Warren Buffett on Why Money Costs Money
At the 1995 Berkshire Hathaway meeting, Warren Buffett explained how Berkshire thinks about capital inside its businesses. Buffett said managers should know how much capital matters. If a manager uses more capital, Berkshire charges for it. If a manager frees up capital, Berkshire gives credit for it. His lesson is simple. A manager’s results are not real unless they include the cost of capital. For more Buffett lessons and Berkshire history, check out my Berkshire Substack. Link in bio. #WarrenBuffett #BerkshireHathaway #CapitalAllocation #BusinessLessons #InvestorMindset

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