Deep > Deep's Quotes

“You are imperfect, permanently and inevitably flawed. And you are beautiful.”
― Amy Bloom

“The heart of a fool is in his mouth, but the mouth of a wise man is in his heart.”
― ben franklin

“A by-product of our managerial style is the ability it gives us to easily expand Berkshire’s activities. We’ve read management treatises that specify exactly how many people should report to any one executive, but they make little sense to us. When you have able managers of high character running businesses about which they are passionate, you can have a dozen or more reporting to you and still have time for an afternoon nap. Conversely, if you have even one person reporting to you who is deceitful, inept or uninterested, you will find yourself with more than you can handle.”
― Warren Buffett, Berkshire Hathaway Letters to Shareholders: 1965-2024

“We tend to let our many subsidiaries operate on their own, without our supervising and monitoring them to any degree. That means we are sometimes late in spotting management problems and that both operating and capital decisions are occasionally made with which Charlie and I would have disagreed had we been consulted. Most of our managers, however, use the independence we grant them magnificently, rewarding our confidence by maintaining an owner-oriented attitude that is invaluable and too seldom found in huge organizations. We would rather suffer the visible costs of a few bad decisions than incur the many invisible costs that come from decisions made too slowly — or not at all — because of a stifling bureaucracy.”
― Warren Buffett, Berkshire Hathaway Letters to Shareholders: 1965-2024

“But we will never allow Berkshire to become some monolith that is overrun with committees, budget presentations and multiple layers of management. Instead, we plan to operate as a collection of separately-managed medium-sized and large businesses, most of whose decision-making occurs at the operating level. Charlie and I will limit ourselves to allocating capital, controlling enterprise risk, choosing managers and setting their compensation.”
― Warren Buffett, Berkshire Hathaway Letters to Shareholders: 1965-2024

“At Berkshire, managers can focus on running their businesses: They are not subjected to meetings at headquarters nor financing worries nor Wall Street harassment. They simply get a letter from me every two years (reproduced at the end of this letter) and call me when they wish. And their wishes do differ: There are managers to whom I have not talked in the last year, while there is one with whom I talk almost daily. Our trust is in people rather than process. A “hire well, manage little” code suits both them and me.”
― Warren Buffett, Berkshire Hathaway Letters to Shareholders: 1965-2024

“Good behavior by each party begets good behavior in return.”
― Warren Buffett, Berkshire Hathaway Letters to Shareholders: 1965-2024

“Because we are the largest lender in the manufactured homes sector and are also normally lending to lower-and-middle-income families, you might expect us to suffer heavy losses during a housing meltdown. But by sticking to old-fashioned loan policies — meaningful down payments and monthly payments with a sensible relationship to regular income — Clayton has kept losses to acceptable levels. It has done so even though many of our borrowers have had negative equity for some time.”
― Warren Buffett, Berkshire Hathaway Letters to Shareholders: 1965-2024

“Over the past 15 years, both Internet stocks and houses have demonstrated the extraordinary excesses that can be created by combining an initially sensible thesis with well-publicized rising prices. In these bubbles, an army of originally skeptical investors succumbed to the “proof” delivered by the market, and the pool of buyers — for a time — expanded sufficiently to keep the bandwagon rolling. But bubbles blown large enough inevitably pop. And then the old proverb is confirmed once again: “What the wise man does in the beginning, the fool does in the end.”
― Warren Buffett, Berkshire Hathaway Letters to Shareholders: 1965-2024

“wishing makes dreams come true only in Disney movies; it’s poison in business.”
― Warren Buffett, Berkshire Hathaway Letters to Shareholders: 1965-2024

“Of course, a business with terrific economics can be a bad investment if the purchase price is excessive.”
― Warren Buffett, Berkshire Hathaway Letters to Shareholders: 1965-2024

“Some Thoughts About Investing”
― Warren Buffett, Berkshire Hathaway Letters to Shareholders: 1965-2024

“Indeed, the unsophisticated investor who is realistic about his shortcomings is likely to obtain better long-term results than the knowledgeable professional who is blind to even a single weakness.”
― Warren Buffett, Berkshire Hathaway Letters to Shareholders: 1965-2024

“We do not talk one-on-one to large institutional investors or analysts, but rather treat all shareholders the same.”
― Warren Buffett, Berkshire Hathaway Letters to Shareholders: 1965-2024

“Since I entered the business world, conglomerates have enjoyed several periods of extreme popularity, the silliest of which occurred in the late 1960s. The drill for conglomerate CEOs then was simple: By personality, promotion or dubious accounting — and often by all three — these managers drove a fledgling conglomerate’s stock to, say, 20 times earnings and then issued shares as fast as possible to acquire another business selling at ten-or-so times earnings. They immediately applied “pooling” accounting to the acquisition, which — with not a dime’s worth of change in the underlying businesses — automatically increased per-share earnings, and used the rise as proof of managerial genius. They next explained to investors that this sort of talent justified the maintenance, or even the enhancement, of the acquirer’s p/e multiple. And, finally, they promised to endlessly repeat this procedure and thereby create ever-increasing per-share earnings.”
― Warren Buffett, Berkshire Hathaway Letters to Shareholders: 1965-2024

“financial markets will become divorced from reality — you can count on that. More Jimmy Lings will appear. They will look and sound authoritative. The press will hang on their every word. Bankers will fight for their business. What they are saying will recently have “worked.” Their early followers will be feeling very clever. Our suggestion: Whatever their line, never forget that 2+2 will always equal 4. And when someone tells you how old-fashioned that math is ---zip up your wallet, take a vacation and come back in a few years to buy stocks at cheap prices.”
― Warren Buffett, Berkshire Hathaway Letters to Shareholders: 1965-2024

“If an investor’s entry point into Berkshire stock is unusually high — at a price, say, approaching double book value, which Berkshire shares have occasionally reached — it may well be many years before the investor can realize a profit. In other words, a sound investment can morph into a rash speculation if it is bought at an elevated price. Berkshire is not exempt from this truth.”
― Warren Buffett, Berkshire Hathaway Letters to Shareholders: 1965-2024

“A CEO’s behavior has a huge impact on managers down the line: If it’s clear to them that shareholders’ interests are paramount to him, they will, with few exceptions, also embrace that way of thinking.”
― Warren Buffett, Berkshire Hathaway Letters to Shareholders: 1965-2024

“If our noneconomic values were to be lost, much of Berkshire’s economic value would collapse as well. “Tone at the top” will be key to maintaining Berkshire’s special culture.”
― Warren Buffett, Berkshire Hathaway Letters to Shareholders: 1965-2024

“In the world of business, bad news often surfaces serially: You see a cockroach in your kitchen; as the days go by, you meet his relatives.”
― Warren Buffett, Berkshire Hathaway Letters to Shareholders: 1965-2024

“Our aversion to leverage has dampened our returns over the years. But Charlie and I sleep well. Both of us believe it is insane to risk what you have and need in order to obtain what you don’t need. We held this view 50 years ago when we each ran an investment partnership, funded by a few friends and relatives who trusted us. We also hold it today after a million or so “partners” have joined us at Berkshire.”
― Warren Buffett, Berkshire Hathaway Letters to Shareholders: 1965-2024

“The less the prudence with which others conduct their affairs, the greater the prudence with which we must conduct our own.”
― Warren Buffett, Berkshire Hathaway Letters to Shareholders: 1965-2024

“The bet illuminated another important investment lesson: Though markets are generally rational, they occasionally do crazy things. Seizing the opportunities then offered does not require great intelligence, a degree in economics or a familiarity with Wall Street jargon such as alpha and beta. What investors then need instead is an ability to both disregard mob fears or enthusiasms and to focus on a few simple fundamentals. A willingness to look unimaginative for a sustained period — or even to look foolish — is also essential.”
― Warren Buffett, Berkshire Hathaway Letters to Shareholders: 1965-2024

“Investing is an activity in which consumption today is foregone in an attempt to allow greater consumption at a later date. “Risk” is the possibility that this objective won’t be attained. By that standard, purportedly “risk-free” long-term bonds in 2012 were a far riskier investment than a long- term investment in common stocks. At that time, even a 1% annual rate of inflation between 2012 and 2017 would have decreased the purchasing-power of the government bond”
― Warren Buffett, Berkshire Hathaway Letters to Shareholders: 1965-2024

“We do not follow the common practice of talking one-on-one with large institutional investors or analysts, treating them instead as we do all other shareholders. There is no one more important to us than the shareholder of limited means who trusts us with a substantial portion of his or her savings. As I run the company day-to-day — and as I write this letter — that is the shareholder whose image is in my mind.”
― Warren Buffett, Berkshire Hathaway Letters to Shareholders: 1965-2024

“Focus on the Forest — Forget the Trees Investors who evaluate Berkshire sometimes obsess on the details of our many and diverse businesses — our economic “trees,” so to speak. Analysis of that type can be mind-numbing, given that we own a vast array of specimens, ranging from twigs to redwoods. A few of our trees are diseased and unlikely to be around a decade from now. Many others, though, are destined to grow in size and beauty.”
― Warren Buffett, Berkshire Hathaway Letters to Shareholders: 1965-2024

“Over the years, Charlie and I have seen all sorts of bad corporate behavior, both accounting and operational, induced by the desire of management to meet Wall Street expectations. What starts as an “innocent” fudge in order to not disappoint “the Street” — say, trade-loading at quarter-end, turning a blind eye to rising insurance losses, or drawing down a “cookie-jar” reserve — can become the first step toward full-fledged fraud. Playing with the numbers “just this once” may well be the CEO’s intent; it’s seldom the end result. And if it’s okay for the boss to cheat a little, it’s easy for subordinates to rationalize similar behavior.”
― Warren Buffett, Berkshire Hathaway Letters to Shareholders: 1965-2024

“My direct experience (limited, thankfully) with CEOs who have played with a company’s numbers indicates that they were more often prompted by ego than by a desire for financial gain.”
― Warren Buffett, Berkshire Hathaway Letters to Shareholders: 1965-2024

“The bedrock challenge for directors, nevertheless, remains constant: Find and retain a talented CEO — possessing integrity, for sure — who will be devoted to the company for his/her business lifetime. Often, that task is hard. When directors get it right, though, they need to do little else. But when they mess it up, . . . . . .”
― Warren Buffett, Berkshire Hathaway Letters to Shareholders: 1965-2024

“At Berkshire, we will continue to look for business-savvy directors who are owner-oriented and arrive with a strong specific interest in our company. Thought and principles, not robot-like “process,” will guide their actions. In representing your interests, they will, of course, seek managers whose goals include delighting their customers, cherishing their associates and acting as good citizens of both their communities and our country. Those objectives are not new. They were the goals of able CEOs sixty years ago and remain so. Who would have it otherwise?”
― Warren Buffett, Berkshire Hathaway Letters to Shareholders: 1965-2024