Top 968 Quotes & Sayings by Warren Buffett - Page 11

Growth and value investing are joined at the hip.

Like most trends, at the beginning it's driven by fundamentals, at some point speculation takes over. What the wise man does in the beginning, the fool does in the end.

Does the business have favourable long term prospects?

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.

The 19th century belonged to England, the 20th century belonged to the U.S., and the 21st century belongs to China. Invest accordingly.

Diversification is protection against ignorance. It makes little sense if you know what you are doing.

My job is essentially just corralling more and more and more facts and information, and occasionally seeing whether that leads to some action.

It's us fun being a horse when the tractor comes along, or the blacksmith when the car comes along.

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.

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.

If I knew where I was going to want to live the next five or 10 years I would buy a home and I'd finance it with a 30-year mortgage... It's a terrific deal.

What we really want to do is buy businesses that we would be happy to own forever.

It's a nightmare to administer some of this sort of thing, but I want to tell the shareholders of Berkshire, to the percent we own marketable securities or things for which there are market, even if those markets - I want to tell them what it's all about.

We always see shifts in employment. If you think about it, if you go back to 1800, it took 80 percent of the labor force to produce enough food for the country. Now it takes less than 3 percent. Well, the truth is that market systems move people around.

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.

I get to do what I like to do every single day of the year.

Don't invest in pieces of papers (stocks), invest in great businesses underlying them

We all make mistakes. If you can't make mistakes, you can't make decisions. I've made a lot bigger mistakes myself.

We also believe candour benefits us as managers. The CEO who misleads often in public eventually misleads himself in private.

The American worker is more productive than he's ever been.

I have a wonderful family. I have a job that I love and wonderful people who help me with it. It can't get any better than that.

If we have a strength, it is in recognizing when we are operating well within our circle of competence and when we are approaching the perimeter.

You get in a lot of trouble when you start putting fictitious numbers.

[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.

I have this complicated procedure I go through every morning, which is to look in the mirror and decide what I'm going to do. And I feel at that point, everybody's had their say.

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.

... but the important thing is that when you do find one where you really do know what you are doing, you must buy in quantity.... Charlie and I have made a dozen or so very big decisions relative to net worth, although not as big as they should have been. And in each of those, we've known that we were almost certain to be right going in.

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.

If you've been playing poker for half an hour and you still don't know who the patsy is, you're the patsy.

Continually challenge and be willing to amend your best loved ideas.

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.

We will continue to ignore political and economic forecasts, which are an expensive distraction for many investors and businessmen. Thirty years ago, no one could have foreseen the huge expansion of the Vietnam War, wage and price controls, two oil shocks, the resignation of a president, the dissolution of the Soviet Union, a one-day drop in the Dow of 508 points, or treasury bill yields fluctuating between 2.8% and 17.4%.

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.

Managers and investors alike must understand that accounting numbers are the beginning, not the end, of business valuation.

Over the years, Charlie [Munger, Berkshire Hathaway Vice Chairman] and I have observed many accounting-based frauds of staggering size. Few of the perpetrators have been punished; many have not even been censured. It has been far safer to steal large sums with pen than small sums with a gun.

We've had public companies in the past in that business and they bleed. We've got a lot more blood than they do.

If you're in a card game and you can't figure out who the patsy is, you're it.

The only way to be loved is to be loveable, which really irritates me.

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

Stocks of companies selling commodity-like products should come with a warning label: "Competition may prove hazardous to human wealth".

Investing in a market where people believe in efficiency is like playing bridge with someone who has been told it doesn't do any good to look at the cards.

Derivatives are like sex. It's not who we're sleeping with, it's who they're sleeping with that's the problem.

When bills come due, only cash is legal tender. Don't leave home without it.

If anything, taxes for the lower and middle class and maybe even the upper-middle class should even probably be cut further. But I think that people at the high end - people like myself - should be paying a lot more in taxes. We have it better than we've ever had it.

Larger sums may be an advantage at some cases and a disadvantage at others.

A fool and his money are soon invited everywhere.

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.

We have long felt that the only value of stock forecasters is to make fortune-tellers look good.

My idea of a group decision is to look in the mirror.

The typical large company has a compensation committee, They don't look for Dobermans on that committee, they look for chihuahuas.

Writing checks to the IRS that include strings of zeros does not bother me ... Overall, we feel extraordinarily lucky to have been dealt a hand in life that enables us to write large checks to the government rather than one requiring the government to regularly write checks to us-say, because we are disabled or unemployed.

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.

We've got a wonderful economic formula in this country.

Calculate "owner earnings" to get a true reflection of value.

We will prosper or suffer in controlled investments in relation to the operating performances of our businesses - we will not attempt to profit by playing various games in the securities markets.

If you are not willing to own a stock for 10 years, do not even think about owning it for 10 minutes.

Truly conservative actions arise from intelligent hypotheses, correct facts and sound reasoning.

Energy deregulation will be the largest transfer of wealth in history.

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?

... not doing what we love in the name of greed is very poor management of our lives.