Taken from the book by Peter Bevelin:

  • I may talk like an idiot, & look like an idiot. But don’t let that fool you. I’m really an idiot.
  • To try to live your life totally free of mistakes is a life of inaction.
  • You only have to be right on a very, very few things in your lifetime as long as you never make any big mistakes.
  • Big life issues like choosing the right spouse, education, career, friends, place to live, investment or taking care of your health- a wrong choice in these matters may haunt you a long, long time.
  • We have a passion for keeping things simple.
  • A clever person solves a problem. A wise man avoids it.
  • Many things are easier to prevent than fix.
  • And that’s why a lot of the correct thinking should be preventive.
  • If you really want to be the outlier in terms of achievement, just sit on your ass & read- and do it all the time.
  • Read & think.
  • The best way to minimize risk is to think.
  • The best way to think about investments is to be in a room with no one else & just think.
  • Many people would rather do something stupid than think.
  • Attention is a limited resource.
  • Focus your attention on one thing- it’s less effort.
  • I did not succeed in life by intelligence. I succeeded because I have a long attention span.
  • Multitasking my way to glory has never occurred to me.
  • I don’t care whether the cat is black or white as long as it catches mice.
  • It is better to try to be consistently not stupid than to be very intelligent.
  • We have not succeeded because we’ve done brilliant things, but because we’ve probably done fewer dumb things than most.
  • We didn’t do all the smartest things. We didn’t do anything really dumb.
  • We recognised that very smart people do very dumb things. It’s ego, greed, fear, mindless imitation of others. It’s called crowd folly.
  • We try to avoid any kind of imitation of other people’s behaviour.
  • A lot of people with high IQs are terrible investors because they’ve got terrible temperaments.
  • You need an ability to not be driven crazy by extreme success.
  • We just don’t do things we don’t understand. And we won’t feel jealous when others do well.
  •  It’s the strong swimmers who drown.
  • If we know what doesn’t work we don’t go there.
  • We emphasize the study of mistakes rather than successes.
  • Always do inversion (think in the opposite direction). To understand how to be happy in life, study how to make life miserable.
  • One day at a time I find new errors & add to my list.
  • You have to be a student of other’s folly.
  • A lot of success in life & business comes from knowing what you want to avoid- early death, a bad marriage.
  • Think of what doesn’t work.
  • Thinking backwards is a great tool for solving problems. Instead of asking how you can achieve a goal, ask the opposite question: What don’t I want to achieve? What causes non-goal?
  • If you want to help India, the question you should consider asking is not: How can I help India? Instead you should ask: How can I hurt India? You find what will do the worst damage, & then try to avoid it.
  • A lot of people make things more complicated than they need to.
  • We just look for no-brainer decisions.
  • One of the greatest ways to avoid trouble is to keep it simple.
  • You don’t have to hire out your thinking, if you keep it simple.
  • I can give you an argument, but I can’t give you an understanding.
  • The secret is ignorance removal.
  • Did you know that many people spend more time planning their wedding, than their marriage?
  • If you really want a marriage to last, look for someone with low expectations.
  • Look for someone who will love you unconditionally & will subtly encourage you to be better than you thought you can be.
  • Marry someone who is better person than you are. Always associate yourself with people who are better than you.
  • The greatest gift that my father ever gave me was unconditional love.
  • Every thing that needs to be said has already been said. But since no one was listening, everything must be said again.
  • I always have a quotation for everything- it saves original thinking.
  • A lot of what is taught in higher education isn’t very useful to those learning it, & a lot of people who are taught wouldn’t learn anything anyways.
  • To understand… is to know what to do.
  • Make 2 or 3 forces working in the same direction.
  • Happy wife, happy life & miserable wife, miserable life.
  • If you want to be happy in marriage, improve yourself as a spouse.
  • I worked myself up from nothing to a state of extreme poverty.
  • What doesn’t work is when you start doing things that you don’t understand or because they worked last week for somebody else. Say- Include me out.
  • Don’t live a life based on the approval from others. Be authentic- be & act in accordance with who you are, what you like & are good at, or one day your mask will fall off.
  • The difference between successful & very successful people is that the very successful people say “no” to almost everything. You’ve got to keep control of your time. And you won’t keep control of your time unless you say no. You can’t let other people set your agenda in life.
  • Both Warren & I have an amazingly open calendar & we are very reluctant to put new commitments in there. I like flexibility & it has worked for me.
  • He was happily married, but his wife wasn’t.
  • If you want to get rich, or make some serious money, you’ve got to save. And the savings have to be intelligently invested.
  • If you don’t know how to save, I cannot help you.
  • Debt & misery live on the same road.
  • Smart men go broke in 3 ways: liquor, ladies & leverage.
  • A guy running his company fired his top producer. The producer asked him why? He replied” You make me nervous. I’m a rich old man. Why should I be nervous?
  • The roads of business are riddled with potholes; a plan that requires dodging them all is a plan for disaster.
  • Good business decisions will eventually produce quite satisfactory economic results, with no aid from leverage.
  • One thing that is asinine is self-pity.
  • For attitude, think: every mischance in life, however bad, creates an opportunity to behave well.
  • Three ways of coping with disappointments: Have low expectations; have a sense of humour, and surround yourself with the love of friends & family.
  • We concentrate on conservatively financed businesses with strong competitive strengths, run by able & honest people.
  • Financial staying power requires a company to maintain three strengths around all circumstances: A large & reliable stream of earnings, massive liquid assets, no big near-term cash requirements.
  • On gambling: A gambling man lost regularly. One day he heard about a race with only one horse in it, so he bet the rent money. Halfway round the track, the horse jumped over the fence & ran away.
  • Remember the proverb: Before setting off on revenge, you first dig two graves.
  • Disraeli, as he rose to become one of the greatest Prime Ministers, learned to give up vengeance as a motivation for action, but he did retain some outlet for resentment by putting the names of people who wronged him in a drawer. Then from time to time he reviewed the names & took pleasure in noting the way the world had taken his enemies down without his assistance.
  • If you speak when angry, you’ll make the best speech you’ll ever regret.
  • One certain path to failure is being unreliable. Reliability is essential for progress in life. And a great reputation is like virginity, it can be preserved but it can’t be restored.
  • When you get older, you will get the reputation you deserve.
  • There’s money in being trusted. It’s such a simple idea.
  • To your children, you teach them by what you do & not by what you say. There is no rewind button.
  • It’s nice to be important but more important to be nice.
  • The big thing you want to do is you want to enjoy everyday. So you want to have a job you love & you want to work with people that you like & admire & trust.
  • I know lots of people who are not rich in financial terms but they are still happy. I know plenty of unhappy rich people.
  • We look for people with not necessary the highest IQs, but people who have a good work ethic, are loyal, honest & reliable.
  • You’ll do better is you have passion for something in which you have aptitude.
  • Man is a prisoner of his talents. That is the hand we are given to play in life.If you are 5’2″, I don’t think you want to play basketball.
  • You’ve got to know what you know & what you don’t know. What could possibly be more useful in life than that?
  • You don’t have to have an opinion on everything.
  • Some problems are so complex that you have to be highly intelligent & well informed just to be undecided about them.
  • What frightens me about business schools…they train their students to sound wonderful. But it’s necessary to find out if there’s judgement behind their language.
  • The downfall of a magician is the belief in his own magic.
  • Avoid dealing with people of questionable character. Don’t fight with a pig, you’ll just get dirty & the pig likes it.
  • Think how much life is simplified & improved when you are around & deal with people you can trust. Or to invert, think about the misery of being around people you can’t trust.
  • We don’t like relationships that are based on contracts.
  • If everybody distrusts everybody & tries to protect himself with contracts & procedure, you don’t have the best human culture, you have the worst.
  • We have decentralization just short of abdication in handling our subsidiaries.
  • The extraordinary delegation of authority now existing in our company is the ideal antidote to bureaucracy.
  • The whole idea of our company, is that managers are responsible for their businesses & we don’t tell them what to do.
  • He is a better business executive for spending no time in micromanagement.
  • In other words, don’t hire a dog & try to do the barking.
  • We have low overhead, don’t have quarterly goals & budgets or a standard personnel system.
  • We can obtain a better management result through non-control than control.
  • By the standards of the rest of the world, we over-trust– but I think a lot of places work better where there is a culture of trust.
  • Culture, more than rule-books, determines how an organisation behaves.
  • If you have a good culture, I think you can make the rules pretty simple.
  • Culture is everything in our company.
  • Our trust is in people rather than process.
  • Have the following: honest accounting, pride of product, respect for customers, & a loyal group of associates having a strong sense of direction.
  • The right way to get a good spouse is to deserve one.
  • I like to know what the truth is so I can decide whether to believe it or not.
  • Wishing makes dreams come true only in Disney movies; its poison in business.
  • Just tell me the bad news; the good news will take care of itself.
  • A fault confessed is half forgiven.
  • To others being wrong is a source of shame; to me, recognising my mistakes is a source of pride.
  • If the terrain & the map don’t agree, follow the terrain.
  • The failure rate at trying to change a culture is 100%.
  • If you want to guarantee yourself a life of misery, marry somebody with the idea of changing them.
  • Appeal to interest & not to reason if you want to change conclusions.
  • Everyone’s entitled to their own opinions, but not to their own facts.
  • You only have to get rich once. But people self-destruct in pursuit of making money they didn’t really need as they were already rich.
  • In our view, it is madness to risk losing what you need in pursuing what you simply desire.
  • It’s waiting that helps you as an investor, & a lot of people just can’t stand to wait.
  • The trick is, when there is nothing to do, do nothing. You don’t get paid for activity. You only get paid for being right.
  • You have to understand when competitive advantages are durable & when they are fleeting.
  • In business, I look for economic castles protected by un-breachable moats. One of the best moats is to be a low cost producer of something that’s essential to people. (Moat is a metaphor for superiorities a company possesses that make life difficult for their competitors.)
  • A brand is a promise.
  • Never abuse current clients by trying to get new ones. Think, how this would work in matrimony-if you ignore your current wife while you pursue another one. Many people don’t practice this rule.
  • We should make a list of everything that irritates a customer. Then we should eliminate those defects one by one.
  • Moat example- Is the product essential to the customer? And does one have pricing power. If you have the power to raise prices without losing business to a competitor, you have a good business. And if you have to pray before asking for the smallest extra price, you have a terrible business.
  • Essentiality & pricing power.
  • Every day with every product, the moat widens or narrows. If the moat is widening, profits will rise.
  • The key to investing in any company is the competitive advantage & the durability of that advantage. The trick is to have no competitors. That means having a product that truly differentiates itself.
  • How did Coca-Cola widen their moat? They deepened the thought in people’s minds that Coca-Coke is where happiness is. The brand is associated with people being happy around the world. Happiness & Coke go together.
  • A really wonderful business is very well protected against the vicissitudes of the economy & competition over time. If you see a business take a lot of adversity & still do well, it tells you something about its underlying strength.
  • There is a huge difference between the business that grows & requires lots of capital to do so & the business that grows & does not require capital.
  • A commodity business: Hundreds of competitors, ease of entry, & a product that cannot be differentiated in any meaningful way.
  • We do not like businesses prone to rapid & continuous change… A moat that must be continuously rebuilt will eventually be no moat at all.
  • The Amazon threat: you punch a button & it comes the next day; you don’t have to drive through traffic; you don’t have to look for a parking spot; you don’t have to wait in line. Amazon could affect a lot of businesses who don’t think they will be affected. For Amazon, it is very hard to find unhappy customers. A business that has millions of happy customers can introduce them to new items will be a powerhouse & could affect a lot of businesses. It will hurt a lot of businesses. It’s terrible for retailers. Highly.
  • I liked you better before I got to know you well.
  •  Making a bad investment decision without thinking much is like: I’ve never gone to bed with an ugly woman but I’ve sure woke up with  few.
  • Projections do more harm than good- especially when they are prepared by people who desire a certain outcome.
  • This is a story of an ailing horse: The owner of the horse tells the vet that sometimes the horse walks just fine & sometimes he limps. The vet’s reply was pointed: No problem- when he’s walking fine, sell him.
  • The ABCs of business decay: arrogance, bureaucracy & complacency.
  • CEO should focus on widening the moat. (Historically, a moat has been the water surrounding a fort or a castle as a protection against invasion. In investing parlance, a moat refers to a company’s ability to have a competitive advantage over its competitors that will help it maintain its market share. It gives long term profit visibility. Great trusted brands have deeper moats. Even patents & high entry barriers result in deeper/ wider moats.)
  • Size seems to make many organisations slow-thinking, resistant to change & smug: In Churchill’s words:’ We shape our buildings, & afterwards our buildings shape us.
  • When you are in a hole, stop digging.
  • A prime rule for investing: You don’t have to make it back the way you lost it.
  • Character is crucial. A Berkshire CEO must be “all in” for the company, not for himself… it’s important that neither ego nor avarice motivate him to reach for pay matching his most lavishly-compensated peers, even if his achievement far exceeds theirs. A CEO’s behaviour has a huge impact on managers down the line: If it’s clear to them that shareholder’s interest are paramount to him, they will, with few exceptions, also embrace that way of thinking.
  • The way you do anything is the way you do everything.
  • Our job is to retain great managers by not messing up something that’s already good.
  • How do you beat Bobby Fisher? You play him any game except chess.
  • How do I find my edge? I would be looking for a place where I could figure out something very useful that other people didn’t know. I don’t think anything that any ordinary person can do easily is likely to work that well. You want to work where there is little competition. One of the secrets of life is weak competition.
  • You have to go to bed wiser than you got up.
  • You don’t need higher math in business & if you learn it you feel tempted to use it- to your detriment. You really have to understand the company & its competitive positions, That’s not disclosed by math.
  • We’d rather be roughly right than precisely wrong.
  • We want our managers to think about what counts, not how it will be counted. And when you ‘count’, don’t make anything more precise than necessary. Often a rough approximation is good enough. For an accountant, 7 times 7 is 49. For a businessman 50 will do.
  • People calculate too much & think too little. In any case, your calculation is only as good as your assumptions.
  • Some subjects are so serious that one can only joke about them.
  • I am never so serious as when I am joking.
  • Market forecasters will fill your ears but not your wallet.
  • Berkshire is a template for rationality.
  • The good decisions scream at you.
  • If something is too hard, we move on to something else. What could be more simple than that?
  • Never make important decisions when you are tired.
  • If you buy the best machine, your profits may not go up if everybody buys the same machines. It becomes an arms race. It is sort of like being in a crowd, & everyone stands on tip-toes- your view doesn’t improve but your legs hurt. It wasn’t that technology didn’t work, it’s that the laws of economics caused the benefit from the new machines to go to the people who bought the product, not the guy who owned the machines. If my competitor has air-conditioning, I had air-conditioning… If they put in an escalator, I also put in one. These are all defensive decisions. Instead, or also, put in moats where you neither lose unit volume or competitive position & really get the benefits of the increased cost-efficiencies.
  • In a business selling a commodity-type product, it’s impossible to be a lot smarter than your dumbest competitor.
  • I’ve avoided idiocy. I try to be non-idiotic.
  • Just avoid doing dumb things.

    1. In a difficult business, no sooner is one problem solved, than another surfaces-never is there just one cockroach in the kitchen.

    2. My wife ran away with my best friend & I still miss him a lot.

    3. On getting an award- I don’t deserve this, but then, I have arthritis & I don’t deserve that either.

    4. Working with people who cause your stomach to churn seems much like marrying for money-probably a bad idea under any circumstances, but absolute madness if you are already rich.

    5. Practice does not make perfect, practice makes permanent.