21 Buffett Quotes Worth Contemplation

Warren Buffett is a smart guy. In my book, it is more important to have great common sense than it is to just be I.Q. rocket-science smart. Mr. Buffett is both – he clearly stood in line several times as God was dealing out common sense before he was born.

As many of you know, I am a long-term investor and I have read Warren’s shareholder letters with great interest for years. I don’t agree with Warren on every front (mostly politics) but he does author a lot of great, common-sense quotes worth thinking through.  Here are a few of my favorites:

1. Someone is sitting in the shade today because someone planted a tree a long time ago.
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2. Should you find yourself in a chronically leaking boat, energy devoted to changing vessels is likely to be more productive than energy devoted to patching leaks.
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3. Price is what you pay. Value is what you get.
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4. It’s better to hang out with people better than you. Pick out associates whose behavior is better than yours and you’ll drift in that direction.
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5. It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you’ll do things differently.
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6. In the 20th century, the United States endured two world wars and other traumatic and expensive military conflicts; the Depression; a dozen or so recessions and financial panics; oil shocks; a flu epidemic; and the resignation of a disgraced president. Yet the Dow rose from 66 to 11,497.
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7. You only have to do a very few things right in your life so long as you don’t do too many things wrong.
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8. The business schools reward difficult complex behavior more than simple behavior, but simple behavior is more effective.
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9. Wide diversification is only required when investors do not understand what they are doing.
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10. It’s far better to buy a wonderful company at a fair price than a fair company at a wonderful price.
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11. Look at market fluctuations as your friend rather than your enemy; profit from folly rather than participate in it.
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12. We believe that according the name ‘investors’ to institutions that trade actively is like calling someone who repeatedly engages in one-night stands a ‘romantic.’
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13. If a business does well, the stock eventually follows.
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14. You’d get very rich if you thought of yourself as having a card with only twenty punches in a lifetime, and every financial decision used up one punch. You’d resist the temptation to dabble. You’d make more good decisions and you’d make more big decisions.
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15. Generally speaking, investing in yourself is the best thing you can do. Anything that improves your own talents; nobody can tax it or take it away from you. They can run up huge deficits and the dollar can become worth far less. You can have all kinds of things happen. But if you’ve got talent yourself, and you’ve maximized your talent, you’ve got a tremendous asset that can return ten-fold.
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16. You are neither right nor wrong because the crowd disagrees with you.
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17. The trick is, when there is nothing to do, do nothing.
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18. No matter how great the talent or efforts, some things just take time. You can’t produce a baby in one month by getting nine women pregnant.
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19. Money will not change how healthy you are or how many people love you.
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20. Never lie under any circumstances.
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There’s a lot of wisdom, and great reason for optimism, in less than 500 words.

I.M. Optimism Man