# Lifestyles & Discussion > Family, Parenting & Education > Books & Literature >  Warren Buffetts straightforward rules for long-term success

## Ronin Truth

> *Warren Buffetts straightforward rules for long-term success
> *
> One thousand dollars invested in Warren Buffetts Berkshire Hathaway stock in 1965 would be worth roughly $5 million today! This astonishing success didnt come through Buffetts use of high-tech computer trading models, or intricate market timing systems. Instead, it came through his stubborn adherence to the time-honored fundamentals of value investing.
> 
> How Buffett Does It is a step-by-step guidebook for investing like Buffett in any market environment. This value investing primer presents and expands on 24 primary ideas Buffett has followed from day one that include:
> 
> * Choose simplicity over complexity * Make your own investment decisions * Be patient * View stocks as businesses not pieces of paper * Practice inactivity, not hyperactivity * View downturns as buying opportunities * Practice independent thinking * Ignore stock market forecasts * Be fearful when other are greedy, and greedy when others are fearful * Avoid the costly mistakes of others.
> 
> Warren Buffett still lives in the house he bought three decades ago, still drives his comfortable Lincoln Town Car, and still holds to the sound and simple value investing style that helped him become one of the worlds wealthiest individuals. How Buffett Does It explains, in Buffetts words as well as those who know him best, what you can do to achieve Buffett-like results in your own portfolio.
> ...


http://www.amazon.com/How-Buffett-Do.../dp/0071449124

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## Schifference

It is my understanding that Buffett owns Kirby vacuum. IMHO that company is disgusting and preys on unemployed people and their families instilling high hopes that fall flat. I would find it more respectable to offer value rather than a scheme that takes advantage if the disadvantaged.

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## Ronin Truth

*List of assets owned by Berkshire Hathaway
**http://en.wikipedia.org/wiki/List_of...shire_Hathaway*

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## Schifference

Kirby = The Scott Fetzer Company = Berkshire Hathaway

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## Ronin Truth

> Kirby = The Scott Fetzer Company = Berkshire Hathaway


 Well, if I were you I wouldn't buy Berkshire.

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## helmuth_hubener

> How Buffett Does It shows you how to follow his lead, and build a portfolio that is solid


 Therein lies a problem.  Buffett didn't "build a portfolio."  That's not how he "did it."  If you follow these steps:

1) Read a "how-to" book
2) Build a portfolio

then what you are doing will not bear any resemblance to what Warren Buffet did.  Since what you are doing will have nothing to do with what Warren Buffett did, obviously the results you get will have nothing to do with the results he got.

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## thoughtomator

Where's "buy the government" on that list?

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## Ronin Truth

> Therein lies a problem. Buffett didn't "build a portfolio." That's not how he "did it." If you follow these steps:
> 
> 1) Read a "how-to" book
> 2) Build a portfolio
> 
> then what you are doing will not bear any resemblance to what Warren Buffet did. Since what you are doing will have nothing to do with what Warren Buffett did, obviously the results you get will have nothing to do with the results he got.


So then you just hire Warren and buy BRK.B or, if you can afford it and really want to vote at the shareholder's meeting, BRK.A.

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## Schifference

What has been the historical net return on BRK ?

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## helmuth_hubener

> So then you just hire Warren and buy BRK.B or, if you can afford it and really want to vote at the shareholder's meeting, BRK.A.


Past performance is no guarantee of future results.  

Passively buying a small share in the diversified business empire of an aged and successful man bears absolutely no resemblance whatsoever to "What Warren Buffet Did".

The book you're promoting purports to reveal "How Buffett Does It," and to tell us precisely how we can duplicate his success.  Now you are saying that we ought to do something totally, totally different than Buffett and, presumably, that that should lead to the same success Mr. Buffett experienced.

Explain to me what type of returns you expect to get in the next 20 years if you were to buy Berkshire Hathaway.  Then explain to me why your prediction of the future is better than anyone else's.

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## Ronin Truth

> Where's "buy the government" on that list?


  It's already been bought and sold several times over.  I think the Rothschilds and their surrogates still own it now.

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## helmuth_hubener

Buffett is the flavor of the week.  Everyone should just follow him and do exactly as he does.  Fine.  What if _I_ think we should all follow the example of the greatest stock investor of all time: Jesse Livermore.

http://www.jesse-livermore.com/

He was the greatest.  Never has there been a better stock trader than him.  So, we should read _his_ book.  Follow _his_ example.  Obviously.  Right?

Right?

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## Brian4Liberty

> *List of assets owned by Berkshire Hathaway
> **http://en.wikipedia.org/wiki/List_of...shire_Hathaway*


Based on that list, the article completely ignores what Buffet actually does. He fully purchases businesses, thus removing them from the grasp of the Wall St vultures and parasites. They are no longer on the stock market, and no longer exposed to stock manipulation, leveraging, options, wild market fluctuations, panics, mergers, media hysteria, acquisitions, shareholders, etc.

My opinion has always been that a company is far better off being private rather than public.

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## Ronin Truth

> *Past performance is no guarantee of future results.* 
> 
> Passively buying a small share in the diversified business empire of an aged and successful man bears absolutely no resemblance whatsoever to "What Warren Buffet Did".
> 
> The book you're promoting purports to reveal "How Buffett Does It," and to tell us precisely how we can duplicate his success. Now you are saying that we ought to do something totally, totally different than Buffett and, presumably, that that should lead to the same success Mr. Buffett experienced.
> 
> Explain to me what type of returns you expect to get in the next 20 years if you were to buy Berkshire Hathaway. Then explain to me why your prediction of the future is better than anyone else's.


 Warren has been saying the very same thing since the mid 70's. I'd bet we can probably count on his selected heir for future growth. Of course Warren is giving away 99% of his personal wealth. 

You just really don't get it do you? I can tell from your ....... questions. Go ahead and believe that you can't make money long term and that no one else can either. LOL!

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## Ronin Truth

> What has been the historical net return on BRK ?


http://en.wikipedia.org/wiki/Berkshire_Hathaway

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## Ronin Truth

> Buffett is the flavor of the week. Everyone should just follow him and do exactly as he does. Fine. What if _I_ think we should all follow the example of the greatest stock investor of all time: Jesse Livermore.
> 
> http://www.jesse-livermore.com/
> 
> He was the greatest. Never has there been a better stock trader than him. So, we should read _his_ book. Follow _his_ example. Obviously. Right?
> 
> Right?


Jesse was an interesting fellow too.  But he lost it all more than once.

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## helmuth_hubener

> You just really don't get it do you?


 That is certainly a possibility.  In fact, it's a certainty that I do not understand everything completely.  There is much I have to learn.




> I can tell from your ....... questions.


 That is good that you can tell that.  But then, knowing my ignorance, you are not going to try to help me overcome my ignorance with good information?  You are not going to _answer_ any of my ignorant questions?

That seems counter-productive.  

It makes you look as if you have no answers, for one thing.




> Go ahead and believe that you can't make money long term and that no one else can either. LOL!


 I do not believe that.  I do make money.  I believe that people can make money.  How do we make it?  *In our careers.*

A good investment plan can help.  It can improve our lives in so many ways.  But that is not how you are going to make your fortune.  You are going to make your fortune *in your career*, if you are going to make one.

_That's_ how Warren Buffett did it, and "Does It."  Investing was and is his career.  His calling.  His obsession.  But it's not mine.  It's not yours.  And that is why we will not get the same results he did.  It's really quite simple, Ronin.

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## helmuth_hubener

> But he lost it all more than once.


 What?  What?  You mean someone that's the best, the absolutely Number 1, could lose it all?

No, that's just not possible.  People who have made oodles of money in the past are going to continue making oodles of money in the future.  That's just the way it is.  All we have to do is to invest our money with _them_.  We can count on them and their selected heirs for future growth.

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## Ronin Truth

> What? What? You mean someone that's the best, the absolutely Number 1, could lose it all?
> 
> No, that's just not possible. People who have made oodles of money in the past are going to continue making oodles of money in the future. That's just the way it is. All we have to do is to invest our money with _them_. We can count on them and their selected heirs for future growth.


<YAWN>

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## helmuth_hubener

> <YAWN>


 Instead of trying to _share_ the superior enlightenment you claim to have, you are just going to mock me?

That seems counter-productive.

I am willing to learn.  I seek to learn.  But for learning to occur there must first be a willingness to communicate.

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## P3ter_Griffin

> [...]
> 
> _That's_ how Warren Buffett did it, and "Does It."  Investing was and is his career.  His calling.  His obsession.  But it's not mine.  It's not yours.  And that is why we will not get the same results he did.  It's really quite simple, Ronin.


Rational investing (not current day stock market) is pretty much arbitrage.  i.e. chicken futures are going for x, and you know land, heaters, food, and labor to produce that lot of chickens cost x-50000.  It doesn't need to be an individuals calling or obsession to realize potential profits... what it really takes is money and a desire to do it-- or at least a desire to make more money.

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## helmuth_hubener

> ...to realize potential profits... what it really takes is money and a desire to do it-- or at least a desire to make more money.


 A much easier and more likely way to realize profits: take that money and that desire and *start a business!*  Put your money into something you control, not something over which you have absolutely no control.  That's my perspective, and it's worked for me.

Making a fortune from smart or lucky investing is very rare.  Making a fortune as a professional person or as an entrepreneur is very common.  I'll choose the easy road with the better chance of leading to my destination over the hard road with a vanishingly small chance of arrival.  Every time.

"Even investment professionals dont generally beat the markets. The Hulbert Financial Digest tracks the results achieved by the published model portfolios of hundreds of investment newsletters  written by people who spend 8-12 hours a day watching and studying the investment markets.

"Each year only a handful of newsletters outperforms the Dow Jones Industrial Average. And the handful changes from year to year, so theres no way to know which advisor will have a 'hot hand' in the coming year.

"Professionals are consumed with the job of tracking investments, and they have easy access to far more information than you do. If they cant consistently beat the investment markets, how can you? The answer is: YOU PROBABLY CAN'T."

-- Harry Browne, in Fail-Safe Investing

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## Ronin Truth

> Instead of trying to _share_ the superior enlightenment you claim to have, you are just going to mock me?
> 
> That seems counter-productive.
> 
> I am willing to learn. I seek to learn. But for learning to occur there must first be a willingness to communicate.


I figured that post of mine would be much tougher for you to slice, dice, edit and parse all out of context. It seems my guess was correct. The information you seek to learn is all out there and available if you care to look. I got very tired and bored being the teacher quite a while ago. Superior enlightenment tends to do that over time. I wouldn't want to short cut your knowledge quest.

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## Natural Citizen

> New York City, New York – U. S. Bankruptcy Court, Southern District of New York’s Judge Martin Glenn, presiding over the simultaneous Chapter 11 bankruptcy filings of 51 residential mortgage companies, received a whistleblower filing package today from one of the creditors in this case, a private American citizen, Greg Morse. 
> 
> The Internal Revenue Service and Securities Exchange Commission received the same package today.  Among its contents is Morse’s whistleblower submission of IRS Form 211—Application for Award for Original Information, and SEC Form TCR—SEC Tip, Complaint or Referral, accompanied by voluminous supporting documentation. These federal agencies are mandated to investigate allegations of corruption and fraud. 
> 
> According to N.Y. bankruptcy court records, as of March, 2012, at stake are over 2.4 million mortgages and Residential Mortgage Backed Securities (RMBS) representing over 6.2 million Americans, according to U. S. census statistics. 
> 
> The value of this bankruptcy case, as of today, is well over $400 billion—making it the largest bankruptcy in history.
> 
> *According to court documents, the second amended Joint Chapter 11 Plan, approved on December 13, 2013 allows for the liquidation of hundreds of billions of dollars worth of homeowners’ mortgages to legendary business billionaire magnate—the fourth richest man in the world, according to Forbes, Warren Buffett’s Berkshire Hathaway, Inc. and Ocwen Loan Servicing, L.L.C.* *The bankruptcy terms allows Berkshire Hathaway and Ocwen to purchase over $400 billion worth of mortgages and RMBS trusts for less than $5 billion.  Once these mortgages are sold, Berkshire Hathaway and Ocwen will be bankruptcy remote.  That means that once the mortgage assets are sold to them, American homeowners, like Morse, will not be able to obtain, through discovery, in judicial proceedings, the documents pertaining to their mortgages to determine if there is an issue with their property’s chain of title or verify if there is a free, clear and legally traceable ownership of their homes. 
> ...


http://www.ronpaulforums.com/showthr...eblower-Filing

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## Ronin Truth

> http://www.ronpaulforums.com/showthr...eblower-Filing


Interesting info. Thanks!

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## helmuth_hubener

> I figured that post of mine would be much tougher for you to slice, dice, edit and parse all out of context. It seems my guess was correct. The information you seek to learn is all out there and available if you care to look. I got very tired and bored being the teacher quite a while ago. Superior enlightenment tends to do that over time. I wouldn't want to short cut your knowledge quest.


Most of your posts are 3 sentences or less.  Many are one sentence.  How can I take a one-sentence post out of context?  I quote what you say, and then I respond to it.  I have not taken things out of context.  I have not edited.  I have not sliced and diced.  I have simply attempted to understand your words, and then added my own words in response.  I have done so very respectfully and politely, I think.  If I have come across in any other way, it is not my intention.

Let me ask you this, Ronin: Have you actually _read_ this book you are so excited about?  And if so, what would you like to say about it?  What are your thoughts?

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## Ronin Truth

> Most of your posts are 3 sentences or less. Many are one sentence. How can I take a one-sentence post out of context? I quote what you say, and then I respond to it. I have not taken things out of context. I have not edited. I have not sliced and diced. I have simply attempted to understand your words, and then added my own words in response. I have done so very respectfully and politely, I think. If I have come across in any other way, it is not my intention.
> 
> Let me ask you this, Ronin: Have you actually _read_ this book you are so excited about? And if so, what would you like to say about it? What are your thoughts?


Nope, nor did I ever claim to have nor expressed any particular excitement over it.  I think the OP expresses my views about it adequately.  Over the last 50 years or so I've been following Warren's progress as a fascinating investment phenomenon.  I've read several books about him and all of his annual investment stockholder letters.  I'm a Warren Buffet fan looking for other fans to chat and share info with about him.

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## Acala

I am not a stock trader, so I claim no expertise.  But I did read a book called Black Swan and it really changed my way of thinking about what we think we know.  Much of what humans ascribe to cause and effect is nothing but a post hoc fallacy.  Human beings are demonstrably far less able to predict the future than they think they are but they are hardwired to create a narrative of the past and project it into the future.  In some situations it works but in others the level of randomness renders it nonsensical.  So to say, in hindsight, "this is how Warren Buffet got rich" very likely offers no help whatsoever in making Acala rich in the future.

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## helmuth_hubener

> I'm a Warren Buffet fan looking for other fans to chat and share info with about him.


Got it.  Well, I don't want to rain on your parade.  Sorry if I've been a downer here.  Carry on...

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## P3ter_Griffin

> A much easier and more likely way to realize profits: take that money and that desire and *start a business!*  Put your money into something you control, not something over which you have absolutely no control.  That's my perspective, and it's worked for me.
> 
> Making a fortune from smart or lucky investing is very rare.  Making a fortune as a professional person or as an entrepreneur is very common.  I'll choose the easy road with the better chance of leading to my destination over the hard road with a vanishingly small chance of arrival.  Every time.
> 
> "Even investment professionals don’t generally beat the markets. The Hulbert Financial Digest tracks the results achieved by the published model portfolios of hundreds of investment newsletters — written by people who spend 8-12 hours a day watching and studying the investment markets.
> 
> "Each year only a handful of newsletters outperforms the Dow Jones Industrial Average. And the handful changes from year to year, so there’s no way to know which advisor will have a 'hot hand' in the coming year.
> 
> "Professionals are consumed with the job of tracking investments, and they have easy access to far more information than you do. If they can’t consistently beat the investment markets, how can you? The answer is: YOU PROBABLY CAN'T."
> ...


I guess I misunderstood what you were saying.  Owning a business is an investment in my mind.. and outright ownership over holding shares has been a big part of Buffett's life, not that I know much of anything about the guy.

Still, reading quarterly filings and business plans-- _not_ newsletters or listening to "professionals"- is something most people are capable of doing, (taking a few hours away from the TV at night probably wouldn't hurt em).  Whereas inventing the OS behind Apple or MS or things to the like takes a "gifted" individual...  Encompassing what Buffett did _to that magnitude_ takes a lot of luck but on a smaller (still large) size I think its plenty attainable.

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## Ronin Truth

> I am not a stock trader, so I claim no expertise. But I did read a book called Black Swan and it really changed my way of thinking about what we think we know. Much of what humans ascribe to cause and effect is nothing but a post hoc fallacy. Human beings are demonstrably far less able to predict the future than they think they are but they are hardwired to create a narrative of the past and project it into the future. In some situations it works but in others the level of randomness renders it nonsensical. So to say, in hindsight, "this is how Warren Buffet got rich" very likely offers no help whatsoever in making Acala rich in the future.


 Buffet said Ben Graham made him rich.  The Graham way just might work for you too.

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## Acala

> Buffet said Ben Graham made him rich.  The Graham way just might work for you too.


Presumably Buffet was not the only person Ben Graham schooled.  Perhaps hundreds listened to Mr. Graham.  But only one had the success of Buffet.  So arguably it is only in hindsight that we think the success of Buffet could have been predicted by what he learned from Graham.  The causal narrative is laid over the historical fact only after the historical fact is know.       

I'm not a trader so this is all academic to me.  But the human tendency to construct a narrative to make the world seem more predictable than it really is fascinates me.  The objective fact seems to be that the unfolding world is scarcely predictable at all.  If you think about your own life, how many of the events that caused major change were predicted?  The meeting of a partner, the occurrence of disease, accident, or death, finding a job, etc.  So much raw chance in it.  

I highly recommend Black Swan if you are at all interested in the rational study of what we think we know.  The author was a Ron Paul supporter and is a fan of Hayek.

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## Ronin Truth

> Presumably Buffet was not the only person Ben Graham schooled. Perhaps hundreds listened to Mr. Graham. But only one had the success of Buffet. So arguably it is only in hindsight that we think the success of Buffet could have been predicted by what he learned from Graham. The causal narrative is laid over the historical fact only after the historical fact is know. 
> 
> I'm not a trader so this is all academic to me. But the human tendency to construct a narrative to make the world seem more predictable than it really is fascinates me. The objective fact seems to be that the unfolding world is scarcely predictable at all. If you think about your own life, how many of the events that caused major change were predicted? The meeting of a partner, the occurrence of disease, accident, or death, finding a job, etc. So much raw chance in it. 
> 
> I highly recommend Black Swan if you are at all interested in the rational study of what we think we know. The author was a Ron Paul supporter and is a fan of Hayek.


Unlike the other Graham students, Buffet just took the ball from Graham and ran with it. No hindsight prediction is necessary. Buffet credits Graham with his success, and I'll take Warren at his word.

I'll check out Black Swan. Thanks!

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## Ronin Truth

> *Buffett fumes over hotels gouging Berkshire fans*
> 
> *Shareholders heading to Omaha this weekend are seeing sky-high room rates. 'I want to protect my cubs,' Buffett says.*


http://money.msn.com/top-stocks/post...berkshire-fans

Those Omaha hotels had just better watch out or Berkshire just might up and buy them.

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