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We Do Not View The Company Itself As The Ultimate Owner Of Our Business Assets But Instead View The Company As A Conduit Through Which Our Shareholders Own Assets.

-Warren Buffett

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We Do Not View

Warren Buffett

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We Do Not View The Company Itself As The Ultimate Owner Of Our Business Assets But Instead View The Company As A Conduit Through Which Our Shareholders Own Assets.

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People Should Always Know Better.

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.

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

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

When 40 Billion Of Treasury Bills Are Sold Like, Seven Day Treasury Bills, At A Yield Of 1/20th Of One Percent, That Means The Whole Country Is Basically At The Point Virtually, Or A Lot Of The Country Is At The Point Of Putting The Money Under The Mattress.

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.

What's Nice About Investing Is You Don't Have To Swing At Every Pitch.

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

The Fed Is The Greatest Hedge Fund In History.

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.

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

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.

It Is More Important To Say "no" To An Opportunity, Than To Say "yes".

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

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.

We're Perfectly Willing To Trade Away A Big Payoff For A Certain Payoff.

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

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.

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.

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.

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

The Stock Market Is A Wonderfully Efficient Mechanism For Transferring Wealth From The Impatient To The Patient.

I Just Don't See Anything Available That Gives Any Reasonable Hope Of Delivering Such A Good Year And I Have No Desire To Grope Around, Hoping To 'get Lucky' With Other People's Money. I Am Not Attuned To This Market Environment, And I Don't Want To Spoil A Decent Record By Trying To Play A Game I Don't Understand Just So I Can Go Out A Hero.

I'm Sitting With Six And A Half Billion Dollars We're Going To Use To Close The Mars-wrigley Deal On October 6. I've Got To Hand Over That Six And A Half Billion On October 6. Now, I Have To Be Very Careful About Who I Leave It In Between Now And Then, Because They're Expecting That He Show Up.

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.

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

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.

A Stock Doesn't Know That You Own It.

I Never Try To Predict The Market.

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

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

Active Management

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

I Have A House That I Bought 55 Years Ago. It's Warm In The Winter; It's Cool In The Summer. It Has Everything I Wanted, Plus It Has All Kinds Of Good Memories. Like My Kids, I Have Good Thoughts About That. I Can't Imagine Living Any Better.

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.

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

Truly Conservative Actions Arise From Intelligent Hypotheses, Correct Facts And Sound Reasoning.

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

I 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

The Important Thing Is To Keep Playing, To Play Against Weak Opponents And To Play For Big Stakes.

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

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

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

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.

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

You Do Not Adequately Protect Yourself By Being Half Awake When Other Are Sleeping.

Money Will Always Flow Toward Opportunity, And There Is An Abundance Of That In America.

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.

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

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

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

I'll Take The Deal, Whatever You Want To Do.

All Day You Wait For The Pitch You Like; Then When The Fielders Are Asleep, You Step Up And Hit It.

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

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

This Country Is Going - Be Living Better Ten Years From Now Than It Is Now. It Will Be Living Better In 20 Years From Now Than Ten Years From Now. The Ingredients That Made This Country, You Know, The Miracle Of The World - I Mean We Had A Seven For One Improvement In The Average American Standard Of Living In The 20th Century.

I've Never Been Very Fully Employed Either.

After 25 Years Of Buying And Supervising A Great Variety Of Businesses, Charlie [munger] And I Have Not Learned How To Solve Difficult Business Problems. What We Have Learned Is To Avoid Them. To The Extent We Have Been Successful, It Is Because We Have Concentrated On Identifying One-foot Hurdles That We Could Step Over Rather Than Because We Acquired Any Ability To Clear Seven-footers.

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.

You Have To Turn Over A Lot Of Rocks To Find Those Little Anomalies. You Have To Find The Companies That Are Off The Map - Way Off The Map. You May Find Local Companies That Have Nothing Wrong With Them At All. A Company That I Found, Western Insurance Securities, Was Trading For $3/share When It Was Earning $20/share!! I Tried To Buy Up As Much Of It As Possible. No One Will Tell You About These Businesses. You Have To Find Them.

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

Inactivity Strikes Us As Intelligent Behavior.

Suppose That An Investor You Admire And Trust Comes To You With An Investment Idea. This Is A Good One, He Says Enthusiastically. I'm In It, And I Think You Should Be, Too.

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

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.

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

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.

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.

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

I Could End The Deficit In 5 Minutes. You Just Pass A Law That Says That Anytime There Is A Deficit Of More Than 3% Of Gdp All Sitting Members Of Congress Are Ineligible For Reelection.

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

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.

If You Have More Than 120 Or 130 I.q. Points, You Can Afford To Give The Rest Away. You Don't Need Extraordinary Intelligence To Succeed As An Investor.

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

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

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

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.

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

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

Always Associate Yourself With People Who Are Better Than You.

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

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.

Buy Stocks Like You Buy Your Groceries, Not Like You Buy Your Perfume.

You Get What I Call The Natural Progression, The Three Is. The Innovators, The Imitators, And The Idiots.

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

Calculate "owner Earnings" To Get A True Reflection Of Value.

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.

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.

Turnarounds Seldom Turn.

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

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.

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

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

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

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

If You Are Not Willing To Own A Stock For 10 Years, Do Not Even Think About Owning It For 10 Minutes.

Emotional Makeup Is More Important Than Technical Skill

We Enjoy The Process Far More Than The Proceeds.

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.

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.

Two Rules: 1. Preserve The Principal 2. When In Doubt, See Rule #1.

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.

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

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

Never Get Too Hung Up On Mistakes.

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.

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

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.

Remember That The Stock Market Is Manic-depressive.

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

Learn From Your Mistakes

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

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.'

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

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.

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

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

American Workers

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.

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

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

Bad Terminology Is The Enemy Of Good Thinking.

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

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

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

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.

Focus On Return On Equity, Not Earnings Per Share.

Working With People Who Cause Your Stomach To Churn Seems Much Like Marrying For Money - Probably A Bad Idea Under Any Circumstances, But Absolute Madness If You Are Already Rich.

I Mean, We'll Be Pounding On The Guy's Chest, You Know, On The Floor, And You Know, He's Not Going To Just Jump Up All Of A Sudden. So It Makes It Tough. I Mean, It's Tough To Be In The Legislature, You Know, And Vote For Something And Then People Say, Well, You Voted All This Money And You Know, It's All Getting Spent. It Isn't Getting Spent. It's Getting Invested. But It's All Getting Spent. Nothing's Happening.

If Past History Was All There Was To The Game, The Richest People Would Be Librarians.

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.

America Should Stand For More Than Just Wealth.

When Bills Come Due, Only Cash Is Legal Tender. Don't Leave Home Without It.

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.

Look At Market Fluctuations As Your Friend Rather Than Your Enemy; Profit From Folly Rather Than Participate In It.

Investment Success

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

My Wealth Has Come From A Combination Of Living In America, Some Lucky Genes, And Compound Interest.

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

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?

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.

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

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

We Need To Throw The Resources At This That Are Necessary. But Like I Say, We Are Not Spending Money. I Mean, If We Buy These Assets Intelligently, The United States Treasury Will Make Money. I Mean, It's Borrowing Money. It's Just A Few Percent A Year.

I Don't Like What's Going On With The Executive Compensation.

Executive Compensation

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

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

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

It Takes 20 Years To Build A Reputation And Five Minutes To Ruin It. If You Think About That, You'll Do Things Differently.

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

Returns Decrease As Motion Increases.

A Single Year's Performance Is Of Minor Importance And, Good Or Bad, Should Never Be Taken Seriously.

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

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

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

If You Don't Know The Jewelry, Know The Jeweller

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

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.

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.

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.

When Asked How He Became So Successful In Investing, Buffett Answered: 'we Read Hundreds And Hundreds Of Annual Reports Every Year.

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 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.

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.

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

Passion For What You Do

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.

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

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.

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

Have Confidence

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

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

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

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

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.

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.

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

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

In The Financial Markets I Find It Easy To Predict What Will Happen And Very Difficult To Predict When It Will Happen. I Think That Things Were Clear During The Bubble As To What Would Happen Eventually.

In Business, I Look For Economic Castles Protected By Unbreachable 'moats'.

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.

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

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.

So If You Are Evaluating Others (or Yourself!) In The Investment Field, Think Out Some Standards - Apply Them - Interpret Them.

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

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

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

I Think Confidence Will Come Back.

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.

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

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

There Are All Kinds Of Businesses That Charlie And I Don't Understand, But That Doesn't Cause Us To Stay Up At Night. It Just Means We Go On To The Next One, And That's What The Individual Investor Should Do.

If The World Couldn't See Your Results, Would You Rather Be Thought Of As The World's Greatest Investor But In Reality Have The World's Worst Record? Or Be Thought Of As The World's Worst Investor When You Were Actually The Best?

It Will Be Good For Us In The Long Run, And I Mean There Are, You Know, Six And A Half Billion People In This World. And It's Great For 300 Million To Keep Enjoying More And More Property, But I Think It's Terrific If, You Know, The Remainder Do.

Valuing A Business Is Part Art And Part Science.

I Always Knew I Was Going To Be Rich. I Don't Think I Ever Doubted It For A Minute.

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

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.

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

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

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

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

I Am Out Of Step With Present Conditions. When The Game Is No Longer Played Your Way, It Is Only Human To Say The New Approach Is All Wrong, Bound To Lead To Trouble, And So On. On One Point, However, I Am Clear. I Will Not Abandon A Previous Approach Whose Logic I Understand ( Although I Find It Difficult To Apply ) Even Though It May Mean Foregoing Large, And Apparently Easy, Profits To Embrace An Approach Which I Don't Fully Understand, Have Not Practiced Successfully, And Which Possibly Could Lead To Substantial Permanent Loss Of Capital.

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

Investing Money

The Most Common Cause Of Low Prices Is Pessimism - Some Times Pervasive, Some Times Specific To A Company Or Industry. We Want To Do Business In Such An Environment, Not Because We Like Pessimism But Because We Like The Prices It Produces. It's Optimism That Is The Enemy Of The Rational Buyer.

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