ime. Our gain in per-share book value over the last twenty-one
years (that is, since present management took over) has been from
$19.46 to $1643.71, or 23.2% compounded annually, another
percentage that will not be repeated.
去年我们的净资产是约6.136亿美元，相当于48.2%。就好比哈雷彗星恰好带着这一比例获益来到访一样：我这辈子再也看不到了。我们的每股账面价值收益超过了过去21年的（即从现在的管理层接管公司以来）已经从19.46美元增加到1643.71美元，约为23.2%的年复合增长率，又一个不能再重现的比率。
Two factors make anything approaching this rate of gain
unachievable in the future. One factor probably transitory - is a
stock market that offers very little opportunity compared to the
markets that prevailed throughout much of the
Today we cannot find significantly-undervalued equities to purchase
for our insurance company portfolios. The current situation is 180
degrees removed from that existing about a decade ago, when the
only question was which bargain to choose.
有两个因素使任何接近这样的增长率在未来无法实现。一个因素是暂时性的---即相比全部年间盛行的市场是一个提供很小机会的股票市场。今天我们已无法为我们的保险公司股票组合找到显著被低估的股票。当唯一问题是该选哪一个低估的股票时，现在的情况与差不多十年前存在的情况转了180°。
This change in the market also has negative implications for our
present portfolio. In our 1974 annual report I could say: “We
consider several of our major holdings to have great potential for
significantly increased values in future years.” I can’t say that
now. It’s true that our insurance companies currently hold major
positions in companies with exceptional underlying economics and
outstanding managements, just as they did in 1974. But current
market prices generously appraise these attributes, whereas they
were ignored in 1974. Today’s valuations mean that our insurance
companies have no chance for future portfolio gains on the scale of
those achieved in the past.
这种在市场上的变化对我们现在的投资组合也有负面影响。在我们的1974年的年报中我可能说过：“我们认为在我们的几只主要持股在未来几年有巨大的潜力带来显著的价值增加值。”现在我不能那样说。我们保险公司目前主要持有的仓位是具有卓越经济基础和优秀管理人员公司是真的，就像在1974他们做的一样。但是现在的市场价格慷慨的评价这些属性，这在1974年是被忽略的。今天的估值意味着我们的保险公司的没有机会在将来获得像过去那样的投资组合收益。
The second negative factor, far more telling, is our size. Our
equity capital is more than twenty times what it was only ten years
ago. And an iron law of business is that growth eventually dampens
exceptional economics. Just look at the records of high-return
companies once they have amassed even $1 billion of equity capital.
None that I know of has managed subsequently, over a ten-year
period, to keep on earning 20% or more on equity while reinvesting
all or substantially all of its earnings. Instead, to sustain their
high returns, such companies have needed to shed a lot of capital
by way of either dividends or repurchases of stock. Their
shareholders would have been far better off if all earnings could
have been reinvested at the fat returns earned by these exceptional
businesses. But the companies simply couldn’t turn up enough
high-return opportunities to make that possible.
第二个负面因素，更说明问题，是我们的规模。我们公司的权益资本大于也就十年前的20倍还多。而商业的铁律是增长终将拖累特别的经济。只要看看那些高回报公司的记录当一旦他们的权益资本超过10亿美金。我所知道后来管理的，超过十年期间，能够在权益上保持20%或者更多的收益率尽管把全部或者它收益的绝大部分再投资了。相反，为维持他们的高回报，这类公司都需要通过要么股息分红要么回购股票的方式来放出大量的资金。如果所有的盈利能够再投资到这些丰厚回报的业务上那么他们的股东会好的多。但是企业根本无法抓住这些足够的高回报机会。
Their problem is our problem. Last year I told you that we needed
profits of $3.9 billion over the ten years then coming up to earn
15% annually. The comparable figure for the ten years now ahead is
$5.7 billion, a 48% increase that corresponds - as it must
mathematically - to the growth in our capital base during 1985.
(Here’s a little perspective: leaving aside oil companies, only
about 15 U.S. businesses have managed to earn over $5.7 billion
during the past ten years.)
他们的问题就是我们的问题。去年我告诉你们我们需要39亿美元以上十年的利润才能每年有15%的收益率。现在以前的十年可比数字是57亿美元，一个对应的48%增长—因为它必需是数字化的---在1985年我们资本基础上的增长。（这里有个小心的角度来看：除去石油公司，只有15家美国公司在过去十年间能够赚到超过57亿美元的盈利。）
Charlie Munger, my partner in managing Berkshire, and I are
reasonably optimistic about Berkshire’s ability to earn returns
superior to those earned by corporate America generally, and you
will benefit from the company’s retention of all earnings as long
as those returns are forthcoming. We have several things going for
us: (1) we don’t have to worry about quarterly or annual figures
but, instead, can focus on whatever actions will maximize long-term
(2) we can expand the business into any areas that make
sense - our scope is not circumscribed by history, structure, or
and (3) we love our work. All of these help. Even so, we
will also need a full measure of good fortune to average our
hoped-for 15% - far more good fortune than was required for our
past 23.2%.
查理-芒格，在伯克希尔公司里我的拍档，和我对于伯克希尔获得超过美国一般公司的获利能力是相当乐观的，并且只要获利是即将到来的你们也将能从这些公司所有的保留盈利中因此受惠。我们有几件事情要做：（1）我们不必担心季度或年度的数字，相反，要将注意力集中到最大化长期价值上的任何行动；（2）我们能够将我们的业务扩展到任何意义的领域上去---我们的范围不受历史、架构或概念的限制；（3）我们热爱我们的工作。所有这些都有助于我们的成长。即便如此，我们必须有好运来平均我们的希望---15%---要远比过去获得23.2%的要求要好运的多。
We need to mention one further item in the investment equation that
could affect recent purchasers of our stock. Historically,
Berkshire shares have sold modestly below intrinsic business value.
With the price there, purchasers could be certain (as long as they
did not experience a widening of this discount) that their personal
investment experience would at least equal the financial experience
of the business. But recently the discount has disappeared, and
occasionally a modest premium has prevailed.
我们需要提及在投资方程里的另一个项目，它可能会影响最近我们的股票的买家们。从历史上看，伯克希尔的股票已略低于其内在价值在出售。在这个价格水平上，购买者可能是（只要他们没有经历过这样折扣的扩大）他们的个人投资经验至少与业务财务经验表现相同。但是最近这个折扣已经消失了，并且偶尔会出现溢价的状况。
The elimination of the discount means that Berkshire’s market value
increased even faster than business value (which, itself, grew at a
pleasing pace). That was good news for any owner holding while that
move took place, but it is bad news for the new or prospective
owner. If the financial experience of new owners of Berkshire is
merely to match the future financial experience of the company, any
premium of market value over intrinsic business value that they pay
must be maintained.
折扣价格的消失意味着伯克希尔的市值的增长甚至要快于企业价值的增长（虽然，本身的增长也以一个欢快的步伐在进行中）。伴随这种移动的发生对于任何已持有的股东而言都是好消息，但是这对于新股东或未来潜在的股东而是坏消息。如果伯克希尔新股东的财务经验仅仅是匹配未来公司的财务经验，那么他们支付的任何超过内在商业价值的市值溢价必须被维持下去。
Management cannot determine market prices, although it can, by its
disclosures and policies, encourage rational behavior by market
participants. My own preference, as perhaps you’d guess, is for a
market price that consistently approximates business value. Given
that relationship, all owners prosper precisely as the business
prospers during their period of ownership. Wild swings in market
prices far above and below business value do not change the final
gains for in the end, investor gains must
equal business gains. But long periods of substantial
undervaluation and/or overvaluation will cause the gains of the
business to be inequitably distributed among various owners, with
the investment result of any given owner largely depending upon how
lucky, shrewd, or foolish he happens to be.
管理层不能决定市场价格，尽管其能够，通过披露及政策，来鼓励市场参与者的理性行为。也许你已经猜到，我个人偏好，是股票市场价格与内在价值近乎一致。基于这个关系，所有的股东的繁荣正是因为在他们作为股东的期间公司生意繁荣的原因。市场价格高于或低于内在商业价值的剧烈波动对股东们来说并不能改变最终的总收益；最后，投资者的收益一定会等于业务的收益。但是长时间的大幅度低估和／或高估将会导致公司的利润不能平均分配到不同的股东身上，在任何特定投资者身上的投资结果大大地依靠他有碰巧多么幸运、聪明或愚蠢上。
Over the long term there has been a more consistent relationship
between Berkshire’s market value and business value than has
existed for any other publicly-traded equity with which I am
familiar. This is a tribute to you. Because you have been rational,
interested, and investment-oriented, the market price for Berkshire
stock has almost always been sensible. This unusual result has been
achieved by a shareholder group with unusual demographics:
virtually all of our shareholders are individuals, not
institutions. No other public company our size can claim the
长期伯克希尔的市场商业价值与内在价值一直存在着一种比我所熟悉的任何另外公开交易的权益更一致的关系。这要归功于你们。因为你们都是理性的、有意的、投资导向型的，所以伯克希尔的市场价格一直算是合理的。这个非同一般的结果是靠一群非同一般的股东团队达成的：几乎我们所有的股东都是个人，而不是机构投资者。没有任何一家象我们这样规模的公共公司能够像我们一样。
You might think that institutions, with their large staffs of
highly-paid and experienced investment professionals, would be a
force for stability and reason in financial markets. They are not:
stocks heavily owned and constantly monitored by institutions have
often been among the most inappropriately valued.
你可能会认为机构投资者，拥有众多高薪的、经验丰富的投资专业人员，应该是金融市场稳定和理性的一股力量。他们不是：那些重仓持有的和持续被机构关注的股票的价值通常都是最不合理的。
Ben Graham told a story 40 years ago that illustrates why
investment professionals behave as they do: An oil prospector,
moving to his heavenly reward, was met by St. Peter with bad news.
“You’re qualified for residence”, said St. Peter, “but, as you can
see, the compound reserved for oil men is packed. There’s no way to
squeeze you in.” After thinking a moment, the prospector asked if
he might say just four words to the present occupants. That seemed
harmless to St. Peter, so the prospector cupped his hands and
yelled, “Oil discovered in hell.” Immediately the gate to the
compound opened and all of the oil men marched out to head for the
nether regions. Impressed, St. Peter invited the prospector to move
in and make himself comfortable. The prospector paused. “No,” he
said, “I think I’ll go along with the rest of the boys. There might
be some truth to that rumor after all.”
本杰明-格雷厄姆在40年前曾讲过一个故事说明为何投资专家们的行为会是这样：一个石油商死后得到上天堂的赏赐，遇到带来坏消息的圣彼得。“你有资格住在天堂”，圣彼得说，“但是，就像你看到的，混合专门留给油商的地方已经满满的了。根本没空间再把你塞进去了。”思考了一会后，这个石油商请求说是否能让他只说4个词给现在的居住者。那似乎对圣彼得没有害处。所以这个石油商就隆起它的手并大喊，“地狱里发现石油啦！”马上大门就开了并且所有的油商都大步跑了出来从上面赶到下面去。惊讶的，圣彼得邀请这个石油商搬进天堂可以让他舒服点了。不料石油商说：“不，我还是想和这些剩下的孩子们一起去地狱，说不定这个消息是真的呢”。
Sources of Reported Earnings
账面利润的来源
The table on the next page shows the major sources of Berkshire’s
reported earnings. These numbers, along with far more detailed
sub-segment numbers, are the ones that Charlie and I focus upon. We
do not find consolidated figures an aid in either managing or
evaluating Berkshire and, in fact, never prepare them for internal
下页的表格显示了伯克希尔报告收益的主要来源。这些数字，与更详细的子部门数字，是查理-芒格和我的关注重点。我们没有发现合并的数字无论是在管理上还是对伯克希尔的估值上有什么帮助，事实上，从来没有准备它们作为内部使用。
Segment information is equally essential for investors wanting to
know what is going on in a multi-line business. Corporate managers
always have insisted upon such information before making
acquisition decisions but, until a few years ago, seldom made it
available to investors faced with acquisition and disposition
decisions of their own. Instead, when owners wishing to understand
the economic realities of their business asked for data, managers
usually gave them a
we-can’t-tell-you-what-is-going-on-because-it-would-hurt-the-company
answer. Ultimately the SEC ordered disclosure of segment data and
management began supplying real answers. The change in their
behavior recalls an insight of Al Capone: “You can get much further
with a kind word and a gun than you can with a kind word
部门信息对于投资者们想了解一家多种经营公司进展是同样重要的。企业管理者们总是在做收购决策之前坚持这样的信息，但是直到几年前，很少将其提供给面对他们自己的收购和处置决定的投资者们。相反，当股东希望了解他们公司的业务经济现实并请求数据时，管理层通常给他们一个我们---不能---告诉你---进展如何---因为---它---会损害---公司这样的回答。最后证监会下令必须披露分部数据管理层才开始提供真正的答案。他们行为的转变让我想起了Al
Capone的一个见解：“你能够比仅仅得到一句好话更多的一句好话和一把枪。”
In the table, amortization of Goodwill is not charged against the
specific businesses but, for reasons outlined in the Appendix to my
letter in the 1983 annual report, is aggregated as a separate item.
(A compendium of the
letters is available upon request.)
In the Business Segment Data and Management’s Discussion sections
on pages 39-41 and 49-55, much additional information regarding our
businesses is provided, including Goodwill and Goodwill
Amortization figures for each of the segments. I urge you to read
those sections as well as Charlie Munger’s letter to Wesco
shareholders, which starts on page 56.
在表中，商誉摊销没有冲减具体业务，但是在1983年年报我的信中附录里概述了原因，是是汇总作为一个单独项目。（一份年信的概要可以向我们索取。）在业务中的分部门数据和管理层讨论部分分别在39-41页和49-55页，提供了有关我们公司业务的更多的信息，包括每一个部门的商誉及其摊销的数字。我力劝你们去读一下查理芒格在致Wesco股东的信中的这些部门，从第56页开始。
(000s omitted)
Pre-Tax Earnings
Berkshire's Share of Net Earnings (after taxes and minority
interests)
Operating Earnings:
Insurance Group:
Underwriting
Net Investment Income
Associated Retail Stores
Blue Chip Stamps
Buffalo News
Mutual Savings and Loan
Nebraska Furniture Mart
Precision Steel
See’s Candies
Wesco Financial
Amortization of Goodwill
Interest on Debt
Shareholder-Designated Contributions
Operating Earnings
Special General Foods Distribution
Special Washington Post Distribution
Sales of Securities
Total Earnings - all entities
Our 1985 results include unusually large earnings from the sale of
securities. This fact, in itself, does not mean that we had a
particularly good year (though, of course, we did). Security
profits in a given year bear similarities to a college graduation
ceremony in which the knowledge gained over four years is
recognized on a day when nothing further is learned. We may hold a
stock for a decade or more, and during that period it may grow
quite consistently in both business and market value. In the year
in which we finally sell it there may be no increase in value, or
there may even be a decrease. But all growth in value since
purchase will be reflected in the accounting earnings of the year
of sale. (If the stock owned is in our insurance subsidiaries,
however, any gain or loss in market value will be reflected in net
worth annually.) Thus, reported capital gains or losses in any
given year are meaningless as a measure of how well we have done in
the current year.
我们1985年的收益中包括出售证券的大量收益。这一事实，本身，并不意味着今年是非常好的年份（尽管，我们当然做到了）。某年的证券利润有点像大学生的毕业典礼一样，超过四年来所学的知识当没有进一步可学时在一天内获得认可。我们可能持有一只股票十年或者更长，而在此期间股价商业价值和市场价值可能会相当一致的增长。在我们最终卖掉它的这一年它的价值可能没有增长，甚至可能还会减少。但自购买起所有的价值增长将被反映在出售的那一年的账面收益上。（如果这只股票是由我们的保险子公司拥有的，那么，在某一年市值的任何收益和损失将被反映在每年的净值上。）因此，任何一年的报告的资本利得或损失作为衡量我们在本年度已经做的有多么好是没有任何意义的。
A large portion of the realized gain in 1985 ($338 million pre-tax
out of a total of $488 million) came about through the sale of our
General Foods shares. We held most of these shares since 1980, when
we had purchased them at a price far below what we felt was their
per/share business value. Year by year, the managerial efforts of
Jim Ferguson and Phil Smith substantially increased General Foods’
business value and, last fall, Philip Morris made an offer for the
company that reflected the increase. We thus benefited from four
factors: a bargain purchase price, a business with fine underlying
economics, an able management concentrating on the interests of
shareholders, and a buyer willing to pay full business value. While
that last factor is the only one that produces reported earnings,
we consider identification of the first three to be the key to
building value for Berkshire shareholders. In selecting common
stocks, we devote our attention to attractive purchases, not to the
possibility of attractive sales.
1985年已实现收益中大部分来自于出售通用食品公司的股票（总的4.88亿美元税前利润中的3.38亿美元）。我们从1980年开始便持有其中的大部分股票，当我们感到他们远低于每股商业价值时我们买了他们。年复一年，Jim
Ferguson和Phil Smith管理上的努力大幅提升了通用食品公司的商业价值，直到去年秋天，Philip
Morris对该公司提出了收购要约，使得其增长显现了出来。我们受益于以下四个因素：便宜的买入价格，一个很好经济基础的业务，一群能干且注重股东权益的管理层，一个愿意对商业价值出全价的买家。尽管最后一个因素是产生报告收益的唯一原因，但是我们认为前三项才是为伯克希尔股东创造价值的最关键因素。在选择普通股票时，我们把我们的注意力放在有吸引力地买入上，而不是有吸引力的卖出可能性上。
We have again reported substantial income from special
distributions, this year from Washington Post and General Foods.
(The General Foods transactions obviously took place well before
the Philip Morris offer.) Distributions of this kind occur when we
sell a portion of our shares in a company back to it simultaneously
with its purchase of shares from other shareholders. The number of
shares we sell is contractually set so as to leave our percentage
ownership in the company precisely the same after the sale as
before. Such a transaction is quite properly regarded by the IRS as
substantially equivalent to a dividend since we, as a shareholder,
receive cash while maintaining an unchanged ownership interest.
This tax treatment benefits us because corporate taxpayers, unlike
individual taxpayers, incur much lower taxes on dividend income
than on income from long-term capital gains. (This difference will
be widened further if the House-passed tax bill becomes law: under
its provisions, capital gains realized by corporations will be
taxed at the same rate as ordinary income.) However, accounting
rules are unclear as to proper treatment for shareholder reporting.
To conform with last year’s treatment, we have shown these
transactions as capital gains.
我们再次报告了从特别的分配里来的大量收入，今年是从华盛顿邮报和通用食品公司里来的。（通用食品的交易很明显地是发生在Philip
Morris提出收购要约之前。）这类发生分配当我们卖掉一部分我们的股票回到它收购股票的同时也从其他股东那里购回股份。我们卖掉的股份数是合约设定我们留下公司股权的比例和该项卖出完成前后是完全一致的。这类交易被IRS认定为同等的股利发放是很恰当的，因为我们，所为一个股东，收到现金，保持一个不变的所有者权益。这税收处理对我们是有利的，因为纳税人是企业，不像个人纳税人，其股利所得税比长期资本利得税要低的多。（如果国会通过的法案正式成为法律，这种差异将会进一步扩大：根据其规定，由企业实现的资本收益将象普通收入一样以相同的比率被征税。）然而，关于如何在股东报告中合适的处理会计准则是不清晰的。为了与去年的做法一致，在财报中我们已经将这些交易视为资本利得。
Though we have not sought out such transactions, we have agreed to
them on several occasions when managements initiated the idea. In
each case we have felt that non-selling shareholders (all of whom
had an opportunity to sell at the same price we received) benefited
because the companies made their repurchases at prices below
intrinsic business value. The tax advantages we receive and our
wish to cooperate with managements that are increasing values for
all shareholders have sometimes led us to sell - but only to the
extent that our proportional share of the business was
undiminished.
虽然我们还没有找到这类交易，但当管理层有这样的念头时我们已经同意他们几次。在每种情况下我们都觉得非售股股东（所有人都有机会以我们收到的同样价格出售）受益因为公司是以低于内在价值的价格回购他们股票的。我们收到的税收优惠以及我们希望与管理层保持增加所有股东价值的合作有时候使得我们卖出股票---但是只限于在我们的业务股份占比例没有减小的前提下。
At this point we usually turn to a discussion of some of our major
business units. Before doing so, however, we should first look at a
failure at one of our smaller businesses. Our Vice Chairman,
Charlie Munger, has always emphasized the study of mistakes rather
than successes, both in business and other aspects of life. He does
so in the spirit of the man who said: “All I want to know is where
I’m going to die so I’ll never go there.” You’ll immediately see
why we make a good team: Charlie likes to study errors and I have
generated ample material for him, particularly in our textile and
insurance businesses.
在这一点上我们通常要转到我们的一些主要业务部门的讨论。然而，在开始之前，先看看我们的一项较小业务的失败。我们的副主席查理-芒格，总是强调学习失败的教训，而不是学习成功的经验，无论对于生意还是人生都是如此。他这样做在精神上会说：“所有我想要知道是我会在哪里死去，然后尽量不去那里。”而你可能也看得出为什么我们两个可以成为完美的团队：查理喜欢研究错误，而我总是能够确保他有足够的题材去研究，尤其是在我们的纺织和保险事业上。
Shutdown of Textile Business
纺织部门的关闭
In July we decided to close our textile operation, and by yearend
this unpleasant job was largely completed. The history of this
business is instructive.
在七月我们决定关闭我们的纺织部门，并且在年底之前这项令人不爽的工作也大致完成了。回购纺织部门的历史是很有教育意义的。
When Buffett Partnership, Ltd., an investment partnership of which
I was general partner, bought control of Berkshire Hathaway 21
years ago, it had an accounting net worth of $22 million, all
devoted to the textile business. The company’s intrinsic business
value, however, was considerably less because the textile assets
were unable to earn returns commensurate with their accounting
value. Indeed, during the previous nine years (the period in which
Berkshire and Hathaway operated as a merged company) aggregate
sales of $530 million had produced an aggregate loss of $10
million. Profits had been reported from time to time but the net
effect was always one step forward, two steps back.
当巴菲特合伙公司，一个由我本人担任一般合伙人的投资合伙公司，在21年前买下伯克希尔纺织公司的控制权时，公司的会计净值约为2200万美元，全部是纺织业务。然而，公司的内在价值是相当的低因为纺织资产不能获得与其会计价值相称的回报。其实，在收购前9年（即伯克希尔与哈撒韦两家公司合并经营期间）总共的营业收入为5.3亿美元已经产生了1000万美元的亏损。虽然有时报告有利润，但净效果却总是进一步、退两步。
At the time we made our purchase, southern textile plants - largely
non-union - were believed to have an important competitive
advantage. Most northern textile operations had closed and many
people thought we would liquidate our business as well.
在我们买下该公司的时候，南方的纺织工厂---大部分没有工会组织---被认为具有重要的竞争优势。大部分北方的纺织工厂均已关门并且许多人认为我们也同样应该清算我们的生意。
We felt, however, that the business would be run much better by a
long-time employee whom we immediately selected to be president,
Ken Chace. In this respect we were 100% correct: Ken and his recent
successor, Garry Morrison, have been excellent managers, every bit
the equal of managers at our more profitable businesses.
然而，我觉得公司由一个我们立刻选择的的长期雇员Ken
Chace来担任公司主席管理将会得运营的更好。在这方面我们是100%正确的：Ken和他的继任者，Garry
Morrison，都是完美的管理者，和我们更有利可图部门的每一个管理者一样。
In early 1967 cash generated by the textile operation was used to
fund our entry into insurance via the purchase of National
Indemnity Company. Some of the money came from earnings and some
from reduced investment in textile inventories, receivables, and
fixed assets. This pullback proved wise: although much improved by
Ken’s management, the textile business never became a good earner,
not even in cyclical upturns.
在1967年初由纺织业务产生的现金是过去一直为我们通过购买国民保险公司进入保险行业提供资金。有些资金来自于收入而有些则来自于纺织部门存货、应收账款和固定资产的减少。这次撤退证明是明智的：尽管Ken的管理使它有所提高，但纺织业务永远也不会变成是好的赚钱生意了，甚至在景气上升期也一样。
Further diversification for Berkshire followed, and gradually the
textile operation’s depressing effect on our overall return
diminished as the business became a progressively smaller portion
of the corporation. We remained in the business for reasons that I
stated in the 1978 annual report (and summarized at other times
also): “(1) our textile businesses are very important employers in
their communities, (2) management has been straightforward in
reporting on problems and energetic in attacking them, (3) labor
has been cooperative and understanding in facing our common
problems, and (4) the business should average modest cash returns
relative to investment.” I further said, “As long as these
conditions prevail - and we expect that they will - we intend to
continue to support our textile business despite more attractive
alternative uses for capital.”
伯克希尔下一步的分散化经营，并且逐渐纺织业务在我们总回报上的抑制效果减少随着业务成为公司的一个越来越小的部分。我们一直保留纺织业务的原因早在1978年的信中我就提到过（在其它时间也曾总结过）：“（1）我们的纺织业务在他们的社区是非常重要的雇主；（2）管理层一直直截了当的在报告问题和充满活力的攻击他们；（3）在面对我们的一般问题上工人一直理解并竭力合作；（4）相对投资来说企业应该是平均温和的现金回报。”我后来还说：“只要这些条件维持不变---我们预期他们将---我们打算继续支持我们的纺织业务尽管资本用途有更多吸引力的可选项。”
It turned out that I was very wrong about (4). Though 1979 was
moderately profitable, the business thereafter consumed major
amounts of cash. By mid-1985 it became clear, even to me, that this
condition was almost sure to continue. Could we have found a buyer
who would continue operations, I would have certainly preferred to
sell the business rather than liquidate it, even if that meant
somewhat lower proceeds for us. But the economics that were finally
obvious to me were also obvious to others, and interest was
原来我在第（4）点是非常错误的。虽然1979年是适度盈利，但随后业务却是耗费了主要现金款。在1985年年中情况变得很明显了，甚至对我来说，那个情况几乎是肯定会持续下去。我们可能已经找到了谁将会继续这个业务的买主，即我肯定首选出售该公司而不是清算它，即使那意味着某种方面对我们更低的收益。但是经济情况最终对我是明显的同样对别人也是明显的，并且利息是零。
I won’t close down businesses of sub-normal profitability merely to
add a fraction of a point to our corporate rate of return. However,
I also feel it inappropriate for even an exceptionally profitable
company to fund an operation once it appears to have unending
losses in prospect. Adam Smith would disagree with my first
proposition, and Karl Marx would dis the
middle ground is the only position that leaves me
comfortable.
仅仅因为给我们公司回报率增加一个点的一小部分我不会关闭低于正常利润率的公司。然而，我同样也觉得即使一个很赚利润的公司提供资金帮助一家公司是不合适的，只要当一旦这个公司显示出有无底洞损失的前景。亚当-斯密可能不赞同我的第一个命题，而卡尔-马克斯可能也会反对我的第二个命题；中庸之道是唯一能让我感到舒服的位置。
I should reemphasize that Ken and Garry have been resourceful,
energetic and imaginative in attempting to make our textile
operation a success. Trying to achieve sustainable profitability,
they reworked product lines, machinery configurations and
distribution arrangements. We also made a major acquisition,
Waumbec Mills, with the expectation of important synergy (a term
widely used in business to explain an acquisition that otherwise
makes no sense). But in the end nothing worked and I should be
faulted for not quitting sooner. A recent Business Week article
stated that 250 textile mills have closed since 1980. Their owners
were not privy to any information th they
simply processed it more objectively. I ignored Comte’s advice -
“the intellect should be the servant of the heart, but not its
slave” - and believed what I preferred to believe.
我应该再次强调Ken与Garry两个人一直以来都是足智多谋、极具干劲和想象力地努力尝试要使我们纺织部门步入成功。为了努力实现可持续获利，他们重新规划产品生产线、机器配置与分销安排。我们还做了一项重大收购，Waumbec纺织厂，带着期望能够发挥协同作用（广泛应用的商业术语来解释收购，否则是没有任何意义的）。但最后一点用都没有，我应该因为没有尽早结束而受到指责。最近商业周刊有一篇文章说1980年以来共有250家纺织工厂破产。他们的所有者并不隐瞒任何我不知道的信息，他们只是更客观的处理它。我忽略了Comte的建议：“智者应该是心灵的仆人，但不是它的奴隶。”---并相信我宁愿相信的。
The domestic textile industry operates in a commodity business,
competing in a world market in which substantial excess capacity
exists. Much of the trouble we experienced was attributable, both
directly and indirectly, to competition from foreign countries
whose workers are paid a small fraction of the U.S. minimum wage.
But that in no way means that our labor force deserves any blame
for our closing. In fact, in comparison with employees of American
industry generally, our workers were poorly paid, as has been the
case throughout the textile business. In contract negotiations,
union leaders and members were sensitive to our disadvantageous
cost position and did not push for unrealistic wage increases or
unproductive work practices. To the contrary, they tried just as
hard as we did to keep us competitive. Even during our liquidation
period they performed superbly. (Ironically, we would have been
better off financially if our union had behaved unreasonably some
we then would have recognized the impossible future that
we faced, promptly closed down, and avoided significant future
国内的纺织业在全球存在大量产能过剩的商品行业中竞争。很多我们经历的麻烦是归功于，直接和间接地，来自于国外工人的工资只是美国最低工资的一小部分的竞争。但是这绝不意味着我们的劳动力会受到关闭工厂的责备。事实上，与业内的一般工人相比，我们的员工薪水很低，这也一直是整个纺织业的状况。在工资协议上，工会领导和成员对我们不利的成本地位敏感并且没有推动未实现工资的增加或或非生产性工作的实践。相反的，他们就像我们艰难地保持竞争力一样艰难地尝试着。甚至即使到了我们清算的时刻他们都表现卓越。（具有讽刺意味的是，如果我们的工会在若干年钱就有不合理的行为，我们反而可能在经济上更好些；我们然后可能会意识到面对的未来是不可能好的，从而及时关闭工厂，以避免未来更大的损失。）
Over the years, we had the option of making large capital
expenditures in the textile operation that would have allowed us to
somewhat reduce variable costs. Each proposal to do so looked like
an immediate winner. Measured by standard return-on-investment
tests, in fact, these proposals usually promised greater economic
benefits than would have resulted from comparable expenditures in
our highly-profitable candy and newspaper businesses.
长期以来，我们有大量资本支出在可以允许我们稍微降低可变成本的纺织业务上的选择。每个这样做的提案都看起来象一个直接的赢家。以标准的投资回报测试衡量，实际上，这些决议通常承诺比从在我们高利润的糖果和报纸业务可比开支的经济效益还要高。
But the promised benefits from these textile investments were
. Many of our competitors, both domestic
and foreign, were stepping up to the same kind of expenditures and,
once enough companies did so, their reduced costs became the
baseline for reduced prices industrywide. Viewed individually, each
company’s capital investment decision appeared cost-effective and
viewed collectively, the decisions neutralized each other
and were irrational (just as happens when each person watching a
parade decides he can see a little better if he stands on tiptoes).
After each round of investment, all the players had more money in
the game and returns remained anemic.
但从这些纺织投资承诺的好处是虚幻的。我们的许多竞争对手，包括国内和国外的，全都加紧同类的资本支出，而一旦足够多的公司这么做，他们降低的成本将成为整个行业降低价格的基线。单独来看，每家公司的资本投资决策显示的都是成本效益且合理的；但整体看，这些决策相互中和而显得就不合理了（就像每个去看游行队伍的观众决定如果自己只要踮脚就能看的更清楚一样）。在每一轮投资后，所有的参与者在游戏中就有越多的钱而回报则保持疲软。
Thus, we faced a miserable choice: huge capital investment would
have helped to keep our textile business alive, but would have left
us with terrible returns on ever-growing amounts of capital. After
the investment, moreover, the foreign competition would still have
retained a major, continuing advantage in labor costs. A refusal to
invest, however, would make us increasingly non-competitive, even
measured against domestic textile manufacturers. I always thought
myself in the position described by Woody Allen in one of his
movies: “More than any other time in history, mankind faces a
crossroads. One path leads to despair and utter hopelessness, the
other to total extinction. Let us pray we have the wisdom to choose
correctly.”
因此，我们面临着一个悲惨的抉择：巨额的资本投入将对我们纺织业的存活有帮助，但可能会留给我们资本永远不断膨胀数额这种可怕的回报。在投资之后，更多的是，国外的竞争将依然保留一个在劳动力成本上主要的，持续的优势。然而，若拒绝投资，将会使我们越来越没有竞争力，甚至与国内纺织品制造商相比。我总觉得自己就像Woody
Allen在他的一部电影中所形容的处境：“超过历史上的任何一刻，人类面临一个十字路口。一条导致绝望和彻底绝望的路径，而另一条路则完全灭绝。让我们一起祈祷使我们有智慧做出正确选择。”
For an understanding of how the to-invest-or-not-to-invest dilemma
plays out in a commodity business, it is instructive to look at
Burlington Industries, by far the largest U.S. textile company both
21 years ago and now. In 1964 Burlington had sales of $1.2 billion
against our $50 million. It had strengths in both distribution and
production that we could never hope to match and also, of course,
had an earnings record far superior to ours. Its stock sold at 60
at the end of 1964; ours was 13.
对于如何投资或者不投资在商品业务两难的一个理解，看看Burlington工业公司是有教育意义的,
它21年前和现在都是美国最大的纺织公司。在1964年Burlington的销售额为12亿美元而我们才5000万美元。它在无论分销还是生产上的强项都是我们无法匹配的，当然,有一个盈利的记录也远比我们好。在1964年底它的股价为60美元，我们的是13美元。
Burlington made a decision to stick to the textile business, and in
1985 had sales of about $2.8 billion. During the 1964-85 period,
the company made capital expenditures of about $3 billion, far more
than any other U.S. textile company and more than $200-per-share on
that $60 stock. A very large part of the expenditures, I am sure,
was devoted to cost improvement and expansion. Given Burlington’s
basic commitment to stay in textiles, I would also surmise that the
company’s capital decisions were quite rational.
Burlington做出了坚守在纺织业的决定，并且在1985年销售额约为28亿美元。在1964-85年间，其资本支出约为30亿美元，远大于其他美国的纺织公司和超过200美元每股在那个股价为60美元。我相信,该支出的大部分是花费在成本改善与扩张上的。鉴于Burlington坚守在纺织行业的基本承诺，我也猜测该公司的资本决策是非常合理的。
Nevertheless, Burlington has lost sales volume in real dollars and
has far lower returns on sales and equity now than 20 years ago.
Split 2-for-1 in 1965, the stock now sells at 34 -- on an adjusted
basis, just a little over its $60 price in 1964. Meanwhile, the CPI
has more than tripled. Therefore, each share commands about
one-third the purchasing power it did at the end of 1964. Regular
dividends have been paid but they, too, have shrunk significantly
in purchasing power.
Burlington已经失去了实际销售量和远低于20年前的销售和权益回报。在1965年，拆分2比1，目前股价为34美元，在调整的基础上，只略高于1964年60美元的价格。同时，CPI却早已翻了不止三倍。因此，每股掌握的购买力大约仅为1964年年底的三分之一。虽然有固定的股息发放，但是他们购买力依然受到严重的缩水。
This devastating outcome for the shareholders indicates what can
happen when much brain power and energy are applied to a faulty
premise. The situation is suggestive of Samuel Johnson’s horse: “A
horse that can count to ten is a remarkable horse - not a
remarkable mathematician.” Likewise, a textile company that
allocates capital brilliantly within its industry is a remarkable
textile company - but not a remarkable business.
这种对股东们毁灭性的后果表明了当花费大量的脑力、精力在错误的前提下会发生什么。这种情况就像Samuel
Johnson的暗示：“一匹能数到十的马是匹了不起的马---却不是一个了不起的数学家。”同样的，一家在业内能够合理分配资本的纺织公司是一家了不起的纺织公司---但却不是了不起的企业。
My conclusion from my own experiences and from much observation of
other businesses is that a good managerial record (measured by
economic returns) is far more a function of what business boat you
get into than it is of how effectively you row (though intelligence
and effort help considerably, of course, in any business, good or
bad). Some years ago I wrote: “When a management with a reputation
for brilliance tackles a business with a reputation for poor
fundamental economics, it is the reputation of the business that
remains .” Nothing has since changed my point of
view on that matter. Should you find yourself in a
chronically-leaking boat, energy devoted to changing vessels is
likely to be more productive than energy devoted to patching
从我自己的经验和对其他公司的观察得出的结论是一条良好的管理记录（用经济回报来衡量）是你上的是一条怎样的生意之船远比你怎样去划该船要有更多的作用（虽然智力和精力帮助很大,当然,在任何公司,好的或坏的）。一些年前我曾经写过：“当一个有辉煌声誉的管理人员遇到一家经济基础非常差的公司时，差公司的状况会会保持完整。”我对这一问题的观点一点也没变。如果你发现自己在一艘长期漏水的船上，全部精力放在改变船只可能比把精力放在如何修补这船更富有成效。
There is an investment postscript in our textile saga. Some
investors weight book value heavily in their stock-buying decisions
(as I, in my early years, did myself). And some economists and
academicians believe replacement values are of considerable
importance in calculating an appropriate price level for the stock
market as a whole. Those of both persuasions would have received an
education at the auction we held in early 1986 to dispose of our
textile machinery.
在我们纺织传奇里有一个投资后记。有些投资者在他们的买入股票决策时把账面价值看得过重（就像早年我的做法一样）。而一些经济学家们和学术人士认为重置价值在整体股票市场计算一个合适的价格水平时是相当重要的。这类双边的说服力可能已经在1986年年初我们处置纺织部门机器设备的拍卖上接受了教育。
The equipment sold (including some disposed of in the few months
prior to the auction) took up about 750,000 square feet of factory
space in New Bedford and was eminently usable. It originally cost
us about $13 million, including $2 million spent in 1980-84, and
had a current book value of $866,000 (after accelerated
depreciation). Though no sane management would have made the
investment, the equipment could have been replaced new for perhaps
$30-$50 million.
售出的设备（包括一些几个月就拍卖出售的）占据了新贝德福德工厂约75万平方英尺的空间并且这些设备都可极好地再使用。它最初花了我们约1300万美元，包括在1980-84年间投入的200万美元，而现在的账面价值为86.6万美元（加速折旧之后）。尽管没有心智健全的管理层可能会投资，但这些设备的重置成本可能是万美元。
Gross proceeds from our sale of this equipment came to $163,122.
Allowing for necessary pre- and post-sale costs, our net was less
than zero. Relatively modern looms that we bought for $5,000 apiece
in 1981 found no takers at $50. We finally sold them for scrap at
$26 each, a sum less than removal costs.
我们出售这些设备的毛收益达到了163,122美元。考虑到必要的售前售后成本，我们的净收益小于零。我们在1981年花5000美元每个买入的现代化织布机现在连50美元都没人要。我们最后以26美元每个当垃圾卖掉它们，连支付搬运费用都不够。
: the economic goodwill attributable to
two paper routes in Buffalo - or a single See’s candy store -
considerably exceeds the proceeds we received from this massive
collection of tangible assets that not too many years ago, under
different competitive conditions, was able to employ over 1,000
想一下：归属于水牛城两份报纸路线的经济商誉---或一家喜事糖果店---大大地超过了我们在近几年前收到的巨大有形资产集合的收入，在不同的竞争环境下，是可以雇佣超过1000人。
three Very Good Businesses (and a Few Thoughts About Incentive
Compensation)
三家好公司（以及一些关于薪酬激励的思考）
When I was 12, I lived with my grandfather for about four months. A
grocer by trade, he was also working on a book and each night he
dictated a few pages to me. The title - brace yourself - was “How
to Run a Grocery Store and a Few Things I Have Learned About
Fishing”. My grandfather was sure that interest in these two
subjects was universal and that the world awaited his views. You
may conclude from this section’s title and contents that I was
overexposed to Grandpa’s literary style (and personality).
当我十二岁的时候，我在我祖父那里住了大约四个月。一个贸易杂货商，他也正在在写一本书，并且每天晚上他会口述几页给我听。它的标题是---支撑你自己---是《如何管理杂货店和我已了解钓鱼的几件事》。我的祖父确信感兴趣的这两个话题是普遍的，整个世界都在等待他的意见。你可以本节的标题和内容得出结论，我是过度暴露我爷爷的的文风（和个性）。
I am merging the discussion of Nebraska Furniture Mart, See’s Candy
Shops, and Buffalo Evening News here because the economic
strengths, weaknesses, and prospects of these businesses have
changed little since I reported to you a year ago. The shortness of
this discussion, however, is in no way meant to minimize the
importance of these businesses to us: in 1985 they earned an
aggregate of $72 million pre-tax. Fifteen years ago, before we had
acquired any of them, their aggregate earnings were about $8
million pre-tax.
我把内布拉斯加家具商城，喜诗糖果商店与水牛城晚报在这里并在一起讨论是因为这几家公司的经济优劣，劣势，以及这些企业前景自从我一年前报告给你们以来变化很小。然而，这个讨论的缺点，并不意味着最大限度的降低这些公司对于我们的重要性：在1985年，他们总共获得了税前7200万美元的盈利。15年前，在我们已经获得他们其中任何一个之前，他们总盈利差不多是税前800万美元。
While an increase in earnings from $8 million to $72 million sounds
terrific - and usually is - you should not automatically assume
that to be the case. You must first make sure that earnings were
not severely depressed in the base year. If they were instead
substantial in relation to capital employed, an even more important
point must be examined: how much additional capital was required to
produce the additional earnings?
尽管盈利从800万美元增长到7200万美元听起来非常的棒---而且通常是---但是你不应该自动假设那是这样的。你必需第一步先要确认收益在基准年没有严重下降。如果他们有与动用资本相关的大改变，那么一个更重要的点必需被检验：为了产生额外的收益需要多少额外的资本要求呢？
In both respects, our group of three scores well. First, earnings
15 years ago were excellent compared to capital then employed in
the businesses. Second, although annual earnings are now $64
million greater, the businesses require only about $40 million more
in invested capital to operate than was the case then.
在以上的这两个方面，我们组的这三家公司都很好。首先，相比资本然后在业务上的雇佣15年前收益是优秀的。第二，尽管年盈利现在是6400万美元多，但公司仅仅在投资资本运营上需要比当时的情况多大约4000万美元。
The dramatic growth in earning power of these three businesses,
accompanied by their need for only minor amounts of capital,
illustrates very well the power of economic goodwill during an
inflationary period (a phenomenon explained in detail in the 1983
annual report). The financial characteristics of these businesses
have allowed us to use a very large portion of the earnings they
generate elsewhere. Corporate America, however, has had a different
experience: in order to increase earnings significantly, most
companies have needed to increase capital significantly also. The
average American business has required about $5 of additional
capital to generate an additional $1 of annual pre-tax earnings.
That business, therefore, would have required over $300 million in
additional capital from its owners in order to achieve an earnings
performance equal to our group of three.
这三家公司的盈利的戏剧性增长，伴随着他们对资本却仅有少量的需求，完美的解释了经济商誉在通胀时期的力量（这一现象在1983年年报中被详细的解释了）。这些公司的财务特征可以使我们得以利用他们在其他领域产生收入的一大部分。而美国公司，却有着不一样的体验：为了显著地增加盈利，大多数公司也需要显著地增加资本投入。平均的美国公司需要差不多5美元的额外资本用以产生一个额外的1美元年税前盈利。那些公司，因此，将从它的股东那里要求超过3亿美元的额外资本为了获取一个和我们的3个公司相等的收益表现。
When returns on capital are ordinary, an
earn-more-by-putting-up-more record is no great managerial
achievement. You can get the same result personally while operating
from your rocking chair. Just quadruple the capital you commit to a
savings account and you will quadruple your earnings. You would
hardly expect hosannas for that particular accomplishment. Yet,
retirement announcements regularly sing the praises of CEOs who
have, say, quadrupled earnings of their widget company during their
reign - with no one examining whether this gain was attributable
simply to many years of retained earnings and the workings of
compound interest.
当资本回报平平时，一个放得多就赚的多的记录就不是一个好的管理成就。你能从你摇椅中摆动中得到同样的个人体验。只要你承诺在一个储蓄账户里投入四倍的资本，你就将四倍的增长你的收益。你将很难预期从那个特别的成就中获得赞美。然而，退休公告一般都是唱CEO是怎样得到赞扬的，比如说，在他们在位期间翻倍了他们那些叫不出名字的公司盈利---没有人去研究这种盈利是因为单纯的多年留存收益作用还是复利作用。
If the widget company consistently earned a superior return on
capital throughout the period, or if capital employed only doubled
during the CEO’s reign, the praise for him may be well deserved.
But if return on capital was lackluster and capital employed
increased in pace with earnings, applause should be withheld. A
savings account in which interest was reinvested would achieve the
same year-by-year increase in earnings - and, at only 8% interest,
would quadruple its annual earnings in 18 years.
如果不知名公司在整个期间持续的获得了一个超额的资本回报，或者动用资本在CEO任职期间仅翻了一倍，那么对他的赞美就配得上。但是如果资本回报率是低迷的并且动用资本增长和盈利增长同步，那么掌声应该暂停。一个利息再投资的储蓄账户也能获得同样的年复一年的盈利增长---并且，只有8%的利息，那么它的年收益在18年将翻四倍。
The power of this simple math is often ignored by companies to the
detriment of their shareholders. Many corporate compensation plans
reward managers handsomely for earnings increases produced solely,
or in large part, by retained earnings - i.e., earnings withheld
from owners. For example, ten-year, fixed-price stock options are
granted routinely, often by companies whose dividends are only a
small percentage of earnings.
这一简单的数学力量经常被公司们忽略以致于损害了他们的股东们。许多公司奖励管理层的薪酬计划对仅仅产生盈利增长是慷慨的，或者说大部分是，是由留存收益产生的---即从股东们手里截留盈利。例如，十年期，固定价格股票期权是被常规地假定，经常被分红是很小一部分盈利的公司们。
An example will illustrate the inequities possible under such
circumstances. Let’s suppose that you had a $100,000 savings
account earning 8% interest and “managed” by a trustee who could
decide each year what portion of the interest you were to be paid
in cash. Interest not paid out would be “retained earnings” added
to the savings account to compound. And let’s suppose that your
trustee, in his superior wisdom, set the “pay-out ratio” at
one-quarter of the annual earnings.
一个例子可以说明在这种情况下可能的不公平。让我们假设你有一个10万美元的储蓄账户赚取8%的利息和一个能够决定每年多少比例利息以现金支付给你的被信托公司“管理”的账户。未支付的利息将是“留存收益”添加到储蓄账户来复合。让我们假设你的受托人，在他的超群智慧里，在年度收益的四分之一里设定“股利发放率”。
Under these assumptions, your account would be worth $179,084 at
the end of ten years. Additionally, your annual earnings would have
increased about 70% from $8,000 to $13,515 under this inspired
management. And, finally, your “dividends” would have increased
commensurately, rising regularly from $2,000 in the first year to
$3,378 in the tenth year. Each year, when your manager’s public
relations firm prepared his annual report to you, all of the charts
would have had lines marching skyward.
在这些假定之下，你的账户将在10年后值179,084美元。另外，根据这个有启发的管理你每年收益将增长70%，从8000美元增长到13515美元。最后，你的“红利”也会同步增长，从第一年的2000美元常规地增长到第十年的3378美元。每年，当你管理的公共关系公司编制他的年报给你时，所有的图表都会被排列的冲上蓝天。
Now, just for fun, let’s push our scenario one notch further and
give your trustee-manager a ten-year fixed-price option on part of
your “business” (i.e., your savings account) based on its fair
value in the first year. With such an option, your manager would
reap a substantial profit at your expense - just from having held
on to most of your earnings. If he were both Machiavellian and a
bit of a mathematician, your manager might also have cut the
pay-out ratio once he was firmly entrenched.
现在，只是为了好玩，让我们把我们的情景分析向前推进一步并且给你的信托管理者在第一年建立在它的公允价值基础之上的部分你的“生意”的一个十年期固定价格的期权（即，你的储蓄账户）。在这个期权下，你的管理层将会在你的费用上收获大量的利润---只是从大多数你盈利持有中来。如果他既是一个权谋主义者又精通数学，你的管理层也可能等到一旦他们地位稳固后削减股息分红率。
This scenario is not as farfetched as you might think. Many stock
options in the corporate world have worked in exactly that fashion:
they have gained in value simply because management retained
earnings, not because it did well with the capital in its
这个情景不像你可能想的那样牵强。许多在企业世界的股票期权都以完全一样的方式运行：他们已经获得的价值只是因为管理层留存了收益，而不是因为很好的运用它手上的资本。
Managers actually apply a double standard to options. Leaving aside
warrants (which deliver the issuing corporation immediate and
substantial compensation), I believe it is fair to say that nowhere
in the business world are ten-year fixed-price options on all or a
portion of a business granted to outsiders. Ten months, in fact,
would be regarded as extreme. It would be particularly unthinkable
for managers to grant a long-term option on a business that was
regularly adding to its capital. Any outsider wanting to secure
such an option would be required to pay fully for capital added
during the option period.
管理者实际上对期权采用了双重标准。撇开权证不论（提供给发行公司立即和实质性的补偿），我相信这是公平的来说在商业世界没有什么地方是十年期的固定价格期权在一个假设给外部人士生意的全部或一部分的。实际上，十个月，将被视为极端。对管理者而言给予一个长期期权在一个定期增加它的资本的生意上是特别地不可想象的。任何想要这么一个期权的外部人士都将在期权存续期间内被要求全额增加的资本。
The unwillingness of managers to do-unto-outsiders, however, is not
matched by an unwillingness to do-unto-themselves. (Negotiating
with one’s self seldom produces a barroom brawl.) Managers
regularly engineer ten-year, fixed-price options for themselves and
associates that, first, totally ignore the fact that retained
earnings automatically build value and, second, ignore the carrying
cost of capital. As a result, these managers end up profiting much
as they would have had they had an option on that savings account
that was automatically building up in value.
管理层们不愿意向外部人士这样做，然而，和他们不愿意给自己做是不匹配的。（与一个人的自我谈判极少产生类似酒吧里的争吵）。管理层定期巧妙的设计十年期的，固定价格的期权给他们自己和合伙人们，第一，完全忽视了留存收益是自动的创造价值的事实，第二，忽略资本的账面成本。因此，这些管理者们最终获利颇丰尽管他们可能已经在那个自动创造价值的储蓄账户中已经有一个期权了。
Of course, stock options often go to talented, value-adding
managers and sometimes deliver them rewards that are perfectly
appropriate. (Indeed, managers who are really exceptional almost
always get far less than they should.) But when the result is
equitable, it is accidental. Once granted, the option is blind to
individual performance. Because it is irrevocable and unconditional
(so long as a manager stays in the company), the sluggard receives
rewards from his options precisely as does the star. A managerial
Rip Van Winkle, ready to doze for ten years, could not wish for a
better “incentive” system.
当然，股票期权的也经常会到富于天赋的，创造价值的管理层们手里并有时候带给他们完全适当的奖励（事实上，真正特别的管理层们几乎总是远比他们应该的要少的多）。但是当结果是公正的，它是随机的。一旦获准，这一期权是无视个人表现的。因为期权的不可撤销性和无条件性（只要管理者还留在公司），懒汉从他那明确的就像是明星所做那个期权里获得奖赏。一个管理的李伯，准备打瞌睡10年，不能期待一个更好的“激励”制度了。
(I can’t resist commenting on one long-term option given an
“outsider”: that granted the U.S. Government on Chrysler shares as
partial consideration for the government’s guarantee of some
lifesaving loans. When these options worked out well for the
government, Chrysler sought to modify the payoff, arguing that the
rewards to the government were both far greater than intended and
outsize in relation to its contribution to Chrysler’s recovery. The
company’s anguish over what it saw as an imbalance between payoff
and performance made national news. That anguish may well be
unique: to my knowledge, no managers - anywhere - have been
similarly offended by unwarranted payoffs arising from options
granted to themselves or their colleagues.)
（我忍不住给一个“外部人士们”的长期期权予以评论：美国政府授予克莱斯勒公司的股份是作为政府的一些救生贷款作担保的部分代价。当这些期权对政府做得好时，克莱斯勒寻求改变盈利，它争论到，政府所获得的奖励无论是远超其所预想还是与其对克莱斯勒的复兴所做的贡献超强的关系上。该公司的痛苦超过了它被看到的作为盈利和由全国新闻里的表现之间的不平衡。这种痛苦或许是独一无二的：据我所知，没有管理层们---在任何地方---同样受到了从他们自己或者他们的同事们那里授权出来期权的未保证盈利上升的伤害。）
Ironically, the rhetoric about options frequently describes them as
desirable because they put managers and owners in the same
financial boat. In reality, the boats are far different. No owner
has ever escaped the burden of capital costs, whereas a holder of a
fixed-price option bears no capital costs at all. An owner must
weigh upside potential a an option holder has
no downside. In fact, the business project in which you would wish
to have an option frequently is a project in which you would reject
ownership. (I’ll be happy to accept a lottery ticket as a gift -
but I’ll never buy one.)
讽刺的是，有关期权的说辞经常被作为期望来描述它们因为他们把管理者们和所有者们放在了同一条船上。现实中，这2条船是很不同的。没有所有者能摆脱资本成本的负担，但是一个固定价格期权持有者却不用承担任何资本成本。一个所有者必需要权衡上升的潜力和下行的风险；但是一个期权持有者却不用承担下行风险。实际上，你所愿意有一个期权的业务项目经常是你可能拒绝拥有所有权的项目。（我会很开心的接受一张彩票作为礼物---但是我永远不会买一张。）
In dividend policy also, the option holders’ interests are best
served by a policy that may ill serve the owner. Think back to the
savings account example. The trustee, holding his option, would
benefit from a no-dividend policy. Conversely, the owner of the
account should lean to a total payout so that he can prevent the
option-holding manager from sharing in the account’s retained
在股利政策上，同样，期权所有者的利益是得到政策上最好的服务而所有者却是最差的。回想储蓄账户的例子。受托人，持有他的期权，将从不分配股利中获利。相反，账户所有者会倾向于一个总的分红以便他可以阻止拥有期权的管理者分享其账户的留存收益。
Despite their shortcomings, options can be appropriate under some
circumstances. My criticism relates to their indiscriminate use
and, in that connection, I would like to emphasize three
尽管有种种不足，期权在某些情形下还是可以适用的。我的批评主要是针对他们不加限制的滥用，在这方面，我打算强调三点：
First, stock options are inevitably tied to the overall performance
of a corporation. Logically, therefore, they should be awarded only
to those managers with overall responsibility. Managers with
limited areas of responsibility should have incentives that pay off
in relation to results under their control. The .350 hitter
expects, and also deserves, a big payoff for his performance - even
if he plays for a cellar-dwelling team. And the .150 hitter should
get no reward - even if he plays for a pennant winner. Only those
with overall responsibility for the team should have their rewards
tied to its results.
第一，股票期权不可避免的与公司的总体表现绑定。从逻辑上看，因此，他们应该只奖励那些全面负责的管理者。有限范围责任的管理者们应该会有通过他们的操控业绩获取回报的激励。击球率高达35%的击球手期待，同时也值得，为他的表现得到一个大大的的回报---尽管他为一个很差的球队在比赛。而击球率只有15%的击球手不应该获得奖励---尽管他为了一支获得锦旗的球队在比赛。只有那些为球队表现总负责的人才应该将其奖励与球队表现挂钩。
Second, options should be structured carefully. Absent special
factors, they should have built into them a retained-earnings or
carrying-cost factor. Equally important, they should be priced
realistically. When managers are faced with offers for their
companies, they unfailingly point out how unrealistic market prices
can be as an index of real value. But why, then, should these same
depressed prices be the valuations at which managers sell portions
of their businesses to themselves? (They may go further: officers
and directors sometimes consult the Tax Code to determine the
lowest prices at which they can, in effect, sell part of the
business to insiders. While they’re at it, they often elect plans
that produce the worst tax result for the company.) Except in
highly unusual cases, owners are not well served by the sale of
part of their business at a bargain price - whether the sale is to
outsiders or to insiders. The obvious conclusion: options should be
priced at true business value.
第二，期权应该被谨慎的构造。除了特别因素，他们应该把一个留存收益或资本成本也放在里面。同等重要的是，他们应该被实事求是地定价。当管理层面临着对他们的公司给的报价时，他们无一例外地会指出这么不现实的市场价格如何能作为一个真正的价值指标。然后,但是，为什么这些同样低廉的价格在管理层卖出他们的业务的一部分给他们自己时就应该成为估值了呢？（他们可能走的更远：管理层和董事们有时候会咨询税法以确定他们所能支付的最低价格，实际上,是出售部分业务给内部人士。尽管他们也在里面，但他们经常会选择对于公司产生最不利的税务结果计划）。除非在极不寻常的情况下，所有者们是不会得到以低价格在销售部分他们的业务时好服务的---无论这个销售是对内部人还是外部人。显而易见的结论是：期权应该以公司的真实价值定价。
Third, I want to emphasize that some managers whom I admire
enormously - and whose operating records are far better than mine -
disagree with me regarding fixed-price options. They have built
corporate cultures that work, and fixed-price options have been a
tool that helped them. By their leadership and example, and by the
use of options as incentives, these managers have taught their
colleagues to think like owners. Such a Culture is rare and when it
exists should perhaps be left intact - despite inefficiencies and
inequities that may infest the option program. “If it ain’t broke,
don’t fix it” is preferable to “purity at any price”.
第三，我想强调的是某些我极其钦佩的管理者们---他们的经营业绩比我的要好得多---就固定价格期权而论看法与我不同。他们已经建立合作的公司文化，而固定价格期权一直是帮助他们的工具。通过他们的领导和榜样，以及通过期权作为激励，这些管理者们已经教会了他们的同事们像公司的所有者一样思考。这种公司文化是罕见的而且当它存在应该保持不变---尽管效率低下和不平等可能会侵扰期权方案。“如果未被损坏，那就不要修正它”比之“不惜一切代价清白”要更好。
At Berkshire, however, we use an incentive & compensation
system that rewards key managers for meeting targets in their own
bailiwicks. If See’s does well, that does not produce incentive
compensation at the News - nor vice versa. Neither do we look at
the price of Berkshire stock when we write bonus checks. We believe
good unit performance should be rewarded whether Berkshire stock
rises, falls, or stays even. Similarly, we think average
performance should earn no special rewards even if our stock should
soar. “Performance”, furthermore, is defined in different ways
depending upon the underlying economics of the business: in some
our managers enjoy tailwinds not of their own making, in others
they fight unavoidable headwinds.
然而，在伯克希尔，我们使用激励和补偿机制以奖励达到他们目标的核心管理人员。如果喜诗糖果做的很好，在新闻上不产生激励补偿---反之亦然。当我们写奖金支票时我们也不会去看伯克希尔的股价。我们认为好的单位表现应该被奖励无论伯克希尔的股价是上涨,下跌,还是平盘。同样地，我们认为平均表现不应该获得特别的奖励即使我们的股票在猛涨。
“表现”，更进一步的说，是被定义成在不同的方式下根据业务有所不同的基本经济学：在我们有些管理者是享受了不是他们自己做的良好的顺风车，而另外的管理者们则与不利的顶风做斗争。
The rewards that go with this system can be large. At our various
business units, top managers sometimes receive incentive bonuses of
five times their base salary, or more, and it would appear possible
that one manager’s bonus could top $2 million in 1986. (I hope so.)
We do not put a cap on bonuses, and the potential for rewards is
not hierarchical. The manager of a relatively small unit can earn
far more than the manager of a larger unit if results indicate he
should. We believe, further, that such factors as seniority and age
should not affect incentive compensation (though they sometimes
influence basic compensation). A 20-year-old who can hit .300 is as
valuable to us as a 40-year-old performing as well.
在这个系统下的奖励可能会很高，在我们的不同业务单元中，顶级的管理者有时候会收到五倍于其基本工资的奖金，甚至更多，在1986年，我们的一个管理者的奖金可能会最高达到200万美元（我希望如此）。我们没有对奖金设限，并且奖励的潜力是不分层的。一个相对较小的单位的管理者可能会远比大的单位的管理者更多的奖金如果结果显示他应得的话。我们认为，进一步说，比如资历和年龄这些因素不应该影响激励补偿（尽管有时候还是会影响基本的薪酬）。一个20岁的能做到30%击球率的员工对于我们而言和一个同等的40岁员工一样有价值。
Obviously, all Berkshire managers can use their bonus money (or
other funds, including borrowed money) to buy our stock in the
market. Many have done just that - and some now have large
holdings. By accepting both the risks and the carrying costs that
go with outright purchases, these managers truly walk in the shoes
of owners.
显然的，所有的伯克希尔的经理人可以用他们的奖金（或者其他的资金，包括借来的钱）在市场上购买我们公司的股票。许多人已经这样做了---有些人仓位还挺重。通过接受风险和一路购买带来的账面成本，这些经理人们真正的与所有者穿同一条裤子了。
Now let’s get back - at long last - to our three businesses:
现在，让我们回过头---终于---到我们的三个业务了：
At Nebraska Furniture Mart our basic strength is an exceptionally
low-cost operation that allows the business to regularly offer
customers the best values available in home furnishings. NFM is the
largest store of its kind in the country. Although the
already-depressed farm economy worsened considerably in 1985, the
store easily set a new sales record. I also am happy to report that
NFM’s Chairman, Rose Blumkin (the legendary “Mrs. B”), continues at
age 92 to set a pace at the store that none of us can keep up with.
She’s there wheeling and dealing seven days a week, and I hope that
any of you who visit Omaha will go out to the Mart and see her in
action. It will inspire you, as it does me.
在内布拉斯加家具卖场我们的基本力量是一个非常低的运营成本，允许企业定期向顾客们提供在家居装饰中可用的最佳价值。内布拉斯加家具卖场是这个国家同类卖场中规模最大的。尽管已经低迷的农场经济在1985年大幅恶化，但是这家店很容易地设置了新的销售记录。我也很开心的报告大家，内布拉斯加家具卖场的主席，“B夫人”，继续在92岁的高龄来为商店设定一个没人能赶上她的速度。她一周不择手段地工作七天，我希望你们任何人在拜访奥马哈时能顺道去那个卖场看看B夫人是如何工作的。这将激励你，就像激励我一样。
At See’s we continue to get store volumes that are far beyond those
achieved by any competitor we know of. Despite the unmatched
consumer acceptance we enjoy, industry trends are not good, and we
continue to experience slippage in poundage sales on a same-store
basis. This puts pressure on per-pound costs. We now are willing to
increase prices only modestly and, unless we can stabilize per-shop
poundage, profit margins will narrow.
在喜诗糖果我们继续取得了远超那些我们所知道的任何竞争对手的商店销售量。尽管我们欣赏这不相称的消费者认可，行业趋势并不好，而我们继续经历在一个同店基础上的总磅数（每磅手续费？）销售下滑。这给我们}