Warren Buffett: You Cannot Get Rich With A Weather Vane

Johnny HopkinsWarren BuffettLeave a Comment

During the 1994 Berkshire Annual Meeting, Warren Buffett explained why you should not make decisions in securities based on what other people think. Here’s an excerpt from the meeting:

WARREN BUFFETT: Yeah, there was an article about a week or so ago in Barron’s. The same fellow wrote an article about four years ago reaching pretty much the same conclusion, and I hope he hasn’t been short in between, but the — (Laughter)

I would say this. It is not the way I would calculate the intrinsic value of Berkshire.

But everyone in securities markets make choices on that. Every day somebody sells a few shares of Berkshire and someone sell — buys — and, you know, they are probably coming to differing opinions about valuation.

I would say that I found it strange that apparently he forgot we were in the insurance business, but that — that’s not — (Applause).

It really doesn’t make any difference. I mean, what — we don’t pay any attention to what people say about Coca-Cola stock or Gillette stock or any of those things.

I mean, on any given day, two million shares of Coca-Cola may trade. That’s a lot of people selling, a lot of people buying. If you talk to one person, you’d hear one thing, and you’d talk to another — you really should not make decisions in securities based on what other people think.

If you’re doing that, you should think about doing something else, because it’s —

A public opinion poll will just — it will not get you rich on Wall Street. So you really want to stick with businesses that you feel you can somehow evaluate yourself.

And, I don’t think — I mean Charlie and I, we don’t read anything about what business is going to be — the economy is going to do, or the market’s going to do, or what anybody —

Anytime I see some article that says, you know, these analysts say this or that about some business, it just — it doesn’t mean anything to us.

You cannot get rich with a weather vane.

For all the latest news and podcasts, join our free newsletter here.

FREE Stock Screener

Don’t forget to check out our FREE Large Cap 1000 – Stock Screener, here at The Acquirer’s Multiple:


Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.