Notes to “Of Permanent Value – The Story of Warren Buffett (2002 edition)
By : Andrew Kilpatrick
I completed this on February 19, 2005 . This is one of the best investment books that I have ever read. The book is 1460 pages (not including the index). These are just a few notes, of several sections, which I wanted to save. I generally will use this page as a reference on some of my own future readings.
- “His hallmarks of integrity, personality, laser-like focus, clarity and blinding speed assure him and exalted place in the Who’s Who of human striving.”
- Says that Graham’s “The Intelligent Investor” is required reading for any successful investor. “He has said Chapter 8 about investor attitudes towards an erratic, unpredictable stock market and Chapter 20 on “Margin of Safety” about buying at bargain prices are among the most important pieces of investment advice ever written- that the true investor takes advantage of stock prices when they become silly in either direction and he buys at a good price compared to real business value (pgs 75-76)”
- “His home is full of books, including a shelf of Bertrand Russell.” “Buffett says he thought like Graham.”
- “Buffett admires the writings of John Maynard Keynes such as Essays in Persuasion.”
- The following is a list of books which Buffett has read (pg 173):
a. Father, Son and Company
b. McDonald’s, Behind the Arches
c. Influence
d. Will America Grow Up Before I Grow Old. (about the looming social security crisis)
- Rule of thumb on newspapers on page 383, “good newspapers may sell for about 2.5X annual revenues.
Some WEB quotes
- “We do not have, never have had, and never will have an opinion about where the stock market, interest rates or business activity will be a year from now.” Warren Buffett 1987
- “Going short is betting on something that will happen. If you go short for meaningful amounts, you can go broke. If something is selling for twice what it is worth, what’s to stop it from selling for 10 times what it’s worth? You’ll be right eventually, but you may be explaining it to somebody from the poorhouse.”
- ” I think I am under-taxed, but I do not send along any voluntary payments.” (annual meeting 1998)
- “In golf, my score is frequently below par on a pro forma basis: I have firm plans to ‘restructure’ my putting stroke and therefore only count the shots I take before I reach the green.” (2001 annual report)
- “I will tell you how to become rich. Close the doors. Be fearful when others are greedy. Be greedy when others are fearful.” (Buffett when he was 21)
- “The public school teacher is probably the most under-compensated and under-appreciated person in the public arena.”
- “Our outlook for inflation is always the same. We feel there’s a big bias towards inflation- both in the U.s. and around the world….It’s a world where prices are going to go up. It’s just a question of how much. You could definitely have some explosive inflation at some point. Printing money is just too easy. I’d do it myself if I could get away with it.” (1988)
- “We don’t view precious metals and precious stones as great inflation hedges. But we don’t bring anything to the game, so we don’t play it.” (1988)
- “Stocks are simple. All you do is buy shares in a great business for less than the business is intrinsically worth, with management of the highest integrity and ability. Then you own those shares forever.” (1990)