Coke blanketed the world. During this period, however, I
carefully avoided buying even a single share, instead allocating
major portions of my net worth to street railway companies,
windmill manufacturers, anthracite producers, textile businesses,
trading-stamp issuers, and the like. (If you think I'm making
this up, I can supply the names.) Only in the summer of 1988 did
my brain finally establish contact with my eyes.
在往后的52年内当可口可乐席卷全世界的同时，我也持续地注意到这种特质，
然而在同一段期间，由于我个人过于小心谨慎以致于竟然连一股都没有买，反而
将大部分的个人资产投注在街车公司、纺织公司、煤炭公司与邮票公司之类的股
票之上，(如果你认为这是我编造的笑话，我可以再告诉大家确实的公司名称)，
终于到了1988年的夏天，我的大脑与眼睛完成了联机动作。
What I then perceived was both clear and fascinating. After
drifting somewhat in the 1970's, Coca-Cola had in 1981 become a
new company with the move of Roberto Goizueta to CEO. Roberto,
along with Don Keough, once my across-the-street neighbor in
Omaha, first rethought and focused the company's policies and
then energetically carried them out. What was already the world's
most ubiquitous product gained new momentum, with sales overseas
virtually exploding.
一时之间，我的观感与眼界大开，在1970年代一度委靡不振之后，可口可乐在
1981年新任总裁古崔塔的带领下，焕然一新，古崔塔加上Don Keough(曾经
是我在奥玛哈的对街邻居)，经过思考并厘清公司的政策后，切实地加以执行，
使得本来就已是全世界最独一无二的产品又平添新动力，尤其是来自海外的营收
更呈现爆炸性的成长。
Through a truly rare blend of marketing and financial
skills, Roberto has maximized both the growth of his product and
the rewards that this growth brings to shareholders. Normally,
the CEO of a consumer products company, drawing on his natural
inclinations or experience, will cause either marketing or
finance to dominate the business at the expense of the other
discipline. With Roberto, the mesh of marketing and finance is
perfect and the result is a shareholder's dream.
利用其行销与财务方面的两把利刃，古崔塔将可口可乐产品的成长与股东的利益
极大化，通常一家消费性商品的CEO，基于个人过去的经验与个性，会偏向公
司的行销或财务任何一边，但是古崔塔却能够将两者调和到极致的境界，这样的
结果实在是股东们前世修来的好福气。
Of course, we should have started buying Coke much earlier,
soon after Roberto and Don began running things. In fact, if I
had been thinking straight I would have persuaded my grandfather
to sell the grocery store back in 1936 and put all of the
proceeds into Coca-Cola stock. I've learned my lesson: My
response time to the next glaringly attractive idea will be
slashed to well under 50 years.
当然我们应该在古崔塔与Don开始接掌公司时，就早点买进该公司的股票，事
实上，要是我有足够的远见，早在1936年我就应该说服我爷爷干脆卖掉杂货
店，然后将钱全部用来买进可口可乐的股票，这次我终于学到了教训，不过照这
种情况看来，距离下一次我灵光一现的时间，可能要再等上个50年以上吧！
As I mentioned earlier, the yearend prices of our major
investees were much higher relative to their intrinsic values
than theretofore. While those prices may not yet cause
nosebleeds, they are clearly vulnerable to a general market
decline. A drop in their prices would not disturb us at all - it
might in fact work to our eventual benefit - but it would cause
at least a one-year reduction in Berkshire's net worth. We think
such a reduction is almost certain in at least one of the next
three years. Indeed, it would take only about a 10% year-to-year
decline in the aggregate value of our portfolio investments to
send Berkshire's net worth down.
就像是我上次所提到的，相较于过去，我们这些被投资公司的股价已高于其实质
价值，虽然目前以这种价位不会造成我们流鼻血，但难免会受到大盘波动的影响
，当然股价下挫一点都不会造成我们的困扰，甚至反而对我们有利，但不可避免
地可能会造成Berkshire年度净值的减少，只要在未来的两、三年间，我们的投
资组合市值平均每年减少10%，就有可能会发生这种状况。
We continue to be blessed with extraordinary managers at our
portfolio companies. They are high-grade, talented, and
shareholder-oriented. The exceptional results we have achieved
while investing with them accurately reflect their exceptional
personal qualities.
我们持续受惠于这些被投资公司经理人，他们高品格、能力佳且设身处地为股东
着想，我们能够有这么好的投资绩效，可以说是完全仰赖这些经理人不凡的人格
特质。
o We told you last year that we expected to do little in
arbitrage during 1989, and that's the way it turned out.
Arbitrage positions are a substitute for short-term cash
equivalents, and during part of the year we held relatively low
levels of cash. In the rest of the year we had a fairly goodsized
cash position and even so chose not to engage in arbitrage.
The main reason was corporate transactions that made no economic
sense to us; arbitraging such deals comes too close to playing
the greater-fool game. (As Wall Streeter Ray DeVoe says: "Fools
rush in where angels fear to trade.") We will engage in arbitrage
from time to time - sometimes on a large scale - but only when we
like the odds.
去年我曾向各位报告今年可能会减少在套利投资方面的活动，结果正是如此，套
利投资是短期资金的替代去处，有时我们手头上没有太多的现金，就算是有我们
也宁愿选择不参与套利，主要的原因是因为最近这些企业活动实在是没有太大的
经济意义，从事这类的套利交易就好象是在比谁比较笨，华尔街人士Ray DeVoe
所说天使回避但傻瓜趋之若骛，我们三不五时会从事大型的套利交易，但只有当
我们觉得胜算颇大时，才会考虑进场。
o Leaving aside the three convertible preferreds discussed in
the next section, we substantially reduced our holdings in both
medium- and long-term fixed-income securities. In the long-terms,
just about our only holdings have been Washington Public Power
Supply Systems (WPPSS) bonds carrying coupons ranging from low to
high. During the year we sold a number of the low-coupon issues,
which we originally bought at very large discounts. Many of these
issues had approximately doubled in price since we purchased them
and in addition had paid us 15%-17% annually, tax-free. Our
prices upon sale were only slightly cheaper than typical highgrade
tax-exempts then commanded. We have kept all of our highcoupon
WPPSS issues. Some have been called for redemption in 1991
and 1992, and we expect the rest to be called in the early to
mid-1990s.
除了后面会提到的三项可转换特别股投资之外，我们大幅减少在中长期的固定收
益债券部位，尤其是长期部份，大概就只剩下华盛顿公用电力系统债券，去年我
们处分了部份当初以相当低折价买进的低收益债券，处分价格与一般信用评等佳
的债券差不多，是原始投资成本的一倍，外加每年15%到17%的免税利息，至
于高收益的债券则予以保留，有些即将在1991年或1992年到期，剩下的则会
在1990年中期到期赎回。
We also sold many of our medium-term tax-exempt bonds during
the year. When we bought these bonds we said we would be happy to
sell them - regardless of whether they were higher or lower than
at our time of purchase - if something we liked better came
along. Something did - and concurrently we unloaded most of these
issues at modest gains. Overall, our 1989 profit from the sale of
tax-exempt bonds was about $51 million pre-tax.
同时我们也卖了不少中期的免税债券，当初买下这些债券时就曾说过，只要时机
成熟找到更好的投资标的，我们会很高兴地把他们给处分掉，不管届时的价格是
高或是低于我们的投资成本，如今时机确实成熟了，所以我们便将大部分的债券
出清，所得的报酬还算不错，总结下来我们1989年从出售免税债券所获得的税
前收益大概在5,100万左右。
o The proceeds from our bond sales, along with our excess cash
at the beginning of the year and that generated later through
earnings, went into the purchase of three convertible preferred
stocks. In the first transaction, which took place in July, we
purchased $600 million of The Gillette Co. preferred with an 8
3/4% dividend, a mandatory redemption in ten years, and the right
to convert into common at $50 per share. We next purchased $358
million of USAir Group, Inc. preferred stock with mandatory
redemption in ten years, a dividend of 9 1/4%, and the right to
convert into common at $60 per share. Finally, late in the year
we purchased $300 million of Champion International Corp.
preferred with mandatory redemption in ten years, a 9 1/4%
dividend, and the right to convert into common at $38 per share.
我们将出售债券所得的收入连同期初帐上的现金与年中所赚取的盈余，通通买进
三种可转换特别股，第一种是在7月我们投资6亿美金在吉列刮胡刀年利率8
又3/4%十年强制赎回的可转换特别股，转换价格订为50美元；之后我们又花
了3.58亿美金投资美国航空年利率9又1/4%十年强制赎回的可转换特别股，
转换价格订为60美元；最后我们在年底又以3亿美金投资冠军企业年利率9又
1/4%十年强制赎回的可转换特别股，转换价格订为38美元。
Unlike standard convertible preferred stocks, the issues we
own are either non-salable or non-convertible for considerable
periods of time and there is consequently no way we can gain from
short-term price blips in the common stock. I have gone on the
board of Gillette, but I am not on the board of USAir or
Champion. (I thoroughly enjoy the boards I am on, but can't
handle any more.)
不像一般的可转换特别股，这次我们所拥有的在限定时间内不得出售或转换的，
所以短期间我们要靠普通股反转而获利的机会不大，我并且已经加入吉列的董事
会，至于美国航空或是Champion公司则没有，(我很喜欢现有加入的董事会，
但可是由于分身乏术可能无法再加入其它公司的董事会)。
Gillette's business is very much the kind we like. Charlie
and I think we understand the company's economics and therefore
believe we can make a reasonably intelligent guess about its
future. (If you haven't tried Gillette's new Sensor razor, go
right out and get one.) However, we have no ability to forecast
the economics of the investment banking business (in which we
have a position through our 1987 purchase of Salomon convertible
preferred), the airline industry, or the paper industry. This
does not mean that we predict a negative future for these
industries: we're agnostics, not atheists. Our lack of strong
convictions about these businesses, however, means that we must
structure our investments in them differently from what we do
when we invest in a business appearing to have splendid economic
characteristics.
吉列这家公司与我们喜爱的类型非常相近，查理跟我都熟悉这个产业的环境，因
此我们相信可以对这家公司的未来做一个合理的预估，(若是没有试过吉列新的
感应式刮胡刀，赶紧去买一个来试试！)，但是我们就没法子来预测投资银行业、
航空业或是造纸业的未来前景，(我们在1987年买下所罗门公司的可转换债
券) ，当然这并不表示他们的未来就是个负数，基本上我们是不可知论者，而不
是无神论者。所以由于我们在这些产业上缺乏强而有力的论点支持我们，因此我
们在这些产业上所采的投资方式就必须与那些显而易见的好公司好产业有所不
同。
In one major respect, however, these purchases are not
different: We only want to link up with people whom we like,
admire, and trust. John Gutfreund at Salomon, Colman Mockler, Jr.
at Gillette, Ed Colodny at USAir, and Andy Sigler at Champion
meet this test in spades.
不过在另一方面，有一点还是很重要，我们只跟我们喜欢、欣赏且信任的人打交
道，像是所罗门的John Gutfreund、吉列的Colman Mockler二世、美国航空
的Ed Colodny与Champion企业的Andy Sigler都算是符合我们的标准。
They in turn have demonstrated some confidence in us,
insisting in each case that our preferreds have unrestricted
voting rights on a fully-converted basis, an arrangement that is
far from standard in corporate finance. In effect they are
trusting us to be intelligent owners, thinking about tomorrow
instead of today, just as we are trusting them to be intelligent
managers, thinking about tomorrow as well as today.
同时他们对我们也相当的信任，坚持给我们无限制的转换权利，这在一般美国大
企业融资案里头并不多见，事实上他们相信我们是聪明的老板，看的是未来而不
是现在，就像我们相信他们是聪明的经理人一样，不但会看未来同时也会顾及现
在。
The preferred-stock structures we have negotiated will
provide a mediocre return for us if industry economics hinder the
performance of our investees, but will produce reasonably
attractive results for us if they can earn a return comparable to
that of American industry in general. We believe that Gillette,
under Colman's management, will far exceed that return and
believe that John, Ed, and Andy will reach it unless industry
conditions are harsh.
这种可转换特别股的投资方式可以确保即便是我们的被投资公司面临产业前景
不佳的环境时，仍能确保我们可以得到稳定的收益，同时若被投资公司表现不错
时，我们又可以获得比投资一般美国企业更好的报酬，我们相信吉列在Colman
的领导之下，一定会有不错的表现，另外John与Andy即使是面临产业不佳的
前景，应该也不会让我们失望。
Under almost any conditions, we expect these preferreds to
return us our money plus dividends. If that is all we get,
though, the result will be disappointing, because we will have
given up flexibility and consequently will have missed some
significant opportunities that are bound to present themselves
during the decade. Under that scenario, we will have obtained
only a preferred-stock yield during a period when the typical
preferred stock will have held no appeal for us whatsoever. The
only way Berkshire can achieve satisfactory results from its four
preferred issues is to have the common stocks of the investee
companies do well.
不管在任何情况之下，我们预期这些可转换特别股都可以让我们收回本金加上股
利无虞，然而若是我们真的只能收回这些，那么这样的结果毋宁是相当令我们失
望的，因为我们必须被迫牺牲流动性，这友可能让我们在往后的十年内错失更好
的投资机会，在这种情况下，我们就只能获得一般特别股所能获得的利益，而后
者却是我们根本就不会想要去投资的，所以唯一对Berkshire最有益处的是我们
的被投资公司本身的普通股也能有优异的表现。
Good management and at least tolerable industry conditions
will be needed if that is to happen. But we believe Berkshire's
investment will also help and that the other shareholders of each
investee will profit over the years ahead from our preferred
stock purchase. The help will come from the fact that each
company now has a major, stable, and interested shareholder whose
Chairman and Vice Chairman have, through Berkshire's investments,
indirectly committed a very large amount of their own money to
these undertakings. In dealing with our investees, Charlie and I
will be supportive, analytical, and objective. We recognize that
we are working with experienced CEOs who are very much in command
of their own businesses but who nevertheless, at certain moments,
appreciate the chance to test their thinking on someone without
ties to their industry or to decisions of the past.
这需要靠好的经营团队再加上可以忍受的产业环境，不过我们相信Berkshire本
身对这四家公司的资金挹注，也能够对这些公司与其股东的长远利益有所帮助，
这是由于他们可以确信现在这些公司的背后有一个稳定又关心公司的大股东在
默默地支持他们，再与我们被投资公司相处时，我们通常会采取支持、客观并给
予分析建议的态度，我们了解这些公司的CEO对于其所处的产业都相当的清
楚，但我想他们应该有会很珍惜我们这些与产业背景完全不相关的客观人士所给
他们的经验交流。
As a group, these convertible preferreds will not produce
the returns we can achieve when we find a business with wonderful
economic prospects that is unappreciated by the market. Nor will
the returns be as attractive as those produced when we make our
favorite form of capital deployment, the acquisition of 80% or
more of a fine business with a fine management. But both
opportunities are rare, particularly in a size befitting our
present and anticipated resources.
这些可转换特别股的报酬当然比不上那些具有经济优势却还没被市场发现的好
股票，或许也比不上那些我们可以买下80%以上股权的优良企业购并案，但大
家要知道后面这两种投资机会相当的稀少，实在是可遇不可求，尤其是以我们现
在的资金规模，实在是很难找的到适合的投资标的。
In summation, Charlie and I feel that our preferred stock
investments should produce returns moderately above those
achieved by most fixed-income portfolios and that we can play a
minor but enjoyable and constructive role in the investee
companies.
总而言之，查理跟我认为这类的可转换特别股投资应该可以让我们获得比一般固
定收益债券更好的投资利益，同时我们也可以在这些被投资公司扮演好具建设性
的少数关键角色。
Zero-Coupon Securities
零息债券
In September, Berkshire issued $902.6 million principal
amount of Zero-Coupon Convertible Subordinated Debentures, which
are now listed on the New York Stock Exchange. Salomon Brothers
handled the underwriting in superb fashion, providing us helpful
