Tag Archive

During the 2024 Berkshire Hathaway Annual Meeting, Warren Buffett discusses the significant role of luck in his success and life in general. He acknowledges that many fortunate circumstances, such as avoiding accidents, have contributed to his longevity and achievements. He admits that he would not have been the favorite to live … Read More

In his 1979 Berkshire Hathaway Annual Letter, Warren Buffett discussed Berkshire Hathaway’s 1979 operating performance, which was strong but slightly less impressive than in 1978, with operating earnings at 18.6% of beginning net worth. Despite a 20% increase in earnings per share, Warren Buffett cautions against focusing on this metric. … Read More

During the recent 2024 Berkshire Annual Meeting, Warren Buffett reflected on past experiences, acknowledging he’d gained wisdom. He anticipates future challenges, expecting crises akin to 2008 but not identical. He emphasizes the need for quick access to substantial funds, foreseeing crises occurring every 5-10 years due to increasing global complexity. … Read More

During his recent Berkshire Hathaway Annual Meeting, Warren Buffett discussed how he would achieve a 50% annual return with less than $1 million by deeply investigating small investment opportunities, akin to his past practices with railroad stocks detailed in Moody’s manuals. He emphasizes the necessity of passion for the process … Read More

During the recent 2024 Berkshire Hathaway Annual Meeting, Warren Buffett recounts meeting Charlie Munger in 1959, likening it to twins reunited. While both were curious, Buffett focused on whether things worked, while Munger delved into how they worked. Munger’s understanding of electricity rivalled Edison’s; he designed and built his home … Read More

During his latest 2024 Berkshire Hathaway Annual Meeting, Warren Buffett acknowledges his lack of understanding about AI but doesn’t dismiss its significance. He compares it to the nuclear genie, once out of the bottle, impossible to control. He recalls a disturbing experience where AI convincingly mimicked him, realizing its potential … Read More

In his 1985 Berkshire Hathaway Letter, Warren Buffett discussed how misguided academic teachings benefit strategic investors. In the early 1970s, successful investing was based on the philosophy of Ben Graham, which emphasized buying shares in solid businesses when their market prices were significantly below their true business values. This approach … Read More

In his 1984 Berkshire Hathaway Letter, Warren Buffett discussed his bond investment strategy where he treats bonds as businesses. An approach that might seem unconventional but is quite insightful. Typically, bond investments are viewed merely in terms of yield. For example, in 1946, investors purchased 20-year AAA tax-exempt bonds yielding … Read More

During the 1994 Berkshire Hathaway Annual Meeting, Warren Buffett explained that Berkshire may consider acquiring a business without current profits if it has strong future potential. He highlights their past investment in GEICO, which initially lost money but turned profitable later. He prioritizes the present value of future earnings over … Read More

In his 1983 Berkshire Hathaway Annual Letter, Warren Buffett discusses his shift in perspective on the value of economic goodwill in business investments. Originally trained to prioritize tangible assets, Buffett initially shunned businesses with high goodwill values, resulting in missed opportunities. Over time, influenced by direct and vicarious business experiences … Read More

In his 2014 Berkshire Hathaway Annual Letter, Warren Buffett discussed the common pitfalls that make stock ownership risky due to investor behavior, such as active trading, trying to time the market, inadequate diversification, paying unnecessary fees, and using borrowed money. He also emphasizes that borrowed funds should never be part … Read More

In his 2016 Berkshire Hathaway Annual Letter, Warren Buffett discusses the role of luck in investing, suggesting that among a large group of managers making predictions, some are bound to occasionally succeed purely by chance, much like a randomly successful monkey. However, unlike the monkey, successful managers might attract investors, … Read More

During the 2007 Berkshire Hathaway Annual Meeting, Warren Buffett discussed the importance of actual experience in investing, comparing theoretical knowledge to the experiential learning that comes with real-world practice. This is akin to the difference between reading about romance and experiencing it. Buffett suggests starting with investments on a small … Read More

In his 2011 Berkshire Hathaway Annual Letter, Warren Buffett explains why Berkshire keeps some of its underperforming businesses. The company believes in honoring its commitment to the sellers and doesn’t sell unless the business has a cash drain or labor problems. This approach may not be optimal in the short … Read More

During the 2018 Berkshire Hathaway Annual Meeting, Warren Buffett discusses the importance of investing in companies that create products that engender positive emotional responses (like getting a kiss for giving See’s Candy) versus negative ones. Using Apple’s ecosystem led by the iPhone as an example of such an investment. The … Read More

In his 2017 Berkshire Hathaway Annual Letter, Warren Buffett discusses a new accounting rule that will distort net income figures. This rule requires including unrealized stock gains/losses, leading to large swings that don’t reflect actual business performance. He argues that these fluctuations will mislead investors and render net income useless … Read More

In his 1988 Berkshire Hathaway Annual Letter, Warren Buffett argues that some companies view Generally Accepted Accounting Principles (GAAP) as guidelines to be creatively interpreted, rather than strict rules. This can lead to misleading financial statements and even fraud. Investors and creditors who rely on GAAP figures are vulnerable to … Read More

In his 1983 Berkshire Hathaway Annual Letter, Warren Buffett explains why operating earnings/equity capital ratio is a good measure of managerial performance for most companies, but it may not be ideal in all situations. He finds it suspicious when a company abandons this metric during poor performance, suggesting they might … Read More

In his 2016 Berkshire Hathaway Annual Letter, Warren Buffett discussed his belief that the company’s normalized earning power per share will increase over time, despite fluctuations in actual earnings due to economic downturns or industry-specific events. This is achieved by reinvesting a significant portion of earnings to achieve this growth … Read More

In his 1997 Berkshire Hathaway Annual Letter, Warren Buffett recommends investors shouldn’t get overly excited about strong performance during bull markets (periods of rising stock prices). This metaphor compares such investors to a duck who thinks its paddling skills caused it to rise after a heavy rain, instead of recognizing … Read More