59 Quotes by Daniel Pecaut

Buffett reminded folks that to buy a stock is to buy part ownership of a business. Don’t get hung up on daily price quotes. Instead, think about business performance and what you would pay for the business, just as you would a farm.

After you have enough for daily life, all that matters is your health and those you love.

Buffett emphasized that the ability to generate cash and reinvest is critical. He noted that it is the ability to generate cash that gives Berkshire its value.

Buffett also shared some of his classic bits of wisdom about growing wealth. Spend less than what you make. Know and stay within your circle of competence. The only businesses that matter are the ones you put your money in. Keep learning over time. Don’t lose. Insist on a margin of safety.

While reading, you may wonder, If Berkshire got out of the market, shouldn’t I do the same? or If Berkshire bought it, should I buy it too? Buffett and Munger are clear in their advice – people should learn from them and model their advice rather than copy their behavior. The main reason is this: Unless you find yourself in the enviable position that Berkshire operates in, you would do well not to copy its moves.

Buffett observed that they do have filters. A key one is whether they have a good idea of how the business is going to do over the next five or 10 years.

Every year Buffett explains that he wants Berkshire to have great long-term shareholders and that splitting the stock would only work against that.

The key to calculating value is determining what will come out of the business.

Warren recommended doing what turns you on. Munger agreed, saying he’d never done anything really well that he didn’t like to do.