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Would Your Reply Possibly Be This? Well, It All Depends On What My Tax Rate Will Be On The Gain You're Saying We're Going To Make. If The Taxes Are Too High, I Would Rather Leave The Money In My Savings Account, Earning A Quarter Of 1 Percent. Only In Grover Norquist's Imagination Does Such A Response Exist.

-Warren Buffett

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Would Your Reply Possibly

Warren Buffett

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Would Your Reply Possibly Be This? Well, It All Depends On What My Tax Rate Will Be On The Gain You're Saying We're Going To Make. If The Taxes Are Too High, I Would Rather Leave The Money In My Savings Account, Earning A Quarter Of 1 Percent. Only In Grover Norquist's Imagination Does Such A Response Exist.

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

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.

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

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

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.

I Do Not Believe In Inheriting Your Position In Society Based On Which Womb You Come From... I Think A Rich Person Should Leave His Children Enough So They Can Do Anything, But Not Enough So They Can Do Nothing.

Accounting Is The Language Of Business.

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

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

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.

People Always Ask Me Where They Should Go To Work, And I Always Tell Them To Go To Work For Whom They Admire The Most.

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

Franklin Delano Roosevelt

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.

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

We Still Find Very Few [stocks] That Even Mildly Interest Us. That Dismal Fact Is Testimony To The Insanity Of Valuations Reached During The Great Bubble. Unfortunately, The Hangover May Prove To Be Proportional To The Binge.

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

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

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

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 Annual Reports Of The Company I'm Looking At And I Read The Annual Reports Of The Competitors - That Is The Main Source Of Material.

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

Successful Investing

It's Easier To Create Money Than To Spend It.

Returns Decrease As Motion Increases.

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

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

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

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

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

First Come The Innovators, Then Come The Imitators, Then Come The Idiots.

I May Have More Money Than You, But Money Doesn't Make The Difference. If There Is Any Difference Between You And Me, It May Simply Be That I Get Up And Have A Chance To Do What I Love To Do, Every Day. If You Learn Anything From Me, This Is The Best Advice I Can Give You.

Success Is Having People Love You That You Want To Have Love You.

The Best Thing I Did Was Choose The Right Heroes.

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.

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

Words Of Wisdom

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

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 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.

We Are In Effect Making A - To Some Extent, Making A Choice Between Future Inflation And Getting Our - Getting Off The Floor. And We're Likely - We're Likely To Have More Inflation In The Future As A Consequence Of The Things We Do To Fight The Present Situation.

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.

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

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 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.

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.

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

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.

If You Owe Money, You Can't Pay Them Out. You Just Pay For Everything, You Do Smart Things, You Eventually Get Very Rich.

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

Be Brave When Others Are Afraid, And Afraid When Others Are Brave.

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.

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'?

Gold Is A Way Of Going Long On Fear, And It Has Been A Pretty Good Way Of Going Long On Fear From Time To Time. But You Really Have To Hope People Become More Afraid In A Year Or Two Years Than They Are Now. And If They Become More Afraid You Make Money, If They Become Less Afraid You Lose Money, But The Gold Itself Doesn’t Produce Anything.

I Made My First Investment At Age Eleven. I Was Wasting My Life Up Until Then.

My Idea Of A Group Decision Is To Look In The Mirror.

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

Emotional Makeup Is More Important Than Technical Skill

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

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

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

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

It Is Madness To Risk Losing What You Need In Pursuing What You Simply Desire.

The Key To Success Is Emotional Stability.

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

Just Imagine Living On 21,000 A Year. I Mean You Have 20 Percent Of The Population Doing That. So You Don't Have To Worry About Guys Like Me.

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

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.

I Think People - What People Want To Do Is Make [economy] Get Worse.

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

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.

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

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

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?

Traditional Wisdom Is Long On Tradition And Short On Wisdom.

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

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

The Most Important Quality For An Investor Is Temperament, Not Intellect.

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.

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

All There Is To Investing Is Picking Good Stocks At Good Times And Staying With Them As Long As They Remain Good Companies.

The Stock Market Is A No-called-strike Game. You Don’t Have To Swing At Everything – You Can Wait For Your Pitch.

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

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

You Can't Make A Good Deal With A Bad Person.

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

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

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.

If You Don't Make Mistakes You Can't Make Decisions.

If You Own The Only Newspaper In Town, Up Until The Last Five Years Or So, You Have Pricing Power And You Didn't Have To Go To The Office.

To Be Successful, You Should Concentrate On The World Of Companies, Not Arcane Accounting Mathematics.

It's Never Paid To Bet Against America.

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.

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

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

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

[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.

We've Got All The Ingredients For A Sensational Future.

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

Charlie And I Decided Long Ago That In An Investment Lifetime, It's Too Hard To Make Hundreds Of Smart Decisions. That Judgment Became Ever More Compelling As Berkshire's Capital Mushroomed And The Universe Of Investments That Could Significantly Affect Our Results Shrank Dramatically. Therefore, We Adopted A Strategy That Required Our Being Smart And Not Too Smart At That, Only A Very Few Times. Indeed, We Now Settle For One Good Idea A Year.

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

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.

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

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

The 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.

Intensity Is The Price Of Excellence.

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.

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

Never Invest In A Business You Don't Understand.

When We Really Sit Back With A Smile On Our Face Is When We Run Into A Situation We Can Understand, Where The Facts Are Ascertainable And Clear, And The Course Of Action Obvious.

You Should Invest Like A Catholic Marries: For Life.

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

Let Blockheads Read What Blockheads Wrote.

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.

We're Paying Maybe 25 Percent Of The Income Tax, But The Payroll Tax Is Over A Third Of The Receipts Of The Federal Government. And They Don't Take That From Me On Capital Gains. They Don't Take That From Me On Dividends.

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.

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

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

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

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.

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

You Shouldn't Own Common Stocks If A 50 Per Cent Decrease In Their Value In A Short Period Of Time Would Cause You Acute Distress.

Investing Your Time

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

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

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.

I Mean, You Can Explain The Fact That These Are Depressed Prices, You Know. We Think These Assets Are Going To Be Worth A Lot More. And I Think That Case Can Be Made In Certain Situations. But I Think To Just Say, You Know, We're Going To Say A Dollar Of Cash Is Worth $2 All Of A Sudden, It Isn't Worth $2. It's Worth A Dollar Today.

Money Will Not Change How Healthy You Are Or How Many People Love You.

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

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.

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

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.

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

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

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

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.'

For Example: (1) As If Governed By Newton's First Law Of Motion, An Institution Will Resist Any Change In Its Current Direction; (2) Just As Work Expands To Fill Available Time, Corporate Projects Or Acquisitions Will Materialize To Soak Up Available Funds; (3) Any Business Craving Of The Leader, However Foolish, Will Be Quickly Supported By Detailed Rate-of-return And Strategic Studies Prepared By His Troops; And (4) The Behavior Of Peer Companies, Whether They Are Expanding, Acquiring, Setting Executive Compensation Or Whatever, Will Be Mindlessly Imitated.

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.

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.

In Some Corner Of The World They Are Probably Still Holding Regular Meetings Of The Flat Earth Society. We Derive No Comfort Because Important People, Vocal People, Or Great Numbers Of People Agree With Us. Nor Do We Derive Comfort If They Don't.

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.

Having First Rate People On The Team Is More Important Than Designing Hierarchies And Clarifying Who Reports To Whom.

Can You Know You Can Have Institutions That Put Curbs On That In Various Ways, And Actually What The Banks, You Know, They Have Various Capital Ratios And That Sort Of Thing, But The Banks Got Around Them, I Mean, They Set Up Sieves And That Sort Of Thing Just To Get More Leverage. People Love Leverage When It's Working. I Mean, It's So Easy To Borrow Money From A Guy At X And Put It Out At X.

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.

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

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

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 Can Eliminate The Government As A 39.6% Partner, Then You Will Be Much Better Off.

The Active Investors Will Have Their Returns Diminished By A Far Greater Percentage Than Will Their Inactive Brethren. That Means That The Passive Group - The "know-nothings" - Must Win.

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.

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.

In The Insurance Business, There Is No Statute Of Limitation On Stupidity.

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.

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.

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.

Is Management Candid With The Shareholders?

I Think That Trying To Invest Through 535 People Is A Tough Job, You Know, And So I Would Give More Latitude.

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

Fund Consultants Like To Require Style Boxes Such As "long-short," "macro," "international Equities." At Berkshire Our Only Style Box Is "smart."

When A Management With Reputation For Brilliance Gets Hooked Up With A Business With A Reputation For Bad Economics, It's The Reputation Of The Business That Remains Intact.

There Is No Question We Have An Access Stock.

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

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

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.

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

Active Management

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

Too Often, Executive Compensation In The U.s. Is Ridiculously Out Of Line With Performance. That Won't Change, Moreover, Because The Deck Is Stacked Against Investors When It Comes To The Ceo's Pay.

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.

I Have An 800 Freephone Number Now That I Call If I Get The Urge To Buy An Airline Stock. I Call At Two In The Morning And I Say: "my Name Is Warren And I'm An Aeroholic." And Then They Talk Me Down.

I Am A Better Investor Because I Am A Businessman, And A Better Businessman Because I Am No Investor.

Of The Billionaires I Have Known, Money Just Brings Out The Basic Traits In Them. If They Were Jerks Before They Had Money, They Are Simply Jerks With A Billion Dollars.

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

Our Future Rates Of Gain Will Fall Far Short Of Those Achieved In The Past. Berkshire's Capital Base Is Now Simply Too Large To Allow Us To Earn Truly Outsized Returns. If You Believe Otherwise, You Should Consider A Career In Sales But Avoid One In Mathematics.

Of Our 49 Billion, We Haven't Moved Any To Bitcoin

Your Premium Brand Had Better Be Delivering Something Special, Or It's Not Going To Get The Business.

The [stock] Market,like The Lord, Helps Those Who Help Themselves. But, Unlike The Lord, The Market Does Not Forgive Those Who Know Not What They Do.

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.

Occasionally, A Man Must Rise Above Principles.

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

I 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.

Well, I Think The Biggest Mistake Is Not Learning The Habits Of Saving Properly Early. Because Saving Is A Habit. And Then, Trying To Get Rich Quick. It's Pretty Easy To Get Well-to-do Slowly. But It's Not Easy To Get Rich Quick.

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

We Will Reject Interesting Opportunities Rather Than Over-leverage Our Balance Sheet.

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

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.

A Home Is One Of The Most Important Assets That Most People Will Ever Buy. Homes Are Also Where Memories Are Made And You Want To Work With Someone You Can Trust.

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

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

The Typical Large Company Has A Compensation Committee, They Don't Look For Dobermans On That Committee, They Look For Chihuahuas.

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

Investing Money

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.

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

The Best Way In My View Is To Just Buy A Low-cost Index Fund And Keep Buying It Regularly Over Time, Because You'll Be Buying Into A Wonderful Industry, Which In Effect Is All Of American Industry... People Ought To Sit Back And Relax And Keep Accumulating Over Time.

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

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

Mental Toughness

Confidence Is Key. You're Not Going To Put Your Money - You're Not Going To Leave Your Money With Me Unless You're Confident I'm Going To Give It Back To You.

Confidence Is Key

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.

It's A Good Idea To Review Past Mistakes Before Committing New Ones.

Activity Is The Enemy Of Investment Returns.

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.

Diversification Is A Protection Against Ignorance. It Makes Very Little Sense For Those Who Know What They're Doing.

I Won't Close Down A Business Of Subnormal Profitability Merely To Add A Fraction Of A Point To Our Corporate Returns. I Also Feel It Inappropriate For Even An Exceptionally Profitable Company To Fund An Operation Once It Appears To Have Unending Losses In Prospect. Adam Smith Would Disagree With My First Proposition And Karl Marx Would Disagree With My Second; The Middle Ground Is The Only Position That Leaves Me Comfortable.

Investors Making Purchases In An Overheated Market Need To Recognize That It May Often Take An Extended Period For The Value Of Even An Outstanding Company To Catch Up With The Price They Paid.

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Vincent Bugliosi

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