Saturday, April 3, 2010

Buffett's Letters

Taking the time to read the time to read Buffett's letters to shareholders is, in my opinion, the best investment of a few hours a young investor could possibly make.


What makes them so good in my opinion is that Buffett is phenomenal at one thing- seeing through the hype.  The man seems to have the ability to step back and look at the bigger picture and analyze, with a critical eye, the current opportunities that are available.  You never read him as calling something a "new economy" or talking about how this bubble will be any different than the last 20 and will never pop. He just doesn't buy the hype. This is something I as investors like to say we are also immune to, like Buffett, the truth of it is though I catch myself all the time making decisions in the now and reacting to news stories, without taking a breath stepping back and asking, how will this potential investment look in a year from now, or five years from now?

If you don't already read them you should take the time, here is the link.

One interesting quote from February's letter:

Within a year or so, residential housing problems should largely be behind us. Prices will remain far below 'bubble' levels, of course, but for every seller or lender hurt by this there will be a buyer who benefits. Indeed, many families that couldn't afford to buy an appropriate home a few years ago now find it well within their means.


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