1998-02-27 Warren Buffett's Letters to Berkshire Shareholders

Refer To：《1998-02-27 Warren Buffett's Letters to Berkshire Shareholders》。

To the Shareholders of Berkshire Hathaway Inc.:

Our gain in net worth during 1997 was $8.0 billion, which increased the per-share book value of both our Class A and Class B stock by 34.1%. Over the last 33 years (that is, since present management took over) per-share book value has grown from $19 to $25,488, a rate of 24.1% compounded annually.(1)

1997 年我们的净资产增加了 $8.0 billion，使得 Class A 和 Class B 两类股票的每股账面价值上升了 34.1%。在过去 33 年（亦即自现任管理层接手以来），每股账面价值已从 $19 增至 $25,488，按年复利增长率为 24.1%。(1)

1. All figures used in this report apply to Berkshire's A shares, the successor to the only stock that the company had outstanding before 1996. The B shares have an economic interest equal to 1/30th that of the A.

1. 本报告所使用的全部数据均针对 Berkshire 的 A 类股份，即 1996 年之前公司唯一已发行股票的延续。B 类股份的经济权益相当于 A 类股份的 1/30。

Given our gain of 34.1%, it is tempting to declare victory and move on. But last year's performance was no great triumph: Any investor can chalk up large returns when stocks soar, as they did in 1997. In a bull market, one must avoid the error of the preening duck that quacks boastfully after a torrential rainstorm, thinking that its paddling skills have caused it to rise in the world. A right-thinking duck would instead compare its position after the downpour to that of the other ducks on the pond.

鉴于我们取得了 34.1% 的增幅，确实让人忍不住想宣布胜利然后继续前行。但去年的成绩并非什么了不起的凯旋：当股市像 1997 年那样大涨时，任何投资者都可能拿到可观的回报。在牛市中，必须避免成为那只自我欣赏的鸭子——暴雨倾盆后得意地呱呱叫，以为自己的划水本领让它飞黄腾达。头脑清醒的鸭子，应当把暴雨过后的自己与池塘里其他鸭子的处境作比较。

So what's our duck rating for 1997? The table on the facing page shows that though we paddled furiously last year, passive ducks that simply invested in the S&P Index rose almost as fast as we did. Our appraisal of 1997's performance, then: Quack.

那么 1997 年我们的“鸭子评分”如何？对页的表格显示，尽管去年我们奋力划水，但那些仅仅投资于 S&P Index 的被动鸭子，涨幅几乎与我们一样快。对 1997 年业绩的评语因此是：Quack。

When the market booms, we tend to suffer in comparison with the S&P Index. The Index bears no tax costs, nor do mutual funds, since they pass through all tax liabilities to their owners. Last year, on the other hand, Berkshire paid or accrued $4.2 billion for federal income tax, or about 18% of our beginning net worth.

当市场繁荣时，与 S&P Index 相比，我们往往显得逊色。该指数本身不承担税负，基金也不会，因为它们把所有税负转嫁给持有人。相反，去年 Berkshire 支付或计提了 $4.2 billion 的联邦所得税，约当我们年初净资产的 18%。

Berkshire will always have corporate taxes to pay, which means it needs to overcome their drag in order to justify its existence. Obviously, Charlie Munger, Berkshire's Vice Chairman and my partner, and I won't be able to lick that handicap every year. But we expect over time to maintain a modest advantage over the Index, and that is the yardstick against which you should measure us. We will not ask you to adopt the philosophy of the Chicago Cubs fan who reacted to a string of lackluster seasons by saying, "Why get upset? Everyone has a bad century now and then."

Berkshire 永远需要支付公司税，这意味着它必须克服税负拖累，才能证明自身存在的价值。显然，Charlie Munger（Berkshire 的副董事长、我的合伙人）和我，不可能年年都战胜这种劣势。但我们预期，长期而言仍能较该指数保持小幅优势——这正是你评判我们的标尺。我们不会让你采纳一位 Chicago Cubs 球迷的哲学：在连年平庸之后他说，“何必生气？谁还不会偶尔遇上一个糟糕的世纪呢。”

Gains in book value are, of course, not the bottom line at Berkshire. What truly counts are gains in per-share intrinsic business value. Ordinarily, though, the two measures tend to move roughly in tandem, and in 1997 that was the case: Led by a blow-out performance at GEICO, Berkshire's intrinsic value (which far exceeds book value) grew at nearly the same pace as book value.

对 Berkshire 而言，账面价值的增长当然不是最终目标。真正重要的是每股内在商业价值的提升。通常这两项指标大致同向而行，1997 年亦如此：在 GEICO 的出色表现带动下，Berkshire 的内在价值（远高于账面价值）几乎与账面价值以同样的速度增长。

For more explanation of the term, intrinsic value, you may wish to refer to our Owner's Manual, reprinted on pages 62 to 71. This manual sets forth our owner-related business principles, information that is important to all of Berkshire's shareholders.

关于“内在价值”一词的更多说明，你可以参阅我们在第 62 至 71 页重印的 Owner’s Manual。该手册阐述了我们与所有者相关的经营原则，这些内容对所有 Berkshire 股东都非常重要。

In our last two annual reports, we furnished you a table that Charlie and I believe is central to estimating Berkshire's intrinsic value. In the updated version of that table, which follows, we trace our two key components of value. The first column lists our per-share ownership of investments (including cash and equivalents) and the second column shows our per-share earnings from Berkshire's operating businesses before taxes and purchase-accounting adjustments (discussed on pages 69 and 70), but after all interest and corporate expenses. The second column excludes all dividends, interest and capital gains that we realized from the investments presented in the first column. In effect, the columns show what Berkshire would look like were it split into two parts, with one entity holding our investments and the other operating all of our businesses and bearing all corporate costs.

在过去两份年报中，我们提供了一张表格——Charlie 和我认为它是估算 Berkshire 内在价值的核心。紧随其后的更新版表格，追踪了我们价值的两个关键组成部分。第一列列示我们每股所拥有的投资（包括现金及等价物）；第二列展示我们来自 Berkshire 各经营业务的每股收益——计入所有利息与公司层面的费用，但未计税项与 purchase-accounting adjustments（见第 69 与 70 页）。第二列排除了第一列所列投资所产生的全部股息、利息与资本利得。实质上，这两列显示：如果把 Berkshire 分成两部分，一部分仅持有我们的投资，另一部分运营我们所有业务并承担全部公司成本，那么它看起来会是什么样子。

Pundits who ignore what our 38,000 employees contribute to the company, and instead simply view Berkshire as a de facto investment company, should study the figures in the second column. We made our first business acquisition in 1967, and since then our pre-tax operating earnings have grown from $1 million to $888 million. Furthermore, as noted, in this exercise we have assigned all of Berkshire's corporate expenses -- overhead of $6.6 million, interest of $66.9 million and shareholder contributions of $15.4 million -- to our business operations, even though a portion of these could just as well have been assigned to the investment side.

那些无视我们 38,000 名员工对公司所作贡献、仅把 Berkshire 视为事实上的投资公司的人，应该仔细看看第二列的数据。我们在 1967 年完成了第一次业务收购，自那时起我们的税前经营利润已从 $1 million 增至 $888 million。此外，如前所述，在这项演示中，我们已将 Berkshire 的全部公司层面费用——$6.6 million 的管理开支、$66.9 million 的利息以及 $15.4 million 的股东指定捐款——全部归入我们的业务运营，尽管这其中有一部分完全可以划归投资端。

Here are the growth rates of the two segments by decade:

以下是这两个板块按十年区间的增长率：

During 1997, both parts of our business grew at a satisfactory rate, with investments increasing by $9,543 per share, or 33.5%, and operating earnings growing by $296.43 per share, or 70.3%. One important caveat: Because we were lucky in our super-cat insurance business (to be discussed later) and because GEICO's underwriting gain was well above what we can expect in most years, our 1997 operating earnings were much better than we anticipated and also more than we expect for 1998.

1997 年，我们业务的两部分都以令人满意的速度增长：每股投资增加 $9,543，增幅 33.5%；每股经营收益增加 $296.43，增幅 70.3%。需要强调的一点：由于我们的 super-cat 再保险业务（后文将讨论）运气不错，且 GEICO 的承保利润远高于多数年份的可期水平，我们 1997 年的经营收益明显好于我们的预期，也高于我们对 1998 年的预期。

Our rate of progress in both investments and operations is certain to fall in the future. For anyone deploying capital, nothing recedes like success. My own history makes the point: Back in 1951, when I was attending Ben Graham's class at Columbia, an idea giving me a $10,000 gain improved my investment performance for the year by a full 100 percentage points. Today, an idea producing a $500 million pre-tax profit for Berkshire adds one percentage point to our performance. It's no wonder that my annual results in the 1950s were better by nearly thirty percentage points than my annual gains in any subsequent decade. Charlie's experience was similar. We weren't smarter then, just smaller. At our present size, any performance superiority we achieve will be minor.

未来，我们在投资与运营两方面的进步速度注定会放缓。对任何需要配置资本的人来说，没有什么比“成功”更会自我递减。我的亲身经历足以说明：1951 年，我在 Columbia 上 Ben Graham 的课，一条带来 $10,000 盈利的点子，就能让当年的投资业绩整整提升 100 个百分点。如今，即便一个创造成 $500 million 税前利润的点子，对 Berkshire 的业绩贡献也只相当于 1 个百分点。难怪我在 1950 年代的年化结果要比此后任何一个十年的年均增幅高出近 30 个百分点。Charlie 的经历也类似。那时我们并非更聪明，只是规模更小。以我们现在的体量，任何超额表现都只会是小幅的。

We will be helped, however, by the fact that the businesses to which we have already allocated capital -- both operating subsidiaries and companies in which we are passive investors -- have splendid long-term prospects. We are also blessed with a managerial corps that is unsurpassed in ability and focus. Most of these executives are wealthy and do not need the pay they receive from Berkshire to maintain their way of life. They are motivated by the joy of accomplishment, not by fame or fortune.

不过，也有利好于我们的因素：我们已经投放资本的那些业务——无论是经营性子公司，还是我们作为被动投资者所持有的公司——都拥有极佳的长期前景。我们还拥有一支在能力与专注上无人能及的管理团队。多数高管本就富有，并不需要来自 Berkshire 的薪酬来维持生活方式。他们的动力来自成就的乐趣，而非名声或财富。

Though we are delighted with what we own, we are not pleased with our prospects for committing incoming funds. Prices are high for both businesses and stocks. That does not mean that the prices of either will fall -- we have absolutely no view on that matter -- but it does mean that we get relatively little in prospective earnings when we commit fresh money.

尽管我们对现有资产十分满意，但对于如何运用新增资金的前景，我们却并不乐观。无论企业还是股票，价格都偏高。这并不意味着二者的价格会下跌——对此我们毫无看法——但这确实意味着当我们投入新资金时，预期收益相对会很少。

Under these circumstances, we try to exert a Ted Williams kind of discipline. In his book The Science of Hitting, Ted explains that he carved the strike zone into 77 cells, each the size of a baseball. Swinging only at balls in his "best" cell, he knew, would allow him to bat .400; reaching for balls in his "worst" spot, the low outside corner of the strike zone, would reduce him to .230. In other words, waiting for the fat pitch would mean a trip to the Hall of Fame; swinging indiscriminately would mean a ticket to the minors.

在这种情况下，我们力求保持一种 Ted Williams 式的自律。在他的著作 The Science of Hitting 中，Ted 解释说他把好球带划分为 77 个单元格，每个大小相当于一个棒球。只对落在自己“最佳”单元格的球挥棒，他知道自己可以打出 .400 的打击率；而去够自己“最差”区域——好球带外侧低角——的球，则会把自己拖到 .230。换句话说，耐心等“肥球”，就能叩响 Hall of Fame 的大门；胡乱出棒，则只能拿到通往小联盟的车票。

If they are in the strike zone at all, the business "pitches" we now see are just catching the lower outside corner. If we swing, we will be locked into low returns. But if we let all of today's balls go by, there can be no assurance that the next ones we see will be more to our liking. Perhaps the attractive prices of the past were the aberrations, not the full prices of today. Unlike Ted, we can't be called out if we resist three pitches that are barely in the strike zone; nevertheless, just standing there, day after day, with my bat on my shoulder is not my idea of fun.

即便把它们勉强算作好球，我们如今在商场上看到的这些“投球”，也只是擦着外侧低角入带。如果我们挥棒，回报就会被锁定在较低水平。但若让今天的所有来球都飞过去，也无法保证下一批球会更合我们心意。也许，过去那些诱人的价格才是异数，而不是今天这些全价。与 Ted 不同，我们即使放过三个勉强擦边的好球也不会被判出局；不过，日复一日就那样扛着球棒站在那儿，也不是我所乐见的。

Unconventional Commitments

非常规投入

When we can't find our favorite commitment -- a well-run and sensibly-priced business with fine economics -- we usually opt to put new money into very short-term instruments of the highest quality. Sometimes, however, we venture elsewhere. Obviously we believe that the alternative commitments we make are more likely to result in profit than loss. But we also realize that they do not offer the certainty of profit that exists in a wonderful business secured at an attractive price. Finding that kind of opportunity, we know that we are going to make money -- the only question being when. With alternative investments, we think that we are going to make money. But we also recognize that we will sometimes realize losses, occasionally of substantial size.

当我们找不到最心仪的配置对象——一家经营良好、定价合理且具备优异经济属性的企业——我们通常会把新增资金放在最高质量的超短期工具上。不过有时，我们也会尝试其他方向。显然，我们相信这些“替代性投入”更有可能盈利而非亏损。但我们同样明白，它们无法像以吸引人价格买到的优秀企业那样，提供几乎确定的收益。遇到那类机会，我们知道一定会赚钱——只是时间问题。做替代性投资时，我们“认为”会赚钱，但也清楚有时会遭受亏损，且偶尔幅度还不小。

We had three non-traditional positions at yearend. The first was derivative contracts for 14.0 million barrels of oil, that being what was then left of a 45.7 million barrel position we established in 1994-95. Contracts for 31.7 million barrels were settled in 1995-97, and these supplied us with a pre-tax gain of about $61.9 million. Our remaining contracts expire during 1998 and 1999. In these, we had an unrealized gain of $11.6 million at yearend. Accounting rules require that commodity positions be carried at market value. Therefore, both our annual and quarterly financial statements reflect any unrealized gain or loss in these contracts. When we established our contracts, oil for future delivery seemed modestly underpriced. Today, though, we have no opinion as to its attractiveness.

年末我们持有三项非传统头寸。第一项是 14.0 million barrels 的原油衍生品合约，这是我们在 1994–95 年建立的 45.7 million barrels 头寸的剩余部分。1995–97 年间我们结清了 31.7 million barrels 的合约，获得了约 $61.9 million 的税前收益。剩余合约将于 1998 与 1999 年到期。到年末，这部分未实现收益为 $11.6 million。会计准则要求大宗商品头寸按市价计量，因此我们的年度与季度报表都会反映这些合约的未实现盈亏。我们建立头寸时，远期交割的原油看起来略有低估。至于今天是否具有吸引力，我们并无观点。

Our second non-traditional commitment is in silver. Last year, we purchased 111.2 million ounces. Marked to market, that position produced a pre-tax gain of $97.4 million for us in 1997. In a way, this is a return to the past for me: Thirty years ago, I bought silver because I anticipated its demonetization by the U.S. Government. Ever since, I have followed the metal's fundamentals but not owned it. In recent years, bullion inventories have fallen materially, and last summer Charlie and I concluded that a higher price would be needed to establish equilibrium between supply and demand. Inflation expectations, it should be noted, play no part in our calculation of silver's value.

第二项非常规投入是白银。去年我们买入了 111.2 million ounces。按市价计量，该头寸在 1997 年为我们带来 $97.4 million 的税前收益。某种意义上，这对我来说是回到过去：三十年前，我因为预期 U.S. Government 将使白银去货币化而买入过白银。此后我一直关注这种金属的基本面，但并未持有。在近几年，金银库存明显下降，去年夏天我与 Charlie 判断，供需达到均衡需要更高的价格。需要说明的是，通胀预期并未纳入我们对白银价值的计算。

Finally, our largest non-traditional position at yearend was $4.6 billion, at amortized cost, of long-term zero-coupon obligations of the U.S. Treasury. These securities pay no interest. Instead, they provide their holders a return by way of the discount at which they are purchased, a characteristic that makes their market prices move rapidly when interest rates change. If rates rise, you lose heavily with zeros, and if rates fall, you make outsized gains. Since rates fell in 1997, we ended the year with an unrealized pre-tax gain of $598.8 million in our zeros. Because we carry the securities at market value, that gain is reflected in yearend book value.

最后一项、也是年末规模最大的非传统头寸，是按摊余成本计 $4.6 billion 的 U.S. Treasury 长期零息债券。这类证券不支付利息，而是通过买入折价为持有人带来回报；这一特性也使其在利率变动时价格波动极快。利率上行，持有零息债会遭受重挫；利率下行，则可能获得超额收益。由于 1997 年利率下行，我们所持零息债录得 $598.8 million 的未实现税前收益。由于这些证券按市价列账，该收益已反映在年末的账面价值中。

In purchasing zeros, rather than staying with cash-equivalents, we risk looking very foolish: A macro-based commitment such as this never has anything close to a 100% probability of being successful. However, you pay Charlie and me to use our best judgment -- not to avoid embarrassment -- and we will occasionally make an unconventional move when we believe the odds favor it. Try to think kindly of us when we blow one. Along with President Clinton, we will be feeling your pain: The Munger family has more than 90% of its net worth in Berkshire and the Buffetts more than 99%.

选择买入零息债而非停留在类现金资产上，我们冒着“看起来很愚蠢”的风险：这种基于宏观判断的投入，成功概率绝不可能接近 100%。不过，你们付钱给我和 Charlie，是让我们尽最大判断之责——而不是为了避免难堪——因此当我们认为胜率在我们这边时，偶尔会做出非常规之举。若我们失手了，请尽量宽容一些。我们会与你们一道“感同身受”，就像 President Clinton 所说那样：Munger 家族超过 90% 的净资产在 Berkshire，而 Buffett 家族超过 99% 在 Berkshire。

How We Think About Market Fluctuations

我们如何看待市场波动

A short quiz: If you plan to eat hamburgers throughout your life and are not a cattle producer, should you wish for higher or lower prices for beef? Likewise, if you are going to buy a car from time to time but are not an auto manufacturer, should you prefer higher or lower car prices? These questions, of course, answer themselves.

来个小测验：如果你一辈子都要吃汉堡、但并非养牛人，你该希望牛肉价格更高还是更低？同理，如果你不时要买车、却不是汽车制造商，你该偏好更高还是更低的车价？这些问题当然不言自明。

But now for the final exam: If you expect to be a net saver during the next five years, should you hope for a higher or lower stock market during that period? Many investors get this one wrong. Even though they are going to be net buyers of stocks for many years to come, they are elated when stock prices rise and depressed when they fall. In effect, they rejoice because prices have risen for the "hamburgers" they will soon be buying. This reaction makes no sense. Only those who will be sellers of equities in the near future should be happy at seeing stocks rise. Prospective purchasers should much prefer sinking prices.

但现在来一道期末题：如果你预期未来五年是净储蓄者，你该希望这段时间里股市更高还是更低？许多投资者答错了。尽管他们在很多年里都会是股票的净买方，但股价上涨时他们欣喜若狂，下跌时却沮丧不已。实质上，他们是在为即将买到的“汉堡”涨价而高兴。这种反应毫无道理。只有近期将卖出股票的人，才该在股价上涨时高兴；有购入计划的人更应偏好价格回落。

For shareholders of Berkshire who do not expect to sell, the choice is even clearer. To begin with, our owners are automatically saving even if they spend every dime they personally earn: Berkshire "saves" for them by retaining all earnings, thereafter using these savings to purchase businesses and securities. Clearly, the more cheaply we make these buys, the more profitable our owners' indirect savings program will be.

对于不打算卖出的 Berkshire 股东，选择就更明确了。首先，即便他们把个人收入花得一分不剩，他们也在“自动储蓄”：Berkshire 通过留存全部利润替他们“储蓄”，再用这些储蓄去购买企业与证券。显然，我们买得越便宜，股东这一间接储蓄计划的收益就越可观。

Furthermore, through Berkshire you own major positions in companies that consistently repurchase their shares. The benefits that these programs supply us grow as prices fall: When stock prices are low, the funds that an investee spends on repurchases increase our ownership of that company by a greater amount than is the case when prices are higher. For example, the repurchases that Coca-Cola, The Washington Post and Wells Fargo made in past years at very low prices benefitted Berkshire far more than do today's repurchases, made at loftier prices.

进一步说，通过 Berkshire，你们在多家持续回购自家股份的公司中持有重要头寸。而且价格越低，这些回购给我们的好处越大：当股价较低时，被投公司用于回购的同样资金，能比高价时更大幅度地提高我们对该公司的持股比例。举例而言，Coca-Cola、The Washington Post 与 Wells Fargo 早年在很低价位实施的回购，带给 Berkshire 的益处远胜于今天这些在更高价位进行的回购。

At the end of every year, about 97% of Berkshire's shares are held by the same investors who owned them at the start of the year. That makes them savers. They should therefore rejoice when markets decline and allow both us and our investees to deploy funds more advantageously.

每到年末，大约有 97% 的 Berkshire 股票仍由年初的同一批投资者持有。这使他们成为“储蓄者”。因此，当市场下跌、让我们与被投公司能够以更有利的价格投放资金时，他们理应感到高兴。

So smile when you read a headline that says "Investors lose as market falls." Edit it in your mind to "Disinvestors lose as market falls -- but investors gain." Though writers often forget this truism, there is a buyer for every seller and what hurts one necessarily helps the other. (As they say in golf matches: "Every putt makes someone happy.")

所以，当你读到“Investors lose as market falls（市场下跌，投资者受损）”这样的标题时，请在心里把它改写为：“Disinvestors lose as market falls —— but investors gain（撤资者在市场下跌中受损——但投资者获益）”。尽管写作者常常忘记这一常识，但每一笔卖出背后都有对应的买入；一方受损，必有另一方受益。（就像高尔夫里那句俏皮话：“Every putt makes someone happy.”）

We gained enormously from the low prices placed on many equities and businesses in the 1970s and 1980s. Markets that then were hostile to investment transients were friendly to those taking up permanent residence. In recent years, the actions we took in those decades have been validated, but we have found few new opportunities. In its role as a corporate "saver," Berkshire continually looks for ways to sensibly deploy capital, but it may be some time before we find opportunities that get us truly excited.

在 1970 与 1980 年代，许多股票与企业被赋予的低价格让我们受益匪浅。那些对短线“过客”不友好的市场，对长期“定居者”却很友善。近些年，我们当年的行动已得到验证，但新的机会却寥寥可觅。作为一家企业层面的“储蓄者”，Berkshire 不断寻找审慎投放资本的方式，但真正令我们兴奋的机会，恐怕还需要一些时间才会出现。

Insurance Operations – Overview

保险业务——概览

What does excite us, however, is our insurance business. GEICO is flying, and we expect that it will continue to do so. Before we expound on that, though, let's discuss "float" and how to measure its cost. Unless you understand this subject, it will be impossible for you to make an informed judgment about Berkshire's intrinsic value.

不过，真正令我们兴奋的是保险业务。GEICO 正在腾飞，我们预计这种势头将会延续。在展开讲它之前，先谈谈“float（浮存金）”以及如何衡量它的成本。除非理解这一主题，否则你无法对 Berkshire 的内在价值作出有根据的判断。

To begin with, float is money we hold but don't own. In an insurance operation, float arises because premiums are received before losses are paid, an interval that sometimes extends over many years. During that time, the insurer invests the money. Typically, this pleasant activity carries with it a downside: The premiums that an insurer takes in usually do not cover the losses and expenses it eventually must pay. That leaves it running an "underwriting loss," which is the cost of float. An insurance business has value if its cost of float over time is less than the cost the company would otherwise incur to obtain funds. But the business is a lemon if its cost of float is higher than market rates for money.

首先，浮存金是我们“持有但并不拥有”的资金。在保险业务中，浮存金之所以存在，是因为保费先收、赔付后出，中间间隔有时长达多年。在这段时间里，保险公司可以投资这笔钱。通常，这种“愉快的活动”自带副作用：保险公司收取的保费往往并不足以覆盖最终必须支付的赔款与各项费用，从而形成“承保亏损”，而这正是浮存金的成本。若一项保险业务长期以来的浮存金成本低于公司以其他方式筹资的成本，它就有价值；但如果浮存金成本高于市场资金利率，这门生意就是个“柠檬”。

A caution is appropriate here: Because loss costs must be estimated, insurers have enormous latitude in figuring their underwriting results, and that makes it very difficult for investors to calculate a company's true cost of float. Estimating errors, usually innocent but sometimes not, can be huge. The consequences of these miscalculations flow directly into earnings. An experienced observer can usually detect large-scale errors in reserving, but the general public can typically do no more than accept what's presented, and at times I have been amazed by the numbers that big-name auditors have implicitly blessed. As for Berkshire, Charlie and I attempt to be conservative in presenting its underwriting results to you, because we have found that virtually all surprises in insurance are unpleasant ones.

这里需要提醒一句：由于赔付成本必须依赖估计，保险公司在计算其承保结果时有着极大的自由裁量，这使投资者很难测算一家公司的真实浮存金成本。估算误差——通常是无心之失，但偶尔也并非如此——可能非常巨大，其后果会直接体现在盈亏之中。老练的观察者往往能识别出准备金上的大规模偏差，但大众通常只能接受呈现出来的数据；而有些数字竟然能得到一些大牌审计师的“默认背书”，这点有时令我惊讶。至于 Berkshire，Charlie 和我在向你们呈报承保结果时力求保守，因为我们发现，保险领域几乎所有的“意外”，都是不愉快的。

As the numbers in the following table show, Berkshire's insurance business has been a huge winner. For the table, we have calculated our float -- which we generate in large amounts relative to our premium volume -- by adding net loss reserves, loss adjustment reserves, funds held under reinsurance assumed and unearned premium reserves, and then subtracting agents' balances, prepaid acquisition costs, prepaid taxes and deferred charges applicable to assumed reinsurance. Our cost of float is determined by our underwriting loss or profit. In those years when we have had an underwriting profit, such as the last five, our cost of float has been negative. In effect, we have been paid for holding money.

正如下表所示，Berkshire 的保险业务是个大赢家。在该表中，我们这样计算浮存金（相对于保费规模，我们创造的浮存金体量很大）：将未决赔款准备金、损失调整准备金、分入再保险留存资金、未到期保费准备金相加，然后扣除代理应收款、递延保单取得成本、预付税款以及与分入再保险相关的递延费用。我们的浮存金成本由承保盈亏决定。在那些实现了承保盈利的年份（比如过去五年），我们的浮存金成本为负。实质上，我们因为持有资金而获得了报酬。

Since 1967, when we entered the insurance business, our float has grown at an annual compounded rate of 21.7%. Better yet, it has cost us nothing, and in fact has made us money. Therein lies an accounting irony: Though our float is shown on our balance sheet as a liability, it has had a value to Berkshire greater than an equal amount of net worth would have had.

自 1967 年进入保险业以来，我们的浮存金以 21.7% 的年复合率增长。更妙的是，它不仅不花我们钱，反而为我们赚钱。这里有个会计学上的“反讽”：尽管浮存金在资产负债表上列为负债，但它给 Berkshire 带来的价值超过了同等规模的净资产。

The expiration of several large contracts will cause our float to decline during the first quarter of 1998, but we expect it to grow substantially over the long term. We also believe that our cost of float will continue to be highly favorable.

若干大合同到期将导致我们在 1998 年第一季度的浮存金出现回落，但从长期看我们预计它会大幅增长。我们也相信，浮存金成本将继续保持非常有利的水平。

Super-Cat Insurance

巨灾再保险

Occasionally, however, the cost of our float will spike severely. That will occur because of our heavy involvement in the super-cat business, which by its nature is the most volatile of all insurance lines. In this operation, we sell policies that insurance and reinsurance companies purchase in order to limit their losses when mega-catastrophes strike. Berkshire is the preferred market for sophisticated buyers: When the "big one" hits, the financial strength of super-cat writers will be tested, and Berkshire has no peer in this respect.

不过，有时我们的浮存金成本会急剧飙升。原因在于我们深度参与了 super-cat 业务（巨灾再保险），其本质决定了它是所有保险门类中波动性最大的。在这项业务中，我们向保险公司与再保险公司出售保单，以便在特大灾害来袭时限制其损失。对成熟买家而言，Berkshire 是首选市场：当“big one”撞上来时，巨灾承保人的财务实力将接受检验，而在这方面 Berkshire 无人能及。

Since truly major catastrophes are rare occurrences, our super-cat business can be expected to show large profits in most years -- and to record a huge loss occasionally. In other words, the attractiveness of our super-cat business will take a great many years to measure. What you must understand, however, is that a truly terrible year in the super-cat business is not a possibility -- it's a certainty. The only question is when it will come.

由于真正重大的灾害极为罕见，我们的 super-cat 业务多数年份会产生可观利润——但偶尔也会录得巨额亏损。换言之，这门生意的吸引力需要用很多年去评估。不过你必须明白，super-cat 业务里真正糟糕的一年并非“可能发生”——而是“必然发生”。唯一的问题只是：何时到来。

Last year, we were very lucky in our super-cat operation. The world suffered no catastrophes that caused huge amounts of insured damage, so virtually all premiums that we received dropped to the bottom line. This pleasant result has a dark side, however. Many investors who are "innocents" -- meaning that they rely on representations of salespeople rather than on underwriting knowledge of their own -- have come into the reinsurance business by means of purchasing pieces of paper that are called "catastrophe bonds." The second word in this term, though, is an Orwellian misnomer: A true bond obliges the issuer to pay; these bonds, in effect, are contracts that lay a provisional promise to pay on the purchaser.

去年，我们在 super-cat 业务上很走运。全球没有发生造成巨额保险损失的灾难，因此我们收到的保费几乎全部沉淀为利润。不过，这个令人愉快的结果也有阴影。许多所谓的“innocents”（生手）——指那些依赖销售人员的说辞、而非自身承保知识的人——通过购买被称作“catastrophe bonds（巨灾债券）”的纸头进入了再保险领域。这个术语中的第二个词可谓“奥威尔式的”误称：真正的债券要求发行人承担支付义务；而这些“债券”实质上是把一个附条件的支付承诺加在购买者身上的合同。

This convoluted arrangement came into being because the promoters of the contracts wished to circumvent laws that prohibit the writing of insurance by entities that haven't been licensed by the state. A side benefit for the promoters is that calling the insurance contract a "bond" may also cause unsophisticated buyers to assume that these instruments involve far less risk than is actually the case.

这种复杂安排之所以出现，是因为合同的推广者想要绕开法律对未经州政府许可的实体承保保险的禁止。对推广者而言，顺带的“好处”是把保险合同称作“bond（债券）”，也会让不够老练的买家以为这些工具所涉风险远低于实际水平。

Truly outsized risks will exist in these contracts if they are not properly priced. A pernicious aspect of catastrophe insurance, however, makes it likely that mispricing, even of a severe variety, will not be discovered for a very long time. Consider, for example, the odds of throwing a 12 with a pair of dice -- 1 out of 36. Now assume that the dice will be thrown once a year; that you, the "bond-buyer," agree to pay $50 million if a 12 appears; and that for "insuring" this risk you take in an annual "premium" of $1 million. That would mean you had significantly underpriced the risk. Nevertheless, you could go along for years thinking you were making money -- indeed, easy money. There is actually a 75.4% probability that you would go for a decade without paying out a dime. Eventually, however, you would go broke.

若这些合同定价不当，就会潜藏极其巨大的风险。而巨灾保险的一个“恶性”特征在于：即便严重误定价，也很可能在很长时间里不被发现。举个例子：掷两枚骰子掷出“12”的概率是 1/36。假设每年掷一次；你这位“债券购买者”同意一旦掷出 12 就支付 $50 million；而为了“承保”这一风险，你每年收取 $1 million 的“保费”。这意味着你严重低估了风险。尽管如此，你可能会连年以为自己在赚钱——而且是“轻松赚”。实际上，你有 75.4% 的概率可以整整十年不赔出一分钱。但最终，你会破产。

In this dice example, the odds are easy to figure. Calculations involving monster hurricanes and earthquakes are necessarily much fuzzier, and the best we can do at Berkshire is to estimate a range of probabilities for such events. The lack of precise data, coupled with the rarity of such catastrophes, plays into the hands of promoters, who typically employ an "expert" to advise the potential bond-buyer about the probability of losses. The expert puts no money on the table. Instead, he receives an up-front payment that is forever his no matter how inaccurate his predictions. Surprise: When the stakes are high, an expert can invariably be found who will affirm -- to return to our example -- that the chance of rolling a 12 is not 1 in 36, but more like 1 in 100. (In fairness, we should add that the expert will probably believe that his odds are correct, a fact that makes him less reprehensible -- but more dangerous.)

在掷骰子的例子中，概率容易算清；但涉及超强飓风与地震的计算必然模糊得多。Berkshire 所能做到的最好情况，是对这类事件给出一组概率区间。精确数据的匮乏叠加灾难的稀少，恰恰有利于推广者，他们通常会雇一个“expert（专家）”来向潜在债券买家“评估”损失概率。该专家无需自掏腰包，却能拿到一次性预付报酬——无论其预测多么不准确，这笔钱都永远归他所有。意外吗？在输赢巨大的场合，总能找到一位专家来“背书”——回到我们的例子——声称掷出 12 的概率不是 1/36，而更像 1/100。（出于公允，我们还应补充：该专家很可能真心相信自己的赔率正确——这让他不那么可责，但却更危险。）

The influx of "investor" money into catastrophe bonds -- which may well live up to their name -- has caused super-cat prices to deteriorate materially. Therefore, we will write less business in 1998. We have some large multi-year contracts in force, however, that will mitigate the drop. The largest of these are two policies that we described in last year's report -- one covering hurricanes in Florida and the other, signed with the California Earthquake Authority, covering earthquakes in that state. Our "worst-case" loss remains about $600 million after-tax, the maximum we could lose under the CEA policy. Though this loss potential may sound large, it is only about 1% of Berkshire's market value. Indeed, if we could get appropriate prices, we would be willing to significantly increase our "worst-case" exposure.

涌入“investor（投资者）”资金的 catastrophe bonds（巨灾债券）——其名称很可能会不幸应验——已使 super-cat 的价格明显恶化。因此，我们将在 1998 年减少承保规模。不过，我们也有一些大型多年期在保合同，可在一定程度上缓解下降。其中最大的是两张在去年的年报中提到的保单——一张覆盖 Florida 的飓风风险，另一张与 California Earthquake Authority（CEA）签署、覆盖该州地震风险。我们的“最坏情形”损失仍约为税后 $600 million，这是在 CEA 保单项下我们可能遭受的最大损失。尽管这个损失看起来不小，但仅约相当于 Berkshire 市值的 1%。事实上，如果能拿到合适价格，我们愿意显著提高自己的“最坏情形”敞口。

Our super-cat business was developed from scratch by Ajit Jain, who has contributed to Berkshire's success in a variety of other ways as well. Ajit possesses both the discipline to walk away from business that is inadequately priced and the imagination to then find other opportunities. Quite simply, he is one of Berkshire's major assets. Ajit would have been a star in whatever career he chose; fortunately for us, he enjoys insurance.

我们的 super-cat 业务是由 Ajit Jain 白手起家创立的，他还在许多其他方面为 Berkshire 的成功作出了贡献。Ajit 既有在定价不足时果断抽身的纪律性，也有转而寻找其他机会的想象力。简单说，他是 Berkshire 的重要资产之一。无论选择什么职业，Ajit 都会成为明星；幸运的是，对我们而言，他热爱保险。

Insurance – GEICO (1-800-555-2756) and Other Primary Operations

保险——GEICO (1-800-555-2756) 及其他主体业务

Last year I wrote about GEICO's Tony Nicely and his terrific management skills. If I had known then what he had in store for us in 1997, I would have searched for still greater superlatives. Tony, now 54, has been with GEICO for 36 years and last year was his best. As CEO, he has transmitted vision, energy and enthusiasm to all members of the GEICO family -- raising their sights from what has been achieved to what can be achieved.

去年我写到 GEICO 的 Tony Nicely 及其出色的管理才能。如果当时知道他在 1997 年为我们准备了什么，我会去寻找更华丽的溢美之词。如今 54 岁的 Tony 在 GEICO 已经 36 年，而去年是他表现最出色的一年。作为 CEO，他把愿景、活力与热情传递给 GEICO 家族的所有成员——把大家的目标从“已成之功”提升到“可及之志”。

We measure GEICO's performance by first, the net increase in its voluntary auto policies (that is, not including policies assigned us by the state) and, second, the profitability of "seasoned" auto business, meaning policies that have been with us for more than a year and are thus past the period in which acquisition costs cause them to be money-losers. In 1996, in-force business grew 10%, and I told you how pleased I was, since that rate was well above anything we had seen in two decades. Then, in 1997, growth jumped to 16%.

我们衡量 GEICO 的表现，首先看自愿车险保单（即不含州政府指派给我们的保单）的净增长，其次看“seasoned”车险业务的盈利性——指与我们合作超过一年的保单，因而已度过因获客成本而亏损的时期。1996 年，在保业务增长 10%，我曾说对此非常满意，因为这一增速远超我们过去二十年的任何水平。随后在 1997 年，增速跃升至 16%。

Below are the new business and in-force figures for the last five years:

下文列示了过去五年的新单与在保数据：

Of course, any insurer can grow rapidly if it gets careless about underwriting. GEICO's underwriting profit for the year, though, was 8.1% of premiums, far above its average. Indeed, that percentage was higher than we wish it to be: Our goal is to pass on most of the benefits of our low-cost operation to our customers, holding ourselves to about 4% in underwriting profit. With that in mind, we reduced our average rates a bit during 1997 and may well cut them again this year. Our rate changes varied, of course, depending on the policyholder and where he lives; we strive to charge a rate that properly reflects the loss expectancy of each driver.

当然，任何保险公司如果在承保上放松要求，都可以实现高速增长。不过 GEICO 当年的承保利润达到保费的 8.1%，远高于其平均水平。事实上，这个比例比我们期望的还要高：我们的目标是把低成本运营的大部分好处让渡给客户，把承保利润控制在约 4%。基于此，我们在 1997 年略微下调了平均费率，今年也很可能再次下调。费率调整当然因投保人及其所在地而异；我们的目标是收取能恰当反映每位驾驶员预期损失的费率。

GEICO is not the only auto insurer obtaining favorable results these days. Last year, the industry recorded profits that were far better than it anticipated or can sustain. Intensified competition will soon squeeze margins very significantly. But this is a development we welcome: Long term, a tough market helps the low-cost operator, which is what we are and intend to remain.

目前获得良好业绩的并不只有 GEICO。去年整个行业录得的利润远好于预期，也远超可持续水平。竞争加剧很快就会大幅压缩利润率。但我们欢迎这种演变：长期来看，艰难的市场会利好低成本经营者——这正是我们当下与将来的定位。

Last year I told you about the record 16.9% profit-sharing contribution that GEICO's associates had earned and explained that two simple variables set the amount: policy growth and profitability of seasoned business. I further explained that 1996's performance was so extraordinary that we had to enlarge the chart delineating the possible payouts. The new configuration didn't make it through 1997: We enlarged the chart's boundaries again and awarded our 10,500 associates a profit-sharing contribution amounting to 26.9% of their base compensation, or $71 million. In addition, the same two variables -- policy growth and profitability of seasoned business -- determined the cash bonuses that we paid to dozens of top executives, starting with Tony.

去年我提到 GEICO 员工拿到创纪录的 16.9% 利润分享，并解释说其额度由两个简单变量决定：保单增长与成熟业务的盈利性。我还解释过，1996 年的表现太过卓越，以至于我们不得不扩大那张界定可能支付区间的图表。新的边界也没能撑过 1997 年：我们再次扩大图表边界，向 10,500 名员工发放相当于其基本薪酬 26.9%、合计 $71 million 的利润分享。此外，同样的两个变量——保单增长与成熟业务盈利性——也决定了我们向几十位高管（从 Tony 开始）支付的现金奖金。

At GEICO, we are paying in a way that makes sense for both our owners and our managers. We distribute merit badges, not lottery tickets: In none of Berkshire's subsidiaries do we relate compensation to our stock price, which our associates cannot affect in any meaningful way. Instead, we tie bonuses to each unit's business performance, which is the direct product of the unit's people. When that performance is terrific -- as it has been at GEICO -- there is nothing Charlie and I enjoy more than writing a big check.

在 GEICO，我们的付酬方式既契合股东，也契合管理层。我们发的是功勋章，而不是彩票：在 Berkshire 的任何子公司里，我们都不会把薪酬与 Berkshire 的股价挂钩——员工对其几乎无法产生实质影响。相反，奖金系于各业务单元的经营表现，而这直接来源于该单元的团队。当表现极佳——如同 GEICO 的情况——没有什么比为此开出一张大支票更让 Charlie 和我开心的了。

GEICO's underwriting profitability will probably fall in 1998, but the company's growth could accelerate. We're planning to step on the gas: GEICO's marketing expenditures this year will top $100 million, up 50% from 1997. Our market share today is only 3%, a level of penetration that should increase dramatically in the next decade. The auto insurance industry is huge -- it does about $115 billion of volume annually -- and there are tens of millions of drivers who would save substantial money by switching to us.

1998 年 GEICO 的承保利润率大概率会回落，但公司的增长或将提速。我们准备“踩下油门”：今年 GEICO 的市场投入将超过 $100 million，较 1997 年提升 50%。我们当前的市占率仅 3%，这一渗透水平在未来十年理应显著提高。汽车保险行业体量庞大——年规模约 $115 billion——数以千万计的司机改投我们都能节省可观费用。

* * * * * * * * * * * *

In the 1995 report, I described the enormous debt that you and I owe to Lorimer Davidson. On a Saturday early in 1951, he patiently explained the ins and outs of both GEICO and its industry to me -- a 20-year-old stranger who'd arrived at GEICO's headquarters uninvited and unannounced. Davy later became the company's CEO and has remained my friend and teacher for 47 years. The huge rewards that GEICO has heaped on Berkshire would not have materialized had it not been for his generosity and wisdom. Indeed, had I not met Davy, I might never have grown to understand the whole field of insurance, which over the years has played such a key part in Berkshire's success.

在 1995 年的年报中，我讲述了你我对 Lorimer Davidson 的巨大感念。1951 年初的某个周六，他耐心向我——一个不请自来、年仅 20 岁的陌生人——讲清了 GEICO 及其行业的来龙去脉。Davy 后来成为公司的 CEO，并在此后 47 年一直是我的朋友与老师。GEICO 为 Berkshire 带来的巨大回报，若没有他的慷慨与智慧，便不会发生。确实，若非遇见 Davy，我可能永远也不会真正理解整个保险领域——而这多年间一直是 Berkshire 成功的关键一环。

Davy turned 95 last year, and it's difficult for him to travel. Nevertheless, Tony and I hope that we can persuade him to attend our annual meeting, so that our shareholders can properly thank him for his important contributions to Berkshire. Wish us luck.

Davy 去年已至 95 岁，出行不易。尽管如此，Tony 和我仍希望能说服他出席我们的年度股东会，让股东们能够郑重感谢他对 Berkshire 的重要贡献。祝我们好运。

* * * * * * * * * * * *

Though they are, of course, far smaller than GEICO, our other primary insurance operations turned in results last year that, in aggregate, were fully as stunning. National Indemnity's traditional business had an underwriting profit of 32.9% and, as usual, developed a large amount of float compared to premium volume. Over the last three years, this segment of our business, run by Don Wurster, has had a profit of 24.3%. Our homestate operation, managed by Rod Eldred, recorded an underwriting profit of 14.1% even though it continued to absorb the expenses of geographical expansion. Rod's three-year record is an amazing 15.1%. Berkshire's workers' compensation business, run out of California by Brad Kinstler, had a modest underwriting loss in a difficult environment; its three-year underwriting record is a positive 1.5%. John Kizer, at Central States Indemnity, set a new volume record while generating good underwriting earnings. At Kansas Bankers Surety, Don Towle more than lived up to the high expectations we had when we purchased the company in 1996.

当然，规模远小于 GEICO 的其他主体保险业务在去年合计起来同样惊艳。National Indemnity 的传统业务实现 32.9% 的承保利润，并一如既往地相对于保费规模创造出大量浮存金。过去三年，由 Don Wurster 负责的该业务板块累计利润为 24.3%。由 Rod Eldred 管理的本州业务，即便在持续消化地域扩张费用的情况下，仍录得 14.1% 的承保利润；Rod 的三年纪录达到了惊人的 15.1%。由 Brad Kinstler 在加州负责的 Berkshire 工伤赔偿保险业务在艰难环境下出现小幅承保亏损；其三年承保纪录为正的 1.5%。在 Central States Indemnity，John Kizer 在取得良好承保收益的同时创下新业务量纪录。在 Kansas Bankers Surety，Don Towle 的表现远超我们在 1996 年收购该公司时所抱有的高期待。

In aggregate, these five operations recorded an underwriting profit of 15.0%. The two Dons, along with Rod, Brad and John, have created significant value for Berkshire, and we believe there is more to come.

合计来看，这五项业务录得 15.0% 的承保利润。两位 Don 与 Rod、Brad、John 一道，为 Berkshire 创造了可观价值，我们相信更好的成绩仍在前方。

Sources of Reported Earnings

报告利润的来源

The table that follows shows the main sources of Berkshire's reported earnings. In this presentation, purchase-accounting adjustments are not assigned to the specific businesses to which they apply, but are instead aggregated and shown separately. This procedure lets you view the earnings of our businesses as they would have been reported had we not purchased them. For the reasons discussed on pages 69 and 70, this form of presentation seems to us to be more useful to investors and managers than one utilizing generally-accepted accounting principles (GAAP), which require purchase-premiums to be charged off business-by-business. The total earnings we show in the table are, of course, identical to the GAAP total in our audited financial statements.

下表展示了 Berkshire 报告利润的主要来源。在这种呈现方式下，purchase-accounting adjustments（购并会计调整）不分配到各具体业务，而是汇总后单列。这样做让你能够看到：若我们当初并未收购这些业务，它们会呈现怎样的利润。基于第 69、70 页所讨论的原因，我们认为这种呈现方式对投资者与管理者比按一般公认会计原则（GAAP）逐一将购并溢价摊销至各业务的做法更有用。当然，表中合计利润与我们经审计财报中的 GAAP 合计数完全一致。

Overall, our operating businesses continue to perform exceptionally well, far outdoing their industry norms. We are particularly pleased that profits improved at Helzberg's after a disappointing 1996. Jeff Comment, Helzberg's CEO, took decisive steps early in 1997 that enabled the company to gain real momentum by the crucial Christmas season. In the early part of this year, as well, sales remained strong.

总体而言，我们的经营性业务继续表现出众，远超行业常态。尤其令人欣慰的是，Helzberg's 在令人失望的 1996 年之后利润有所改善。Helzberg's 的 CEO Jeff Comment 在 1997 年年初果断采取措施，使公司在关键的圣诞季节获得了真正的动能。今年年初，销售也依然强劲。

Casual observers may not appreciate just how extraordinary the performance of many of our businesses has been: If the earnings history of, say, Buffalo News or Scott Fetzer is compared to the records of their publicly-owned peers, their performance might seem to have been unexceptional. But most public companies retain two-thirds or more of their earnings to fund their corporate growth. In contrast, those Berkshire subsidiaries have paid 100% of their earnings to us, their parent company, to fund our growth.

旁观者或许难以体会我们许多业务的非凡：如果将 Buffalo News 或 Scott Fetzer 的盈利历史与其同行业的上市公司相比，它们的表现看起来也许并不惊人。但大多数上市公司会留存至少三分之二的利润来支持自身增长。相比之下，这些 Berkshire 子公司把 100% 的利润上缴给我们这一母公司，用于支持我们的增长。

In effect, the records of the public companies reflect the cumulative benefits of the earnings they have retained, while the records of our operating subsidiaries get no such boost. Over time, however, the earnings these subsidiaries have distributed have created truly huge amounts of earning power elsewhere in Berkshire. The News, See's and Scott Fetzer have alone paid us $1.8 billion, which we have gainfully employed elsewhere. We owe their managements our gratitude for much more than the earnings that are detailed in the table.

实质上，上市公司的业绩记录反映了其留存利润的累积效应，而我们经营性子公司的记录并未获得这类“助推”。然而，从长期看，这些子公司分配上来的利润已在 Berkshire 的其他地方创造出极为可观的盈利能力。仅 The News、See's 与 Scott Fetzer 三家公司就向我们支付了 $1.8 billion，而我们已将这些资金高效投用。对于这些企业管理层，我们的感激远不止表格中所列利润数字。

Additional information about our various businesses is given on pages 36 - 50, where you will also find our segment earnings reported on a GAAP basis. In addition, on pages 55 - 61, we have rearranged Berkshire's financial data into four segments on a non-GAAP basis, a presentation that corresponds to the way Charlie and I think about the company. Our intent is to supply you with the financial information that we would wish you to give us if our positions were reversed.

有关各项业务的更多信息见第 36–50 页，你也将在那里看到按 GAAP 口径披露的分部利润。此外，在第 55–61 页，我们按非 GAAP 口径将 Berkshire 的财务数据重组为四个分部，这种呈现方式与我和 Charlie 看待公司的方式一致。我们的用意，是向你提供这样一套财务信息：若角色互换，我们也希望你能提供给我们。

Look-Through Earnings

透视盈余

Reported earnings are a poor measure of economic progress at Berkshire, in part because the numbers shown in the table presented earlier include only the dividends we receive from investees -- though these dividends typically represent only a small fraction of the earnings attributable to our ownership. Not that we mind this division of money, since on balance we regard the undistributed earnings of investees as more valuable to us than the portion paid out. The reason is simple: Our investees often have the opportunity to reinvest earnings at high rates of return. So why should we want them paid out?

以报告利润来衡量 Berkshire 的经济进步并不理想，部分原因在于前述表格所示数字只包含我们从被投公司收到的股息——而这些股息通常仅是按我们持股应享利润的一小部分。我们并不介意这种分配方式；总体而言，我们认为被投公司未分配留存的利润对我们更有价值，理由很简单：我们的被投企业往往能以很高的回报率再投资这些利润。那么我们为什么要希望它们把钱分出来呢？

To depict something closer to economic reality at Berkshire than reported earnings, though, we employ the concept of "look-through" earnings. As we calculate these, they consist of: (1) the operating earnings reported in the previous section, plus; (2) our share of the retained operating earnings of major investees that, under GAAP accounting, are not reflected in our profits, less; (3) an allowance for the tax that would be paid by Berkshire if these retained earnings of investees had instead been distributed to us. When tabulating "operating earnings" here, we exclude purchase-accounting adjustments as well as capital gains and other major non-recurring items.

为了给出比报告利润更接近 Berkshire 经济实质的刻画，我们采用“look-through（穿透）”盈余的概念。按我们的计算，它包括：（1）上一节所列的经营利润；加上（2）我们按持股比例应享而在 GAAP 下未体现在我们利润中的主要被投企业留存的经营利润；减去（3）若这些留存利润改为分配给我们，Berkshire 需为此缴纳的税费的预提。在这里统计“经营利润”时，我们剔除了 purchase-accounting adjustments（购并会计调整）、资本利得及其他重大的一次性项目。

The following table sets forth our 1997 look-through earnings, though I warn you that the figures can be no more than approximate, since they are based on a number of judgment calls. (The dividends paid to us by these investees have been included in the operating earnings itemized on page 11, mostly under "Insurance Group: Net Investment Income.")

下表列示了我们 1997 年的 look-through 盈余，但我得提醒你，这些数字只能是近似值，因为其基于若干判断。（这些被投企业向我们支付的股息，已计入第 11 页所列的经营利润中，主要体现在“Insurance Group: Net Investment Income（保险集团：净投资收益）”项下。）

Acquisitions of 1997

1997 年的收购

In 1997, we agreed to acquire Star Furniture and International Dairy Queen (a deal that closed early in 1998). Both businesses fully meet our criteria: They are understandable; possess excellent economics; and are run by outstanding people.

1997 年，我们同意收购 Star Furniture 和 International Dairy Queen（该交易于 1998 年初完成）。这两家企业完全符合我们的标准：业务易于理解；具备优异的经济属性；由出色的人才经营。

The Star transaction has an interesting history. Whenever we buy into an industry whose leading participants aren't known to me, I always ask our new partners, "Are there any more at home like you?" Upon our purchase of Nebraska Furniture Mart in 1983, therefore, the Blumkin family told me about three outstanding furniture retailers in other parts of the country. At the time, however, none was for sale.

Star 这笔交易有段颇有意思的来历。每当我们进入一个我不熟悉其领先参与者的行业时，我都会问新伙伴：“Are there any more at home like you?”（你们家里还有像你这样的好对象吗？）因此，在 1983 年我们收购 Nebraska Furniture Mart 时，Blumkin 家族告诉我，在美国其他地区还有三家出色的家具零售商。不过当时它们都不对外出售。

Many years later, Irv Blumkin learned that Bill Child, CEO of R.C. Willey -- one of the recommended three -- might be interested in merging, and we promptly made the deal described in the 1995 report. We have been delighted with that association -- Bill is the perfect partner. Furthermore, when we asked Bill about industry standouts, he came up with the remaining two names given me by the Blumkins, one of these being Star Furniture of Houston. But time went by without there being any indication that either of the two was available.

许多年后，Irv Blumkin 得知 R.C. Willey 的 CEO Bill Child——当初推荐的三家之一——或许有意合并，我们随即达成了 1995 年年报中所述的那笔交易。我们对这段合作欣喜万分——Bill 是完美的伙伴。更进一步，当我们向 Bill 打听行业中的翘楚时，他又提到了当初 Blumkin 家族给我的另两个名字，其中之一便是位于 Houston 的 Star Furniture。但随着时间推移，并未出现任何迹象表明这两家中的任何一家愿意出售。

On the Thursday before last year's annual meeting, however, Bob Denham of Salomon told me that Melvyn Wolff, the long-time controlling shareholder and CEO of Star, wanted to talk. At our invitation, Melvyn came to the meeting and spent his time in Omaha confirming his positive feelings about Berkshire. I, meanwhile, looked at Star's financials, and liked what I saw.

不过，在去年股东大会前的那个星期四，Salomon 的 Bob Denham 告诉我，Star 的长期控股股东兼 CEO Melvyn Wolff 想聊一聊。应我们的邀请，Melvyn 来到大会，在 Omaha 期间进一步确认了他对 Berkshire 的积极观感。与此同时，我审阅了 Star 的财务数据，结果令我颇为满意。

A few days later, Melvyn and I met in New York and made a deal in a single, two-hour session. As was the case with the Blumkins and Bill Child, I had no need to check leases, work out employment contracts, etc. I knew I was dealing with a man of integrity and that's what counted.

几天之后，Melvyn 与我在 New York 会面，仅用一场两个小时的谈判便达成交易。与当年和 Blumkin 一家、以及 Bill Child 的情况一样，我无须核查租约、拟定雇佣合同之类的细节。我知道自己面对的是一位正直的人——这才是关键。

Though the Wolff family's association with Star dates back to 1924, the business struggled until Melvyn and his sister Shirley Toomin took over in 1962. Today Star operates 12 stores -- ten in Houston and one each in Austin and Bryan -- and will soon move into San Antonio as well. We won't be surprised if Star is many times its present size a decade from now.

虽然 Wolff 家族与 Star 的渊源可追溯至 1924 年，但这门生意一直挣扎，直到 1962 年由 Melvyn 及其妹妹 Shirley Toomin 接手。如今 Star 经营着 12 家门店——其中 10 家在 Houston，Austin 与 Bryan 各一——并将很快进入 San Antonio。若十年后 Star 的规模成为如今的数倍，我们并不会感到意外。

Here's a story illustrating what Melvyn and Shirley are like: When they told their associates of the sale, they also announced that Star would make large, special payments to those who had helped them succeed -- and then defined that group as everyone in the business. Under the terms of our deal, it was Melvyn and Shirley's money, not ours, that funded this distribution. Charlie and I love it when we become partners with people who behave like that.

这里有个故事能说明 Melvyn 与 Shirley 是怎样的人：当他们把出售消息告知团队时，同时宣布 Star 将向所有帮助他们成功的人发放一笔数额可观的特别奖金——然后他们把这群人定义为公司里的每一个人。按我们交易的约定，支付这笔奖金使用的是 Melvyn 与 Shirley 的资金，而非我们的。遇到这样行事的人成为我们的合伙人，Charlie 和我无比乐见。

The Star transaction closed on July 1. In the months since, we've watched Star's already-excellent sales and earnings growth accelerate further. Melvyn and Shirley will be at the annual meeting, and I hope you get a chance to meet them.

Star 的交易在 7 月 1 日完成。此后几个月里，我们看到 Star 已经很出色的销售与利润增长进一步加速。Melvyn 与 Shirley 将出席年度股东会，我希望你们有机会与他们见面。

Next acquisition: International Dairy Queen. There are 5,792 Dairy Queen stores operating in 23 countries -- all but a handful run by franchisees -- and in addition IDQ franchises 409 Orange Julius operations and 43 Karmelkorn operations. In 190 locations, "treat centers" provide some combination of the three products.

下一笔收购：International Dairy Queen。Dairy Queen 在 23 个国家共有 5,792 家门店在运营——除极少数外均由加盟商经营——此外，IDQ 还以特许方式经营 409 家 Orange Julius 与 43 家 Karmelkorn。另在 190 个地点，“treat centers”（甜品中心）提供上述三类产品的组合。

For many years IDQ had a bumpy history. Then, in 1970, a Minneapolis group led by John Mooty and Rudy Luther took control. The new managers inherited a jumble of different franchising agreements, along with some unwise financing arrangements that had left the company in a precarious condition. In the years that followed, management rationalized the operation, extended food service to many more locations, and, in general, built a strong organization.

多年来，IDQ 的发展颇为坎坷。随后在 1970 年，由 John Mooty 与 Rudy Luther 领导的 Minneapolis 团队取得控股权。新管理层接手时，公司拥有一堆杂乱不一的特许经营协议，外加若干不明智的融资安排，使公司处境岌岌可危。其后数年，管理层理顺了运营，把餐饮服务扩展到更多地点，总体上构建起一家更强健的组织。

Last summer Mr. Luther died, which meant his estate needed to sell stock. A year earlier, Dick Kiphart of William Blair & Co., had introduced me to John Mooty and Mike Sullivan, IDQ's CEO, and I had been impressed with both men. So, when we got the chance to merge with IDQ, we offered a proposition patterned on our FlightSafety acquisition, extending selling shareholders the option of choosing either cash or Berkshire shares having a slightly lower immediate value. By tilting the consideration as we did, we encouraged holders to opt for cash, the type of payment we by far prefer. Even then, only 45% of IDQ shares elected cash.

去年夏天，Luther 先生去世，其遗产因此需要出售股份。再往前一年，William Blair & Co. 的 Dick Kiphart 曾把我介绍给 John Mooty 与 IDQ 的 CEO Mike Sullivan，而两位都给我留下了深刻印象。因此，当我们获得与 IDQ 合并的机会时，便提出了一个参照我们收购 FlightSafety 的方案，给予出售股东选择权：要么收取现金，要么选择即时价值略低一些的 Berkshire 股票。通过如此倾斜对价，我们鼓励持有人选择我们最偏好的支付方式——现金。即便如此，最终也只有 45% 的 IDQ 股份选择了现金。

Charlie and I bring a modicum of product expertise to this transaction: He has been patronizing the Dairy Queens in Cass Lake and Bemidji, Minnesota, for decades, and I have been a regular in Omaha. We have put our money where our mouth is.

在这笔交易上，Charlie 和我也算带来了一点产品方面的“专业经验”：几十年来，他一直常去 Minnesota 的 Cass Lake 与 Bemidji 的 Dairy Queen，而我则是 Omaha 的老主顾。我们说到做到，把钱花在了自己“嘴上说好”的地方。

A Confession

坦白

I've mentioned that we strongly prefer to use cash rather than Berkshire stock in acquisitions. A study of the record will tell you why: If you aggregate all of our stock-only mergers (excluding those we did with two affiliated companies, Diversified Retailing and Blue Chip Stamps), you will find that our shareholders are slightly worse off than they would have been had I not done the transactions. Though it hurts me to say it, when I've issued stock, I've cost you money.

我已经提到过，在并购中我们强烈偏好使用现金而不是 Berkshire 的股票。回顾历史记录就知道原因：如果把我们所有“仅用股票”进行的并购合并起来（不包括与两家关联公司 Diversified Retailing 和 Blue Chip Stamps 的交易），你会发现，相比我当初不做这些交易，我们的股东处境略差。尽管说起来刺痛我，但每当我发行股票时，我就让你们亏了钱。

Be clear about one thing: This cost has not occurred because we were misled in any way by sellers or because they thereafter failed to manage with diligence and skill. On the contrary, the sellers were completely candid when we were negotiating our deals and have been energetic and effective ever since.

有一点要说清楚：这种代价并不是因为卖方以任何方式误导了我们，或因为他们此后未能勤勉、称职地经营。恰恰相反，在谈判时卖方完全坦诚，此后也一直精力充沛、行之有效。

Instead, our problem has been that we own a truly marvelous collection of businesses, which means that trading away a portion of them for something new almost never makes sense. When we issue shares in a merger, we reduce your ownership in all of our businesses -- partly-owned companies such as Coca-Cola, Gillette and American Express, and all of our terrific operating companies as well. An example from sports will illustrate the difficulty we face: For a baseball team, acquiring a player who can be expected to bat .350 is almost always a wonderful event -- except when the team must trade a .380 hitter to make the deal.

实质上，我们的问题在于我们拥有一组真正出色的业务组合，这意味着为了换取新东西而让出其中一部分几乎从不合理。我们在并购中发行新股，就会稀释你们在我们所有业务中的持股——既包括我们部分持股的公司，如 Coca-Cola、Gillette 和 American Express，也包括我们所有优秀的经营性子公司。用体育的例子可以说明我们面临的难处：对一支棒球队来说，引进一位预计能打出 .350 打击率的球员几乎总是好事——除非为了达成交易不得不送走一位 .380 的打者。

Because our roster is filled with .380 hitters, we have tried to pay cash for acquisitions, and here our record has been far better. Starting with National Indemnity in 1967, and continuing with, among others, See's, Buffalo News, Scott Fetzer and GEICO, we have acquired -- for cash -- a number of large businesses that have performed incredibly well since we bought them. These acquisitions have delivered Berkshire tremendous value -- indeed, far more than I anticipated when we made our purchases.

正因为我们的阵容里满是“.380 的打者”，我们在收购中力求用现金支付，而在这方面我们的成绩要好得多。自 1967 年的 National Indemnity 起，之后还有 See's、Buffalo News、Scott Fetzer 和 GEICO 等，我们用现金收购了多家大型企业，它们在被我们买下之后表现极为出色。这些收购为 Berkshire 带来了巨大的价值——事实上，远超我在出手时的预期。

We believe that it is almost impossible for us to "trade up" from our present businesses and managements. Our situation is the opposite of Camelot's Mordred, of whom Guenevere commented, "The one thing I can say for him is that he is bound to marry well. Everybody is above him." Marrying well is extremely difficult for Berkshire.

我们认为，要从我们现有的业务与管理团队“再攀更好对象”几乎不可能。我们的处境与 Camelot 的 Mordred 截然相反，Guenevere 曾评价他：“我能替他说的一句好话是：他注定会‘婚配得好’，因为所有人都高他一等。” 对 Berkshire 来说，要“婚配得好”极其困难。

So you can be sure that Charlie and I will be very reluctant to issue shares in the future. In those cases when we simply must do so -- when certain shareholders of a desirable acquiree insist on getting stock -- we will include an attractive cash option in order to tempt as many of the sellers to take cash as is possible.

因此你可以确定，未来 Charlie 和我会非常不愿意发行新股。若在某些情形下我们非发不可——例如某些心仪标的的股东坚持要拿股票——我们会同时提供一个颇具吸引力的现金选项，尽可能多地诱使卖方选择现金。

Merging with public companies presents a special problem for us. If we are to offer any premium to the acquiree, one of two conditions must be present: Either our own stock must be overvalued relative to the acquiree's, or the two companies together must be expected to earn more than they would if operated separately. Historically, Berkshire has seldom been overvalued. In this market, moreover, undervalued acquirees are almost impossible to find. That other possibility -- synergy gains -- is usually unrealistic, since we expect acquirees to operate after we've bought them just as they did before. Joining with Berkshire does not normally raise their revenues nor cut their costs.

与上市公司合并对我们来说尤为棘手。若要向被并方提供任何溢价，必须满足两个条件之一：要么我们自家股票相对于被并方被高估；要么两家公司合并后预期盈利要高于各自独立经营时的水平。从历史上看，Berkshire 很少被高估。而在当下的市场里，低估的并购标的几乎难以寻得。至于另一种可能——协同收益——通常并不现实，因为我们期望被并公司在被我们收购后依然像之前那样运营。与 Berkshire 合并通常既不会提高它们的收入，也不会降低它们的成本。

Indeed, their reported costs (but not their true ones) will rise after they are bought by Berkshire if the acquiree has been granting options as part of its compensation packages. In these cases, "earnings" of the acquiree have been overstated because they have followed the standard -- but, in our view, dead wrong -- accounting practice of ignoring the cost to a business of issuing options. When Berkshire acquires an option-issuing company, we promptly substitute a cash compensation plan having an economic value equivalent to that of the previous option plan. The acquiree's true compensation cost is thereby brought out of the closet and charged, as it should be, against earnings.

实际上，如果被并公司此前将期权作为薪酬方案的一部分，那么在被 Berkshire 收购后，它们的“报告成本”（而非真实成本）反而会上升。在这些情形下，被并公司的“earnings（利润）”此前被高估了，因为它们遵循的是一种标准——但在我们看来完全错误——的会计做法：忽略企业授予期权的成本。当 Berkshire 收购一家发放期权的公司时，我们会立刻以与原期权计划经济价值等同的现金薪酬方案予以替换。于是，被并公司的真实薪酬成本就从“壁橱里”被请了出来，并如其所应当那样计入利润表予以扣减。

The reasoning that Berkshire applies to the merger of public companies should be the calculus for all buyers. Paying a takeover premium does not make sense for any acquirer unless a) its stock is overvalued relative to the acquiree's or b) the two enterprises will earn more combined than they would separately. Predictably, acquirers normally hew to the second argument because very few are willing to acknowledge that their stock is overvalued. However, voracious buyers -- the ones that issue shares as fast as they can print them -- are tacitly conceding that point. (Often, also, they are running Wall Street's version of a chain-letter scheme.)

Berkshire 在与上市公司合并时所运用的逻辑，理应成为所有买家的计算方法。除非 a）自身股票相对于被并方被高估，或 b）两家企业合并后的盈利将高于各自独立经营，否则为收购支付溢价对任何收购方都不合理。不出所料，收购方通常坚持第二条理由，因为很少有人愿意承认自家股票被高估。然而，那些贪婪的买家——发行新股的速度堪比印钞——则在无声处承认了这一点。（而且，他们常常在运行 Wall Street 版的“连锁信”游戏。）

In some mergers there truly are major synergies -- though oftentimes the acquirer pays too much to obtain them -- but at other times the cost and revenue benefits that are projected prove illusory. Of one thing, however, be certain: If a CEO is enthused about a particularly foolish acquisition, both his internal staff and his outside advisors will come up with whatever projections are needed to justify his stance. Only in fairy tales are emperors told that they are naked.

在某些并购中确实存在重大的协同——尽管收购方往往为此付出了过高代价——但在另一些情况下，所预测的成本与收入方面的好处则被证明是虚幻的。不过，有一件事可以肯定：如果一位 CEO 对某个特别愚蠢的收购兴致勃勃，那么他内部的团队和外部顾问都会拿出一切所需的预测来为他的立场背书。只有在童话里，皇帝才会被告知自己没穿衣服。

Common Stock Investments

普通股投资

Below we present our common stock investments. Those with a market value of more than $750 million are itemized.

下文列示我们的普通股投资。市值超过 $750 million 的持仓将逐一列出。

We made net sales during the year that amounted to about 5% of our beginning portfolio. In these, we significantly reduced a few of our holdings that are below the $750 million threshold for itemization, and we also modestly trimmed a few of the larger positions that we detail. Some of the sales we made during 1997 were aimed at changing our bond-stock ratio moderately in response to the relative values that we saw in each market, a realignment we have continued in 1998.

年内我们进行了净卖出，规模约为期初组合的 5%。其中，我们大幅减持了几项低于 $750 million 单列阈值的持仓，也适度削减了几项将在文后详列的较大头寸。我们在 1997 年进行的部分卖出，旨在根据我们对各市场相对价值的判断，适度调整债券—股票比例；这一再平衡在 1998 年仍在继续。

Our reported positions, we should add, sometimes reflect the investment decisions of GEICO's Lou Simpson. Lou independently runs an equity portfolio of nearly $2 billion that may at times overlap the portfolio that I manage, and occasionally he makes moves that differ from mine.

需要补充的是，我们披露的持仓有时也反映了 GEICO 的 Lou Simpson 的投资决策。Lou 独立管理着近 $2 billion 的股票组合，偶尔会与我管理的组合有所重叠，也会在某些时候采取不同于我的操作。

Though we don't attempt to predict the movements of the stock market, we do try, in a very rough way, to value it. At the annual meeting last year, with the Dow at 7,071 and long-term Treasury yields at 6.89%, Charlie and I stated that we did not consider the market overvalued if 1) interest rates remained where they were or fell, and 2) American business continued to earn the remarkable returns on equity that it had recently recorded. So far, interest rates have fallen -- that's one requisite satisfied -- and returns on equity still remain exceptionally high. If they stay there -- and if interest rates hold near recent levels -- there is no reason to think of stocks as generally overvalued. On the other hand, returns on equity are not a sure thing to remain at, or even near, their present levels.

虽然我们不试图预测股市走势，但会以非常粗略的方式对其进行估值。去年的股东大会上，在 Dow 为 7,071、长期 U.S. Treasury 收益率为 6.89% 的背景下，Charlie 和我表示：若（1）利率维持当时水平或下行，且（2）美国企业能继续取得其近期所录得的优异股本回报，我们并不认为市场被高估。到目前为止，利率已经下降——这满足了其一——而股本回报仍然异常高企。若两者能维持——且利率保持在接近近期的水平——就没有理由认为股票总体被高估。另一方面，股本回报并不能保证维持在当前或接近当前的水平。

In the summer of 1979, when equities looked cheap to me, I wrote a Forbes article entitled "You pay a very high price in the stock market for a cheery consensus." At that time skepticism and disappointment prevailed, and my point was that investors should be glad of the fact, since pessimism drives down prices to truly attractive levels. Now, however, we have a very cheery consensus. That does not necessarily mean this is the wrong time to buy stocks: Corporate America is now earning far more money than it was just a few years ago, and in the presence of lower interest rates, every dollar of earnings becomes more valuable. Today's price levels, though, have materially eroded the "margin of safety" that Ben Graham identified as the cornerstone of intelligent investing.

1979 年夏天，当我认为股票很便宜时，我在 Forbes 上写了一篇题为“You pay a very high price in the stock market for a cheery consensus.”的文章。彼时怀疑与失望占据上风，而我的观点是：投资者应为此感到高兴，因为悲观会把价格压到真正有吸引力的水平。如今，我们却拥有一个十分“乐观的一致预期”。这并不必然意味着现在就是买入股票的错误时点：美国企业现在赚的钱远超数年前，而在较低利率环境下，每一美元的盈利更为值钱。只是，今日的价格水平已在实质上侵蚀了 Ben Graham 所提出、作为聪明投资基石的“margin of safety（安全边际）”。

* * * * * * * * * * * *

In last year's annual report, I discussed Coca-Cola, our largest holding. Coke continues to increase its market dominance throughout the world, but, tragically, it has lost the leader responsible for its outstanding performance. Roberto Goizueta, Coke's CEO since 1981, died in October. After his death, I read every one of the more than 100 letters and notes he had written me during the past nine years. Those messages could well serve as a guidebook for success in both business and life.

在去年的年报中，我谈到了我们最大的持仓 Coca-Cola。Coke 继续在全球提升其市场主导地位，但遗憾的是，它失去了促成其卓越表现的领导者。自 1981 年起担任 Coke CEO 的 Roberto Goizueta 于 10 月辞世。他去世后，我把过去九年他写给我的一百多封信札逐一读过。这些文字足以成为事业与人生成功的指南。

In these communications, Roberto displayed a brilliant and clear strategic vision that was always aimed at advancing the well-being of Coke shareholders. Roberto knew where he was leading the company, how he was going to get there, and why this path made the most sense for his owners -- and, equally important, he had a burning sense of urgency about reaching his goals. An excerpt from one handwritten note he sent to me illustrates his mind-set: "By the way, I have told Olguita that what she refers to as an obsession, you call focus. I like your term much better." Like all who knew Roberto, I will miss him enormously.

在这些交流中，Roberto 展现出卓越而清晰的战略眼光，始终以增进 Coke 股东的福祉为目标。Roberto 知道他要把公司带向何方、如何抵达那里，以及为何这条路径对其所有者最为合理——同样重要的是，他对实现目标怀有强烈的紧迫感。他寄给我的一则手写便笺中的一段话足以体现他的心态：“By the way, I have told Olguita that what she refers to as an obsession, you call focus. I like your term much better.”像所有认识 Roberto 的人一样，我将无比想念他。

Consistent with his concern for the company, Roberto prepared for a seamless succession long before it seemed necessary. Roberto knew that Doug Ivester was the right man to take over and worked with Doug over the years to ensure that no momentum would be lost when the time for change arrived. The Coca-Cola Company will be the same steamroller under Doug as it was under Roberto.

与他对公司的关切一以贯之，Roberto 早在看似尚无必要之前就为无缝交接做好了准备。Roberto 确认 Doug Ivester 是合适的接班人，并与 Doug 多年并肩工作，以确保在变更时刻到来之际不会丧失任何动能。The Coca-Cola Company 在 Doug 的领导下将与 Roberto 时代一样，继续如同一台势不可挡的压路机。

Convertible Preferreds

可转换优先股

Two years ago, I gave you an update on the five convertible preferreds that we purchased through private placements in the 1987-1991 period. At the time of that earlier report, we had realized a small profit on the sale of our Champion International holding. The four remaining preferred commitments included two, Gillette and First Empire State, that we had converted into common stock in which we had large unrealized gains, and two others, USAir and Salomon, that had been trouble-prone. At times, the last two had me mouthing a line from a country song: "How can I miss you if you won't go away?"

两年前，我向你们更新了我们在 1987–1991 年期间通过私募方式购买的五只可转换优先股的情况。在那份较早的报告时点，我们已通过出售 Champion International 的持仓获得了一点小利润。余下的四笔优先股投资中，有两笔——Gillette 和 First Empire State——我们已转换为普通股，并在其上有大量未实现收益；另外两笔——USAir 和 Salomon——则多次惹麻烦。有些时候，后两者让我常常哼起一首乡村歌曲里的句子：“How can I miss you if you won't go away?”

Since I delivered that report, all four holdings have grown significantly in value. The common stocks of both Gillette and First Empire have risen substantially, in line with the companies' excellent performance. At yearend, the $600 million we put into Gillette in 1989 had appreciated to $4.8 billion, and the $40 million we committed to First Empire in 1991 had risen to $236 million.

自那份报告以来，这四项持仓的价值都显著上升。Gillette 与 First Empire 的普通股大幅上涨，与两家公司的卓越表现相呼应。到年末，我们 1989 年投在 Gillette 的 $600 million 已增至 $4.8 billion，而 1991 年投在 First Empire 的 $40 million 已升至 $236 million。

Our two laggards, meanwhile, have come to life in a very major way. In a transaction that finally rewarded its long-suffering shareholders, Salomon recently merged into Travelers Group. All of Berkshire's shareholders -- including me, very personally -- owe a huge debt to Deryck Maughan and Bob Denham for, first, playing key roles in saving Salomon from extinction following its 1991 scandal and, second, restoring the vitality of the company to a level that made it an attractive acquisition for Travelers. I have often said that I wish to work with executives that I like, trust and admire. No two fit that description better than Deryck and Bob.

与此同时，我们的两只“拖后腿”的持仓也强势复苏。Salomon 近期并入 Travelers Group，这笔交易终于回报了其久经煎熬的股东。Berkshire 的所有股东——包括我个人在内——都深深感激 Deryck Maughan 与 Bob Denham：其一，在 1991 年丑闻后于挽救 Salomon 于覆灭中发挥关键作用；其二，把公司的生机恢复到足以令 Travelers 愿意出手收购的水平。我常说，我希望与我所喜欢、信任且钦佩的高管共事——没有人比 Deryck 与 Bob 更符合这一描述。

Berkshire's final results from its Salomon investment won't be tallied for some time, but it is safe to say that they will be far better than I anticipated two years ago. Looking back, I think of my Salomon experience as having been both fascinating and instructional, though for a time in 1991-92 I felt like the drama critic who wrote: "I would have enjoyed the play except that I had an unfortunate seat. It faced the stage."

Berkshire 在 Salomon 投资上的最终结果一时半会儿还算不清，但可以肯定，会远好于我两年前的预期。回头看，我把这段 Salomon 经历视为既引人入胜又颇具启迪——尽管在 1991–92 年间，有一段时间我就像那位戏剧评论家所写的那样：“要不是我的座位不太走运——正对着舞台——我本来会很享受这出戏的。”

The resuscitation of US Airways borders on the miraculous. Those who have watched my moves in this investment know that I have compiled a record that is unblemished by success. I was wrong in originally purchasing the stock, and I was wrong later, in repeatedly trying to unload our holdings at 50 cents on the dollar.

US Airways 的“复活”几乎称得上是奇迹。关注我这笔投资操作的人都知道，我在这上面留下的是一份“毫无成功污点”的记录。我最初买入这只股票是错的，后来多次尝试按面值 50% 出清持仓也还是错的。

Two changes at the company coincided with its remarkable rebound: 1) Charlie and I left the board of directors and 2) Stephen Wolf became CEO. Fortunately for our egos, the second event was the key: Stephen Wolf's accomplishments at the airline have been phenomenal.

公司出现的两项变化与其惊人反弹相伴而生：1）Charlie 和我退出董事会；2）Stephen Wolf 出任 CEO。就我们的“自尊心”而言，幸好第二件事才是关键：Stephen Wolf 在这家航空公司的作为可谓非凡。

There still is much to do at US Airways, but survival is no longer an issue. Consequently, the company made up the dividend arrearages on our preferred during 1997, adding extra payments to compensate us for the delay we suffered. The company's common stock, furthermore, has risen from a low of $4 to a recent high of $73.

US Airways 仍有许多工作要做，但生存已不再是问题。因此，公司在 1997 年补发了我们优先股的拖欠股息，并额外支付以补偿我们遭受的延误。此外，公司普通股也已从最低 $4 上涨至近期高点 $73。

Our preferred has been called for redemption on March 15. But the rise in the company's stock has given our conversion rights, which we thought worthless not long ago, great value. It is now almost certain that our US Airways shares will produce a decent profit -- that is, if my cost for Maalox is excluded -- and the gain could even prove indecent.

我们的优先股已被通知将于 3 月 15 日赎回。但公司股价的上涨，让我们不久前还以为一文不值的转换权变得大有价值。现在几乎可以确定，我们的 US Airways 持股将带来不错的利润——当然，前提是不把我为 Maalox（治疗胃疼的药）支付的成本算进去——甚至这笔收益还可能“好得有点过分”。

Next time I make a big, dumb decision, Berkshire shareholders will know what to do: Phone Mr. Wolf.

下次我再做出又大又蠢的决定时，Berkshire 的股东们就知道该怎么做了：给 Mr. Wolf 打电话。

* * * * * * * * * * * *

In addition to the convertible preferreds, we purchased one other private placement in 1991, $300 million of American Express Percs. This security was essentially a common stock that featured a tradeoff in its first three years: We received extra dividend payments during that period, but we were also capped in the price appreciation we could realize. Despite the cap, this holding has proved extraordinarily profitable thanks to a move by your Chairman that combined luck and skill -- 110% luck, the balance skill.

除了可转换优先股之外，我们在 1991 年还购买了一笔私募——$300 million 的 American Express Percs。这类证券本质上相当于普通股，但在最初三年有一项“交换条件”：我们在此期间可获得额外股息，但可实现的价格涨幅有上限。尽管有上限，这笔持仓却被证明异常赚钱，缘于你们董事长的一次出手，兼具运气与技巧——110% 是运气，剩下的才是技巧。

Our Percs were due to convert into common stock in August 1994, and in the month before I was mulling whether to sell upon conversion. One reason to hold was Amex's outstanding CEO, Harvey Golub, who seemed likely to maximize whatever potential the company had (a supposition that has since been proved -- in spades). But the size of that potential was in question: Amex faced relentless competition from a multitude of card-issuers, led by Visa. Weighing the arguments, I leaned toward sale.

我们的 Percs 计划于 1994 年 8 月转换为普通股，在转换前一个月，我一直在琢磨是否在转换后卖出。持有的一大理由是 Amex 出色的 CEO Harvey Golub，他看起来有能力把公司的潜力发挥到极致（这一假设后来被充分验证——而且有过之）。但潜力的“量级”仍存疑：Amex 面临来自众多发卡机构的无情竞争，龙头是 Visa。权衡利弊之下，我当时更偏向于卖出。

Here's where I got lucky. During that month of decision, I played golf at Prouts Neck, Maine with Frank Olson, CEO of Hertz. Frank is a brilliant manager, with intimate knowledge of the card business. So from the first tee on I was quizzing him about the industry. By the time we reached the second green, Frank had convinced me that Amex's corporate card was a terrific franchise, and I had decided not to sell. On the back nine I turned buyer, and in a few months Berkshire owned 10% of the company.

幸运之处在这儿。那个月我在 Maine 的 Prouts Neck 与 Hertz 的 CEO Frank Olson 打高尔夫。Frank 是位杰出的经营者，对信用卡业务了如指掌。于是从第一发球台开始我就向他打探行业情况。到了第二个果岭，Frank 已说服我：Amex 的企业卡是个极好的“特许经营权”。我于是决定不卖。后九洞我就开始买入，几个月后 Berkshire 便持有了该公司 10% 的股份。

2024年底，Amex企业卡占整体销售收入的24%。

We now have a $3 billion gain in our Amex shares, and I naturally feel very grateful to Frank. But George Gillespie, our mutual friend, says that I am confused about where my gratitude should go. After all, he points out, it was he who arranged the game and assigned me to Frank's foursome.

如今我们在 Amex 的持股上已有 $3 billion 的收益，我自然对 Frank 心怀感激。不过我们的共同朋友 George Gillespie 说我“感谢错了人”。毕竟，正是他安排了那场球赛，还把我编到 Frank 的四人组里。

Quarterly Reports to Shareholders

致股东的季度报告

In last year's letter, I described the growing costs we incur in mailing quarterly reports and the problems we have encountered in delivering them to "street-name" shareholders. I asked for your opinion about the desirability of our continuing to print reports, given that we now publish our quarterly and annual communications on the Internet, at our site, www.berkshirehathaway.com. Relatively few shareholders responded, but it is clear that at least a small number who want the quarterly information have no interest in getting it off the Internet. Being a life-long sufferer from technophobia, I can empathize with this group.

在去年的信中，我说明了邮寄季度报告所产生的不断攀升的成本，以及向“street-name” 股东寄送时遭遇的问题。鉴于我们现在已在 Internet（网址：www.berkshirehathaway.com）发布季度与年度信息，我征询了你们对于是否继续印刷报告的意见。回应的股东并不多，但可以肯定的是，至少有一小部分想要季度信息的股东并不愿意通过互联网获取。作为一个终生受“技术恐惧症”困扰的人，我对这群人感同身受。

The cost of publishing quarterlies, however, continues to balloon, and we have therefore decided to send printed versions only to shareholders who request them. If you wish the quarterlies, please complete the reply card that is bound into this report. In the meantime, be assured that all shareholders will continue to receive the annual report in printed form.

然而，印刷季度报告的成本仍在膨胀，因此我们决定只向提出申请的股东寄送纸质版本。若你需要季度报告，请填写本报告随附的回执卡。同时请放心，所有股东仍将继续收到纸质版的年度报告。

Those of you who enjoy the computer should check out our home page. It contains a large amount of current information about Berkshire and also all of our annual letters since 1977. In addition, our website includes links to the home pages of many Berkshire subsidiaries. On these sites you can learn more about our subsidiaries' products and -- yes -- even place orders for them.

喜欢使用电脑的朋友，不妨浏览我们的主页。那里包含大量关于 Berkshire 的最新信息，以及自 1977 年以来的全部年度股东信。此外，我们的网站还提供许多 Berkshire 子公司的主页链接。通过这些网站，你可以进一步了解子公司产品——没错——甚至可以下单购买。

We are required to file our quarterly information with the SEC no later than 45 days after the end of each quarter. One of our goals in posting communications on the Internet is to make this material information -- in full detail and in a form unfiltered by the media -- simultaneously available to all interested parties at a time when markets are closed. Accordingly, we plan to send our 1998 quarterly information to the SEC on three Fridays, May 15, August 14, and November 13, and on those nights to post the same information on the Internet. This procedure will put all of our shareholders, whether they be direct or "street-name," on an equal footing. Similarly, we will post our 1998 annual report on the Internet on Saturday, March 13, 1999, and mail it at about the same time.

我们被要求在每个季度结束后不超过 45 天向 SEC 提交季度信息。我们在互联网上发布信息的目标之一，是在市场休市的时间，以完整细节、未经媒体过滤的形式，同时向所有相关方提供这些重大信息。因此，我们计划在 1998 年的三个周五——5 月 15 日、8 月 14 日与 11 月 13 日——向 SEC 提交季度信息，并在当晚将同样内容发布到互联网。此举将使所有股东——无论是直接持有人还是“street-name” 股东——处于同等地位。同样地，我们将在 1999 年 3 月 13 日（周六）将 1998 年度报告发布到互联网，并在大致相同时间邮寄纸质版。

Shareholder-Designated Contributions

股东指定捐款

About 97.7% of all eligible shares participated in Berkshire's 1997 shareholder-designated contributions program. Contributions made were $15.4 million, and 3,830 charities were recipients. A full description of the program appears on pages 52 - 53.

约有 97.7% 的合资格股份参与了 Berkshire 1997 年的股东指定捐款计划。捐款总额为 $15.4 million，受赠慈善机构共 3,830 家。该计划的完整说明见第 52–53 页。

Cumulatively, over the 17 years of the program, Berkshire has made contributions of $113.1 million pursuant to the instructions of our shareholders. The rest of Berkshire's giving is done by our subsidiaries, which stick to the philanthropic patterns that prevailed before they were acquired (except that their former owners themselves take on the responsibility for their personal charities). In aggregate, our subsidiaries made contributions of $8.1 million in 1997, including in-kind donations of $4.4 million.

截至目前 17 年间，在股东指示下，Berkshire 累计捐款 $113.1 million。除此之外，Berkshire 的其他捐赠由我们的子公司完成，它们延续被收购前既有的公益方式（但其原所有者需自行承担其个人慈善的责任）。合计来看，我们的各子公司在 1997 年捐赠 $8.1 million，其中包含 $4.4 million 的实物捐赠。

Every year a few shareholders miss out on our contributions program because they don't have their shares registered in their own names on the prescribed record date or because they fail to get the designation form back to us within the 60-day period allowed. Charlie and I regret this. But if replies are received late, we have to reject them because we can't make exceptions for some shareholders while refusing to make them for others.

每年都有少数股东错过我们的捐款计划，原因或为在规定的记录日未将股份登记在本人名下，或为未能在允许的 60 天期限内将指定表格寄回。对此 Charlie 和我深感遗憾。但若逾期收到回复，我们只能拒绝处理，因为我们不能对部分股东破例却对其他人不予破例。

To participate in future programs, you must own Class A shares that are registered in the name of the actual owner, not the nominee name of a broker, bank or depository. Shares not so registered on August 31, 1998, will be ineligible for the 1998 program. When you get the contributions form from us, return it promptly so that it does not get put aside or forgotten.

若要参与未来的计划，你必须持有以实际所有人名义登记的 Class A 股份，而非以券商、银行或托管机构的名义登记。凡未在 1998 年 8 月 31 日前完成上述登记的股份，将无资格参与 1998 年度的计划。收到我们的捐款表格后，请尽快寄回，避免搁置或遗忘。

The Annual Meeting

年度股东大会

Woodstock Weekend at Berkshire will be May 2-4 this year. The finale will be the annual meeting, which will begin at 9:30 a.m. on Monday, May 4. Last year we met at Aksarben Coliseum, and both our staff and the crowd were delighted with the venue. There was only one crisis: The night before the meeting, I lost my voice, thereby fulfilling Charlie's wildest fantasy. He was crushed when I showed up the next morning with my speech restored.

今年 Berkshire 的 Woodstock Weekend 将在 5 月 2–4 日举行。压轴活动是年度股东大会，将于 5 月 4 日（星期一）上午 9:30 开始。去年我们在 Aksarben Coliseum 举行会议，会场让员工与与会者都非常满意。唯一的“危机”是：会前一晚我失声了，成全了 Charlie 最大胆的幻想。第二天早晨当我嗓音恢复、现身会场时，他顿时大失所望。

Last year about 7,500 attended the meeting. They represented all 50 states, as well as 16 countries, including Australia, Brazil, Israel, Saudi Arabia, Singapore and Greece. Taking into account several overflow rooms, we believe that we can handle more than 11,000 people, and that should put us in good shape this year even though our shareholder count has risen significantly. Parking is ample at Aksarben; acoustics are excellent; and seats are comfortable.

去年约有 7,500 人参会，覆盖全部 50 个州以及 16 个国家，包括 Australia、Brazil、Israel、Saudi Arabia、Singapore 与 Greece。考虑到若干溢出会场，我们认为可接待逾 11,000 名与会者；即便今年股东人数显著上升，这一容量也足够。Aksarben 的停车位充足、声场极佳、座椅也很舒适。

The doors will open at 7 a.m. on Monday and at 8:30 we will again feature the world premiere of a movie epic produced by Marc Hamburg, our CFO. The meeting will last until 3:30, with a short break at noon. This interval will permit the exhausted to leave unnoticed and allow time for the hardcore to lunch at Aksarben's concession stands. Charlie and I enjoy questions from owners, so bring up whatever is on your mind.

周一早上 7 点开门，8:30 我们将再次放映由 CFO Marc Hamburg 制作的“史诗电影”全球首映。大会持续至 3:30，中午有短暂休息。这段时间既方便疲惫者悄然离场，也让铁杆股东有时间在 Aksarben 的小卖部用午餐。Charlie 和我很享受来自所有者的提问，请尽管开口。

Berkshire products will again be for sale in the halls outside the meeting room. Last year -- not that I pay attention to this sort of thing -- we again set sales records, moving 2,500 pounds of See's candy, 1,350 pairs of Dexter shoes, $75,000 of World Books and related publications, and 888 sets of Quikut knives. We also took orders for a new line of apparel, featuring our Berkshire logo, and sold about 1,000 polo, sweat, and T-shirts. At this year's meeting, we will unveil our 1998 collection.

会议厅外的走廊里将再次售卖 Berkshire 的产品。去年——并不是说我盯着这类事情——我们又创了销售纪录：售出 2,500 磅 See’s 糖果、1,350 双 Dexter 鞋、$75,000 的 World Books 及相关出版物，以及 888 套 Quikut 刀具。我们还接受了带有 Berkshire 标志的新款服饰预订，售出约 1,000 件 polo、卫衣与 T 恤。今年大会上我们将发布 1998 款系列。

GEICO will again be on hand with a booth staffed by star associates from its regional offices. Find out whether you can save money by shifting your auto insurance to GEICO. About 40% of those who check us out learn that savings are possible. The proportion is not 100% because insurers differ in their underwriting judgments, with some favoring drivers who live in certain geographical areas and work at certain occupations more than we do. We believe, however, that we more frequently offer the low price than does any other national carrier selling insurance to all comers. In the GEICO informational material that accompanies this report, you will see that in 38 states we now offer a special discount of as much as 8% to our shareholders. We also have applications pending that would extend this discount to drivers in other states.

GEICO 也将设展台，由各区域办公室的明星同事值守。来看看把你的车险转到 GEICO 是否能省钱。约 40% 前来咨询的人会发现确有节省空间。比例不是 100%，原因在于各保险公司在承保判断上有差异，有些公司比我们更偏好来自特定地区或从事特定职业的驾驶员。不过我们相信，相较于面向所有客户销售保险的其他全国性公司，我们更常给出低价。随本报告附上的 GEICO 资料显示，我们目前在 38 个州向股东提供最高可达 8% 的专属折扣；我们也已申请在其他州推广这一折扣。

An attachment to the proxy material that is enclosed with this report explains how you can obtain the card you will need for admission to the meeting. We expect a large crowd, so get plane, hotel and car reservations promptly. American Express (800-799-6634) will be happy to help you with arrangements. As usual, we will have buses at the larger hotels that will take you to and from the meeting and also deliver you to Nebraska Furniture Mart, Borsheim's and the airport after its conclusion. You are likely, however, to find a car handy.

本报告所附的代理资料附件，说明了如何获取入场卡以进入会场。预计到场人数众多，请尽快预订机票、酒店与租车。American Express（800-799-6634）很乐意协助安排。照例，我们将在较大的酒店安排巴士，接送往返会场，并在会后送至 Nebraska Furniture Mart、Borsheim’s 以及机场。不过，你很可能会觉得自驾更方便。

NFM's main store, located on a 75-acre site about a mile from Aksarben, is open from 10 a.m. to 9 p.m. on weekdays, 10 a.m. to 6 p.m. on Saturdays, and noon to 6 p.m. on Sundays. During the period from May 1 to May 5, shareholders who present NFM with the coupon that will accompany their meeting ticket will be entitled to a discount that is otherwise restricted to its employees.

NFM 的主店位于距 Aksarben 约一英里、占地 75 英亩的园区内。营业时间为：工作日 10:00–21:00，周六 10:00–18:00，周日 12:00–18:00。5 月 1 日至 5 日期间，凭随会议门票附带的优惠券，股东可享受原本仅限员工的折扣。

Borsheim's normally is closed on Sunday but will be open for shareholders from 10 a.m. to 6 p.m. on May 3rd. Last year was our second-best shareholder's day, exceeded only by 1996's. I regard this slippage as an anomaly and hope that you will prove me right this year. Charlie will be available for autographs. He smiles, however, only if the paper he signs is a Borsheim's sales ticket. Shareholders who wish to visit on Saturday (10 a.m. to 5:30 p.m.) or on Monday (10 a.m.-8 p.m.) should be sure to identify themselves as Berkshire owners so that Susan Jacques, Borsheim's CEO, can make you especially welcome. Susan, I should add, had a fabulous year in 1997. As a manager, she is everything that an owner hopes for.

Borsheim’s 通常周日歇业，但将于 5 月 3 日为股东开放，时间 10:00–18:00。去年是我们第二好的股东日，仅次于 1996 年。我把那次小滑坡视为异常，也希望你们今年帮我证明确实如此。Charlie 会到场签名；不过，只有当他签名的纸张是 Borsheim’s 的销售小票时，他才会面带微笑。打算在周六（10:00–17:30）或周一（10:00–20:00）前往的股东，请务必表明自己是 Berkshire 的所有者，以便 Borsheim’s 的 CEO Susan Jacques 能给你特别的欢迎。补充一句：1997 年 Susan 表现极为出色。作为管理者，她完全契合所有者的一切期望。

On Sunday afternoon we will also have a special treat for bridge players in the mall outside of Borsheim's. There, Bob Hamman -- a legend of the game for more than three decades -- will take on all comers. Join in and dazzle Bob with your skill.

周日下午，我们还将在 Borsheim’s 外的商场为桥牌爱好者安排特别活动。届时，纵横牌坛逾三十年的传奇 Bob Hamman 将迎战四方来客。欢迎加入，用你的牌技“晃瞎”Bob 的眼。

My favorite steakhouse, Gorat's, opens one Sunday a year -- for Berkshire shareholders on the night before the annual meeting. Last year the restaurant started serving at 4 p.m. and finished about 1:30 a.m, an endurance trial that was the result of taking 1,100 reservations vs. a seating capacity of 235. If you make a reservation and then can't attend, be sure to let Gorat's know promptly, since it goes to great effort to help us and we want to reciprocate. You can make reservations beginning on April 1st (but not before) by calling 402-551-3733. Last year I had to leave Gorat's a little early because of my voice problem, but this year I plan to leisurely savor every bite of my rare T-bone and double order of hash browns.

我最喜欢的牛排馆 Gorat’s 每年只在一个周日开门——就在年会前夜，专为 Berkshire 股东开放。去年餐厅从下午 4 点一直忙到凌晨约 1:30——为 1,100 份预约与仅 235 个座位硬扛了一场“耐力赛”。若你预约后无法前往，请务必尽快告知 Gorat’s；他们为帮助我们付出了很大努力，我们也要投桃报李。4 月 1 日起（此前不接受）可致电 402-551-3733 预约。去年我因嗓音问题稍早离席；今年我计划从容享用每一口“三成熟”的 T-bone 与“双份”薯饼。

After this warmup, Charlie and I will head for the Dairy Queen on 114th, just south of Dodge. There are 12 great Dairy Queens in metropolitan Omaha, but the 114th Street location is the best suited to handle the large crowd that we expect. South of the property, there are hundreds of parking spaces on both sides of the street. Also, this Dairy Queen will extend its Sunday hours to 11 p.m. in order to accommodate our shareholders.

在这次热身之后，Charlie 和我将前往位于 114th、Dodge 南侧的 Dairy Queen。大 Omaha 地区共有 12 家出色的 Dairy Queen，但 114th Street 这家最适合应对我们预期的大人流。其南侧街道两边有数百个停车位。另外，这家 Dairy Queen 周日营业时间将延长至晚上 11 点，以方便股东。

The 114th Street operation is now run by two sisters, Coni Birge and Deb Novotny, whose grandfather put up the building in 1962 at what was then the outer edge of the city. Their mother, Jan Noble, took over in 1972, and Coni and Deb continue as third generation owner-managers. Jan, Coni and Deb will all be on hand Sunday evening, and I hope that you meet them. Enjoy one of their hamburgers if you can't get into Gorat's. And then, around eight o'clock, join me in having a Dusty Sundae for dessert. This item is a personal specialty -- the Dairy Queen will furnish you a copy of my recipe -- and will be offered only on Shareholder Sunday.

114th Street 这家店如今由两位姐妹 Coni Birge 与 Deb Novotny 经营。她们的祖父在 1962 年于当时城市的外缘修建了这栋楼；1972 年她们的母亲 Jan Noble 接手；如今 Coni 与 Deb 以第三代所有者—管理者的身份延续经营。周日傍晚 Jan、Coni 与 Deb 都会在场，我希望你们与她们见面。若你进不去 Gorat’s，不妨来一份她们的汉堡；然后大约在八点，和我一起用一份 Dusty Sundae 作甜点。这是我的“私房菜”——Dairy Queen 会提供我的配方复印件——且只在“股东周日”供应。

The Omaha Royals and Albuquerque Dukes will play baseball on Saturday evening, May 2nd, at Rosenblatt Stadium. As usual, your Chairman, shamelessly exploiting his 25% ownership of the team, will take the mound. But this year you will see something new.

5 月 2 日（周六）晚，Omaha Royals 与 Albuquerque Dukes 将在 Rosenblatt Stadium 上演一场棒球赛。照例，你们的董事长将“毫无羞耻”地利用自己持有球队 25% 股权的优势，登上投手丘。不过，今年你们会看到一点新花样。

In past games, much to the bafflement of the crowd, I have shaken off the catcher's first call. He has consistently asked for my sweeping curve, and I have just as regularly resisted. Instead, I have served up a pathetic fast ball, which on my best day was clocked at eight miles per hour (with a following wind).

以往比赛里，我常常摇头否决捕手的第一个暗号，让观众大惑不解。捕手总是要我的“大弧度曲球”，而我却一如既往地拒绝；我给出的，是一记可怜的直球——我状态最好的一天也就 8 英里/小时（还得靠顺风）。

There's a story behind my unwillingness to throw the curve ball. As some of you may know, Candy Cummings invented the curve in 1867 and used it to great effect in the National Association, where he never won less than 28 games in a season. The pitch, however, drew immediate criticism from the very highest of authorities, namely Charles Elliott, then president of Harvard University, who declared, "I have heard that this year we at Harvard won the baseball championship because we have a pitcher who has a fine curve ball. I am further instructed that the purpose of the curve ball is to deliberately deceive the batter. Harvard is not in the business of teaching deception." (I'm not making this up.)

我不愿投曲球的背后有个典故。你们中的一些人也许知道，Candy Cummings 于 1867 年发明了曲球，并在 National Association 中大发神威——他在那里的单季胜场从未少于 28 场。然而，此球路立刻遭到“最高权威”的批评，即当时 Harvard University 的校长 Charles Elliott，他宣称：“我听说我们 Harvard 今年能拿到棒球冠军，是因为我们有个投手的曲球很漂亮。我进一步获悉，曲球的目的在于有意欺骗打者。Harvard 不从事教授欺骗的勾当。”（我不是编的。）

Ever since I learned of President Elliott's moral teachings on this subject, I have scrupulously refrained from using my curve, however devastating its effect might have been on hapless batters. Now, however, it is time for my karma to run over Elliott's dogma and for me to quit holding back. Visit the park on Saturday night and marvel at the majestic arc of my breaking ball.

自从知晓 Elliott 校长在此问题上的道德教诲，我就一直克制自己不用曲球——无论它对无辜打者可能有多“毁灭性”。不过现在，是时候让我的“karma（因果）”碾过 Elliott 的“dogma（教条）”，不再束手束脚。周六晚来球场，欣赏我那记断球划出的雄伟弧线吧。

Our proxy statement includes information about obtaining tickets to the game. We will also provide an information packet describing the local hot spots, including, of course, those 12 Dairy Queens.

我们的委托书（proxy statement）包含了如何获取球票的信息。我们还会提供一份资料包，介绍本地的人气去处，当然也包括那 12 家 Dairy Queen。

Come to Omaha -- the cradle of capitalism -- in May and enjoy yourself.

5 月来 Omaha——资本主义的摇篮——尽情享受吧。

Warren E. Buffett

Chairman of the Board

February 27, 1998

1998-02-27 Warren Buffett's Letters to Berkshire Shareholders

1998-02-27 Warren Buffett's Letters to Berkshire Shareholders

Unconventional Commitments

How We Think About Market Fluctuations

Insurance Operations – Overview

Super-Cat Insurance

Insurance – GEICO (1-800-555-2756) and Other Primary Operations

Sources of Reported Earnings

Look-Through Earnings

Acquisitions of 1997

A Confession

Common Stock Investments

Convertible Preferreds

Quarterly Reports to Shareholders

Shareholder-Designated Contributions

The Annual Meeting

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