巴菲特1994年致股东的信（英文版）

Here is the full text of Buffett's 1994 letter to shareholders:

Our gain in net worth during 1994 was $1.45 billion, or 13.9%. Over the last 30 years (that is, since present management took over), our per - share book value has grown from $19 to $10,083, or at a rate of 23% compounded annually.

Charlie Munger, Berkshire's vice - chairman and my partner, and I make few predictions. One we will confidently offer, however, is that the future performance of Berkshire won't come close to matching the performance of the past.

The problem is not that what has worked in the past will cease to work in the future. To the contrary, we believe that our formula - the purchase at sensible prices of businesses that have good underlying economics and are run by honest and able people - is certain to produce reasonable success. We expect, therefore, to keep on doing well.

A fat wallet, however, is the enemy of superior investment results. And Berkshire now has a net worth of $11.9 billion compared to about $22 million when Charlie and I began to manage the company. Though there are as many good businesses as ever, it is useless for us to make purchases that are inconsequential in relation to Berkshire's capital. (As Charlie regularly reminds me, "If something is not worth doing at all, it's not worth doing well.") We now consider a security for purchase only if we believe we can deploy at least $100 million in it. Given that minimum, Berkshire's investment universe has shrunk dramatically.

Nevertheless, we will stick with the approach that got us here and try not to relax our standards. Ted Williams, in The Story of My Life, explains why: "My argument is, to be a good hitter, you've got to get a good ball to hit. It's the first rule in the book. If I have to bite at stuff that is out of my happy zone, I'm not a.344 hitter. I might only be a.250 hitter". Charlie and I agree and will try to wait for opportunities that are well within our own "happy zone".

We will continue to ignore political and economic forecasts, which are an expensive distraction for many investors and businessmen. Thirty years ago, no one could have foreseen the huge expansion of the Vietnam War, wage and price controls, two oil shocks, the resignation of a president, the dissolution of the Soviet Union, a one - day drop in the Dow of 508 points, or treasury bill yields fluctuating between 2.8% and 17.4%.

But, surprise - none of these blockbuster events made the slightest dent in Ben Graham's investment principles. Nor did they render unsound the negotiated purchases of fine businesses at sensible prices. Imagine the cost to us, then, if we had let a fear of unknowns cause us to defer or alter the deployment of capital. Indeed, we have usually made our best purchases when apprehensions about some macro event were at a peak. Fear is the foe of the faddist, but the friend of the fundamentalist.

Going forward, we are sure there will be a different set of major shocks in the next 30 years, but that Berkshire will neither try to predict these nor to profit from them. The disciplined indentification of opportunities following Berkshire's criterion means that external surprises would have little effect on its long - term results.

We regularly report our per - share book value, an easily calculable number, though one of limited use. Just as regularly, we tell you that what counts is intrinsic value, a number that is impossible to pinpoint but essential to estimate. For example, in 1964, we could state with certitude that Berkshire's per - share book value was $19.46. However, that figure considerably overstated the stock's intrinsic value since all of the company's resources were tied up in a sub - profitable textile business. Our textile assets had neither going - concern nor liquidation values equal to their carrying values. Today, Berkshire's situation has reversed: many of the businesses we control are worth far more than their carrying value5. (Those we don't control, such as Coca - Cola or Gillette, are carried at current market values.) We continue to give you book value figures, however, because they serve as a rough, albeit significantly understated, tracking measure for Berkshire's intrinsic value. Last year, in fact, the two measures moved in concert: book value gained 13.9%, and that was the approximate gain in intrinsic value also.

Understanding intrinsic value is as important for managers as it is for investors. It is vital that managers "act in ways that increase per - share intrinsic value and avoid moves that decrease it". While this principle may seem obvious, it is constantly violated. Buffett then looked at a very common technique when appraising mergers and acquisitions - the focus on whether the transaction is immediately dilutive or anti - dilutive to earnings per share. Buffett warned that an emphasis of this sort carries great dangers.

In corporate transactions, it is silly for the would - be purchaser to focus on current earnings when the prospective acquiree has either different prospects, different amounts of non - operating assets, or a different capital structure. At Berkshire, we have rejected many merger and purchase opportunities that would have boosted current and near - term earnings but that would have reduced per - share intrinsic value. Our approach, rather, has been to follow Wayne Gretzky's advice: "Go to where the puck is going to be, not to where it is." As a result, our shareholders are now many billions of dollars richer than they would have been if we had used the standard catechism.

Unfortunately, many major acquisitions increase the income and status of the acquirer's management; and they are a "honey pot" for the investment bankers and other professionals on both sides. But, alas, they usually reduce the wealth of the acquirer's shareholders, often to a substantial extent. That happens because the acquirer typically gives up more intrinsic value than it receives.

Over time, the skill with which a company's managers allocate capital has an enormous impact on an enterprise's value. Almost by definition, a good business generates far more money (at

Despite this difficult situation, USAir may yet achieve the cost reductions it needs to maintain its viability long - term3. But it is far from sure that will happen3. Accordingly, we wrote our USAir investment down to $89.5 million, 25 cents on the dollar at year - end 19943. This valuation reflects both a possibility that our preferred will have its value fully or largely restored and an opposite possibility that the stock will eventually become worthless3. Whatever the outcome, we will heed a prime rule of investing: You don't have to make it back the way that you lost it.

But in the fourth quarter, we concluded that the decline in value was, in accounting terms, "other than temporary," and that judgment required us to send the writedown of $269 million through our income statement4. The amount will have no other fourth - quarter effect. That is, it will not reduce our net worth, because the diminution of value had already been reflected.

Charlie and I will not stand for reelection to USAir's board at the upcoming annual meeting. Should Seth wish to consult with us, however, we will be pleased to be of any help that we can.

Late in 1993 I sold 10 million shares of Cap Cities at $63; at year - end 1994, the price was $85.256. (The difference is $222.5 million for those of you who wish to avoid the pain of calculating the damage yourself.) When we purchased the stock at $17.25 in 1986, I told you that I had previously sold our Cap Cities holdings at $4.30 per share during 1978 - 80, and added that I was at a loss to explain my earlier behavior. Now I've become a repeat offender. Maybe it's time to get a guardian appointed.

We also want to assure you that the vast majority of my personal net worth is and will continue to be invested in Berkshire shares. We won't be asking you to participate in our investments while we put our own money elsewhere. In fact, the vast majority of the investments of the Buffett family and Charlie's and my old friends from the 1960s partnership days are also in Berkshire shares.

Charlie and I would love for you to come to this year's shareholders' meeting. Because the number of people attending last year slightly exceeded the 2,750 - seat capacity of the Orpheum Center, we have decided to hold this year's meeting at the new Holiday Conference Center at 9:30 am on Monday, May 1, 1995. The new venue's main hall can accommodate 3,300 people, and if necessary, with the help of audio - visual equipment, there is also a meeting room next door that can hold 1,000 people.

We displayed some of Berkshire's products at the meeting last year and sold a total of 800 pounds of candy, 507 pairs of shoes, and more than $12,000 worth of World Book Encyclopedia and related publications. These products will be available again this year. Although we think the main significance of this meeting lies in the spiritual aspect, we should not forget that even the most sacred religious ceremonies include the rite of offering donations.

Of course, you must not miss the video of the 1995 Orange Bowl. I watched this classic game at night and even played the exciting fourth quarter in slow motion. We express our respect for the University of Nebraska football coach - Tom Osborne and his top - ranked team - the Cornhuskers with the color of this year's cover. I urge you to come to this year's shareholders' meeting dressed in the red of the Huskers. And I can assure you that more than 50% of Berkshire's management duo will be wearing the correct color.

Because we expect a large number of people to attend, we suggest that you make hotel reservations in advance. Those who want to stay in the city center (about 6 miles from the venue) can choose the Radisson - Redick Hotel, a small hotel with 88 rooms, or the larger Red Lion Hotel next door. Near the venue, there are the Holiday Inn (403 rooms), Homewood Suites (118 rooms), or Hampton Inn (136 rooms). Another recommended hotel is the Marriott in West Omaha, about 100 meters from Borsheim's Jewelry and a 10 - minute drive from the venue. There will be a bus to take you to and from the shareholders' meeting.

The relevant information on voting at the shareholders' meeting is attached, explaining how to obtain the admission badges. There is a large parking lot at the venue on the day of the meeting. People staying at the Holiday Inn, Homewood Suites, or Hampton Inn can walk to the meeting.

As in previous years, we will have buses to take you to Nebraska Furniture Mart and Borsheim's Jewelry after the meeting, or to the hotel and the airport. I hope you will especially visit Nebraska Furniture Mart because this year's newly opened super - store, selling various home appliances, electronic information, CDs, cameras, and audio - visual products, has had amazing sales since its opening. When you get there, you will definitely be impressed by the variety of products and the display methods.

The super - store next to the NFM main building is about 2 miles from the venue. Its business hours are from 10 am to 9 pm on weekdays, from 10 am to 6 pm on Saturdays, and from 12 pm to 6 pm on Sundays. When you get there, remember to say hello to Mrs. B, who is 101 years old. She goes to work at Mrs. B's Warehouse every day, or rather, every hour.

Borsheim's Jewelry, which is usually not open on Sundays, will be open especially for shareholders and guests on the day of the shareholders' meeting from 12 pm to 6 pm. This day is always special, and we will try to give you some pleasant surprises. Usually, that day is also the day with the highest annual turnover of the store. This is one of the main reasons why Charlie and I hope to see you there.

On the evening of Saturday, April 29, the day before, there will be a game between the Omaha Royals and the Buffalo Bisons at Rosenblatt Stadium. The owner of the Bisons, my friends Mindy and Bob, I hope they will also come. If they do, I will lure Bob into a showdown with me on the pitcher's mound. Bob can be called the capitalist's Randy Johnson, young, strong, and energetic, definitely an opponent you don't want to meet during the season. So I hope you will all come to cheer me on.

The shareholders' meeting materials will tell you how to get the admission tickets. About 1,400 shareholders attended this grand event last year. Before the game that night, I threw a pitch at a speed of 8 miles per hour. However, many fans did not see that I ignored the catcher's request for a fastball and instead threw my knuckleball. As for the pitch I will throw this year, it is still a mystery.

Warren E. Buffett
Chairman of the Board
March 7, 1995