Background Image

...

That's Been Lost. It's A Huge Problem. What You Have Is You Have The Major Institutions Of The World All Wanting To Deleverage. They Want To Take Down Their Assets And Liabilities. What Seemed So Easy To Borrow Against A Year Ago Now Looks Like Rat Poison To Them. So They're Trying To Deleverage. There Is Only One Institution In The World That Can Leverage Up In A Way That's All A Countervailing Force To That, And That's The United States Treasury.

-Warren Buffett

...

Please Wait....
Translating....

That's Been Lost. It's

Warren Buffett

...

That's Been Lost. It's A Huge Problem. What You Have Is You Have The Major Institutions Of The World All Wanting To Deleverage. They Want To Take Down Their Assets And Liabilities. What Seemed So Easy To Borrow Against A Year Ago Now Looks Like Rat Poison To Them. So They're Trying To Deleverage. There Is Only One Institution In The World That Can Leverage Up In A Way That's All A Countervailing Force To That, And That's The United States Treasury.

Views: 3360

Topic

More From Warren Buffett

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

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

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

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

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

Doing What You Love

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

The Most Dangerous Distractions Are The Ones You Love, But That Don’t Love You Back.

I Have Three Boxes On My Desk: In, Out, And Too Hard.

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.

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

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

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

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

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

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

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.

Nothing Sedates Rationality Like Large Doses Of Effortless Money.

Investing Money

Everybody's Got A Different Circle Of Competence. The Important Thing Is Not How Big The Circle Is. The Important Thing Is Staying Inside The Circle.

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.

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.

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.

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

The Happiest People Do Not Necessarily Have The Best Things. They Simply Appreciate The Things They Have.

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

My Favorite Time Frame For Holding A Stock Is Forever.

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.

Emotional Makeup Is More Important Than Technical Skill

Earnings Can Be Pliable As Putty When A Charlatan Heads The Company Reporting Them.

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.

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

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.

Investing Your Time

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.

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.

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

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.

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.

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

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.

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.

Wall Street Is The Only Place That People Ride To In A Rolls Royce To Get Advice From Those Who Take The Subway.

Investing Money

I'd Rather Have A $10 Million Business Making 15 Per Cent Than A $100 Million Business Making 5 Per Cent.

Enjoy Your Work And Work For Whom You Admire.

The Major Asset In This Category Is Gold, Currently A Huge Favorite Of Investors Who Fear Almost All Other Assets, Especially Paper Money (of Whose Value, As Noted, They Are Right To Be Fearful). Gold, However, Has Two Significant Shortcomings, Being Neither Of Much Use Nor Procreative. True, Gold Has Some Industrial And Decorative Utility, But The Demand For These Purposes Is Both Limited And Incapable Of Soaking Up New Production. Meanwhile, If You Own One Ounce Of Gold For An Eternity, You Will Still Own One Ounce At Its End.

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

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 Purpose Of Life Is To Be Loved By As Many People As Possible Among Those You Want To Have Love You

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.

You Don't Need To Have Extraordinary Effort To Achieve Extraordinary Results. You Just Need To Do The Ordinary, Everyday Things Exceptionally Well.

Everyday Things

I Mean [franklin Delano] Roosevelt Didn't - You Know, When He Came In, He Didn't Print Any Money.

Franklin Delano Roosevelt

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

Never Depend On Single Income. Make Investment To Create A Second Source.

Read Ben Graham And Phil Fisher Read Annual Reports, But Don't Do Equations With Greek Letters In Them.

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

Successful Investing

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.

We Enjoy The Process Far More Than The Proceeds.

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%.

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.

Occasionally, A Man Must Rise Above Principles.

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

Investing Is Not As Tough As Being A Top-notch Bridge Player. All It Takes Is The Ability To See Things As They Really Are.

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.

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.

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

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.

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

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.

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.

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.

It’s Not That I Want Money. It’s The Fun Of Making Money And Watching It Grow.

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

Time Is Your Friend, Impulse Is Your Enemy. Take Advantage Of Compound Interest And Don't Be Captivated By The Siren Song Of The Market.

A Fool And His Money Are Soon Invited Everywhere.

I Mean, They Were Getting The Mortgage Of Some Guy In Omaha, You Know, Securitized A Couple Of Times. I Mean He Had All These - They Had All These Types From Wall Street, You Know, And They Had Advanced Degrees, And They Look Very Alert, And They Came With These - They Came With These Things That Said Gamma And Alpha And Sigma And All That. And All I Can Say Is Beware Of Geeks, You Know, Bearing Formulas. They've Heard That In Europe.

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

Intrinsic Value

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.

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

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

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.

We've Actually Been Pretty Good On Exports. I Mean We Are Exporting 12% Of Our Gdp Now Roughly.

[gold] Gets Dug Out Of The Ground In Africa, Or Someplace. Then We Melt It Down, Dig Another Hole, Bury It Again And Pay People To Stand Around Guarding It. It Has No Utility. Anyone Watching From Mars Would Be Scratching Their Head.

The Investor Of Today Does Not Profit From Yesterday's Growth.

Investing Money

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

If You Want To Soar Like An Eagle In Life, You Can't Be Flocking With The Turkeys.

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

There Is Nothing Like Writing To Force You To Think And Get Your Thoughts Straight.

I Look For Businesses In Which I Think I Can Predict What They're Going To Look Like In Ten To Fifteen Years Time. Take Wrigley's Chewing Gum. I Don't Think The Internet Is Going To Change How People Chew Gum.

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.

Mark Zuckerberg Will Be A Hero To Many Young Entrepreneurs 20 Years From Now. Bill Gates Will Be A Hero To Others, And They Will Look To Those [people] Like I Read Books When I Was In My Teens About Rockefeller Or Carnegie.

Young Entrepreneurs

I Lose Confidence In Other People, All Kinds Of Institutions.

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

Interest Rates Are To Asset Prices What Gravity Is To The Apple. When There Are Low Interest Rates, There Is A Very Low Gravitational Pull On Asset Prices.

A Stock Doesn't Know That You Own It.

I Insist On A Lot Of Time Being Spent, Almost Every Day, To Just Sit And Think. That Is Very Uncommon In American Business. I Read And Think. So I Do More Reading And Thinking, And Make Less Impulse Decisions Than Most People In Business. I Do It Because I Like This Kind Of Life.

There Is One Thing Of Which I Can Assure You. If Good Performance Of The Fund Is Even A Minor Objective, Any Portfolio Encompassing One Hundred Stocks (whether The Manager Is Handling One Thousand Dollars Or One Billion Dollars) Is Not Being Operated Logically. The Addition Of The One Hundredth Stock Simply Can't Reduce The Potential Variance In Portfolio Performance Sufficiently To Compensate For The Negative Effect Its Inclusion Has On The Overall Portfolio Expectation.

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

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

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

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

We Will Prosper Or Suffer In Controlled Investments In Relation To The Operating Performances Of Our Businesses - We Will Not Attempt To Profit By Playing Various Games In The Securities Markets.

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

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

I Prefer Liquor Store Robbers With Hungry Kids To Companies That Locate Offshore To Avoid U.s. Taxes.

To Win, The First Thing You Have To Do Is Not Lose.

Other Guys Read Playboy. I Read Annual Reports.

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

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.

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.

Intrinsic Value

If We Start Deciding, Based On Guesses Or Emotions, Whether We Will Or Won't Participate In A Business Where We Should Have Some Long Run Edge, We're In Trouble.

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

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

Investment Must Be Rational; If You Can't Understand It, Don't Do It.

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.

The Reaction Of Weak Management To Weak Operations Is Often Weak Accounting.

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.

What An Investor Needs Is The Ability To Correctly Evaluate Selected Businesses. Note That Word “selected”: You Don't Have To Be An Expert On Every Company, Or Even Many. You Only Have To Be Able To Evaluate Companies Within Your Circle Of Competence. The Size Of That Circle Is Not Very Important; Knowing Its Boundaries, However, Is Vital.

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

You Have Hedge Funds And People Like That Buying These Assets To Yield 15 Or 20 Percent, I Mean, That's The Buyer For These People That Are Trying To Unload Them.

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

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

Investment Decision Should Be Made On The Basis Of The Most Probable Compounding Of After-tax Net Worth With Minimum Risk.

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

Possessing A Powerful Worldwide Brand Is Essential For Sustained Success.

You Should Look At Stocks As Small Pieces Of Business.

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

We Believe That According The Name 'investors' To Institutions That Trade Actively Is Like Calling Someone Who Repeatedly Engages In One-night Stands A 'romantic.'

If, When Making A Stock Investment, You're Not Considering Holding It At Least Ten Years, Don't Waste More Than Ten Minutes Considering It.

Good Profits Simply Are Not Inconsistent With Good Behavior.

I Was Lucky Enough To Be Born In A Time And Place Where Society Values My Talent, And Gave Me A Good Education To Develop That Talent, And Set Up The Laws And The Finanical System To Let Me Do What I Love Doing-and Make A Lot Of Money Doing It. The Least I Can Do Is Help Pay For All That.

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

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.

Much Success Can Be Attributed To Inactivity. Most Investors Cannot Resist The Temptation To Constantly Buy And Sell.

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

Don't Invest In Pieces Of Papers (stocks), Invest In Great Businesses Underlying Them

This Economy Doesn't Work Well Without The Lubrication Of Credit And Trust.

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

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

Investing Money

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.

A Lot Of Great Fortunes In The World Have Been Made By Owning A Single Wonderful Business. If You Understand The Business, You Don't Need To Own Very Many Of Them.

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

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

Asking For Financial Advice From A Financial Planner Is Like Asking A Barber If You Need A Hair Cut.

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

I Always Say That In Investing You Want To Buy Stock In A Company That Has A Business That's So Good That An Idiot Can Run It, Because Sooner Or Later One Will. We Have A Country Like That.

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

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.

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.

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.

It's Got To Be The Best Intellectual Exercise Out There. You're Seeing Through New Situations Every Ten Minutes. In The Stock Market You Don't Base Your Decisions On What The Market Is Doing, But On What You Think Is Rational. Bridge Is About Weighing Gain/loss Ratios. You're Doing Calculations All The Time.

Forecasts Usually Tell Us More Of The Forecaster Than Of The Forecast

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

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.

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.

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

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

A Hyperactive Stock Market Is The Pickpocket Of Enterprise.

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

There Is No Question That An Important Service Is Provided To Investors By Investment Companies, Investment Advisors, Trust Departments, Etc. This Service Revolves Around The Attainment Of Adequate Diversification, The Preservation Of A Long-term Outlook, The Ease Of Handling Investment Decisions And Mechanics, And Most Importantly, The Avoidance Of The Patently Inferior Investment Techniques Which Seem To Entice Some Individuals.

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

Mental Toughness

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

Does The Business Have A Consistent Operating History?

It's Going To Be Tough Because The Economy Is Going To Be Getting Worse For A While. And It Might Fall Off A Cliff If This Doesn't Pass. But Nobody Will Ever Know That If It Does.

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

I Am Not Worried About The Country. I'm Just Worried About Anything That Gums Up The Potential Of The Country. And Right Now, It's Pretty Gummed Up.

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

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.")

When They Get Their Ego Involved, People Do Things They Shouldn't Do.

We Only Want To Link Up With People Whom We Like, Admire, And Trust. ... We Do Not Wish To Join With Managers Who Lack Admirable Qualities, No Matter How Attractive The Prospects Of Their Business. We've Never Succeeded In Making A Good Deal With A Bad Person.

Let Only Individuals Contribute - With Sensible Limits Per Election. Otherwise, We Are Well On Our Way To Ensuring That A Government Of The Moneyed, By The Moneyed, And For The Moneyed Shall Not Perish From The Earth.

If You Want To Shoot Rare, Fast-moving Elephants, You Should Always Carry A Loaded Gun.

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.

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

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."

Our Favorite Holding Period Is Forever.

Funny Inspirational

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

If You Expect To Be A Net Saver During The Next 5 Years, Should You Hope For A Higher Or Lower Stock Market During That Period? Many Investors Get This One Wrong. Even Though They Are Going To Be Net Buyers Of Stocks For Many Years To Come, They Are Elated When Stock Prices Rise And Depressed When They Fall. This Reaction Makes No Sense. Only Those Who Will Be Sellers Of Equities In The Near Future Should Be Happy At Seeing Stocks Rise. Prospective Purchasers Should Much Prefer Sinking Prices.

All I Have To Do Is Think And Not Be Influenced By Others.

Many Stock Options In The Corporate World Have Worked In Exactly That Fashion: They Have Gained In Value Simply Because Management Retained Earnings, Not Because It Did Well With The Capital In Its Hands.

When Berkshire Hathaway Laid Out Three Billion Dollars For Ge Today, We Didn't Spend It, We Invested It. When The Federal Government Buys The Mortgages, They're Not Spending It, They're Investing It. Now, They're Investing It In Distress Type Assets But They're Buying Them At Distress Prices If They Buy Them At Market. It's The Kind Of Stuff I Love To Do. I Just Don't Have 700 Million. Maybe We Could Go In It Together.

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.

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

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

Investing Money

Buy A Business, Don't Rent Stocks.

The Critical Investment Factor Is Determining The Intrinsic Value Of A Business And Paying A Fair Or Bargain Price.

I Certainly Do Believe Anyone Engaged In The Management Of Money Should Have A Standard Of Measurement, And That Both He And The Party Whose Money Is Managed Should Have A Clear Understanding Why It Is The Appropriate Standard, What Time Period Should Be Utilized, Etc.

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.

We Have Learned To Turn Out Lots Of Goods And Services, But We Haven't Learned As Well How To Have Everybody Share In The Bounty. The Obligation Of A Society As Prosperous As Ours Is To Figure Out How Nobody Gets Left Too Far Behind.

The Stock Market Is Designed To Transfer Money From The Active To The Patient.

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

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

Stocks Of Companies Selling Commodity-like Products Should Come With A Warning Label: "competition May Prove Hazardous To Human Wealth".

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

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

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. I've Never Borrowed A Significant Amount Of Money In My Life. Never. Never Will. I've Got No Interest In It.

[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.

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

Too Often, A Vast Collection Of Possessions Ends Up Possessing Its Owner.

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

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

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

Trending Author

Michael P. Anderson

Category