There’s a lot of evidence of that – that our conventional techniques of extracting oil will eventually taper off, [a theory called] Hubert’s Peak. [First articulated more than 50 years ago by a Shell Oil geologist, this theory describes how production rates of oil and gas will increase to a peak and then rapidly taper off as reserves are depleted.] I’m sure that will happen eventually. But you can never be sure. Some people think that energy reserves are not from deceased former life – for example, there’s methane in the heavens where there was no former life. So there may be more energy than people expect…
I recall reading something about Chevron finding a lot of energy way deep, some kind of hydride – a deep reserve with a lot of energy locked up. So there may be one last gasp – one more windfall coming of hydrocarbons. If we have to live without hydrocarbons, we can, but it would just be unpleasant. An awful lot of energy comes to the earth every day from the sun. If we had to adjust, we could.
Point 38. “How do I play the hand that has been dealt me?” The world is not going to give you extra just because you want it. It’s so much easier to reduce your wants.
Point 39. Old School Is Good School. The old attitudes will work fine. If you live long enough and act well, and have some intelligence, you’ll do fine.
People need to ask, “How do I play the hand that has been dealt me?” The world is not going to give you extra return just because you want it. You have to be very shrewd and hard working to get a little extra. It’s so much easier to reduce your wants. There are a lot of smart people and a lot of them cheat, so it’s not easy to win. (Nervous laughter)
The old attitudes will work fine. If you live long enough and act well, and have some intelligence, you’ll do fine.
Never abuse current clients by trying to get new ones. Think how this would work with matrimony – if you ignore your current wife while you pursue another one. (Laughter)
Point 40. Future of the United States. The eclipse rate of great civilizations being overtaken is 100%. I’m more optimistic about the staying power of what’s good in this country.
Over the long term, the eclipse rate of great civilizations being overtaken is 100%. So you know how it’s going to end. (Laughter)
I’m more optimistic about the staying power of what’s good in this country. But just because you have a wonderful spouse doesn’t mean you should treat her badly. You have the feeling that some of the old virtues [that made this country great] are lessening. But there’s so much good and so much strength left that I would not expect this country to suddenly founder.
But there are some developments that would make us commit to the old ways. I think there are certain classes of people who if they were swept away, it would be desirable.
Biggest Threat to Our Way of Life
Warren answered this at the annual meeting. The biggest threat in the next 60 years is a really unpleasant nuclear event. Next is that someone does some terrible things with pathogens. I don’t think either is unlikely in the next 60 years. If we have to go through some recessions and convulsions, these are minor compared to nuclear events. People in this room certainly should be wise enough to handle their lives so they can do OK even in big stretches of unpleasant economic conditions. I think the big threats are not the ones we’re talking about here.
Point 41. Contentment Is Good. There’s nothing crazy about a 75 year old rich man (with a new family and 12-year-old kid) who stopped spending his time trying to get richer.
Rick Guerin’s Not Crazy – We Are
[Guerin was one of the investors Buffett profiled in his famous speech, The Superinvestors of Graham-and-Doddsville] I think it’s fair to say that once he got rich, he stopped spending his time trying to get richer. He has a new family. He’s 75 and has a 12-year-old child. He does a lot of things because he enjoys doing them. He’s stopped trying to get richer. There’s nothing crazy about that. We’re the crazy ones. (Laughter)
Point 42: Read About The Best People. And Don’t Get Sucked In By Evil.
I believe in reading the best people, and reading because you like learning. I don’t spend my time reading detective stories or romances. In spite of Warren’s wise-ass comment about better late than never about me…[I missed the rest of this sentence]
But a book like the one I just recommended [Conspiracy of Fools, by Kurt Eichenwald] – that Enron book is really worth reading because the evil is so extreme. You see people getting sucked in by the evil all around them. You just learn so much. You know the outcome – it’s like a tragedy. Not everyone likes tragedy – I took my wife to a movie where the rats were eating the bodies of the dead soldiers in World War I. Afterward, she told me, “You may like this, but I never want to go to another one.” It was King & Country.
Notes from 2005 Wesco Financial Annual Meeting – May 4, 2005 – By Whitney Tilson