Than Ample Cash. We Never Want To Count On The Kindness Of Strangers In Order To Meet Tomorrow's Obligations. When Forced To Choose, I Will Not Trade Even A Night's Sleep For The Chance Of Extra Profits.

In The Business World, The Rearview Mirror Is Always Clearer Than The Windshield.

I Think You Should Read Everything You Can. In My Case, By The Age Of 10, I'd Read Every Book In The Omaha Public Library About Investing, Some Twice. You Need To Fill Your Mind With Various Competing Thoughts And Decide Which Make Sense.

I View Derivatives As Time Bombs, Both For The Parties That Deal In Them And The Economic System.

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

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

Most People Get Interested In Stocks When Everyone Else Is. The Time To Get Interested Is When No One Else Is. You Can't Buy What Is Popular And Do Well.

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Activity Is The Enemy Of Investment Returns.

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

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

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.

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.

It's Better To Hang Out With People Better Than You. Pick Out Associates Whose Behavior Is Better Than Yours And You'll Drift In That Direction.

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The Most Important Quality For An Investor Is Temperament, Not Intellect. You Need A Temperament That Neither Derives Great Pleasure From Being With The Crowd Or Against The Crowd.

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

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?

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.

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.

The Truth Is, Everything That Has Happened In My Life... That I Thought Was A Crushing Event At The Time, Has Turned Out For The Better.

I'm Not Worried They're All About The Investments We Make. I Mean, Listen, This Country - We've Got $46,000 Or $47,000 Of Gdp Per Capita. Now, We've Done Pretty Darn Well. We'll Do Better In The Future.

The Worst Sort Of Business Is One That Grows Rapidly, Requires Significant Capital To Engender The Growth, And Then Earns Little Or No Money. Think Airlines. Here A Durable Competitive Advantage Has Proven Elusive Ever Since The Days Of The Wright Brothers. Indeed, If A Farsighted Capitalist Had Been Present At Kitty Hawk, He Would Have Done His Successors A Huge Favor By Shooting Orville Down.

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.

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

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Intensity Is The Price Of Excellence.

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

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

An Irresistable Footnote: In 1971, Pension Fund Managers Invested A Record 122% Of Net Funds Available In Equities - At Full Prices They Couldn't Buy Enough Of Them. In 1974, After The Bottom Had Fallen Out, They Committed A Then Record Low Of 21% To Stocks.

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

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

When It's Raining Gold, Reach For A Bucket, Not A Thimble.

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.

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

I've Never Been Very Fully Employed Either.

They Say The Chains Of Habit Are Too Light To Be Felt Until They Are Too Heavy To Be Broken. The Chains You Put Around Yourself Now Have Enormous Consequences As You Go Through Life.

He Must Never Forget Charlie's Plea: Tell Me Where I'm Going To Die, So I'll Never Go There.

I Asked Him What He Wanted To Do For His Career, And He Replied That He Wanted To Go Into A Particular Field, But Thought He Should Work For Mckinsey For A Few Years First To Add To His Resume. To Me That's Like Saving Sex For Your Old Age. It Makes No Sense.

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.

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

I Have No Use Whatsoever For Projections Or Forecasts. They Create An Illusion Of Apparent Precision. The More Meticulous They Are, The More Concerned You Should Be. We Never Look At Projections, But We Care Very Much About, And Look Very Deeply At, Track Records. If A Company Has A Lousy Track Record, But A Very Bright Future, We Will Miss The Opportunity.

If Principles Can Become Dated, They're Not Principles.

Managers Thinking About Accounting Issues Should Never Forget One Of Abraham Lincoln's Favorite Riddles: How Many Legs Does A Dog Have, If You Call A Tail A Leg? The Answer: Four, Because Calling A Tail A Leg Doesn't Make It A Leg.

Buy Companies With Strong Histories Of Profitability And With A Dominant Business Franchise.

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

You’d Get Very Rich If You Thought Of Yourself As Having A Card With Only Twenty Punches In A Lifetime, And Every Financial Decision Used Up One Punch. You’d Resist The Temptation To Dabble. You’d Make More Good Decisions And You’d Make More Big Decisions.

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

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.

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

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

Business Success

You Don't Need To Be A Rocket Scientist. Investing Is Not A Game Where The Guy With The 160 Iq Beats The Guy With 130 Iq.

Investment Success

I Would Say It's More Important Who The Treasury Secretary Is Than Who The Vice President Is. If You Want To Have A Debate Here, I'd Like A Debate Between Potential Treasury Secretaries Than The Vice Presidential Debate.

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.

With Enough Insider Information And A Million Dollars, You Can Go Broke In A Year.

I Get To Do What I Like To Do Every Single Day Of The Year.

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

The Approach And Strategies Are Very Similar In That You Gather All The Information You Can And Then Keep Adding To That Base Of Information As Things Develop. You Do Whatever The Probabilities Indicated Based On The Knowledge That You Have At That Time, But You Are Always Willing To Modify Your Behaviour Or Your Approach As You Get New Information. In Bridge, You Behave In A Way That Gets The Best From Your Partner. And In Business, You Behave In The Way That Gets The Best From Your Managers And Your Employees.

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.

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

Does Management Resist The Institutional Imperative?

It's A Big Mistake To Try And Mislead People. They Will Turn Around.

I Was Lucky To Have The Right Heroes. Tell Me Who Your Heroes Are And I'll Tell You How You'll Turn Out To Be. The Qualities Of The One You Admire Are The Traits That You, With A Little Practice, Can Make Your Own, And That, If Practiced, Will Become Habit Forming.

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

I've Never Been Very Fully Employed Either But Just Think Of What It's Like, You Know, To Go Home With A Mortgage Payment You Know And Kids And Everything Else. My Dad Had That Happen To Him In The Early '30s.

You Can Lose Leverage, And It's The Only Way A Smart Guy Can Go Broke.

The Best Investment You Can Make Is In Yourself.

Investment Success

The Same Things Happen To Quite An Extent Around The Globe. I Mean, The European Banks Were Doing What The American Banks Were.

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

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

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."

Too Often, A Vast Collection Of Possessions Ends Up Possessing Its Owner. The Asset I Most Value, Aside From Health, Is Interesting, Diverse, And Long-standing Friends.

You Do Things When The Opportunities Come Along. I've Had Periods In My Life When I've Had A Bundle Of Ideas Come Along, And I've Had Long Dry Spells. If I Get An Idea Next Week, I'll Do Something. If Not, I Won't Do A Damn Thing.

Investing Money

Outstanding Long-term Results Are Produced Primarily By Avoiding Dumb Decisions, Rather Than By Making Brilliant Ones.

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.

Taking Jobs To Build Up Your Resume Is The Same As Saving Up Sex For Old Age.

Goldman Sachs Saying They Might Be Interested In Such An Investment. I'm Familiar With The Company. I've Known The Management, The Current Management, Jack Welch Before Jeff Immelt. I've Known Him For Decades.

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

We All Make Mistakes. If You Can't Make Mistakes, You Can't Make Decisions. I've Made A Lot Bigger Mistakes Myself.

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

I Think The Most Important Factor In Getting Out Of The Recession Actually Is Just The Regenerative Capacity Of - Of American Capitalism.

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.

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

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

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.

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.

If You Cannot Control Your Emotions, You Cannot Control Your Money.

Risk Can Be Greatly Reduced By Concentrating On Only A Few Holdings.

There Is No Question We Have An Access Stock.

We Try To Exert A Ted Williams Kind Of Discipline. In His Book The Science Of Hitting, Ted Explains That He Carved The Strike Zone Into 77 Cells, Each The Size Of A Baseball. Swinging Only At Balls In His "best" Cell, He Knew, Would Allow Him To Bat .400; Reaching For Balls In His "worst" Spot, The Low Outside Corner Of The Strike Zone, Would Reduce Him To .230. In Other Words, Waiting For The Fat Pitch Would Mean A Trip To The Hall Of Fame; Swinging Indiscriminately Would Mean A Ticket To The Minors.

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.

When Investing, Pessimism Is Your Friend, Euphoria The Enemy.

We've Been In A Recession, By Any Common Sense Definition, Because If You Look At The American Public, They've Got 20 Billion - 20 Trillion, I Should Say, Worth Of Residential Homes.

The Capital Gains Tax Is 15 Percent Now. So I Sit There In My Office And I Make A Lot Of Money By Capital Gains, And I Pay 15 Percent, And I Pay No Payroll Tax On It.

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

It's Good To Learn From Your Mistakes. It's Better To Learn From Other People's Mistakes.

Learn From Your Mistakes

Successful Investing Takes Time, Discipline And Patience. No Matter How Great The Talent Or Effort, Some Things Just Take Time: You Can't Produce A Baby In One Month By Getting Nine Women Pregnant.

Investing Money

Forecasts May Tell You A Great Deal About The Forecaster; They Tell You Nothing About The Future.

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

I Do Know That When I Am 60, I Should Be Attempting To Achieve Different Personal Goals Than Those Which Had Priority At Age 20.

Investing Requires Qualities Of Temperament Way More Than It Requires Qualities Of Intellect.

The Commission Of The Investment Sins Listed Above Is Not Limited To 'the Little Guy.' Huge Institutional Investors, Viewed As A Group, Have Long Underperformed The Unsophisticated Index-fund Investor Who Simply Sits Tight For Decades. A Major Reason Has Been Fees: Many Institutions Pay Substantial Sums To Consultants Who, In Turn, Recommend High-fee Managers. And That Is A Fool's Game.

The Speed At Which A Business Success Is Recognized, Furthermore, Is Not That Important As Long As The Company's Intrinsic Value Is Increasing At A Satisfactory Rate. In Fact, Delayed Recognition Can Be An Advantage: It May Give Us The Chance To Buy More Of A Good Thing At A Bargain Price.

Growth And Value Investing Are Joined At The Hip.

If You Were At Lehman, The Same Thing Happened. If You Were At Aig, The Shareholders Are Getting Creamed On These Things. And Those Shareholders Are Not Just A Bunch Of Big Shots In Wall Street. Those Are Pension Funds, And Those Are Investors All Over The Country. I Wouldn't Worry Too Much About That. Justice Won't Be Perfect On It.

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.

In The World Of Business, The People Who Are Most Successful Are Those Who Are Doing What They Love.

Investment 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.

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

So Some Guy May Know How To Make Money In Cocoa Beans, But I Don't So I Just Let Him Have That. But It's Got To Be Something I Understand. It's Got To Be A Business With Fundamentally Good Economics. It's Got To Be A Management That I Like And Trust And Admire. And It's Got To Be A Price That Makes Sense.

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

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

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.

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

Measure Of Success

I Spend Twelve Hours A Week - A Little Over 10% Of My Waking Hours - Playing The Game. Now I Am Trying To Figure Out How To Get By On Less Sleep In Order To Fit In A Few More Hands.

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

Words Of Wisdom

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

Investment Philosophy Is The Clear Understanding That By Owning Shares Of Stocks He Owns Businesses, Not Pieces Of Paper.

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 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.

I Think The Oversight Is Great, And I Think That Oversight Ought To Be Devoted Almost Entirely To The Question Is This Being Done At Market You Know. In Other Words, You Want To Make Sure That The Government Isn't Investing Foolishly. But You Don't Want To Care About Which Congressional Districts It Goes To Or Whether Banks Get Favored Over.

We Have To Live With The Rest Of The World. And It's A Mistake, In My View. Trade Has Generally Developed In This Country. We Actually Export 12 Or 13 Percent Of Our Gdp. It Was Only 5 Percent In 1970. But It Benefits Us. It Benefits The Rest Of The World. It Doesn't Benefit The Steelworker Maybe In Ohio. And That's The Problem That Has To Be Addressed, Because When You Have Something That's Good For Society, But Terribly Harmful For Given Individuals, We Have Got To Make Sure Those Individuals Are Taken Care Of.

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

You Don't Have To Be A Genius To Invest Well

The Strategy We've Adopted Precludes Our Following Standard Diversification Dogma. Many Pundits Would Therefore Say The Strategy Must Be Riskier Than That Employed By More Conventional Investors. We Disagree. We Believe That A Policy Of Portfolio Concentration May Well Decrease Risk If It Raises, As It Should, Both The Intensity With Which An Investor Thinks About A Business And The Comfort-level He Must Feel With Its Economic Characteristics Before Buying Into It.

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

[economy] Is Flat On The Floor, And The Paramedics Have Arrived. And They Shouldn't Argue About Whether They Put The Resuscitation Equipment A Quarter Of An Inch This Way Or A Quarter Of An Inch This Way, Or They Shouldn't Start Criticizing The Patient, Because He Didn't Have A Blood Pressure Test Or Something Like That. They Should Do What's Needed Right Now.

There's Not Many Businesses Where Someone Can Come In And Offer To Cut The Price In Half And Somebody Doesn't Think About Shifting. But That's The Nature Of The Ratings Business.

I’ve Worked In An Economy That Rewards Someone Who Saves The Lives Of Others On A Battlefield With A Medal, Rewards A Great Teacher With Thank-you Notes From Parents, But Rewards Those Who Can Detect The Mispricing Of Securities With Sums Reaching Into The Billions.

We Don't Get Paid For Activity, Just For Being Right. As To How Long We'll Wait, We'll Wait Indefinitely.

In My Opinion, The Entire Field Of Investment Management, Involving Hundreds Of Billions Of Dollars, Would Be More Satisfactorily Conducted If Everyone Had A Good Yardstick For Measurement Of Ability And Sensibly Applied It.

Well, One Time Some Attractive Woman Sat Next To Charlie And Asked Him What He Owed His Success To, And, Unfortunately, She Insisted On A One Word Answer. He Had A Speech Prepared That Would Have Gone On For Several Hours. But When Forced To Boil It Down To One Word, He Said That Was "rational". You Know, He Comes Equipped For Rationality, And He Applies It In Business. He Doesn't Always Apply It Elsewhere, But He Applies It In Business And That Has Made Him A Huge Business Success.

Business Success

An Investor Should Ordinarily Hold A Small Piece Of An Outstanding Business With The Same Tenacity That An Owner Would Exhibit If He Owned All Of That Business.

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

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

You Can't Produce A Baby In One Month By Getting Nine Women Pregnant.

Investing Money

A Ceo's Behavior Has A Huge Impact On Managers Down The Line.

The Best Thing I Did Was Choose The Right Heroes.

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.

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.

I Think I Could Make You Fifty Percent A Year On One Million Dollars. No, I Know I Could. I Guarantee That.

Guarantees That

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.

On His Giving Pledge Philanthropy: The Way I Got The Message Out Was To Get A Copy Of Forbes, Look Down That 400 List And Start Making Phone Calls! Bill And Melinda [gates] Did The Same Thing. So Keep Publishing The List So I Can Milk It.

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.

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.

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

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

I Do Not Like Debt And Do Not Like To Invest In Companies That Have Too Much Debt, Particularly Long-term Debt. With Long-term Debt, Increases In Interest Rates Can Drastically Affect Company Profits And Make Future Cash Flows Less Predictable.

Be Fearful When The Markets Get Greedy, Be Greedy When The Markets Get Fearful.

It's Far Better To Buy A Wonderful Company At A Fair Price Than A Fair Company At A Wonderful Price.

Investing Money

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Kristin Cavallari

Benigno Aquino III

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