Friday, March 13, 2009

Buffett-isms 2008

Warren Buffett's annual letter to the shareholders of Berkshire Hathaway was released a couple of weeks back. I finally got around to reading it earlier today. When you do that, the thing you cannot escape is the folksy (some say cheesy) Buffett-isms that are such a big part of the man's persona. A discussion on Berkshire's financial performance might be a little bit out of Brick and Rope's fairway, but surely there is a place here to talk about Buffett's turns of phrase?

So here are my favorite Buffett-isms from Berkshire's 2008 annual report:

Talking about the financial markets in 2008 -
By year-end, investors of all stripes were bloodied and confused, much as if they were small birds that had strayed into a badminton game.

Talking about government intervention to keep key financial participants alive -
At the moment, it is much better to be a financial cripple with a government guarantee than a Gibraltar without one.

On the complicated world-side network of derivative contracts and corresponding counter-party risks -
Participants seeking to dodge troubles face the same problem as someone seeking to avoid venereal disease: It’s not just whom you sleep with, but also whom they are sleeping with.

On banks that are 'too big to fail' -
The First Law of Corporate Survival for ambitious CEOs who pile on leverage and run large and unfathomable derivatives books: Modest incompetence simply won’t do; it’s mindboggling screw-ups that are required.

... And finally, on the booming auto insurance business at a Berkshire subsidiary -
As we view GEICO’s current opportunities, Tony [Nicely, GEICO's CEO] and I feel like two hungry mosquitoes in a nudist camp. Juicy targets are everywhere.


1 comment:

  1. How about some of the older Buttett-isms? I am going to paraphrase but I like the following
    - When a manager with a great reputation and an industry with a terrible reputation meet, it's usually the reputation of the industry that survives.
    - Price is what you pay, value is what you get
    I also found this article that had a lot of Buffettisms that I wasn't aware of