February 26, 2011, 8:59 AMET
The annual letter that Warren Buffett pens to shareholders islooked to for as much as its investment acumen as its homespunaphorisms. Both reveal much about the company and the man himself.Here are a few of the best quotes from the latest offering:
Discussing why Berkshire keeps so much cash onhand:
Borrowers then learn that credit is like oxygen. When either isabundant, its presence goes unnoticed. When either is missing,that’s all that is noticed.
****
“Money will always flow toward opportunity, and there is anabundance of that in America.”
****
On human potential and the nation’s future
Human potential is far from exhausted, and the American system forunleashing that potential–a system that has worked wonders for overtwo centuries despite frequent interruptions for recessions andeven a Civil War—remains alive and effective.
****
John Kenneth Galbraith once slyly observed that economists weremost economical with ideas: They made the ones learned in graduateschool last a lifetime. University finance departments often behavesimilarly. Witness the tenacity with which almost all clung to thetheory of efficient markets throughout the 1970s and 1980s,dismissively calling powerful facts that refuted it “anomalies.” (Ialways love explanations of that kind: The Flat Earth Societyprobably views a ship’s circling of the globe as an annoying, butinconsequential, anomaly.)
****
One footnote: When we issued a press release about Todd [Comb's]joining us, a number of commentators pointed out that he was“little-known” and expressed puzzlement that we didn’t seek a“big-name.” I wonder how many of them would have known of Lou in1979, Ajit in 1985, or, for that matter, Charlie in 1959. Our goalwas to find a 2-year-old Secretariat, not a 10-year-old Seabiscuit.(Whoops–that may not be the smartest metaphor for an 80-year-oldCEO to use.)
****
On hedge funds:
The hedge-fund world has witnessed some terrible behavior bygeneral partners who have
received huge payouts on the upside and who then, when bad resultsoccurred, have walked away rich, with their limited partners losingback their earlier gains. Sometimes these same general partnersthereafter quickly started another fund so that they couldimmediately participate in future profits without having toovercome their past losses. Investors who put money with suchmanagers should be labeled patsies, not partners.
****
Berkshire and the housing/mortgage crisis:
Our borrowers get in trouble when they lose their jobs, have healthproblems, get divorced, etc. The recession has hit them hard. Butthey want to stay in their homes, and generally they borrowedsensible amounts in relation to their income. In addition, wewere keeping the originated mortgages for our own account, whichmeans we were not securitizing or otherwise reselling them. If wewere stupid in our lending, we were going to pay the price. Thatconcentrates the mind. If home buyers throughout the countryhad behaved like our buyers, America would not have had the crisisthat it did.
(Emphasis added)
****
On home ownership
Home ownership makes sense for most Americans, particularly attoday’s lower prices and bargain interest rates. … But a house canbe a nightmare if the buyer’s eyes are bigger than his wallet andif a lender–often protected by a government guarantee–facilitateshis fantasy. Our country’s social goal should not be to putfamilies into the house of their dreams, but rather to put theminto a house they can afford.
****
On the worst of the global financial crisis:
As one investor said in 2009: “This is worse than divorce. I’velost half my net worth–and I still have my wife.”
****
In discussing the bazaar that is the coming annualmeeting:
Remember: Anyone who says money can’t buy happiness simply hasn’tlearned where to shop.
联系客服
