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Berkshire Hathaway
Letter to Shareholders
 
 
As the chairman of Berkshire Hathaway, Warren Buffett publishes an annual letter to shareholders, in which he discusses his activities and his investment approach. This approach was directly influenced by the insights of Benjamin Graham and Philip Fisher, with considerable help from his partner, Charles Munger. Add to the mix Buffett's unique talents in judging both businesses and people, and you have the background of the most impressive investment track record in modern times.

Buffett's approach is deceptively simple, a combination of exceptional insight and discipline. He once said, "We never learned how to jump over seven-foot bars. But occasionally we find two-foot bars." As you know from reading this web site, his focus is on well-managed companies with sustainable competitive advantages. And throughout an investment career spanning five decades, he has remained remarkably true to his Two Rules:

 
 

Rule #1: Never lose money.
 
  Rule #2: Never forget Rule #1.  
 
The Letters to Shareholders from 1977-2000 are available at www.berkshirehathaway.com/letters/letters.html. They offer a good look at a management should treat its stockholders. Buffett not only highlights what to look for in potential investments, he also leads by example. In our opinion, he is the finest CEO in the country, an unusual statement given that he is generally viewed as an investor and not a manager. But, in fact, Buffett oversees one of the larger conglomerates in this country, and if you judge the quality of a CEO by his success in identifying opportunities, allocating capital and attracting/motivating exceptional operating personnel, only Jack Welch of General Electric would be a serious contender to the title.

Suggestion: Go to The Intelligent Investor