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Book Description
Editorial Reviews
Amazon.com Review
Buffett, the Bard of Omaha, is a genuine American folk hero, if folk heroes are allowed to build fortunes worth upward of $15 billion. He's great at homespun metaphor, but behind those catchy phrases is a reservoir of financial acumen that's generally considered the best of his generation. For example, in an essay on CEO stock options, he writes, "Negotiating with one's self seldom produces a barroom brawl." This is his way of saying that an executive who can give himself compensation totally disproportionate to his performance surely will. There are uncountable gems of financial wisdom to be harvested from these essays, taken from the annual reports he writes for Berkshire Hathaway, his holding company. Just to pick one more, here's a now-famous line about those he competes with when making stock-market investments: "What could be more advantageous in an intellectual contest--whether it be chess, bridge, or stock selection--than to have opponents who have been taught that thinking is a waste of energy?"
While Buffett has a policy of seldom commenting on stocks he owns--he feels public pronouncements will only lead to the public's expectation of more public pronouncements, and he likes to keep his cards close to his vest--he loves to discuss the principles behind his investments. These come primarily from Ben Graham, under whom Buffett studied at Columbia University and for whom he worked in the 1950s. First among them is the idea that price is what you pay and value is what you get--and if you're a smart investor, the first will always be less than the second. In that sense, the value of the lessons learned from Buffett's Essays could be far greater than the book's price. --Lou Schuler --This text refers to an out of print or unavailable edition of this title.
Review
"One of the top investment books of all time."
--The Motley Fool
"Two thumbs up."
--CNN
"The book on Buffett. A superb job."
--Forbes
"Extraordinary."
--Money
"A classic on value investing and the definitive source on Buffett."
--Financial Times
"One of the top investment books of all time."
--The Motley Fool
"Two thumbs up."
--CNN
"The book on Buffett. A superb job."
--Forbes
"Extraordinary."
--Money
"A classic on value investing and the definitive source on Buffett."
--Financial Times
--The Motley Fool
"Two thumbs up."
--CNN
"The book on Buffett. A superb job."
--Forbes
"Extraordinary."
--Money
"A classic on value investing and the definitive source on Buffett."
--Financial Times
"One of the top investment books of all time."
--The Motley Fool
"Two thumbs up."
--CNN
"The book on Buffett. A superb job."
--Forbes
"Extraordinary."
--Money
"A classic on value investing and the definitive source on Buffett."
--Financial Times
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Customer Reviews
Most Helpful Customer Reviews
108 of 110 people found the following review helpful
5.0 out of 5 stars
Here in the Third Edition are business information, insights, and counsel of incalculable and timeless value
November 6, 2008
Format:Paperback|Amazon Verified Purchase
This is my review of the THIRD EDITION, dated March 18, 2013. If you wish to read my review of the SECOND EDITION, it follows.
This is the Third Edition of an ongoing process by which Warren Buffett presents a "chairman's letter" (i.e. progress report with his unique reflections) to Berkshire Hathaway shareholders at their annual meeting. Lawrence A. Cunningham edited each of the three editions, with the latest including Buffett's annual letters to Berkshire shareholders since 2008, the date of the prior edition. Other new material includes:
o The financial crisis and its continuing implications for investors, managers and society;
o The housing bubble at the bottom of that crisis
o The debt and derivatives excesses that fueled the crisis and how to deal with them
o Controlling risk and protecting reputation in corporate governance
o Berkshire's acquisition and operation of Burlington Northern Santa Fe
o The role of oversight in heavily regulated industries
o Investment possibilities today
o Weaknesses of popular option valuation models
Some other material has been rearranged to deepen the themes and lessons that the collection has always produced:
o Buffett's "owner-related business principles" are in the prologue as a separate subject
o Valuation and accounting topics are spread over four instead of two sections and reordered to sharpen their payoff.
According to Cunningham, "Those who are familiar with The Essays will notice that we have made the cover snappier than has been our custom. (Thanks for the cover design to Tim Colton, of Carolina Academic Press, which will continue to partner with me in the distribution of the book.) The main reason: the book's traditional covers could be seen well in physical form but pictures of them, shown on the internet, could not. Since most sales are done over the Internet these days, the cover needed a face-lift.
"The adage remains, however, that one should not judge a book by its cover. This book should continue to be judged on its content and organization, in which a distinctive investment and business philosophy is coherently articulated. Thanks to the many fans of the book, first published in 1997. I hope you enjoy the updated edition. And I hope to see many of you in Omaha for the Berkshire shareholders' meeting in May."
With regard to the Third Edition's subtitle, "Lessons for Corporate America," my own opinion is that almost all of the lessons can be of substantial value to leaders in any organization, whatever its size and nature may be. Among Buffett's most important and yet least appreciated talents is his ability to establish a direct and personal rapport with each person he meets or who reads any of his letters as well as any of his articles such as those included in Carol Loomis' superb book, Tap Dancing to Work: Warren Buffett on Practically Everything, 1966-2012.
I watched three segments of Buffett and Loomis' appearances on The Charlie Rose Show and their informal but gracious manner made me feel as if I had been a personal friend of theirs for many years. (I wish I had purchased Berkshire stock 50 years ago!) Credit Cunningham with brilliant editing as well as his own contributions to what continues to be a "moveable feast" of information, insights, wisdom, and wit. Once again, his Introduction (all by itself) is worth much more than the cost of the book as he again discusses with rigor and eloquence what he considers to be key points about Buffett and his leadership of Berkshire Hathaway in recent years.
* * *
Review of Second Edition:
Over the years, I have read several of the essays that Warren Buffett included in Berkshire Hathaway's annual reports. After reading two biographies of him (Alice Schroeder's The Snowball: Warren Buffett and the Business of Life and Roger Lowenstein's Buffett: The Making of an American Capitalist), I purchased a copy of this volume and began to work my way through the contents selected, arranged, and introduced by Lawrence A. Cunningham. I began with Cunningham's Introduction (all by itself, worth much more than the cost of the book) in which he reviews what he considers to be key points about Buffett and his leadership of Berkshire Hathaway.
For example, "The CEOs of Berkshire's various operating companies enjoy a unique position in corporate America. They are given a simple set of commands: to run their business as if (1) they are its sole owner, (2) it is the only asset they hold, and (3) they can never sell or merge it for a hundred years." With regard to investment thinking, "one must guard against what Buffett calls the `institutional imperative.' It is a pervasive force in which institutional dynamics produce resistance to change, absorption of available corporate funds, and reflexive approval of suboptimal CEO strategies by subordinates. Contrary to what is often taught in business and law schools, this powerful force often interferes with rational business decision-making. The ultimate result of the institutional imperative is a follow-the-pack mentality producing industry imitators, rather than industry leaders - what Buffett calls a lemming-like approach to business."
Cunningham organizes the essays within seven sections between Buffett's Prologue (Pages 27-28) and his Epilogue (Pages 273-282):
I Corporate Governance
II Corporate Finance and Investing
III Alternatives to Common Stock
IV Common Stock
V Mergers and Acquisitions
VI Accounting and Valuation
VII Accounting Policy and Tax Matters
As Buffett explains in his Prologue, members of Berkshire Hathaway's shareholder group receive communications directly "from the fellow you are paying to run the business. Your Chairman has a firm belief that owners are entitled to hear directly from the CEO as to what is going on and how he evaluates the business, currently and prospectively. You should demand that in a private company; you should expect no less in a public company. A once-a-year report of stewardship should not be turned over to a staff specialist or public relations consultant who is unlikely to be in a position to talk frankly on a manager-to-owner basis."
Those who share my own keen interest in Warren Buffett's leadership and management principles will learn a great deal from a careful reading of these essays. They are quite literally "from the horse's mouth." The substantial value-added benefits include the fact that Buffett thinks and writes so clearly, duly acknowledges bad decisions and personal regrets (yes, there were several), explains what he learned from them, and meanwhile reveals a playful (albeit dry) sense of humor. He also includes a number of personal observations about America, especially about its culture and economy, at various times throughout the last 25-30 years. The two aforementioned biographies indicate that throughout his life, Buffett thoroughly enjoyed each and every opportunity to increase others' understanding of sound business principles that include but are by no means limited to investments.
Readers who are not among Berkshire Hathaway's shareholders will especially appreciate the fact that, in each of these essays, Buffett establishes and then sustains a direct and personal rapport. The tone is conversational and, better yet, inclusive. He never talks down to his reader. He never "dumbs down" the material. Inevitably and appropriately, he cites Berkshire Hathaway situations when illustrating certain key points but, really, most of the material in this book will have wide and deep general interest to executives as well as to shareholders who otherwise have no association with either Buffett or his company. I highly recommend this book without hesitation or qualification.
This is the Third Edition of an ongoing process by which Warren Buffett presents a "chairman's letter" (i.e. progress report with his unique reflections) to Berkshire Hathaway shareholders at their annual meeting. Lawrence A. Cunningham edited each of the three editions, with the latest including Buffett's annual letters to Berkshire shareholders since 2008, the date of the prior edition. Other new material includes:
o The financial crisis and its continuing implications for investors, managers and society;
o The housing bubble at the bottom of that crisis
o The debt and derivatives excesses that fueled the crisis and how to deal with them
o Controlling risk and protecting reputation in corporate governance
o Berkshire's acquisition and operation of Burlington Northern Santa Fe
o The role of oversight in heavily regulated industries
o Investment possibilities today
o Weaknesses of popular option valuation models
Some other material has been rearranged to deepen the themes and lessons that the collection has always produced:
o Buffett's "owner-related business principles" are in the prologue as a separate subject
o Valuation and accounting topics are spread over four instead of two sections and reordered to sharpen their payoff.
According to Cunningham, "Those who are familiar with The Essays will notice that we have made the cover snappier than has been our custom. (Thanks for the cover design to Tim Colton, of Carolina Academic Press, which will continue to partner with me in the distribution of the book.) The main reason: the book's traditional covers could be seen well in physical form but pictures of them, shown on the internet, could not. Since most sales are done over the Internet these days, the cover needed a face-lift.
"The adage remains, however, that one should not judge a book by its cover. This book should continue to be judged on its content and organization, in which a distinctive investment and business philosophy is coherently articulated. Thanks to the many fans of the book, first published in 1997. I hope you enjoy the updated edition. And I hope to see many of you in Omaha for the Berkshire shareholders' meeting in May."
With regard to the Third Edition's subtitle, "Lessons for Corporate America," my own opinion is that almost all of the lessons can be of substantial value to leaders in any organization, whatever its size and nature may be. Among Buffett's most important and yet least appreciated talents is his ability to establish a direct and personal rapport with each person he meets or who reads any of his letters as well as any of his articles such as those included in Carol Loomis' superb book, Tap Dancing to Work: Warren Buffett on Practically Everything, 1966-2012.
I watched three segments of Buffett and Loomis' appearances on The Charlie Rose Show and their informal but gracious manner made me feel as if I had been a personal friend of theirs for many years. (I wish I had purchased Berkshire stock 50 years ago!) Credit Cunningham with brilliant editing as well as his own contributions to what continues to be a "moveable feast" of information, insights, wisdom, and wit. Once again, his Introduction (all by itself) is worth much more than the cost of the book as he again discusses with rigor and eloquence what he considers to be key points about Buffett and his leadership of Berkshire Hathaway in recent years.
* * *
Review of Second Edition:
Over the years, I have read several of the essays that Warren Buffett included in Berkshire Hathaway's annual reports. After reading two biographies of him (Alice Schroeder's The Snowball: Warren Buffett and the Business of Life and Roger Lowenstein's Buffett: The Making of an American Capitalist), I purchased a copy of this volume and began to work my way through the contents selected, arranged, and introduced by Lawrence A. Cunningham. I began with Cunningham's Introduction (all by itself, worth much more than the cost of the book) in which he reviews what he considers to be key points about Buffett and his leadership of Berkshire Hathaway.
For example, "The CEOs of Berkshire's various operating companies enjoy a unique position in corporate America. They are given a simple set of commands: to run their business as if (1) they are its sole owner, (2) it is the only asset they hold, and (3) they can never sell or merge it for a hundred years." With regard to investment thinking, "one must guard against what Buffett calls the `institutional imperative.' It is a pervasive force in which institutional dynamics produce resistance to change, absorption of available corporate funds, and reflexive approval of suboptimal CEO strategies by subordinates. Contrary to what is often taught in business and law schools, this powerful force often interferes with rational business decision-making. The ultimate result of the institutional imperative is a follow-the-pack mentality producing industry imitators, rather than industry leaders - what Buffett calls a lemming-like approach to business."
Cunningham organizes the essays within seven sections between Buffett's Prologue (Pages 27-28) and his Epilogue (Pages 273-282):
I Corporate Governance
II Corporate Finance and Investing
III Alternatives to Common Stock
IV Common Stock
V Mergers and Acquisitions
VI Accounting and Valuation
VII Accounting Policy and Tax Matters
As Buffett explains in his Prologue, members of Berkshire Hathaway's shareholder group receive communications directly "from the fellow you are paying to run the business. Your Chairman has a firm belief that owners are entitled to hear directly from the CEO as to what is going on and how he evaluates the business, currently and prospectively. You should demand that in a private company; you should expect no less in a public company. A once-a-year report of stewardship should not be turned over to a staff specialist or public relations consultant who is unlikely to be in a position to talk frankly on a manager-to-owner basis."
Those who share my own keen interest in Warren Buffett's leadership and management principles will learn a great deal from a careful reading of these essays. They are quite literally "from the horse's mouth." The substantial value-added benefits include the fact that Buffett thinks and writes so clearly, duly acknowledges bad decisions and personal regrets (yes, there were several), explains what he learned from them, and meanwhile reveals a playful (albeit dry) sense of humor. He also includes a number of personal observations about America, especially about its culture and economy, at various times throughout the last 25-30 years. The two aforementioned biographies indicate that throughout his life, Buffett thoroughly enjoyed each and every opportunity to increase others' understanding of sound business principles that include but are by no means limited to investments.
Readers who are not among Berkshire Hathaway's shareholders will especially appreciate the fact that, in each of these essays, Buffett establishes and then sustains a direct and personal rapport. The tone is conversational and, better yet, inclusive. He never talks down to his reader. He never "dumbs down" the material. Inevitably and appropriately, he cites Berkshire Hathaway situations when illustrating certain key points but, really, most of the material in this book will have wide and deep general interest to executives as well as to shareholders who otherwise have no association with either Buffett or his company. I highly recommend this book without hesitation or qualification.
112 of 120 people found the following review helpful
Format:Paperback
I cannot imagine that Mr. Warren Buffet is not on any investor's top 10 list of the greatest investors since there were markets in this Country. I would also suggest that a dispassionate appraisal of his performance argues quite eloquently that he is the best to have ever amassed his fortune, and that of his shareholders on Wall Street.
Thanks to the efforts of Mr. Lawrence A. Cunningham readers have access to essays that previously were available primarily to shareholders, and which are organized in this book thematically for the first time. Annual reports are generally easy to come by, however as I write, 1 Share Of Berkshire Hathaway "A" requires $59,900.00, and the "Baby Berkshires" $1,966.00 per share. Many are quick to respond the price is so high as Mr. Buffet has not split the stock, ever. But what is more important is why he has never done this. This book explains his theory on this matter, and dozens of others.
Mr. Buffet has his critics, they range from the idiotic, "he's lucky", "his success allows him to make attractive deals", and to those who feel he missed the money that was made in tech stocks. As for the luck theory, who else has earned 23.8% compounded annually for over 25 years? Winning the lottery is probably more likely an event. As to the attractive deals his wealth is said to facilitate, I guess the answer is, is the questioner serious? He made what he has, his reputation allowed him to have the Federal Government allow Solomon Brothers to continue participating in the bond market based on one thing, his word! This is a man who has rescinded very successful trades because news arrived within days of his buying that could have given the appearance of his having had information others were not privy to.
This book has more useful information and ideas that have been proven over decades than any 10 hot Business Books of the moment. Mr. Buffet has had off years, but he has never gone bust.
One of my favorite stories is when he was hanging out with friends as a kid, his pals were collecting bottles for the deposit. He was collecting bottle caps, sorting them, and determining who was drinking what brand! He clearly was put amongst us for a reason.
On a time invested basis there is no better or more rewarding reading than these essays. No one can match what he has accomplished, why would someone not wish to hear what he has to say on dozens of topics?
42 of 43 people found the following review helpful
By A Customer
Format:Paperback
At the 1998 Berkshire annual meeting, Buffett himself credited this book by saying it is better than all the other biographies and the best business investment book to read. Who could ignore such a high recommendation?
Having read several other books claiming to have captured and outlined Buffett's investment wizardry, I am excited to report that finally some one has done so beautifully. Cunningham distills and presents the Berkshire philosophy in a coherent and organized manner that puts it in a whole new light. This book is an excellent investment guidance source for everyone, from the novice to the more seasoned investor. You will find yourself dog-earing pages and underlining like crazy. Absolutely brilliant!
Most Recent Customer Reviews
5.0 out of 5 stars
A must read
If you are thinking a getting an overview regarding successful investing philosophies in general i would greatly recommend this book.
Published 1 month ago by Waka
5.0 out of 5 stars
Super Valuable Teachings for Entrepreneurs and CEOs
As an entrepreneur and CEO I can say that Warren Buffett teachings are incredibly valuable to me. It’s part of a CEO job to make resource allocation decisions all the time. Read more
Published 1 month ago by Leonardo Grinstein
4.0 out of 5 stars
Textbook
I began reading this as a textbook. It's very informative and insightful. However, it seems more directed at shareholders of Berkley than at the general public.
Published 2 months ago by Rebeca Archambeault
5.0 out of 5 stars
SO worth the money!
When I was considering buying this book, I realized that the material is available in his shareholder letters. However, the value of this book far exceeded my expectations. Read more
Published 2 months ago by William
5.0 out of 5 stars
Great Book
A wonderful compilation of Buffet's guiding investment philosophy. He covers a range of investing topics from corporate management to accounting. Read more
Published 3 months ago by Romulus D
5.0 out of 5 stars
Great read, very insightful.
Along with the intelligent investor, this is a must-read for investors. Does not provide any secret sauce, however it provides much insights as to what to look when investing in a... Read more
Published 3 months ago by Rachael and Pete
5.0 out of 5 stars
The best
This is the best way to learn from Buffett. They are his words, collected in a nice format. Cunningham uses the book in his university lectures. They are timeless and valuable.
Published 3 months ago by fourdegreesc
5.0 out of 5 stars
great book on investment...and philosophy
great book on investment...and philosophy
It goes without saying that Buffett has a lot of wisdom to share on the subject of value investing... Read more
It goes without saying that Buffett has a lot of wisdom to share on the subject of value investing... Read more
Published 3 months ago by SAMUEL A MARK
4.0 out of 5 stars
Warren Buffett
A bit repetitive and sometimes dry but what do you expect from a book pieced together from annual reports. Thank God Warren Buffett is an excellent story teller. Read more
Published 3 months ago by gehad
5.0 out of 5 stars
Invaluable quality
Warren Buffett is fond of saying that he loves Coca-Cola (the stock) because of the virtue of knowing how its business will look a decade from now (i.e. the same). Read more
Published 4 months ago by eqtbooks
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