I recently had an opportunity to read “Essays of Warren Buffett“. Below are some of the key short takeaways (for me). For a more thorough perspective on each of these I would highly recommend the book.
On Corporate Governance
More Money, It has been noted, has been stolen with the point of a Pen than at the point of a gun
Managers that always promise to “Make the Numbers” will at some point be tempted to “Make up” the Numbers
At too many companies, the boss shoots the arrow of managerial performance and then hastily paints the Bulls-eye around the spot where it lands
Good Managerial record is far more a function of what business boat you get into than it is of how effectively you row (though intelligence and effort help considerably, of course, in any business good or bad). Should you find yourself in a chronically leaking boat, energy devoted to changing vessels is likely to be more productive than energy devoted to patching leaks.
There is plenty of money to be made at the center of the court. If it’s questionable whether some actions are close to the line, just assume it is outside and forget it.
On finance and Investing
Final Exam: If you expect to be a net saver during the next five years, should you hope for a higher or lower stock market during that period? Many Investors get this one wrong, Even though they are going to be net buyers of stock for years to come, they are elated when stock prices rise and depressed when they fall. In effect they rejoice because prices have risen for the “Hamburgers” they will soon be buying. This reaction makes no sense, only those who are sellers of equities in the near future should be happy at seeing stocks rise. Prospective purchasers should much prefer sinking prices.
Our goal is to find an outstanding business at a sensible price, not a mediocre business at a bargain price
Lack of capital allocation skills is very high, Most bosses rise to the top because they have excelled in an area such as Marketing, Production, Engineering, administration – or sometimes, institutional politics.
Leaving the question of price aside, the best business to own is one that over an extended period can employ large amounts of incremental capital at very high rate of return. The worst business does the opposite — that is consistently employs ever greater amounts of capital at very low rate of return. unfortunately the first type of business of is very hard to find;
In a difficult business, no sooner is one problem solved than another surfaces – never is there just one cockroach in the kitchen
This is Part one since i have been able to cover only first 2 chapters … Don’t expect part two anytime soon 🙂
On a more serious note, Lawrence A Cunningham has done a commendable job in compiling a lifetime of wisdom to 300 pages.


