Berkshire Hathaway Annual Letter
A footnote: We paid the IRS tax of $1.2 billion on our PetroChina gain. This sum paid all costs of the U.S. government – defense, social security, you name it – for about four hours.
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The best anecdote I’ve heard during the current presidential campaign came from Mitt Romney, who asked his wife, Ann, “When we were young, did you ever in your wildest dreams think I might be president?” To which she replied, “Honey, you weren’t in my wildest dreams.”
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You may recall a 2003 Silicon Valley bumper sticker that implored, “Please, God, Just One More Bubble.” Unfortunately, this wish was promptly granted, as just about all Americans came to believe that house prices would forever rise. That conviction made a borrower’s income and cash equity seem unimportant to lenders, who shoveled out money, confident that HPA – house price appreciation – would cure all problems. Today, our country is experiencing widespread pain because of that erroneous belief. As house prices fall, a huge amount of financial folly is being exposed. You only learn who has been swimming naked when the tide goes out – and what we are witnessing at some of our largest financial institutions is an ugly sight.
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You will recall that in our catastrophe insurance business, we are always ready to trade increased volatility in reported earnings in the short run for greater gains in net worth in the long run. That is our philosophy in derivatives as well.
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(I’ve reluctantly discarded the notion of my continuing to manage the portfolio after my death – abandoning my hope to give new meaning to the term “thinking outside the box.”).
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Then, after a short recess, Charlie and I will convene the annual meeting at 3:15. If you decide to leave during the day’s question periods, please do so while Charlie is talking.
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Stop by the NetJets booth at the Qwest to learn about viewing these planes. Come to Omaha by bus; leave in your new plane. And take all the hair gel and scissors that you wish on board with you.
Principles for Writing
Here are the six rules (and their origin) I try to follow when writing:
- Avoid the verb ‘to be’ and all its forms (is, am …). – Grade 10 English Teacher, Mr. Shannon
- Write something once, then cross out the unnecessary words. – Yves Faguy
- Avoid the use of “I” because it is stylistically poor and it bad for the ego. – Good to Great
- Use positive language (i.e. avoid no, can’t, won’t) because people prefer positive thinking. – Neuro-Linguistic Programming
- Use sub-titles, chapter headings, etc. – Yves Faguy
- Open and close paragraphs with short, positive statements.
- Provide much more context than you think you need. People always underestimate how much context is in their own heads and communicating that context to the readers is critical to get your point across.
- Alternate long and short sentences, use language in the same way you use notes in music.
Great book on the topic: Writing without Bullshit (for business writers)
This piece by Paul Graham outlines where essays came from and what they are really for: exploring an idea, not making an argument.Essay here.
Movies, Books, and Drama
While the west was already “developed” in the 1950s, we have become significantly more developed since then. Our society has more precise rules, more information, more security, more wealth, and more peace – all of which are reflections of the degree of development. We need more to be shocked – if at all possible – more to be pleased, and more to be happy.
On a note of some relevance, I am currently rereading The Lord of the Rings (for the third time). What comes to mind in comparison with the film adaptation is two things, the timeline and the dramatics. While the journey and time is dragged out over years and decades in the book, the movie does not make much effort to show that is less than a year or so. Also, actions are made more dramatic and sensational in the movie. These two trends are both common in film adaptations, but it leads me to the question of whether our society has been saturated with tales and stories. To get our attention, an event must truly be dramatic.
The one scene that quickly comes to mind is where Frodo accidentally puts the ring on while at the Prancing Pony. In the book he is dancing on a table, slips and the ring slides onto his finger because he was fingering it in his pocket. In the film, the ring goes flying through the air and slides onto his outstretched arm as he tumbles to the ground. While the difference is not enormous, it reflects the larger trend of making an event far more dramatic in film than in a descriptive book.
Published on February 19, 2008Information
Abridged talk by Dawkins (there is a longer one, which I will try to dig up).
No Science, No progress
Our PM recently fired the National Science Advisor and closed the post. The fact that there is no scientist advising the head of Canada is pretty frightening. All progress is because of science. Even social movements are usually thanks to science (printing press, radio, sanitation…); so if we are not putting science at the top of our agenda, what are putting up there?
This conservative government scares me. It’s nice to know we have an un-charismatic scientist named Dion in the wings.
http://www.cbc.ca/technology/quirks-blog/2008/01/no_science_in_the_pms_ear.html
Published on January 28, 2008