buffett letter - buying stocks should be like getting married lol

In reviewing my uneven record, I’ve concluded that acquisitions are similar to marriage: They start, of course, with a joyful wedding – but then reality tends to diverge from pre-nuptial expectations. Sometimes, wonderfully, the new union delivers bliss beyond either party’s hopes. In other cases, disillusionment is swift. Applying those images to corporate acquisitions, I’d have to say it is usually the buyer who encounters unpleasant surprises. It’s easy to get dreamy-eyed during corporate courtships.

Pursuing that analogy, I would say that our marital record remains largely acceptable, with all parties happy with the decisions they made long ago. Some of our tie-ups have been positively idyllic. A meaningful number, however, have caused me all too quickly to wonder what I was thinking when I proposed. Fortunately, the fallout from many of my errors has been reduced by a characteristic shared by most businesses that disappoint: As the years pass, the “poor” business tends to stagnate, thereupon entering a state in which its operations require an ever-smaller percentage of Berkshire’s capital.

Meanwhile, our “good” businesses often tend to grow and find opportunities for investing additional capital at attractive rates. Because of these contrasting trajectories, the assets employed at Berkshire’s winners gradually become an expanding portion of our total capital.

Nice! So like stocks, you should keep a portfolio of women like a harem and kick out the ones that underperform. This is great wisdom from Nery as usual.

lol. YA! well technically he doesnt kick them out. he just lets the relationship fizzle out. look at berkshire for instance. a dying textile mill he acquired a long time ago for its balance sheet. he kept the co even if the main operations kept losing money. in fact he made it the name of his co and just kept buying other companies under it. so its like if you had a declining wife who looked for other wives for you to have.

what an amazing concept right! i have always been a big fan of polygamy esp since divorce can be so expensive. when you get married to someone. you have pre marital assets which is similar to cost basis. and if you get divorced, any earnings after that half goes to them. similarlyin cali, capital gains tax fed and state can reach about 38%. what a tragedy. i do not see why anyone would live here!

Community property in California is indeed similar to capital gains tax in that they disadvantage successful people. Sounds like you want to move to somewhere like the Philippines where your money buys you more advantages!

I have some relatives who lived in Manila when they did the congestion rule - any specific car, based on license plate, is only allowed on the road on 4 days a week. The solution: they bought more cars so they can register each for a different day!

It’s incredible how your philosophy applies to so many things!

i think having a car is pretty expensive, id say between 6k to 12k annually if yo uhave a new car which represents about 50% of a typicaly expat budget in philippines… i understand the need to have a car if you work M-F. but if you are retired then you dont really need a car. in addition if you live in an urban center like bgc you can basically walk to anything you need. in the provinces, you can use the tricycle or jeeps. they are dirt cheap. the arrival of ubers around the world has also made it a lot cheaper if you want to travel without using poor transporation also .

anyways speaking of which, my rich auntie from philippines just gave me 3k for wedding. i think she worth like 20m usd.