Warren Buffett: Bubbles

“In economics, it’s far easier to tell what will happen than when it will happen. I mean, you can see bubbles develop and things, but you do not know how big the bubble will get.”

—Warren Buffett (2005). 

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Warren Buffett: Simpatico

“If you really think you’re in with people that have got a good business, but they’re going to keep doing dumb things with your money, you’ll probably do better to get out and get in with people who’ve got a good business and you think they’re going to do sensible things with it…. As a matter of investment technique, and maybe as a matter of…avoiding stress in your life…I would say that it’s better to be in with a management you’re simpatico with, than simply to be in a great business with a management that’s bent on doing things that don’t make much sense to you.”

—Warren Buffett. 

Warren Buffett: Brands and retailers

“There will be a battle, always, between brands and retailers, because the retailer would like his name to be the brand. And, to the extent that people trust Costco or Walmart more than they — or as much as — they trust the brand, then the value of having the brand moves over to the retailer from the product itself.”

—Warren Buffett (2001 Berkshire Hathaway Annual Meeting). 

Warren Buffett: No master plan

“We don’t have a master plan…. Charlie and I do not sit around and strategize or talk about the future of various industries or do anything of that sort. It just doesn’t happen. We don’t have any reports. We don’t have any staff. We don’t have any of that…. We try to look at what comes in and look for things we understand, where we think they have a durable, competitive advantage, where we like the management, and where the price is sensible.”

—Warren Buffett. 

Warren Buffett: Errors

“We only regard errors as being things that are within our circle of competence. So if somebody knows how to make money in cocoa beans, or they know how to make money in a software company or anything, and we miss that, that is not an error, as far as we’re concerned. What’s an error is when it’s something we understand, and we stand there and stare at it, and we don’t do anything. Or worse yet, what really gets me is when we do something very small with it. We do an eyedropper’s worth of it, when we could do it very big.”

—Warren Buffett. 

Warren Buffett: When we look at businesses 

“When we look at businesses, we try to think of what can go wrong with them. We try to look [for] businesses that are good businesses now, and we think about what can go wrong with them. If we can think of very much that can go wrong with them, we just forget it. We are not in the business of assuming a lot of risk in businesses. That doesn’t mean we don’t do it inadvertently and make mistakes, because we do. But we don’t intentionally, or willingly, voluntarily, go into situations where we perceive really significant risk that the business is going to change in a major way.”

—Warren Buffett.