在中国工作一定要抽烟喝酒，在美国工作一定要打好Golf。谢谢感恩节的假期。

Here I am, playing 9 hole. 该享受一下了。

 

What would be the best gift for thanksgiving this year?

 

You are right. we both got it! and now we are celebrating...

 

Gilroy的名牌打折店(factory outlet)半夜12点开门，我带着两个一年级的MBA和富彦夫妇、Rachmat夫妇驱车前往。还没有到Gilroy的出口，就看到1公里长的长队。

 

原来只知道中国人图便宜货，商店门口排长队，这次在美国是开了眼。下面分别是凌晨3点钟，Calvin Klein里面和Puma店外面的长队。有点中国春节买火车票的壮观景象。

 

 

 

 

 

 

If there is a god in investment, it's Warren Buffett.

 

40+ years, never a down year, almost always beat the S&P. Became the 3rd richest person by Investing.

 

 

About knowing a company

He made investments without knowing much about the products (counter-intuitive, huh?).

 

Unlike the stock pitch many investment banks do, he only focused on several key factors, such as earnings, capital intensity, and price to earning multiples.

 

Then he made his investment decision. He invested in many companies without even physically seeing the facilities or products. He still does not know much about the furniture business but he did a sound investment in Nebraska Furniture Company.

 

Making decisions based on sufficient reasons is enough.

 

On China stocks:

Cinderella analogy: when you know there is bubble out there, price exceeds value too much, he would not invest. He said it’s like Cinderella at the ball: it’s so tempting to stay longer and longer. Unfortunately, there is no clock on the wall.

 

When midnight comes, all things will turn into pumpkins and mice. It gets really ugly.

 

Mr. Market:

“Mr. market is there to serve you, not to direct you”.

 

You should always ask yourself, “if I buy this stock, but I can’t trade it for two years, will I still buy it?”

 

Blind Spots:

 

Even great investors will have blind spots. He mentioned that when internet just came out, Bill Gates and Steve Ballmer invited him and his partner Charlie to go to Seattle. They tried to figure out how to “monetize” the internet.

 

Those smartest people spent three hours together, and none of the search, auction or online retailing came across their minds.

 

GEICO/State farm:

He mentioned that a book from Amazon shows that the founder of Statefarm identified some inefficiency in the insurance market and totally rewrote the insurance industry. Later on, the founder of GEICO found out ways to even further reduce the costs, thus providing cheaper services by restructuring the distribution system.

 

He said repeatedly that there is a chance to get big in China and Japan by doing the distribution system right.

 

GEICO is good because it has over 8m policy holders, and increasing very fast. The customer acquisition cost is very low, and the internet further lowered the costs.

 

 

 

Circle of expertise: good enough and comfortable enough: know your limits

If he can get 20% return at the risk level of 10 (out of 100), he would not get 40% return if the risk is more than 20 (out of 100).

 

 

Giving out $30bn dollars:

 

Check out Charlie Rose’s interview with Mr. Buffett after he donated his money to Gates foundation:

 

http://www.youtube.com/watch?v=XkyEfqjbp8U

 

The Lunch:

 

Talk with staff at Piccolo’s. they all love him as a nice person. This is so amazing.

 

No matter he is rich or not, he is a nice human. When I asked about Bill Gates, the waiter told me Gates was not as friendly and approachable as Mr. Buffett. Gates has security wherever he goes to, and is not as friendly as Mr. Buffett. As a matter of fact, Gates only did one great project: creating company and then he could coast on it forever. However, Mr. Buffett invested in many companies single handedly for over 40 years old. Microsoft Corporation is an empire built by tens of thousands of engineers.

 

How Buffett jokes:

Saving good things for the future is like “saving sex for old age”.

 

He made jokes on “Be careful when you cross the street. The cars might be insured with GEICO”. He also said “take your time on this one” when he was taking pictures with ladies.

 

Others:

See’s candy is a great business because of its strong brand equity, high pricing power and low capital intensity. So is Coca Cola that makes the syrup, not the bottling company.

 

 

A 77 year old man with tens of billions of asset, 200bn dollars to invest is doubt busy. He could spend his time with us from 10am to 2:30pm was surprising.

 

He still drives a 1982 Lincoln Continental, and he does not have a driver or body guard. He lives in a humble house. The only difference is that he travels with a private jet, to save time. his house is only worth $700,000 (Gates' is oever 100 million), and his pay check in 2006 was $100, 000, 1/3 lower than stanford MBA grads' starting salary.

 

Legacy.