This should be posted in all schools and work places

This should be posted in all schools and work places

Love him or hate him, he sure hits the nail on the head with this! Bill Gates recently gave a speech at a High School about 11 things they did not and will not learn in school. He talks about how feel-good, politically correct teachings created a generation of kids with no concept of reality and how this concept set them up for failure in the real world.

Rule 1: Life is not fair - get used to it!

Rule 2: The world won't care about your self-esteem. The world will expect you to accomplish something BEFORE you feel good about yourself.

Rule 3 : You will NOT make $60,000 a year right out of high school. You won't be a vice-president with a car phone until you earn both.

Rule 4 : If you think your teacher is tough, wait till you get a boss.

Rule 5 : Flipping burgers is not beneath your dignity. Your Grandparents had a different word for burger flipping: they called it opportunity.

Rule 6: If you mess up, it's not your parents' fault, so don't whine about your mistakes, learn from them.

Rule 7: Before you were born, your parents weren't as boring as they are now. They got that way from paying your bills, cleaning your clothes and listening to you talk about how cool you thought you were. So before you save the rain forest from the parasites of your parent's generation, try delousing the closet in your own room.

Rule 8: Your school may have done away with winners and losers, but life HAS NOT. In some schools, they have abolished failing grades and they'll give you as MANY TIMES as you want to get the right answer. This doesn't bear the slightest resemblance to ANYTHING in real life.

Rule 9: Life is not divided into semesters. You don't get summers off and very few employers are interested in helping you FIND YOURSELF. Do that on your own time.

Rule 10: Television is NOT real life. In real life people actually have to leave the coffee shop and go to jobs.

Rule 11: Be nice to nerds. Chances are you'll end up working for one.

Quotes Of The Day: China

Tuesday, May. 27, 2008

To lose a child is to lose everything for Chinese parents. A child is their only hope.

• Professor ZHONGXIN SUN
• a sociology professor at Fudan University in Shanghai, after Chinese officials announced that parents whose only child was killed or grievously injured in the earthquake would be exempt from the country's one-child policy

Quotes By Bush on Democracy

"True democracy requires competitive elections in which opposition candidates are allowed to campaign without fear or intimidation."

U.S. President George W. Bush

The president was speaking at the World Economic Forum in Sharm el-Sheikh, Egypt.

Quotes

John F. Kennedy When we got into office the thing that surprised me most was to find that things were just as bad as we'd been saying they were. Winston Churchill The optimist sees opportunity in every danger; the pessimist sees danger in every opportunity. I would rather see finance less proud and industry more content. Adolf Hitler No country has ever been ruined on account of its debts. Napoleon Bonaparte

If you want to be a success in the world, promise everything and deliver nothing.

Once I have made up my mind, I screen out everything except what will make it succeed.

I want the whole of Europe to have one currency; it will make trading much easier.

Quotes By Warren Buffett

Warren Buffett

• I put heavy weight on certainty. It's not risky to buy securities at a fraction of what they're worth.
• Occasional outbreaks of those two super-contagious diseases, fear and greed, will forever occur in the investment community. The timing of these epidemics is equally unpredictable, both as to duration and degree. Therefore we never try to anticipate the arrival or departure of either. We simply attempt to be fearful when others are greedy and to be greedy only when others are fearful.
• With enough inside information and a million dollars you can go broke in a year.
• The first rule is not to lose. The second rule is not to forget the first rule.
• When you combine ignorance with leverage you get some pretty interesting results.
• The market, like the Lord, helps those who help themselves. But, unlike the Lord, the market does not forgive those who know not what they do.
• You could be somewhere where the mail was delayed three weeks and do just fine investing.
• Never ask the barber if you need a haircut.
• You don't need to be a rocket scientist. Investing is not a game where the guy with the 160 IQ beats the guy with the 130 IQ.
• You should invest in a business that even a fool can run, because someday a fool will.
• You go to bed feeling very comfortable just thinking about two and a half billion males with hair growing while you sleep. No one at Gillette has trouble sleeping.
• If you gave me $100 billion and said take away the soft drink leadership of Coca-Cola in the world, I'd give it back to you and say it can't be done.
• Most people get interested in stocks when everyone else is. The time to get interested is when no one else is. You can't buy what is popular and do well.
• For some reason people take their cues from price action rather than from values. Price is what you pay. Value is what you get.
• For society, the internet's a wonderful thing. But for capitalists it's probably a net negative.
• Diversification may preserve wealth, but concentration builds wealth.
• I'd be a bum on the street with a tin cup if the markets were efficient.
• In the short run, the market is a voting machine. In the long run, it's a weighing machine.
• The new issue market is ruled by controlling stockholders and corporations who can usually select the timing of offerings. Understandably these sellers are not going to offer any bargains. It's rare you'll find X being sold for half-X. Indeed, in the case of common-stock offerings, selling shareholders are often motivated to unload only when they feel the market is overpaying.
• As far as I am concerned, the stock market doesn't exist. It is only there as a reference to see if anybody is offering to do anything foolish.
• To be successful, you should concentrate on the world of companies, not arcane accounting mathematics.
• With each investment you make, you should have the courage and the conviction to place at least ten per cent of your net worth in that stock.
• We like to buy businesses. We don't like to sell and we expect the relationship to last a lifetime.
• There's very little money to be made recommending our strategy [buy-and-hold].Your broker would starve to death. Recommending something to be held for 30 years is a level of self-sacrifice you'll rarely see in a monastery, let alone a brokerage house.
• When a chief executive officer is encouraged by his advisors to make deals, he responds much as would a teenager boy who is encouraged by his father to have a normal sex life. It's not a push he needs.
• It's easier to create money than to spend it.
• I wouldn't mind going to jail if I had three cellmates who played bridge.
• I don't try to jump over 7-foot bars. I look around for 1-foot bars that I can step over.
• Money, to some extent, sometimes lets you be in more interesting environments. But it can't change how many people love you or how healthy you are.
• I've often felt there might be more to be gained by studying business failures than business successes.
• It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you'll do things differently.
• Chains of habit are too light to be felt until they are too heavy to be broken.
• I wouldn't have been the most popular guy in the class, but I wouldn't have been the most unpopular either. I was just sort of nothing.
• Ben made his customary calculation of value to price and said no.
• If Bill had started a hot dog stand, he would have become the hot dog king of the world. He will win in any game. He would be very good at my business, but I wouldn't at his.
• I'd just bet on him. Nobody has lost money doing that yet.
• Charlie and I can handle a four page memo over the phone with three grunts.
• Ben Graham wasn't about brilliant investments and he wasn't about fads of fashion. He was about sound investing, and I think sound investing can make you very wealthy if you're not in too big of a hurry. And it never makes you poor, which is even better.
• Investing in a market where people believe in efficiency is like playing bridge with someone who has been told it doesn't do any good to look at the cards.
• John Maynard Keynes essentially said, don't try and figure out what the market is doing. Figure out a business you understand, and concentrate.
• If the business does well, the stock eventually follows.
• My idea of a group decision is to look in the mirror.
• When managers want to get across the facts of a business to you, it can be done within the rules of accounting. Unfortunately, when they want to play games, at least in some industries, it can also be done within the rules of accounting. If you can't recognize the differences, you shouldn't be in the equity-picking business.
• Full-time professionals in other fields, let's say dentists, bring a lot to the layman. But in aggregate, people get nothing for their money from professional money managers.
• Draw a circle around the businesses you understand and then eliminate those that fail to qualify on the basis of value, good management and limited exposure to hard times.
• I read annual reports of the company I'm looking at and I read the annual reports of the competitors - that is the main source of material.
• All there is to investing is picking good stocks at good times and staying with them as long as they remain good companies.
• I'd rather have a $10 million business making 15 per cent than a $100 million business making 5 per cent.
• Read Ben Graham and Phil Fisher, read annual reports, but don't do equations with Greek letters in them.
• Whenever I read about some company undertaking a cost-cutting program, I know it's not a company that really knows what costs are about. The really good manager does not wake up in the morning and say 'This is the day I'm going to cut costs,' any more than he wakes up and decides to practice breathing.
• Owning Snow White is like owning an oil field. You pump it out and sell it, and then it seeps back in again.
• When management with a reputation for brilliance tackles a business with a reputation for poor fundamentals, it is the reputation of the business that remains intact.
• Diversification is a protection against ignorance. It makes very little sense for those who know what they're doing.
• My favorite time frame for holding a stock is forever.
• Our prototype for occupational fervour is the Catholic tailor who used his small savings of many years to finance a pilgrimage to the Vatican. When he returned, his parish held a special meeting to get his first-hand account of the Pope. "Tell us," said the eager faithful, "just what sort of fellow is he?" Our hero wasted no words. "He's a forty-four medium."
• A good managerial record (measured by economic returns) is far more a function of what business boat you get into than it is of how effectively you row. 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.
• Many corporate managers deplore governmental allocation of the taxpayer's dollar but embrace enthusiastically their own allocation of the shareholder's dollar [to charities of their own choosing]. We've yet to find a CEO who believes he should personally fund the charities favored by his shareholders. Why, then should they foot the bill for his picks?
• It has become fashionable at public companies to describe almost every compensation plan as aligning the interests of management with those of shareholders. In our book, alignment means being a partner in both directions, not just on the upside. Many 'alignment' plans flunk this basic test, being artful forms of 'heads I win, tails you lose.'
• The professors who taught Efficient Market Theory said that someone throwing darts at the stock tables could select stock portfolio having prospects just as good as one selected by the brightest, most hard-working securities analyst. Observing correctly that the market was frequently efficient, they went on to conclude incorrectly that it was always efficient.
• The strategy we've adopted precludes us from following standard diversification dogma. Many pundits would therefore say our strategy must be riskier than that employed by more conventional investors. We disagree. We believe that a policy of portfolio concentration may well decrease risk if it raises, as it should, both the intensity with which an investor thinks about a business and the comfort-level he must feel with its economic characteristics before buying into it.
• We believe that according the name 'investors' to institutions that trade actively is like calling someone who repeatedly engages in one-night stands a romantic.
• Our reaction to a fermenting industry is much like our attitude toward space exploration: we applaud the endeavour but prefer to skip the ride. Obviously many companies in high-tech businesses or embryonic industries will grow much faster than will The Inevitables [like Coca-Cola and Gillette]. But we would rather be certain of a good result than hopeful of a great one.
• Loss of focus is what most worries Charlie [Munger] and me when we contemplate investing in a business that looks outstanding. All too often, we've seen value stagnate in the presence of hubris or boredom that caused the attention span of managers to wander. Would you believe that not a few decades back they were growing shrimp at Coke and exploring for oil at Gillette?
• Your goal as an investor should be to purchase, at a rational price, a part interest in an easily-understandable business whose earnings are virtually certain to be materially higher five, ten and twenty years from now. Over time, you will find only a few companies that meet these standards - so when you see one that qualifies, you should buy a meaningful amount of stock. You must also resist temptation to stray from your guidelines: If you aren't willing to own a stock for ten years, don't even think about owning it for ten minutes.
• It's far better to buy a wonderful company at a fair price, than a fair company at a wonderful price. Now, when buying companies or common stocks, we look for first-class businesses accompanies by first-class managements.
• After 25 years of buying and supervising a great variety of businesses, Charlie [Munger] and I have not learned how to solve difficult business problems. What we have learned is to avoid them. To the extent we have been successful, it is because we have concentrated on identifying one-foot hurdles that we could step over rather than because we acquired any ability to clear seven-footers.
• The most common cause of low prices is pessimism - sometimes pervasive, sometimes specific to a company or industry. We want to do business in such an environment, not because we like pessimism but because we like the prices it produces. It's optimism that is the enemy of the rational buyer.
• Stocks can't outperform businesses indefinitely. Indeed, because of the heavy transaction and investment management costs they bear, stockholders as a whole and over the long term must inevitably underperform the companies they own. If American business, in aggregate, earns about 12% on equity annually, investors must end up earning significantly less. Bull markets can obscure mathematical laws, but they cannot repeal them.
• Earnings should only be retained [as opposed to being paid out as dividends] when there is a reasonable prospect that for ever dollar retained by the corporation, at least one dollar of market value will be created for owners. This will happen only if the capital retained produces incremental earnings equal to, or above, those generally available to investors.
• One of the ironies of the stock market is the emphasis on activity. Brokers, using terms such as 'marketability' and 'liquidity', sing the praises of companies with high share turnover. But investors should understand that what is good for the croupier is not good for the customer. A hyperactive stock market is the pickpocket of enterprise.
• In the search for companies to acquire, we adopt the same attitude one might find appropriate in looking for a spouse: it pays to be active, interested, and open-minded, but it does not pay to be in a hurry.
• A company that wants to use its own stock as currency for an acquisition has no problems if the stock is selling in the market at full intrinsic value. But suppose it is selling at only half intrinsic value. In that case it is faced with the unhappy prospect of using a substantially undervalued currency to pay for a fully valued property [the negotiated price of the target company]. In effect the acquirer must give up $2 of value to receive $1 of value. Under such circumstances, a marvellous business purchased at a fair sales price becomes a terrible buy. For gold valued as gold cannot be purchased intelligently through the utilization of gold valued as lead.
• If Fed Chairman Alan Greenspan were to whisper to me what his monetary policy was going to be over the next two years, it wouldn't change one thing I do.
• A pin lies in wait for every bubble and when the two eventually meet, a new wave of investors learns some very old lessons.
• We have embraced the 21st century by entering such cutting-edge industries as brick, carpet, insulation and paint. Try to control your excitement.
• Buy stocks like you buy your groceries, not like you buy your perfume.
• If you are a know-something investor, able to understand business economics and to find five to ten sensibily priced companies that possess important long-term competitive advantages, conventional diversification (broadly based active portfolios) makes no sense to you.
• When the whorehouse burns down, even the pretty girsl have to run out.
• If, after half an hour, you haven't figured out who the patsy is, then you're the patsy.
• I never attempt to make money on the stock market. I buy on the assumption that they could close the market the next day and not reopen it for five years.
• Either they're trying to con you or they're trying to con themselves.
• In a difficult business, no sooner is one problem solved than another surfaces - never is there just one cockroach in the kitchen.
• I look for businesses in which I think I can predict what they're going to look like in ten to fifteen years time. Take Wrigley's chewing gum. I don't think the internet is going to change how people chew gum.

Quotes by Peter Lynch

Peter Lynch

• Never invest in any idea you can't illustrate with a crayon.

• Investing without research is like playing stud poker and never looking at the cards.

• Warren Buffett, the greatest investor of them all, looks for the same opportunities I do, except that when he finds them, he buys the whole company.

• Investing in stocks is an art, not a science, and people who've been trained to rigidly quantify everything have a big disadvantage.

• To me, an investment is simply a gamble in which you've managed to tilt the odds in your favour.

• It only takes a handful of big winners to make a lifetime of investing worthwhile.

• I like buying companies that can be run by monkeys - because one day they will be.

• Twenty years in this business convinces me that any normal person using the customary three per cent of the brain can pick stocks as well as, if not better, than the average Wall Street expert.

• There seems to be an unwritten rule on Wall Street: If you don't understand it, put your life savings into it. Shun the enterprise round the corner, which can at least be observed, and seek out one that manufactures an incomprehensible product.

• Whoever imagines that the average Wall Street professional is looking for reasons to buy exciting stocks hasn't spent much time on Wall Street. The fund manager most likely is looking for reasons not to buy exciting stocks, so that he can offer the proper excuses if those exciting stocks go up.

• Between the chance of making an unusually large profit on an unknown company and the assurance of losing only a small amount on an established company, the normal mutual-fund manager, pension-fund manager, or corporate-portfolio manager would jump at the latter. Success is one thing, but it's more important not to look bad if you fail.

• You don't have to invest like an institution. If you invest like an institution, you're doomed to perform like one, which in many cases isn't very well.

• In stocks you've got the company's growth on your side. You're a partner in a prosperous and expanding business. In bonds, you're nothing more than the nearest source of spare change. When you lend money to somebody, the best you can hope for is to get it back, plus interest.

• The list of qualities [an investor ought to have] include patience, self-reliance, common sense, a tolerance for pain, open-mindedness, detachment, persistence, humility, flexibility, a willingness to do independent research, an equal willingness to admit mistakes, and the ability to ignore general panic.

• When it comes to predicting the market, the important skill is not listening, but snoring. The trick is not to learn to trust your gut feelings, but rather to discipline yourself to ignore them. Stand by your stocks as long as the fundamental story of the company hasn't changed.

• When ten people would rather talk to a dentist about plaque than to the manager of an equity mutual fund about stocks, it's likely that the market is about to turn up. When the neighbours tell me what to buy and then I wish I had taken their advice, it's a sure sign that the market has reached a top and is due for a tumble.

• If you're considering a stock on the strength of some specific product that a company makes, the first thing to find out is: what effect will the success of the product have on the company's bottom line?

• If I could avoid a single stock, it would be the hottest stock in the hottest industry, the one that gets the most favourable publicity, the one that every investor hears about in the car pool or on the commuter train - and succumbing to the social pressure, often buys.

• Although it's easy to forget sometimes, a share of a stock is not a lottery ticket. It's part ownership of a business.

• If you remember nothing else about p/e ratios, remember to avoid stocks with excessively high ones. A company with a high p/e must have incredible earnings growth to justify its high price.

• I got positive feelings when I saw that Taco Bell's headquarters was stuck behind a bowling alley. When I saw those executives operating out of that grim little bunker, I was thrilled. Obviously they weren't wasting money on landscaping the office.

• When you buy a stock for its book value, you have to have a detailed understanding of what those values really are. At Penn Central, tunnels through mountains and useless rail cars counted as assets.

• If you can find a company that can get away with raising prices year after year without losing customers (an addictive product such as cigarettes fills the bill), you've got a terrific investment.

• Some people automatically sell the 'winners' - stocks that go up - and hold on to their 'losers' - stocks that go down - which is about as sensible as pulling out the flowers and watering the weeds. Others automatically sell their losers and hold on to their winners, which doesn't work out much better. Both strategies fail because they're tied to the current movement of the stock price as an indicator of the company's fundamental value.

• If you know why you bought a stock in the first place, you'll automatically have a better idea of when to say goodbye to it.

• Warren Buffett thinks that stock futures and options ought to be outlawed, and I agree with him.

• Just because the price goes up doesn't mean you're right. Just because it goes down doesn't mean you're wrong. Stock prices often move in opposite directions from the fundamentals but long term the direction and sustainability of profits will prevail.