Seperating fact from fiction – Warren Buffett Wisdom
Warren Buffett is widely considered to be the world’s greatest investor and the internet is littered with his investment wisdom.
However, a large amount of the Warren Buffett wisdom you read today is taken out of context, misused and repeated so many times over, it has lost some of its meaning.
So, in this article I’ve tried to capture some of Buffett’s lesser known quotes and present them in full detail. Hopefully, you’ll stumble across some Warren Buffett Wisdom you’ve not come across before.
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Warren Buffett wisdom - some quotes
"The line separating investment and speculation, which is never bright and clear, becomes blurred still further when most market participants have recently enjoyed triumphs. Nothing sedates rationality like large doses of effortless money. After a heady experience of that kind, normally sensible people drift into behavior akin to that of Cinderella at the ball. They know that overstaying the festivities — that is, continuing to speculate in companies that have gigantic valuations relative to the cash they are likely to generate in the future — will eventually bring on pumpkins and mice. But they nevertheless hate to miss a single minute of what is one helluva party. Therefore, the giddy participants all plan to leave just seconds before midnight. There’s a problem, though: They are dancing in a room in which the clocks have no hands."
This is probably my favorite Buffett quote. Buffett is known as long-term investor yet he does occasionally place some short-term bets. That said, he is well aware of the dangers of speculation as the above quote shows, which is why he would rather devote his energy to making long-term investment decisions, rather than short-term bets on market movements as trying to second guess the market is tantamount to gambling.
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