Great Throughts Treasury

"Despite three years of falling prices, which have significantly improved the attractiveness of common stocks, we still find very few that even mildly interest us. That dismal fact is testimony to the insanity of valuations reached during The Great Bubble. Unfortunately, the hangover may prove to be proportional to the binge."

"Despite the lack of precedent, a negative coupon security seemed possible in the present interest rate environment ... I asked Goldman Sachs to create such an instrument and they responded promptly with the innovative security being announced today."

"Do a lot of reading. [On how to determine the value of a business]"

"Do not take yearly results too seriously. Instead, focus on four or five-year averages."

"Does management resist the institutional imperative?"

"Do not save what is left after spending, but spend what is left after spending."

"Does the business have a consistent operating history?"

"Does the business have favorable long term prospects?"

"Economic medicine that was previously meted out by the cupful has recently been dispensed by the barrel. These once unthinkable dosages will almost certainly bring on unwelcome after-effects. Their precise nature is anyone's guess, though one likely consequence is an onslaught of inflation."

"During 2002 we entered the foreign currency market for the first time in my life. In 2003, we enlarged our position, as I became increasingly bearish on the dollar."

"Eddie is a very smart guy, but putting Kmart and Sears together is a tough hand."

"Eddie understood that how he lugged bats was unimportant. What counted instead was hooking up with the cream of those on the playing field."

"Enjoy your work and work for whom you admire."

"First, many in Wall Street - a community in which quality control is not prized - will sell investors anything they will buy."

"Failing conventionally is the route to go; as a group, lemmings may have a rotten image, but no individual lemming has ever received bad press"

"Every saint has a past. Every sinner has a future."

"Focus on your customers and lead your people as though their lives depend on your success."

"Forecasts may tell you a great deal about the forecaster; they tell you nothing about the future."

"Focus on return on equity, not earnings per share."

"For some reason, people take their cues from price action rather than from values. What doesn’t work is when you start doing things that you don't understand or because they worked last week for somebody else. The dumbest reason in the world to buy a stock is because it's going up."

"For example: (1) As if governed by Newton's First Law of Motion, an institution will resist any change in its current direction; (2) Just as work expands to fill available time, corporate projects or acquisitions will materialize to soak up available funds; (3) Any business craving of the leader, however foolish, will be quickly supported by detailed rate-of-return and strategic studies prepared by his troops; and (4) The behavior of peer companies, whether they are expanding, acquiring, setting executive compensation or whatever, will be mindlessly imitated."

"Getting fired can produce a particularly bountiful payday for a CEO. Indeed, he can 'earn' more in that single day, while cleaning out his desk, than an American worker earns in a lifetime of cleaning toilets. Forget the old maxim about nothing succeeding like success: Today, in the executive suite, the all-too-prevalent rule is that nothing succeeds like failure."

"Give a man a fish, and you feed him for a day. Teach him how to arbitrage, and you feed him forever."

"Gold gets dug out of the ground in Africa, or someplace. Then we melt it down, dig another hole, bury it again and pay people to stand around guarding it. It has no utility. Anyone watching from Mars would be scratching their head."

"Great investment opportunities come around when excellent companies are surrounded by unusual circumstances that cause the stock to be mis-appraised."

"Gold is a way of going long on fear, and it has been a pretty good way of going long on fear from time to time. But you really have to hope people become more afraid in a year or two years than they are now. And if they become more afraid you make money, if they become less afraid you lose money, but the gold itself doesn’t produce anything."

"Growth and value investing are joined at the hip."

"I always knew I was going to be rich. I don’t think I ever doubted it for a minute."

"I am a better investor because I am a businessman, and a better businessman because I am no investor."

"I am a huge bull on this country. We will not have a double-dip recession at all. I see our businesses coming back almost across the board."

"Honesty is a very expensive gift, Don't expect it from cheap people."

"I am out of step with present conditions. When the game is no longer played your way, it is only human to say the new approach is all wrong, bound to lead to trouble, and so on. On one point, however, I am clear. I will not abandon a previous approach whose logic I understand ( although I find it difficult to apply ) even though it may mean foregoing large, and apparently easy, profits to embrace an approach which I don't fully understand, have not practiced successfully, and which possibly could lead to substantial permanent loss of capital."

"I am a bull on sterling versus the U.S. dollar."

"I am quite serious when I say that I do not believe there are, on the whole earth besides, so many intensified bores as in these United States. No man can form an adequate idea of the real meaning of the word, without coming here."

"I call investing the greatest business in the world because you never have to swing. You stand at the plate, the pitcher throws you General Motors at 47! U.S. Steel at 39! and nobody calls a strike on you. There's no penalty except opportunity lost. All day you wait for the pitch you like; then when the fielders are asleep, you step up and hit it."

"I buy expensive suits. They just look cheap on me."

"I could end the deficit in 5 minutes. You just pass a law that says that anytime there is a deficit of more than 3% of GDP all sitting members of congress are ineligible for reelection."

"I don’t measure my life by the money I’ve made. Other people might, but certainly don’t."

"I do know that when I am 60, I should be attempting to achieve different personal goals than those which had priority at age 20."

"I don't have a problem with guilt about money. The way I see it is that my money represents an enormous number of claim checks on society. It is like I have these little pieces of paper that I can turn into consumption. If I wanted to, I could hire 10,000 people to do nothing but paint my picture every day for the rest of my life. And the GNP would go up. But the utility of the product would be zilch, and I would be keeping those 10,000 people from doing AIDS research, or teaching, or nursing. I don't do that though. I don't use very many of those claim checks. There's nothing material I want very much. And I'm going to give virtually all of those claim checks to charity when my wife and I die."

"I don't read economic forecasts. I don't read the funny papers."

"I don't look to jump over 7-foot bars: I look around for 1-foot bars that I can step over."

"I do not like debt and do not like to invest in companies that have too much debt, particularly long-term debt. With long-term debt, increases in interest rates can drastically affect company profits and make future cash flows less predictable."

"I don’t have a problem with guilt about money. The way I see it is that my money represents an enormous number of claim checks on society. It’s like I have these little pieces of paper that I can turn into consumption. If I wanted to, I could hire 10,000 people to do nothing but paint my picture every day for the rest of my life. And the GNP would go up. But the utility of the product would be zilch, and I would be keeping those 10,000 people from doing AIDS research, or teaching, or nursing. I don’t do that though. I don’t use very many of those claim checks. There’s nothing material I want very much. And I’m going to give virtually all of those claim checks to charity when my wife and I die."

"I follow very simple rule, when it comes to food, if a 3-year old doesn’t eat it, I don’t eat it."

"I get to do what I like to do every single day of the year."

"I have known Arnold for years and know he'll be a great governor. It is critical to the rest of the nation that California's economic crisis be solved, and I think Arnold will get that job done."

"I have no idea on timing. It’s easier to tell what will happen than when it will happen. I would say that what is going on in terms of trade policy is going to have very important consequences."

"I have listened to many cost of capital discussions, and they have never made much sense. It’s taught in business schools, and consultants use it, so board members nod their heads, without any idea of what’s going on."

"I have no views as to where it will be, but the one thing I can tell you is it won’t do anything between now and then except look at you. Whereas, you know, Coca-Cola (NYSE:KO) will be making money, and I think Wells Fargo (NYSE:WFC) will be making a lot of money and there will be a lot — and it’s a lot — it’s a lot better to have a goose that keeps laying eggs than a goose that just sits there and eats insurance and storage and a few things like that."