In our view, derivatives are financial weapons of mass destruction carrying dangers that, while latent, are potentially lethal.

Would you rather be the world's greatest lover, but have everyone think you're the world's worst lover? Or would you rather be the world's worst lover but have everyone think you're the world's greatest lover? Now, that's an interesting question.

The best way in my view is to just buy a low-cost index fund and keep buying it regularly over time, because you'll be buying into a wonderful industry, which in effect is all of American industry... People ought to sit back and relax and keep accumulating over time.

I don't think it would be crazy to have a model or an entity model on the Reconstruction Finance Corp.

In the end, alchemy, whether it is metallurgical or financial, fails. A base business can not be transformed into a golden business by tricks of accounting or capital structure. The man claiming to be a financial alchemist may become rich. But gullible investors rather than business achievements will usually be the source of his wealth.

Do not take yearly results too seriously. Instead, focus on four or five-year averages.

The Noah rule: Predicting rain doesn't count; building arks does.