The most important thing to remember that came out of the...

The most important thing to remember that came out of the woodstock for capitalist weekend was despite heavy fluctuations in markets, security price falls, broker downgrades, a credit crunch etc etc... keeping calm and rational is an absolute must. Both Warren and Charlie ooze calmness about them and could give no hoot about the businesses (stock) falling on the exchange or what recommendations the broker houses have put on a stock.

Warren states that there is not one stock that is in the Berkshire portfolio that is looked at by him or Charlie and is considered risky - risky is defined in terms of permanent capital loss. He also states that the prices could fall as much as 50% and this would still not phase him but welcome the notion so that he can purchase more. What they are concerned of is being in the right businesses to start with. To add to this, he uses Berkshire Hathaway as an example; BRK.A had fallen 50% 3 times since the stock started trading (1974, 1987& 1998/2000). Has this made any difference to todays value of Berkshire??
The point being, there is no need to worry about fluctuations and manic behaviour. The *permanent* loss of capital is what the long term investor must be concerned about.... and getting the right businesses led by the right management with the right temperament and philosophy is far,far more important than a short horizon graph with a line.

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Have a look at a company called Seaboard Corporation (www.seaboardcorp.com), this is listed on the AMEX (american stock exchange) and is one greatly run company. Would love to hear your thoughts on it, incl you cK.....