If you do smart things and use leverage and do one wrong thing along the way, it could wipe you out, because anything times zero is zero. But it's reinforcing when the people around you are doing it successfully, you're doing it successfully, and it's a lot like Cinderella at the ball.
I will do anything that is basically covered by the law to reduce Berkshire's tax rate. For example, on wind energy, we get a tax credit if we build a lot of wind farms. That's the only reason to build them. They don't make sense without the tax credit.
Take the probability of loss times the amount of possible loss from the probability of gain times the amount of possible gain. That is what we're trying to do. It's imperfect, but that's what it's all about.
Too often, a vast collection of possessions ends up possessing its owner. The asset I most value, aside from health, is interesting, diverse, and long-standing friends.
It's going to be tough because the economy is going to be getting worse for a while. And it might fall off a cliff if this doesn't pass. But nobody will ever know that if it does.
When Berkshire Hathaway laid out three billion dollars for GE today, we didn't spend it, we invested it. When the Federal government buys the mortgages, they're not spending it, they're investing it. Now, they're investing it in distress type assets but they're buying them at distress prices if they buy them at market. It's the kind of stuff I love to do. I just don't have 700 million. Maybe we could go in it together.
In a bull market, one must avoid the error of the preening duck that quacks boastfully after a torrential rainstorm, thinking that its paddling skills have caused it to rise in the world. A right-thinking duck would instead compare its position after the downpour to that of the other ducks on the pond.
SUPPOSE that an investor you admire and trust comes to you with an investment idea. This is a good one, he says enthusiastically. I'm in it, and I think you should be, too.
What motivates most gold purchasers is their belief that the ranks of the fearful will grow ... As 'bandwagon' investors join any party, they create their own truth - for a while.