I've made money over the years by buying into good companies, run by good people, at attractive prices. And I don't try and make it out of buying into the market at one point and selling at another point.
Although we deal with probabilities and expectations, the actual results can deviate substantially from such expectations, particularly on a short-term basis.
If
you're an investor, you're looking on what the asset is going to do, if
you're a speculator, you're commonly focusing on what the price of the
object is going to do, and that's not our game.
The best business returns are usually achieved by companies that are doing something quite similar today to what they were doing five or ten years ago.
Most business mistakes are irreversible setbacks, but you get another chance. There are two things in life that you don't get another chance at - marrying the wrong person and what you do with your children.
But 300 million Americans, their lending institutions, their government, their media, all believed that house prices were going to go up consistently. And that got billed into a $20 trillion residential home market. Lending was done based on it, and everybody did a lot of foolish things.
While the poor and middle class fight for us in Afghanistan, and while most Americans struggle to make ends meet, we mega-rich continue to get our extraordinary tax breaks.
I just don't see anything available that gives any reasonable hope of delivering such a good year and I have no desire to grope around, hoping to 'get lucky' with other people's money. I am not attuned to this market environment, and I don't want to spoil a decent record by trying to play a game I don't understand just so I can go out a hero.
[The U.S. Treasury] can borrow basically unlimited amounts. They can stay there for years and years. These assets will be worth more money over time. So when Merrill Lynch sells a bunch of mortgage-related assets at 22 cents on the dollar like they did a month or so ago, the buyer goes - is going to make money, and he's going to make a lot more money if it happens to be an institution like the U.S. government which has very, very cheap borrowing costs.