Wednesday, April 24, 2013

Buffett Tells Coke CEO Study Failure, Avoid Complacency


The article above reminded me of this excerpt from Bill Miller’s Q2 2008 letter to investors:
Mason Hawkins said, "Warren, I'm an optimist. I think this whole thing can turn quickly, and surprise people. Are you an optimist?" "I'm a realist, Mason," the sage replied. Warren went on to say he was optimistic long term, and backed that up in a talk the next morning on the remarkable history of growth, innovation, and wealth creation the U.S. had produced over the past 200-plus years. He also offered a sober assessment of the current challenges we face, and said it would take some time to work through them.
My opinion is that the best outlook to take on investing and life is not to be a pessimist or an optimist, but to be a positive realist. I think it is important to be a positive person and to have the long-term optimism that Mr. Buffett discusses, but I also think it is vital to be a realist in the present moment. Though a positive one.