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

-Warren Buffett

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You Have To Understand

Warren Buffett

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

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I Think What People Understand There Probably - Well, They Were Hoping The Private Sector Would Do It [rescuing Aig ].

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.

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

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

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

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

An Investor Should Act As Though He Had A Lifetime Decision Card With Just Twenty Punches On It.

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

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

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

Learn From Your Mistakes

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

Investing Money

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).

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

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.

You're Dealing With A Lot Of Silly People In The Marketplace; It's Like A Great Big Casino And Everyone Else Is Boozing. If You Can Stick With Pepsi, You Should Be Ok.

Investing Money

I Think Once You Start Putting Phony Figures Into Financial Statements, You Get In A Lot Of Trouble. And We've Seen So Much Of That In The Last 20 Years.

We Try To Buy Businesses With Good-to-superb Underlying Economics Run By Honest And Able People And Buy Them At Sensible Prices. That's All I'm Trying To Do.

There Seems To Be Some Perverse Human Characteristic That Likes To Make Easy Things Difficult.

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 Dominant Factors Affecting Control Valuations Are Earning Power (past And Prospective) And Asset Values.

All But A Few Of The Organizations Do Not Specifically Promise To Deliver Superior Investment Performance Although It Is Perhaps Not Unreasonable For The Public To Draw Such An Inference From Their Advertised Emphasis On Professional Management.

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

Would You Rather Be The World's Greatest Lover, But Have Everyone Think You're The World's Worst Lover? Or Would You Rather Be The World's Worst Lover But Have Everyone Think You're The World's Greatest Lover? Now, That's An Interesting Question.

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?

I'm The Luckiest Guy In The World In Terms Of What I Do For A Living. No One Can Tell Me To Do Things I Don't Believe In Or Things I Think Are Stupid.

Never Get Too Hung Up On Mistakes.

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

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

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

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

But 300 Million Americans, Their Lending Institutions, Their Government, Their Media, All Believed That House Prices Were Going To Go Up Consistently. And That Got Billed Into A $20 Trillion Residential Home Market. Lending Was Done Based On It, And Everybody Did A Lot Of Foolish Things.

It's Easy To Identify Many Investment Managers With Great Recent Records. But Past Results, Though Important, Do Not Suffice When Prospective Performance Is Being Judged. How The Record Has Been Achieved Is Crucial.

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.

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

Remember That The Stock Market Is Manic-depressive.

If You Want A Government That's Going To Do The Things We Ask Our Government To Do, You've Got To Get It From Somebody.

More Investment Sins Are Probably Committed By Otherwise Quite Intelligent People Because Of "tax Considerations" Than From Any Other Cause. One Of My Friends-a Noted West Coast Philosopher-maintains That A Majority Of Life's Errors Are Caused By Forgetting What One Is Really Trying To Do. This Is Certainly The Case When An Emotionally Supercharged Element Like Taxes Enters The Picture (i Have Another Friend-a Noted East Coast Philosopher Who Says It Isn't The Lack Of Representation He Minds-it's The Taxation).

Always Invest For The Long Term.

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.

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

In That, We Agreed With Andrew Carnegie, Who Said That Huge Fortunes That Flow In Large Part From Society Should In Large Part Be Returned To Society. In My Case, The Ability To Allocate Capital Would Have Had Little Utility Unless I Lived In A Rich, Populous Country In Which Enormous Quantities Of Marketable Securities Were Traded And Were Sometimes Ridiculously Mispriced. And Fortunately For Me, That Describes The U.s. In The Second Half Of The Last Century.

Enormous Quantities

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

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

If You Gave Me $100 Billion And Said Take Away The Soft Drink Leadership Of Coca-cola In The World, I'd Give It Back To You And Say It Can't Be Done.

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.

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.

Benign Neglect, Bordering On Sloth, Remains The Hallmark Of Our Investment Process.

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

The Problem With Commodities Is That You Are Betting On What Someone Else Would Pay For Them In Six Months. The Commodity Itself Isn't Going To Do Anything For You....it Is An Entirely Different Game To Buy A Lump Of Something And Hope That Somebody Else Pays You More For That Lump Two Years From Now Than It Is To Buy Something That You Expect To Produce Income For You Over Time.

If I Got Any Good Ideas Out Of That Or I Think They're Good Ideas, I'll Be Glad To Contribute Them But The System Will Probably Overdo Some Other Things.

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

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

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

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

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

Investing Money

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

Investors Should Remember That Excitement And Expenses Are Their Enemies. And If They Insist On Trying To Time Their Participation In Equities, They Should Try To Be Fearful When Others Are Greedy And Greedy Only When Others Are Fearful.

Investing Money

Invest In As Much Of Yourself As You Can, You Are Your Own Biggest Asset By Far.

Nevertheless, As Circumstances Presently Appear, I Feel Substantially Greater Size Is More Likely To Harm Future Results Than To Help Them. This Might Not Be True For My Own Personal Results, But It Is Likely To Be True For Your Results.

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

If You've Got The Power To Raise Prices Without Losing Business To A Competitor, You've Got A Very Good Business. And If You Have To Have A Prayer Session Before Raising The Price By A Tenth Of A Cent, Then You've Got A Terrible Business. I've Been In Both, And I Know The Difference.

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

A Very Rich Person Should Leave His Kids Enough To Do Anything, But Not Enough To Do Nothing.

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.

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.

Anything Can Happen Anytime In Markets. And No Advisor, Economist, Or Tv Commentator-and Definitely Not Charlie Nor I-can Tell You When Chaos Will Occur. Market Forecasters Will Fill Your Ear But Will Never Fill Your Wallet.

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

If You Gave Me The Choice Of Being Ceo Of General Electric Or Ibm Or General Motors, You Name It, Or Delivering Papers, I Would Deliver Papers. I Would. I Enjoyed Doing That. I Can Think About What I Want To Think. I Don't Have To Do Anything I Don't Want To Do.

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.

Cash Combined With Courage In A Time Of Crisis Is Priceless.

When You Listen To Tax-cut Rhetoric, Remember That Giving One Class Of Taxpayer A Break Requires - Now Or Down The Line - That An Equivalent Burden Be Imposed On Other Parties. In Other Words, If I Get A Break, Someone Else Pays. Government Can't Deliver A Free Lunch To The Country As A Whole. It Can However, Determine Who Pays For Lunch.

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

Mass Destruction

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

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

There Are Certain Things That Cannot Be Adequately Explained To A Virgin Either By Words Or Pictures.

The Value Of Market Esoterica To The Consumer Of Investment Advice Is A Different Story. In My Opinion, Investment Success Will Not Be Produced By Arcane Formulae, Computer Programs Or Signals Flashed By The Price Behavior Of Stocks And Markets. Rather An Investor Will Succeed By Coupling Good Business Judgment With An Ability To Insulate His Thoughts And Behavior From The Super-contagious Emotions That Swirl About The Marketplace.

Investment Success

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.

A Lot Of People Disagree With Me On This, I Believe In Mark To Market.

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

I Don't Read Economic Forecasts. I Don't Read The Funny Papers.

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

We Enjoy The Process Far More Than The Proceeds.

... Not Doing What We Love In The Name Of Greed Is Very Poor Management Of Our Lives.

Investment Success

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.

It's Better To Build Than To Buy If You Can Find The Right People.

That Which Is Not Worth Doing At All Is Not Worth Doing Well.

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.

John Maynard Keynes Essentially Said, Don't Try And Figure Out What The Market Is Doing. Figure Out A Business You Understand, And Concentrate.

In Other Words, The Percentage Change In Book Value In Any Given Year Is Likely To Be Reasonably Close To That Year's Change In Intrinsic Value.

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.

The Optimum Portfolio Depends On The Various Expectations Of Choices Available And The Degree Of Variance In Performance Which Is Tolerable. The Greater The Number Of Selections, The Less Will Be The Average Year-to-year Variation In Actual Versus Expected Results. Also, The Lower Will Be The Expected Results, Assuming Different Choices Have Different Expectations Of Performance.

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

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

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 Greatest Enemies Of The Equity Investor Are Expenses And Emotions.

Never Do Anything In Life If You Would Be Ashamed Of Seeing It Printed On The Front Page Of Your Hometown Newspaper For Your Friends And Family To See.

Family And Friends

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

It's Us Fun Being A Horse When The Tractor Comes Along, Or The Blacksmith When The Car Comes Along.

I Think It's Been, You Know, Kind Of Like A Tragic Play To This Point. But At This Point, I Think It's Clear, And Will Be Clear To The Majority Of The Congress. I Think It's Clear To The American People That There Is Only One Countervailing Force To A World Where Financial Institutions Are Trying To Sell Instruments Every Day And Where Credit Has Dried Up, And That's The United States Treasury.

My Net Worth Is The Market Value Of Holdings Less The Tax Payable Upon Sale. The Liability Is Just As Real As The Asset Unless The Value Of The Asset Declines (ouch), The Asset Is Given Away (no Comment), Or I Die With It. The Latter Course Of Action Would Appear To At Least Border On A Pyrrhic Victory.

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

Investing Is Forgoing Consumption Now In Order To Have The Ability To Consume More At A Later Date.

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.

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

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.

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

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

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

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

It's The Deleveraging That's Going On Right Now That Has Caused The Credit Crisis.

Someone Is Sitting In The Shade Today Because Someone Planted A Tree A Long Time Ago.

Valuing A Business Is Part Art And Part Science.

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

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.

If You Have A Harem Of 40 Women, You Never Get To Know Any Of Them Very Well.

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.

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

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

Investing Money

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.

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.

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

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

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

I Think That Both Parties Should Declare The Debt Limit As A Political Weapon Of Mass Destruction Which Can't Be Used. I Mean, It Is Silly To Have A Country That Has 237 Years Building Up Its Reputation And Then Have People Threaten To Tear It Down Because They're Not Getting Some Other Matter.

Accounting Consequences Do Not Influence Our Operating Or Capital-allocation Decisions. When Acquisition Costs Are Similar, We Much Prefer To Purchase $2 Of Earnings That Is Not Reportable By Us Under Standard Accounting Principles Than To Purchase $1 Of Earnings That Is Reportable.

A Public-opinion Poll Is No Substitute For Thought.

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.

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.

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

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.

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

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.

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.

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

Investing Money

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.

No Matter How Great The Talent Or Efforts, Some Things Just Take Time.

Investing Money

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

I Have Worked With Investors For 60 Years And I Have Yet To See Anyone - Not Even When Capital Gains Rates Were 39.9 Percent In 1976-77 - Shy Away From A Sensible Investment Because Of The Tax Rate On The Potential Gain.

As Of 1992, In Fact-though The Picture Would Have Improved Since Then-the Money That Had Been Made Since The Dawn Of Aviation By All Of This Country's Airline Companies Was Zero. Absolutely Zero.

Airline Business

What Could Be More Advantageous In An Intellectual Contest - Whether It Be Chess, Bridge, Or Stock Selection - Than To Have Opponents Who Have Been Taught That Thinking Is A Waste Of Energy?

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

Business Success

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

Look For Companies With High Profit Margins.

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 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.

Whether We’re Talking About Socks Or Stocks, I Like Buying Quality Merchandise When It Is Marked Down.

Investing Money

Having A Large Amount Of Leverage Is Like Driving A Car With A Dagger On The Steering Wheel Pointed At Your Heart. If You Do That, You Will Be A Better Driver. There Will Be Fewer Accidents But When They Happen, They Will Be Fatal.

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

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

Important Decisions

The Most Important Investment You Can Make Is In Yourself... Nobody Can Tax It Or Take It Away From You.

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

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

To Invest Successfully, You Need Not Understand Beta, Efficient Markets, Modern Portfolio Theory, Option Pricing Or Emerging Markets. You May, In Fact, Be Better Off Knowing Nothing Of These. That, Of Course, Is Not The Prevailing View At Most Business Schools, Whose Finance Curriculum Tends To Be Dominated By Such Subjects. In Our View, Though, Investment Students Need Only Two Well-taught Courses - How To Value A Business, And How To Think About Market Prices.

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.

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

What Motivates Most Gold Purchasers Is Their Belief That The Ranks Of The Fearful Will Grow ... As 'bandwagon' Investors Join Any Party, They Create Their Own Truth - For A While.

The Advice "you Never Go Broke Taking A Profit" Is Foolish.

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

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

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.

Investing Is Simple, But Not Easy.

We Do Not Have, Nor Have Had, And Never Will Have An Opinion About Where The Stock Market, Interest Rates, Or Business Activity Will Be A Year From Now.

Businesses Always Have Opportunities To Improve Service, Product Lines, Manufacturing Techniques, And The Like, And Obviously These Opportunities Should Be Seized. But A Business That Constantly Encounters Major Change Also Encounters Many Chances For Major Error

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.

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.

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

It Is Better To Point Out Your Own Mistakes Than Have Somebody Else Do It.

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

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

Wall Street Makes Its Money On Activity. You Make Your Money On Inactivity.

Paradoxically, When 'dumb' Money Acknowledges Its Limitations, It Ceases To Be Dumb.

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

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

Investors, Of Course, Can, By Their Own Behavior Make Stock Ownership Highly Risky. And Many Do. Active Trading, Attempts To "time" Market Movements, Inadequate Diversification, The Payment Of High And Unnecessary Fees To Managers And Advisors, And The Use Of Borrowed Money Can Destroy The Decent Returns That A Life-long Owner Of Equities Would Otherwise Enjoy. Indeed, Borrowed Money Has No Place In The Investor's Tool Kit.

Observing That The Market Was Frequently Efficient, Emt Adherents Went On To Conclude Incorrectly That It Was Always Efficient. The Difference Between These Propositions Is Night And Day.

The Most Common Cause Of Low Prices Is Pessimism - Sometimes Pervasive, Sometimes 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.

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

It's Quite Clear That Stocks Are Cheaper Than Bonds. I Can't Imagine Anybody Having Bonds In Their Portfolio When They Can Own Equities, A Diversified Group Of Equities. But People Do Because They, The Lack Of Confidence. But That's What Makes For The Attractive Prices. If They Had Their Confidence Back, They Wouldn't Be Selling At These Prices. And Believe Me, It Will Come Back Over Time.

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

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

You Ought To Be Able To Explain Why You’re Taking The Job You’re Taking, Why You’re Making The Investment You’re Making, Or Whatever It May Be. And If It Can’t Stand Applying Pencil To Paper, You’d Better Think It Through Some More. And If You Can’t Write An Intelligent Answer To Those Questions, Don’t Do It.

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

Other Guys Read Playboy. I Read Annual Reports.

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

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

The Nature Of Democracy Is Such That When There's - There'll Be Revulsion, Obviously, Towards - That's Never Going To Happen Again.

Always Associate Yourself With People Who Are Better Than You.

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

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

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

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

Successful Investing

America Should Stand For More Than Just Wealth.

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

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

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

I'm Just Lucky To Have Been In The Right Place At The Right Time. Another Place, Another Time, I Wouldn't Have Been As Successful. Society Enabled Me To Make My Money And My Money Should Go To Society.

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

We Like To Buy Businesses, But We Don't Like To Sell Them.

Market Price, While Used Exclusively To Value Our Investments In Minority Positions, Is Not A Relevant Factor When Applied To Our Controlling Interests.

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

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