If the value of a company doesn't just scream out at you, it's too close.
Our approach has worked for us. Look at the fun we, our managers, and our shareholders are having. More people should copy us. It's not difficult, but it looks difficult because it's unconventional - it isn't the way things are normally done. We have low overhead, don't have quarterly goals and budgets or a standard personnel system, and our investing is much more concentrated than average. It's simple and common sense.
A lot of our respected financial institutions are just casinos in drag.
What's the best way to get a good spouse? The best single way is to deserve a good spouse because a good spouse is by definition not nuts.
Those who keep learning, will keep rising in life
The only intelligence investing is value investing...to acquire more than one is paying for.
If you took our top fifteen decisions out, we'd have a pretty average record. It wasn't hyperactivity, but a hell of a lot of patience. You stuck to your principles and when opportunities came along, you pounced on them with vigor.
Over many decades, our usual practice is that if something we like goes down, we buy more and more. Sometimes something happens, you realize you’re wrong, and you get out. But if you develop correct confidence in your judgment, buy more and take advantage of stock prices.
Suppose you were a real estate investor with a 1/3 interest in the best apartment complex in town, the best mall, and the best office building. Would you feel like a poor, undiversified investor? No! But as soon as you get into stocks, people feel this way. Partly, people need to justify their fees.
An investment decision in the common stock of a company frequently involves a whole lot of factors interacting ... the one thing that causes the most trouble is when you combine a bunch of these together, you get this lollapalooza effect.
You need to have a passionate interest in why things are happening. That cast of mind, kept over long periods, gradually improves your ability to focus on reality. If you don't have the cast of mind, you're destined for failure even if you have a high I.Q.
We both (Charlie Munger and Warren Buffett) insist on a lot of time being available almost every day to just sit and think. That is very uncommon in American business. We read and think.
Berkshire has the lowest turnover of any major company in the U.S.The Walton family owns more of Wal-Mart than Buffett owns of Berkshire, so it isn't because of large holdings. It's because we have a really unusual shareholder body that thinks of itself as owners and not holders of little pieces of paper.
Berkshire was built on the eternal verities: basic mathematics, basic horse sense, basic fear, and basic diagnosis of human nature to make predictions regarding human behavior. We stuck to the basics with a certain amount of discipline and it has worked out quite well.
It's not a competency if you don't know the edge of it.
When you borrow a man's car, always return it with a tank of gas.
Just avoid things like racing trains to the crossing, doing cocaine, etc. Develop good mental habits.
The liabilities are always 100 percent good. It's the assets you have to worry about.
You don't have to have perfect wisdom to get very rich - just a bit better than average over a long period of time.
It's simplicity itself that its future will be way worse than its past.
If you don't allow for self-serving bias in the conduct of others, you are, again, a fool.
Rationality is not just something you do so that you can make more money, it is a binding principle. Rationality is a really good idea. You must avoid the nonsense that is conventional in one's own time. It requires developing systems of thought that improve your batting average over time.
We bought a doomed textile mill [Berkshire Hathaway] and a California S&L [Savings & Loan; Wesco] just before a calamity. Both were bought at a discount to liquidation value.
It's human nature to extrapolate the recent past into the future, but it's terrible that managements go along with this.
Choose clients as you would friends.
