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When the Oracle of Omaha speaks, investors listen — and they have been listening to the seemingly divinely-inspired business analysis of financier Warren Buffett for decades.
As Buffett steps down as CEO after 60 years at the helm of Berkshire Hathaway, his greatest legacy may be the plain-spoken yet sharp advice about money, mistakes and human nature that inspired legions of fans.
Buffett, now one of the world’s richest people, built his fortune through decades of investing and by turning Berkshire Hathaway from a struggling textile company into a sprawling conglomerate spanning insurance, railroads, energy and consumer brands.
Despite his wealth, he became almost as famous for his frugality — living for years in the same modest Omaha home and cultivating a no-frills image — as for his investing acumen.
Buffett has continuously pledged to give away the vast majority of his fortune, donating tens of billions of dollars to philanthropy, while his annual shareholder letters became required reading for investors worldwide.
Each spring, fans and shareholders flocked to Omaha for Berkshire’s annual meetings, an event so popular it earned the nickname “Woodstock for Capitalists”.
Here is a collection of some of Buffett’s most famous quotes from over the years:
On greed
“Be fearful when others are greedy, and greedy when others are fearful.”
This is how Buffett summed up his investing approach of buying out-of-favour stocks and companies when they were selling for less than he estimated they were worth.
He also urged investors to stick with industries they understand and that fall within their “circle of competence” and offered this classic maxim: “Rule No. 1: Never lose money. Rule No. 2: Never forget Rule No. 1.”
On ethics
“After they first obey all rules, I then want employees to ask themselves whether they are willing to have any contemplated act appear the next day on the front page of their local paper to be read by their spouses, children and friends with the reporting done by an informed and critical reporter.”
“If they follow this test, they need not fear my other message to them: Lose money for the firm and I will be understanding; lose a shred of reputation for the firm and I will be ruthless.”
That is the ethical standard Buffett explained to a Congressional committee in 1991 that he would apply as he cleaned up the Wall Street investment firm Salomon Brothers. He has reiterated the newspaper test many times since over the years.
On the true nature of businesses
“You only find out who is swimming naked when the tide goes out.”
Many companies might do well when times are good and the economy is growing, but Buffett told investors that a crisis always reveals whether businesses are making sound decisions.
On friends and associates
“Who you associate with is just enormously important. Don’t expect that you’ll make every decision right on that. But you are going to have your life progress in the general direction of the people you work with, that you admire, that become your friends.”
Buffett always told young people that they should try to hang out with people who they feel are better than them because that will help improve their lives. He said that holds particularly true when choosing a spouse, which might be the most important decision in life.
On the US economic system
“Our unwavering conclusion: never bet against America.”
Buffett has always remained steadfast in his belief in the American capitalist system. He wrote in 2021 that “there has been no incubator for unleashing human potential like America. Despite some severe interruptions, our country’s economic progress has been breathtaking.”