Managing director of Pimco and the world's most influential bond fund manager
Best advice I can give: Most of Wall Street is focused on next month's numbers, but by taking a long-term view on economic statistics and investment fundamentals, you stand a better chance of not getting whipsawed by the volatile economy.
Best advice I ever got: Hanging on the walls of my office are three pictures: There's J.P. Morgan, who taught me that it's character, not assets, that counts most; Jesse Livermore [who made a fortune calling the market downturns of 1907 and 1929 -- but later lost it], who taught me that it is important to "know thyself"; and [financier] Bernard Baruch, who taught me that no matter what, "two and two will always equal four" -- and that no one has ever invented a way to get something for nothing.
Fear is your friend.
The past two years were an "ideal period" for value-minded investors. For example, Buffett managed to scoop up bargains ranging from municipal bonds to securities of Goldman Sachs, GE, and others. "When it's raining gold," he writes, "reach for a bucket, not a thimble."
Focus on the (really) long term.
Buffett notes the investments that he and partner Charlie Munger prefer are "businesses whose profit picture for decades to come seems reasonably predictable." Not the next two months or quarters or years, mind you. Decades.
Stick with what you know.
Against the advice of the firm's managers, Buffett pushed Geico -- the home and auto insurer that Berkshire owns -- into the crowded credit card business several years ago. Geico bailed out in 2009, losing about $50 million in all. The moral: If you don't understand that commodity ETF your pal is bragging about, pass on it.
Maintain a cushion.
While firms were fighting for their lives in the credit crisis, Berkshire kept doing deals. Why? Because Buffett keeps about $20 billion in cash on hand. This reserve is earning "a pittance," he says. "But we sleep well." A reserve will help you sleep better too, especially as you near retirement.
The buck stops with you.
Buffett oversees virtually all derivatives contracts on the company's books. "If Berkshire ever gets in trouble, it will be my fault." You need to adopt the same attitude. Whether you go it alone or work with an adviser, understand the level of risk you're assuming. If something goes wrong, you'll suffer the consequences.
Anchor of CNBC's Closing Bell and author of "The 10 Laws of Enduring Success"
Best advice I can give: Darwin said it: You need to be adaptable. As it relates to your portfolio, if you regularly put money into your 401(k) or invest in mutual funds, you might have to change your strategy as the economic times change around you.
As it relates to your skill set, make sure you have a broad understanding of where the growth is in the job market, so you can apply your talents there. We are seeing different skill sets required. We are seeing traditional industries change. Some positions are leaving and aren't coming back.
Best advice I ever got: When I was a little girl and wanted an ice cream cone, my mom would say, "Yes. But how much change do you have in your jar?" (I would save my pennies.)
I am a big saver. I got my first credit card only about two years ago.
Founder and CEO of Papa John's Pizza, with more than 3,000 locations worldwide
Best advice I can give: Live below your means and be frugal. The economy is going to get worse before it gets better. And folks who have savings have the best chance of getting through this.
Best advice I ever got: When I was a boy, my grandfather and I would go to the hardware store, and he would charge things. I'd say, "Papa, don't you have any money?" And he would say, "I have money, but my credit is good." I didn't understand it then, but he wasn't teaching me that it was good to borrow. Rather, if you borrow money, pay it back promptly so you can maintain good credit. That advice is more applicable now than ever.
In Washington they're spending money like drunken sailors, but that means they have to print money like drunken sailors. They're doing the opposite of what my Papa would have done.
Owner of the Dallas Mavericks; sold Broadcast.com to Yahoo just before the tech bust
Best advice I can give: Unless you think you've done more research and have better insight on a stock than a multibillion-dollar hedge fund, why are you trading?
Best advice I ever got: My first broker told me that stocks were sold just like any product. He said no one buys or sells stocks expecting to leave money on the table or lose money on the deal.
So know why others are buying when you're selling and vice versa. It was great advice because when I started trading, I tended to become attached to stocks rather than doing the work to ensure I had enough information to make a good decision.
Manager, FPA New Income, and Morningstar's co-bond manager of the year in 2008
Best advice I can give: Be patient. You don't have to be the first person to come into a promising investment.
Best advice I ever got: I got this from a bunch of places, including my dad and Peter Lynch: Don't invest in anything you don't understand. As an investor, stick with simple businesses and simple business models.
People really need to get back to owning 15 or 20 companies that they understand, rather than 50 stocks that they don't.
Chief financial officer of Morehouse College and former CFO at Yale University and NASA
Best advice I can give: Many people who have been laid off start looking for a new job right away, but sometimes it's better to go back to school for additional training and education. When the economy does turn around, the opportunities are going to be there for people with new skills and additional bandwidth.
Best advice I ever got: My mother told me that a girl should always have a rainy-day fund. She never specified how big (that's something I figured out on my own later on). But her advice is certainly applicable today.
In the economic downturn, the advice to have three months of expenses put away has stretched to six months of expenses. I have a year's worth of salary put away.
Fox Business Network anchor and author of "The Best Investment Advice I Ever Received"
Best advice I can give: We all have to learn from our mistakes of overleveraging ourselves and acting like 5-year-olds -- "I want four cookies." You don't need four cookies; you only need one. It's not about what you want, it's about what you need.
We all must reassess our consumer behavior. It's not good enough to live within our means -- we have to live beneath them.
Best advice I ever got: My father, Mo Claman, would say, "Liz, buy good companies going through bad times." When I was growing up, he was a big believer in Kodak, and every day he would get the paper and run his finger down the stocks column to check on it. The stock went through some rough periods, but he kept his Kodak shares, knowing it was a good company. He swears he put us five kids through college thanks to that stock.
Professor of finance at Santa Clara University and a leading expert in behavioral finance
Best advice I ever got -- and can give: You are more resilient than you imagine. And if you ever doubt that, remember the many people whose troubles were much greater than yours yet who survived.
The best advice that I ever received was the strength of my parents -- Holocaust survivors who persevered to make a life for themselves and their three children.
0 comments:
Post a Comment