Buffett: If a manager loves money, a relationship won't work. If a manager loves the business, it can.
Buffett: Rose Blumkin (owner of Nebraska Furniture Mart) left Berkshire and died a year later. That's a lesson for our managers.
Buffett: Wall Street has a
great desire to "teach" what it knows and you don't. Great investing
requires a mindset that the market is there to serve you, not influence
you.
Buffett: Most of what I want from life can't be bought with money.
Munger: If you donate based on extreme political views, left or right, you'll make a lot of dumb donations.
Buffett: Make
your ethical decisions based on whether or not you'd be embarrassed to
have an informed but unfriendly reporter put it on the front page of
your local paper.
Buffett: Don't sleepwalk through life, do what you love. I got lucky to find what I loved to do young.
Munger: When asked what metric he'd look at if he couldn't see any info other than financial statements: "We prefer businesses that drown in cash."
Munger: We don't do anything where the phrase "regardless of price" is part of the equation.
Buffett: The
trick for the professional is to invest in a non-diversified portfolio,
where he really understand the components. The nonprofessional should do
the exact opposite.
Buffett: The CEO of a large financial institution is the chief risk officer and must have the DNA to resist the entreaties of those beneath them who are well
paid to take risk and want to stay that way.
Munger: I call some assets "Good Until Reached For," which often forms the core of assets pledged as trading collateral.
Buffett: When the world doesn't want to lend you money, 10 or 20 basis points doesn't make much difference.
Buffett: We've never made a mistake that conventional due diligence would have uncovered in advance.
Buffett: When
we say yes to a deal, we mean yes whether or not there's a flood, a
nuclear bomb in downtown Cleveland or if Ben Bernanke runs off to South
America with Paris Hilton.
Buffett: People with investment skills are solid, trustworthy, analytical, and can contemplate problems that haven't come up.
Munger: Managerial devotion
to systems and formulas clutters the mind and creates the illusion of
safety but really only justifies the manager's job.
Munger: If
the phrase "financial risk has been diversified away" had been banned
from public discourse, the country would be a better place.
Munger: There are those for whom an axe
murder is acceptable if it was the result of a free market decision. Some people have overdosed on Ayn Rand.
Munger: Problem with derivatives is in allowing buying of insurance by those without an insurable interest in the underlying asset.
Buffett: Berkshire is an automatic formula for getting ahead, not for galloping ahead.