Thursday, February 7, 2008

Buffett Interview in Canada

The Dow Jones [Industrial] Average started the 20th century at 66 and it ended at 11,400. That is not a bad train to be on. How could anybody lose money on something that went from 66 to 11,400? Well, a lot of people lost a lot of money in stocks because they come in at the wrong time, and they get out at the wrong time, and they buy the wrong things, and they get excited, and they get greedy when others get greedy, and fearful when others get fearful. I say you should get greedy when others are fearful and fearful when others are greedy, but that's hard for most people to do

It is much easier to buy and buy and buy little pieces of a wonderful group of American businesses, and you'll do fine over time and you'll keep your costs low. If you try to be a little bit smarter, you'll probably end up being a lot dumber.

Warren Buffet was in Canada attending the BusinessWire debut there. He spent some time with the Financial Post discussing his thoughts on investing, and the general state of affairs.

Both the written interview and video clip are provided below.

Video Interview

Interview Transcript


Anonymous said...

66 to 11400 sounds impressive, but over 100 years, that's only a 5.3% annual return. :) Dividends included??

Sham Gad said...

It's actually very impressive. If you begin at 11400 and compound this figure over 100 years at 5.3% then the Dow would be at....1,994,077!

I'd be willing to bet that this won't occur in 100 years. Imagine the growth in value of some of your securities, if carefully chosen, that would materialize over this growth.

Your point definitely reiterates Buffett's thoughts that you'll do well over time. Great comment...thanks for bringing it up.