Warren Buffett
This a collection of almost everything including stories, lessons, short quotes which I will keep updating often. This is going to be a very long long collection full with wisdom. Happy Learning!
Feel free to jump anywhere,
I have in life all that I want right here. I love every day. I mean, I tap dance in here and work with nothing but people I like. There is no job in the world that is more fun than runnning Berkshire and I count myself lucky to be where I am.
Buffettism
We have all the money we need. We would like to have more but we can afford to lose money. We can’t afford to lose reputation, not a shred of reputation.
Rule of Investing: You want to be greedy when others are fearful and fearful when other are greedy.
Newspaper Action: How will the managers(taking decisions) feel about any action if they knew it was to be written up the next day in their local paper read by the family, neighbours, friends written by a smart but unfriendly kind of reporter? If it passes that test, it’s okay. If anything is close to line, it’s out.
I could improve your ultimate financial welfare by giving you a ticket with only twenty slots in it so that you had twenty punches — representing all the investments that you got to make in a lifetime. And once you’d punched through the card, you couldn’t make any more investments at all. Under those rules, you’d really think carefully about what you did, and you’d be forced to load up on what you’d really thought about. So you’d do so much better.
My dad taught me an important lesson to see what is in your inner scorecard that your outer scorecard.
I have got a terrific partner named Charlie and you cannot find anybody any smarter, any better quality or anything.
I think if you run into a few great teachers and they really change the way you see the world to some degree, you know you are lucky and you can find them in academia as well as ordinary life. I have been extraordinarly lucky and having great teachers including Charlie who has been a wonderful teacher. Any place you can find somebody that gives you insight into things you didn’t understand before, makes you a better person that you would have been before, that’s very lucky and you want to make most of it. Any situtaion make most of it.
I am running Berkshire for those people who are the ones that are going to stay and not the ones that who want to get out. I do not believe in running a company to respond to people that want to sell the stock in the next few months.
As you see larger and larger group making decisions, they get more and more homogenised and I don’t think you will get best investment decisions out of a large committee.
I have been drinking 5-12 ounce of cokes a day more or less all my life.
The main thing to do is to get involve in something you love.
We bet on brains and we bet on people with brains, integrity and energy.
Have the right heroes.
I would invest in myself as much as I can. That’s the best investment one could possibly make. Follow you passion. Whatever turns you on.
Charlie Munger and I have been business partner for 54 years, we have made a lot of decisions on buying bussiness, a lot of decisions on buying stocks, in a converstations that accompained that decisions neither one ever once brought up anything about macro nature. Period. It just isn’t doesn’t make any difference. I don’t know what is going to happen next week or next month or next year, I know what is going to happen 10 or 20 years and why concern myself with things that I can’t know and don’t understand.
Warren does have bias, a strong one about competence, intelligence and character. Those 3 things are the only things he thinks about.
When people come to me with wonderful bussiness and they do, they talk about selling them to me. My first advice is don’t sell them. I mean wonderful bussiness, they are too rare and if you got one in your family keep it unless something forces you to sell. I would say stay private unless you have need to go in public in terms of financing or in terms of solving the problems of ownership within a family that’s going in different directions or something.
I don’t try to predict markets. I don’t try to predict business. I just try to adapt what comes along.
If I was running $1 million today, or $10 million for that matter, I’d be fully invested. Anyone who says that size does not hurt investment performance is selling. The highest rates of return I’ve ever achieved were in the 1950s. I killed the Dow. You ought to see the numbers. But I was investing peanuts then. It’s a huge structural advantage not to have a lot of money. I think I could make you 50% a year on $1 million. No, I know I could. I guarantee that.
Quotes
You want to be greedy when others are fearful and fearful when other are greedy.
You have to be good at saying no and picking the things that really make a difference.
You have to make mistakes in life. Don’t make them on big decisions like who you marry and some things like that.
Biggest mistakes are the ones that actually don’t show up. They are the mistakes of ommission rather than commission.
The triumphs in life are partly triumphs because you know that everything is not going to be triumph.
I never hung up on mistakes.
Confidence comes one at a time, but fear is instantaneous.
If you buy things you do not need, soon you will have to sell things you need.
It takes 20 years to build a reputation and 20 minutes to ruin it.
Great reputation is like virginity, it can preserved but not restored. (These words my Dad told me!)
I love a sale (cheap companies), just try me out!
Fear is incredibly contagious. Confidence comes back through the door one at a time.
If you don’t find a way to make money while you sleep, you will work until you die.
A business should be viewed as an unfolding movie, not as a still photograph text.
Chains of habit are too light to be felt, until they are too heavy to be broken.
As they say in poker, “If you’ve been in the game 30 minutes and you don’t know who the patsy is, you’re the patsy.”
Stories
I met Bill on July 5th 1991. It was out in Washington as a guest of a friend of mine who was in editorial page of Washington Post. She knew Bill’s parents and was heading down there to meet Senior Gates’s.
Bill was forced(urged/asked) by his mom to come out and meet some people like Warren, Katherine Graham and couple other people. After coming on a helicopter hoping to return soon, Bill stayed the day and that turned into an unbelievable friendship. Even though Bill and Warren came from different directions the kinds of things that fascinated us and that we thought were important were pretty much the same.
So, for last 14 years Bill found every excuse they could possibly find to get together. It’s really about talking about the world and what’s going on in it that’s the core of it. The moral of story is “Listen to your mother”.
I bought my first stock in April of 1942. After Pearl Harbour, we had nothing but bad news for 6 months. The Dow was about 100 and the news was terrible. But I and practically every American I knew we were going to win the war and the stock I bought got cheap in next few months butI have been buying stock ever since.
I have a friend that used to like to own a 100% of any company he had, because he would like to look in the mirror and say, “All my shareholders love me”. I like to look in mirror and say, “Enough of my shareholders loving me”.
Bill Gates on Warren Buffett: At first glance, Warren and I may seem like a mismatch. I’m a technology nerd. He’s an investor who doesn’t use email. In fact, I never expected to be friends with him. In 1991, when my mother called me to come out to our vacation home on Hood Canal to meet a group of friends, including Warren, I didn’t want to go. I told her I was too busy at work. Warren would be interesting, my mother insisted. But I wasn’t convinced. “Look, he just buys and sells pieces of paper. That’s not real value added. I don’t think we’d have much in common,” I told her. Eventually, she persuaded me to go. I agreed to stay for no more than two hours before getting back to work at Microsoft. Then I met Warren. He started asking me some questions about the software business and why a small company like Microsoft could expect to compete with IBM and what were the skillsets and the pricing. These were amazingly good questions that nobody had ever asked. We were suddenly lost in conversation and hours and hours slipped by. He didn’t come across as a bigshot investor. He had this modest way of talking about what he does. He was funny, but what impressed me most was how clearly he thought about the world. It was a deep friendship from our very first conversation. To this day, every time I go to Omaha (which I try to do whenever I can), Warren still drives out to the airport to pick me up. It’s a small gesture, but it means the world to me. I’m always impatient for the plane doors to open because I know Warren will be waiting with a new story or a joke and I’ll be learning and laughing with him all over again.