I have pledged - to you, the rating agencies and myself - to always run Berkshire with more than ample cash. We never want to count on the kindness of strangers in order to meet tomorrow's obligations. When forced to choose, I will not trade even a night's sleep for the chance of extra profits.
Interpretation
The quote emphasizes the importance of financial prudence and integrity in business.
Warren Buffett highlights the necessity of maintaining a strong cash reserve to ensure operational stability and to honor commitments without relying on external help. He prioritizes long-term security and ethical practices over short-term financial gains, showcasing a deep understanding of responsible business management.
In practice
During a financial presentation, one might use this quote to stress the need for prudence in managing company finances.
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 (KO) will be making money, and I think Wells Fargo (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.
If the world couldn't see your results, would you rather be thought of as the world's greatest investor but in reality have the world's worst record? Or be thought of as the world's worst investor when you were actually the best?
Cash never makes us happy, but it's better to have the money burning a hole in Berkshire's pocket than resting comfortably in someone else's.
I think you should read everything you can. In my case, by the age of 10, I'd read every book in the Omaha public library about investing, some twice. _x000D_ You need to fill your mind with various competing thoughts and decide which make sense.
The most common cause of low prices is pessimism - some times pervasive, some times specific to a company or industry. We want to do business in such an environment, not because we like pessimism but because we like the prices it produces. It's optimism that is the enemy of the rational buyer.
One’s objective should be to get it right, get it quick, get it out and get it over. Your problem won’t improve with age.
The only person who acts sensibly is my tailor. He takes my measure anew every time he sees me. Everyone else goes by their old measurements.
Jealous people poison their own banquet and then eat it
What would be the good of rushing? You want these books to last.
Until I became a published writer, I remained completely ignorant of books on how to write and courses on the subject ... they would have spoiled my natural style; made me observe caution; would have hedged me with rules.
There is perhaps no psychological skill more fundamental than resisting impulse.
Like a tongue on frozen steel, like flesh in flame —
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