Monday, August 13, 2007


I am an avid admirer of Warren Buffett and his way of life. In addition to being the third richest man in the world, he is the biggest philanthropist the world has ever known and a delightful elocutonist of philosophy of economics, business and the business of life. A completely self-made man, his self-deprecating sense of humor rivals that of the best stand-up comedians in the show business. I had first heard about him back in India and gradually heard and read more about the man as I started to get more interested in finance and economics. I had the occasion to watch him give a speech, or more accurately- a performance, when he came to Georgia Tech as an invited speaker. I fondly remember a very entertaining afternoon when he had audiences in splits with his quips and wisecracks punctuated with his trademark pearls of business wisdom. Warren is known for his unpretentious, bucolic and a very humorous persona which immediately makes his audience drop their guard and drown in his charm. Behind that charm, however, lies a very astute businessman and investor whose grasp on finance and investing is simply peerless. He is famous for his firm understanding of even the minutest of business issues and such a memory for detail that he can reel off all the balance sheet information- from memory -of the companies he has ever bought or is planning to buy . Despite all his wealth and fame, he remains very humble and still lives in his birthplace Omaha in the house he bought about 50 years ago.

Here are a sample of some of his quips that I like and that have been delivered in his speeches and his immensely popular shareholder letters-

  • 'In looking for people to hire, you look for three qualities: integrity, intelligence, and energy. And if they don't have the first, the other two will kill you. You think about it; it's true. If you hire somebody without the first, you really want them to be dumb and lazy.'
  • Energy and drive may be the essential qualities for success in many other walks of life but in the business of investing they are likely to get you into trouble. Lethargy, bordering on sloth, should remain the cornerstone of an investment style.
  • What is popular is not necessarily good. Public opinion poll is no substitute for thought.
  • When a good manager tries to turn around a fundamentally bad business, quite often it is the reputation of the business that remains intact.
  • I like to hold stocks for the long term. My favourite holding period is forever.
  • Much success can be attributed to inactivity. Most investors cannot resist the temptation to constantly buy and sell.

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