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1、巴菲特致股东的信19971997ChairmansLetterTotheShareholdersofBerkshireHathawaylnc.:1.AllfiguresusedinthisreportapplytoBerkshiresAshares,thesuccessortotheonlystockthatthecompanyhadoutstandingbefore1996.TheBshareshaveaneconomicinterestequalto130ththatoftheA.Givenourgainof34.1%,itistemptingtodeclarevictoryandmove
2、on.Butlastyearsperformancewasnogreattriumph:Anyinvestorcanchalkuplargereturnswhenstockssoar,astheydidin1997.Inabullmarket,onemustavoidtheerrorofthepreeningduckthatquacksboastfullyafteratorrentialrainstorm,thinkingthatitspaddlingskillshavecausedittoriseintheworld.Aright-thinkingduckwouldinsteadcompar
3、eitspositionafterthedownpourtothatoftheotherducksonthepond.Sowhatsourduckratingfor1997?Thetableonthefacingpageshowsthatthoughwepaddledfuriouslylastyear,passiveducksthatsimplyinvestedintheS&PIndexrosealmostasfastaswedid.Ourappraisalof1997sperformance,then:Quack.Whenthemarketbooms,wetendtosufferincomp
4、arisonwiththeS&PIndex.TheIndexbearsnotaxcosts,nordomutualfunds,sincetheypassthroughalltaxliabilitiestotheirowners.Lastyear,ontheotherhand,Berkshirepaidoraccrued$4.2billionforfederalincometax,orabout18%ofourbeginningnetworth.BerkshireW川alwayshavecorporatetaxestopay,whichmeansitneedstoovercometheirdra
5、ginordertojustifyitsexistence.Obviously,CharlieMunger,BerkshiresViceChairmanandmypartner,andIwon,tbeabletolickthathandicapeveryyear.ButweexpectovertimetomaintainamodestadvantageovertheIndex,andthatistheyardstickagainstwhichyoushouldmeasureus.WewillnotaskyoutoadoptthephilosophyoftheChicagoCubsfanwhor
6、eactedtoastringoflacklusterseasonsbysaying,Whygetupset?Everyonehasabadcenturynowandthen.,Gainsinbookvalueare,ofcourse,notthebottomlineatBerkshire.Whattrulycountsaregainsinper-shareintrinsicbusinessvalue.Ordinarily,though,thetwomeasurestendtomoveroughlyintandem,andin1997thatwasthecase:Ledbyablow-outp
7、erformanceatGEICO,Berkshiresintrinsicvalue(whichfarexceedsbookvalue)grewatnearlythesamepaceasbookvalue.Formoreexplanationoftheterm,intrinsicvalue,youmaywishtorefertoourOwnersManual,reprintedonpages62to71.Thismanualsetsforthourowner-relatedbusinessprinciples,informationthatisimportanttoallofBerkshire
8、sshareholders.Inourlasttwoannualreports,wefurnishedyouatablethatCharlieandIbelieveiscentraltoestimatingBerkshiresintrinsicvalue.Intheupdatedversionofthattable,whichfollows,wetraceourtwokeycomponentsofvalue.Thefirstcolumnlistsourper-shareownershipofinvestments(includingcashandequivalents)andthesecond
9、columnshowsourper-shareearningsfromBerkshiresoperatingbusinessesbeforetaxesandpurchase-accountingadjustments(discussedonpages69and70),butafterallinterestandcorporateexpenses.Thesecondcolumnexcludesalldividends,interestandcapitalgainsthatwerealizedfromtheinvestmentspresentedinthefirstcolumn.Ineffect,
10、thecolumnsshowwhatBerkshirewouldlooklikewereitsplitintotwoparts,withoneentityholdingourinvestmentsandtheotheroperatingallofourbusinessesandbearingallcorporatecosts.Pre-taxEarningsPerShareYearInvestmentsPerShareExcludingAllIncomefromInvestments1967$41$1.09197737212.4419873,910108.14199738,043717.82Pu
11、nditswhoignorewhatour38,000employeescontributetothecompany,andinsteadsimplyviewBerkshireasadefactoinvestmentcompany,shouldstudythefiguresinthesecondcolumn.Wemadeourfirstbusinessacquisitionin1967,andsincethenourpre-taxoperatingearningshavegrownfrom$1millionto$888million.Furthermore,asnoted,inthisexer
12、cisewehaveassignedallofBerkshirescorporateexpenses-overheadof$6.6million,interestof$66.9millionandshareholdercontributionsof$15.4million-toourbusinessoperations,eventhoughaportionofthesecouldjustaswellhavebeenassignedtotheinvestmentside.Herearethegrowthratesofthetwosegmentsbydecade:Pre-taxEarningsPe
13、rShareInvestmentsExcludingAllIncomefromDeCadeEndinqPerShareInvestments197724.6%27.6%198726.5%24.1%199725.5%20.8%AnnualGrowthRate,1967-199725.6%24.2%During1997,bothpartsofourbusinessgrewatasatisfactoryrate,withinvestmentsincreasingby$9,543pershare,or33.5%,andoperatingearningsgrowingby$296.43pershare,
14、or70.3%.Oneimportantcaveat:Becausewewereluckyinoursuper-catinsurancebusiness(tobediscussedlater)andbecauseGEICO,sunderwritinggainwaswellabovewhatwecanexpectinmostyears,our1997operatingearningsweremuchbetterthanweanticipatedandalsomorethanweexpectfor1998.Ourrateofprogressinbothinvestmentsandoperation
15、siscertaintofallinthefuture.Foranyonedeployingcapital,nothingrecedeslikesuccess.Myownhistorymakesthepoint:Backin1951,whenIwasattendingBenGrahamsclassatColumbia,anideagivingmea$10,000gainimprovedmyinvestmentperformancefortheyearbyafull100percentagepoints.Today,anideaproducinga$500millionpre-taxprofit
16、forBerkshireaddsonepercentagepointtoourperformance.Itsnowonderthatmyannualresultsinthe1950swerebetterbynearlythirtypercentagepointsthanmyannualgainsinanysubsequentdecade.Charliesexperiencewassimilar.Weweren,tsmarterthen,justsmaller.Atourpresentsize,anyperformancesuperiorityweachievewillbeminor.Wewil
17、lbehelped,however,bythefactthatthebusinessestowhichwehavealreadyallocatedcapital-bothoperatingsubsidiariesandcompaniesinwhichwearepassiveinvestors-havesplendidlong-termprospects.Wearealsoblessedwithamanagerialcorpsthatisunsurpassedinabilityandfocus.Mostoftheseexecutivesarewealthyanddonotneedthepayth
18、eyreceivefromBerkshiretomaintaintheirwayoflife.Theyaremotivatedbythejoyofaccomplishment,notbyfameorfortune.Thoughwearedelightedwithwhatweown,wearenotpleasedwithourprospectsforcommittingincomingfunds.Pricesarehighforbothbusinessesandstocks.Thatdoesnotmeanthatthepricesofeitherwillfall-wehaveabsolutely
19、noviewonthatmatter-butitdoesmeanthatwegetrelativelylittleinprospectiveearningswhenwecommitfreshmoney.Underthesecircumstances,wetrytoexertaTedWilliamskindofdiscipline.InhisbookTheScienceofHitting,Tedexplainsthathecarvedthestrikezoneinto77cells,eachthesizeofabaseball.Swingingonlyatballsinhisbestcell,h
20、eknew,wouldallowhimtobat.400;reachingforballsinhisworstspot,thelowoutsidecornerofthestrikezone,wouldreducehimto.230.Inotherwords,waitingforthefatpitchwouldmeanatriptotheHallofFame;swingingindiscriminatelywouldmeanatickettotheminors.Iftheyareinthestrikezoneatall,thebusinesspitcheswenowseearejustcatch
21、ingtheloweroutsidecorner.Ifweswing,wewillbelockedintolowreturns.Butifweletalloftodaysballsgoby,therecanbenoassurancethatthenextonesweseewillbemoretoourliking.Perhapstheattractivepricesofthepastweretheaberrations,notthefullpricesoftoday.UnlikeTed,wecantbecalledoutifweresistthreepitchesthatarebarelyin
22、thestrikezone;nevertheless,juststandingthere,dayafterday,withmybatonmyshoulderisnotmyideaoffun.UnconventionalCommitmentsWhenwecantfindourfavoritecommitment-awell-runandsensibly-pricedbusinesswithfineeconomics-weusuallyopttoputnewmoneyintoveryshort-terminstrumentsofthehighestquality.Sometimes,however
23、,weventureelsewhere.Obviouslywebelievethatthealternativecommitmentswemakearemorelikelytoresultinprofitthanloss.Butwealsorealizethattheydonotofferthecertaintyofprofitthatexistsinawonderfulbusinesssecuredatanattractiveprice.Findingthatkindofopportunity,weRnowthatwearegoingtomakemoney-theonlyquestionbe
24、ingwhen.Withalternativeinvestments,wethinkthatwearegoingtomakemoney.Butwealsorecognizethatwewillsometimesrealizelosses,occasionallyofsubstantialsize.Wehadthreenon-traditionalpositionsatyearend.Thefirstwasderivativecontractsfor14.0millionbarrelsofoil,thatbeingwhatwasthenleftofa45.7millionbarrelpositi
25、onweestablishedin1994-95.Contractsfor31.7millionbarrelsweresettledin1995-97,andthesesupplieduswithapre-taxgainofabout$61.9million.Ourremainingcontractsexpireduring1998and1999.Inthese,wehadanunrealizedgainof$11.6millionatyearend.Accountingrulesrequirethatcommoditypositionsbecarriedatmarketvalue.There
26、fore,bothourannualandquarterlyfinancialstatementsreflectanyunrealizedgainorlossinthesecontracts.Whenweestablishedourcontracts,oilforfuturedeliveryseemedmodestlyunderpriced.Today,though,wehavenoopinionastoitsattractiveness.Oursecondnon-traditionalcommitmentisinsilver.Lastyear,wepurchased111.2milliono
27、unces.Markedtomarket,thatpositionproducedapre-taxgainof$97.4millionforusin1997.Inaway,thisisareturntothepastforme:Thirtyyearsago,IboughtsilverbecauseIanticipateditsdemonetizationbytheU.S.Government.Eversince,Ihavefollowedthemetalsfundamentalsbutnotownedit.Inrecentyears,bullioninventorieshavefallenma
28、terially,andlastsummerCharlieandIconcludedthatahigherpricewouldbeneededtoestablishequilibriumbetweensupplyanddemand.Inflationexpectations,itshouldbenoted,playnopartinourcalculationofsilver,svalue.Finally,ourlargestnon-traditionalpositionatyearendwas$4.6billion,atamortizedcost,oflong-termzero-coupono
29、bligationsoftheU.S.Treasury.Thesesecuritiespaynointerest.Instead,theyprovidetheirholdersareturnbywayofthediscountatwhichtheyarepurchased,acharacteristicthatmakestheirmarketpricesmoverapidlywheninterestrateschange.Ifratesrise,youloseheavilywithzeros,andifratesfall,youmakeoutsizedgains.Sinceratesfelli
30、n1997,weendedtheyearwithanunrealizedpre-taxgainof$598.8millioninourzeros.Becausewecarrythesecuritiesatmarketvalue,thatgainisreflectedinyearendbookvalue.Inpurchasingzeros,ratherthanstayingwithcash-equivalents,werisklookingveryfoolish:Amacro-basedcommitmentsuchasthisneverhasanythingclosetoa100%probabi
31、lityofbeingsuccessful.However,youpayCharlieandmetouseourbestjudgment-nottoavoidembarrassment-andwewilloccasionallymakeanunconventionalmovewhenwebelievetheoddsfavorit.Trytothinkkindlyofuswhenweblowone.AlongwithPresidentClinton,wewillbefeelingyourpain:TheMungerfamilyhasmorethan90%ofitsnetworthinBerksh
32、ireandtheBuffettsmorethan99%.HowWeThinkAboutMarketFluctuationsAshortquiz:Ifyouplantoeathamburgersthroughoutyourlifeandarenotacattleproducer,shouldyouwishforhigherorlowerpricesforbeef?Likewise,ifyouaregoingtobuyacarfromtimetotimebutarenotanautomanufacturer,shouldyoupreferhigherorlowercarprices?Theseq
33、uestions,ofcourse,answerthemselves.Butnowforthefinalexam:Ifyouexpecttobeanetsaverduringthenextfiveyears,shouldyouhopeforahigherorlowerstockmarketduringthatperiod?Manyinvestorsgetthisonewrong.Eventhoughtheyaregoingtobenetbuyersofstocksformanyyearstocome,theyareelatedwhenstockpricesriseanddepressedwhe
34、ntheyfall.Ineffect,theyrejoicebecausepriceshaverisenforthehamburgerstheywillsoonbebuying.Thisreactionmakesnosense.Onlythosewhowillbesellersofequitiesinthenearfutureshouldbehappyatseeingstocksrise.Prospectivepurchasersshouldmuchprefersinkingprices.ForshareholdersofBerkshirewhodonotexpecttosell,thecho
35、iceisevenclearer.Tobeginwith,ourownersareautomaticallysavingeveniftheyspendeverydimetheypersonallyearn:Berkshiresavesforthembyretainingallearnings,thereafterusingthesesavingstopurchasebusinessesandsecurities.Clearly,themorecheaplywemakethesebuys,themoreprofitableourownersindirectsavingsprogramwillbe
36、.Furthermore,throughBerkshireyouownmajorpositionsincompaniesthatconsistentlyrepurchasetheirshares.Thebenefitsthattheseprogramssupplyusgrowaspricesfall:Whenstockpricesarelow,thefundsthataninvesteespendsonrepurchasesincreaseourownershipofthatcompanybyagreateramountthanisthecasewhenpricesarehigher.Fore
37、xample,therepurchasesthatCoca-Cola,TheWashingtonPostandWellsFargomadeinpastyearsatverylowpricesbenefittedBerkshirefarmorethandotodaysrepurchases,madeatloftierprices.Attheendofeveryyear,about97%ofBerkshiressharesareheldbythesameinvestorswhoownedthematthestartoftheyear.Thatmakesthemsavers.Theyshouldth
38、ereforerejoicewhenmarketsdeclineandallowbothusandourinvesteestodeployfundsmoreadvantageously.SosmilewhenyoureadaheadlinethatsaysInvestorsloseasmarketfalls.EdititinyourmindtoD/sinvestorsloseasmarketfalls-butinvestorsgain.Thoughwritersoftenforgetthistruism,thereisabuyerforeverysellerandwhathurtsonenec
39、essarilyhelpstheother.(Astheysayingolfmatches:Everyputtmakessomeonehappy.)Wegainedenormouslyfromthelowpricesplacedonmanyequitiesandbusinessesinthe1970sand1980s.Marketsthatthenwerehostiletoinvestmenttransientswerefriendlytothosetakinguppermanentresidence.Inrecentyears,theactionswetookinthosedecadesha
40、vebeenvalidated,butwehavefoundfewnewopportunities.Initsroleasacorporatesaver；Berkshirecontinuallylooksforwaystosensiblydeploycapital,butitmaybesometimebeforewefindopportunitiesthatgetustrulyexcited.InsuranceOperations-OverviewWhatdoesexciteus,however,isourinsurancebusiness.GEICOisflying,andweexpectt
41、hatitwillcontinuetodoso.Beforeweexpoundonthat,though,letsdiscussfloatandhowtomeasureitscost.Unlessyouunderstandthissubject,itwillbeimpossibleforyoutomakeaninformedjudgmentaboutBerkshiresintrinsicvalue.Tobeginwith,floatismoneyweholdbutdontown.Inaninsuranceoperation,floatarisesbecausepremiumsarereceiv
42、edbeforelossesarepaid,anintervalthatsometimesextendsovermanyyears.Duringthattime,theinsurerinveststhemoney.Typically,thispleasantactivitycarrieswithitadownside:Thepremiumsthataninsurertakesinusuallydonotcoverthelossesandexpensesiteventuallymustpay.Thatleavesitrunninganunderwritingloss,whichisthecost
43、offloat.Aninsurancebusinesshasvalueifitscostoffloatovertimeislessthanthecostthecompanywouldotherwiseincurtoobtainfunds.Butthebusinessisalemonifitscostoffloatishigherthanmarketratesformoney.Acautionisappropriatehere:Becauselosscostsmustbeestimated,insurershaveenormouslatitudeinfiguringtheirunderwriti
44、ngresults,andthatmakesitverydifficultforinvestorstocalculateacompanystruecostoffloat.Estimatingerrors,usuallyinnocentbutsometimesnot,canbehuge.Theconsequencesofthesemiscalculationsflowdirectlyintoearnings.Anexperiencedobservercanusuallydetectlarge-scaleerrorsinreserving,butthegeneralpubliccantypical
45、lydonomorethanacceptwhat,spresented,andattimesIhavebeenamazedbythenumbersthatbig-nameauditorshaveimplicitlyblessed.AsforBerkshire,CharlieandIattempttobeconservativeinpresentingitsunderwritingresultstoyou,becausewehavefoundthatvirtuallyallsurprisesininsuranceareunpleasantones.Asthenumbersinthefollowi
46、ngtableshow,Berkshiresinsurancebusinesshasbeenahugewinner.Forthetable,wehavecalculatedourfloat-whichwegenerateinlargeamountsrelativetoourpremiumvolume-byaddingnetlossreserves,lossadjustmentreserves,fundsheldunderreinsuranceassumedandunearnedpremiumreserves,andthensubtractingagentsbalances,prepaidacq
47、uisitioncosts,prepaidtaxesanddeferredchargesapplicabletoassumedreinsurance.Ourcostoffloatisdeterminedbyourunderwritinglossorprofit.Inthoseyearswhenwehavehadanunderwritingprofit,suchasthelastfive,ourcostoffloathasbeennegative.Ineffect,wehavebeenpaidforholdingmoney.19671968196919706.25%197119721973197
48、48.13%19758.03%197619771978197919801981198210.64%198311.84%198411.58%19859.34%ZZOoo Ppp.3635rOooooo Pppppp33.8748.0644.2317.319.923.432.452.569.573.379.187.6102.6139.0190.4227.3237.0228.4220.6231.3253.2390.2less than zero5.50%less than zero5.90%less than zero6.79%1.14%less than zero5.81%less than zero5.82%less than zero7.27%9.30%less than zero7.30%less than zero7.97%less than zero8.93%less than zero10.08%less than zero11.94%less than zero13.61%12.96%9.77%14.64%18.98%11.34%(1)(
