Warren Buffett, investor extraordinaire, Chairman of Berkshire Harthaway, and amongst the world’s richest men. He is also a human quote machine, sprewling bite size pieces of concentrated wisdom wherever he goes.
I like to share some of my favourites. These are quotes that educated me, quotes that made me see things in a different light and quotes that moved me in little ways. Here is Warren at his very best.
1. Price is what you pay, value is what you get.
This one never ever gets old. These are the ten words that I fall back on every time I stop to ponder a purchasing decision. Be it socks or stocks, boots or boats, horses or houses, keep your mind wrapped around the concept of value and you will never go wrong.
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2. Risk comes from not knowing what you are doing.
During a recent Christmas meet up of old friends, the conversation drifted to investing in stocks. Penny stocks to be precise. Penny stocks are risky, a friend proclaimed. For sure, another agreed.
Well my friends, if you are reading this, penny stocks are more volatile indeed. That is their characteristic and there is no running away. The risk element however, evolves from you and you alone. Do not confuse volatility and risk.
If you study penny stocks in depth and buy the best, the risk is largely mitigated.
Let me put it in another way. If you had to take a plane ride and could choose between my mother and a trained pilot to fly you there, who would you pick? Well my mother is probably the riskier option, only because she does not know what she is doing while the pilot does.
So there, risk decreases when expertise increases.
3. I always knew I was going to be rich. I don’t think I ever doubted it for a minute.
If you are ever in need of another definition of financial freedom, this is it. Financial freedom is not about the dollar value of your assets. Financial freedom is your state of mind.
4. Time is the friend of the wonderful business, the enemy of the mediocre
Time is also the friend of the wonderful investor, the enemy of the mediocre. Too many people get distracted by short term gains and results that they lose sight of the big picture. Investing is like running a marathon, it is not a 100m dash. Only time will tell the winners.
5. No matter how great the talent or efforts, some things just take time. You can’t produce a baby in one month by getting nine women pregnant.
This is another one I like tremendously. It reinforces the previous quote nicely. Some things you just cannot rush. Investing is one of them.
6. Forecasts may tell you a great deal about the forecaster; they tell you nothing about the future.
Any forecast that you hear or read about is a human construct. The same set of data could be presented to two different ‘experts’ and they could come back with radically different forecasts. This set of forecasts says it all.
7. There seems to be some perverse human characteristic that likes to make easy things difficult.
This one I am totally guilty of. Investing is meant to be simple. So is life.
8. If you’re in the luckiest one per cent of humanity, you owe it to the rest of humanity to think about the other 99 per cent.
Putting his money where his mouth is, Warren has given away USD 23 Billion to date. He has also pledged to give away 99% of his wealth in time to come.
At BigFatPurse we are always on the lookout for worthy causes to give to and help. We may not have billions but I am pretty sure we can make a difference in our own little ways. Drop me an email, firstname.lastname@example.org if there are people you think we can help.
9. Too often, a vast collection of possessions ends up possessing the owner. The asset I most value, aside from health, is interesting, diverse, and long-standing friends.
Here is Garfield to tell us more
10. There comes a time when you ought to start doing what you want. Take a job that you love. You will jump out of bed in the morning. I think you are out of your mind if you keep taking jobs that you don’t like because you think it will look good on your resume. Isn’t that a little like saving up sex for your old age?
No one says it better than Warren. Do what you love. At BigFatPurse, we are all loving what we do. We ain’t the type to save up for sex at all.
Have a great 2015 ahead!