John Kay

Mr Buffett’s success demonstrates the weakness of one economic theory, the efficient market hypothesis, and the strength of another – the central role that the pursuit and defence of economic rents plays in modern corporate life.

Asset prices are a measure less of our wealth than of our propensity for self-congratulation. The net effect is only a transfer between the existing owners and the prospective owners.

If very rich people are to pay much lower tax rates than the doctors who care for them or the teachers who made their careers possible, there needs to be a compelling demonstration of widespread economic benefits.

Academics and think-tanks need to be reminded that generating publicity is not a legitimate research objective. The study of business is afflicted by confusion between the results of a survey of what people think about the world and a survey of what the world is really like.

Bear in mind the gambler’s advice: if you don’t know who is the patsy in the room, it’s you.

When pressure for brand extension of products and geography is continuous, and the service must be delivered by local partners, it is hard to maintain the brand as a means of quality control.

For fundamentalists, the value of an asset is the sum of the returns it will yield over its life. For fellow travellers, an asset is worth what someone else is willing to pay for it.

Models are only as good as the correspondence between the model and the world, and this is where problems begin.

Making decisions that balance human life against costs is unavoidable. We prefer them to be made by public agencies than by private companies. And we deny that we make these judgments ourselves, although we do so every day.

An effective business strategy is not separable from execution and is not based on visions and dreams, but on a match between capabilities and activities.