Wednesday, July 14, 2010

Gems from Warren Buffett

  • Never be afraid to ask for to much when selling or offer too little when buying.
  • Overcome embarrassment. Be in control to walk away from a bad deal.
  • People with integrity are predisposed to perform; people without are predisposed to not perform.
  • You cannot make a good deal with a bad person. Reference checks are nifty.
  • You can never un-sign a contract. Do your thinking before signing anything.
  • Invest for life – like a catholic.
  • When Warren bought stocks in the bear market of 73-74, he said it was like a “sex-starved man in the middle of a harem with beautiful women”.
  • Buy companies with products that don’t have to change; businesses that will stay after 20 years.
  • Stocks are like pieces of a business. # of stocks * Stock Price = price you would pay if you were to buy the whole business. Would you buy it?
  • Invest in a business that a fool can run… because eventually a fool will.
  • If a business needs lots of capital to grow, it will not make you rich, because the business cannot invest efficiently in growth expansion, people or processes. Neither can it buy back its stocks. Such a company rotates money for a long time.
  • In a difficult business there is never just one cockroach in the kitchen. Warren avoids them even if the stock market is handing them out!
  • All man’s miseries derive from not being able to sit quietly in a room alone.
  • Coke, Wrigley, Gillette, Snickers, GE are companies that have gone on and on for a really long time. There is little that can go wrong with them. Where will their business be in 20 years from now?
  • Wall Street is the only place where people in Rolls Royce get off to seek advice from someone who rode the Subway.
  • Look for Integrity, Intelligence and Energy in your managers.

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