Investors making purchases in an overheated market need to recognize that it may often take an extended period for the value of even an outstanding company to catch up with the price they paid.
Although we deal with probabilities and expectations, the actual results can deviate substantially from such expectations, particularly on a short-term basis.
An investor will succeed by coupling good business judgment with an ability to insulate his thoughts and behavior from the super-contagious emotions that swirl about the marketplace.
There's always a mismatch. I mean, you know, as the economy evolves, it reallocates resources. Now, the real problem, in my view, is - this has been - the prosperity has been unbelievable for the extremely rich people. If you go to 1982, when Forbes put on their first 400 list, those people had $93 billion. They now they have $2.4 trillion, 25 for one. That is - this has been a prosperity that's been disproportionately rewarding to the people on top.
Charlie and I decided long ago that in an investment lifetime, it's too hard to make hundreds of smart decisions. That judgment became ever more compelling as Berkshire's capital mushroomed and the universe of investments that could significantly affect our results shrank dramatically. Therefore, we adopted a strategy that required our being smart and not too smart at that, only a very few times. Indeed, we now settle for one good idea a year.
If anything, taxes for the lower and middle class and maybe even the upper-middle class should even probably be cut further. But I think that people at the high end - people like myself - should be paying a lot more in taxes. We have it better than we've ever had it.
If I got any good ideas out of that or I think they're good ideas, I'll be glad to contribute them but the system will probably overdo some other things.
Never do anything in life if you would be ashamed of seeing it printed on the front page of your hometown newspaper for your friends and family to see.
I have a house that I bought 55 years ago. It's warm in the winter; it's cool in the summer. It has everything I wanted, plus it has all kinds of good memories. Like my kids, I have good thoughts about that. I can't imagine living any better.