I enjoyed this old interview with Warren Buffett (1985):
Berkshire Hathaway was 20 years old at this time.
“If you buy things for far below what they’re worth, and you buy a group of them, you basically don’t lose money.” 1:05
Q: Warren, what do you consider the most important quality for an investment manager?
A: It’s a temperamental quality not an intellectual quality. You don’t need tons of IQ in this business. You do not have to be able to play three dimensional chess. You need a stable personality. You need the temperament that neither derives great pleasure from being with the crowd or against the crowd. This is not a business where you take polls, this is a business where you think. Ben Graham would say “You’re not right or wrong because a 1,000 people agree with you or disagree with you. You’re right because your facts and your reasoning are right.”
“The real test of whether you’re investing from a value stand point is if you care if the stock market is open tomorrow. If you’re making a good investment in a security, it shouldn’t both you if they close down the stock market for 5 years. All the ticker tells me is the price. Prices don’t tell me anything about a business. Business figures themselves tell me about a business. I’d rather evaluate a business first without knowing the price, so the price doesn’t influence me, then look at the price later to see if it’s way out of line than what my value is.” (2:20)
“There may be many wonderful pitches to swing at, but if you don’t know enough, you don’t have to swing. You can sit there and watch thousands of pitches and only swing at ONE when you know a bunch about it. I might not swing for 2 years. It would bore most people, and certainly boredom is a problem with most professional money managers.” (5:50)