BUFFETT PARTNERSHIP, LTD. 810 KIEWIT PLAZA OMAHA 31, NEBRASKA
November 1, 1962
TO MY PARTNERS FOR 1963:
致1963年合伙人：
Here we go on the annual paper flurry. Two copies of an amended partnership agreement for 1963 are enclosed. The one with the General Provisions attached is to be kept by you and the other single-page agreement should be returned. There are no substantive changes of any sort from last year's agreement. This amendment is merely to allow for a few new partners and in several places to reword in clearer (we hope) language provisions of the present agreement. Practically all of the rewording is in General Provision 5 (paragraph 7 in last year's agreement). Rather than have a separate amending document, we have incorporated the changes into one complete document embodying the entire agreement.
开始年底繁琐的文书工作了。随信附上两份修改过将在1963年实施的合伙人协议。包含了若干细则的一份请各位保管，一份单页的同意书请寄回。新的协议和去年没有什么大的变化。这份协议仅仅允许一些新的合伙人加入，并且重新调整了若干条款的遣词以期更加准确。基本所有的更改都在细则5（对应去年协议的第7段）。我们将更改合并到一个的完整文件中而非另起草一份修订稿。
We are also enclosing two commitment letters (one for you--one to be returned) on which you are to indicate your wishes regarding additions or withdrawals at January 1st. We would like to have the agreement and the commitment letter back by December 1st. However, the commitment letter can be amended right up until the end of the year (not after) so if you should have a change of plans and you have already mailed us your commitment letter, all you have to do is get in touch with me, and I will make whatever changes you desire.
我们同时附带了两份关于在1月1日增持或者撤资的承诺书（一份自留一份寄回）。我希望在12月1日前收到各位的协议和承诺书。当然，承诺书的内容在年底前的任何时间都可以更改，如果你已经寄出承诺书，只需要直接联系我就行，任何更改都可以。
Any withdrawals will be paid immediately after January 1st. Any additions must reach us by January 10 , and
should they be paid in during November, they will take on the status of advance payments and draw interest at the rate of 6% until yearend.
所有的撤资会立即在1月1日支付。增资则需要在1月10日前到账。如果在今年十一月到账，那么这笔钱将会被当作预付款以6%的年利率，按比例支付其到年底的利息。
Please be sure the signature on your partnership agreement is notarized. Partners in Omaha may obtain the notarization at our office if they wish. Also, be sure to let us know by an appropriate circle on the commitment letter whether you wish to receive monthly payments in 1963. In order to be sure everyone understands this, let me again state that these monthly payments are in no sense guaranteed earnings or anything of the sort. They represent a convenient form of regular withdrawal, which to the extent we earn better than 6% are payments from earnings, and to the extent we don't, are payments from capital.
请确保您的合伙协议上的签名经过公证。 各位合伙人如果愿意，可以在我们的办公室获得公证。同时请在承诺书上注明是否愿意在1963年收取月付款。为了确保各位明白，请允许我再次澄清这笔付款和当年的盈利毫无关系。这只是一种定期撤资的方法。如果当年收益超过6%，那么就从收益中扣除；若收益低于6%，款项就会从本金中取。
Complete tax information for your 1962 return will be in your hands by January 20th. If you should need an estimate of your tax position before that time, let me know and I will give you a rough idea. We will also send out a short letter on taxes in late December.
1962年的税务信息将会在1月20日送达各位手中。如果需要在那之前知道大致的税率，请提前联系，我会给出大致的范围。在12月底会有一封关于税率的短信寄出。
Having read this far, you are entitled to a report on how we have done to date in 1962. For the period ending October 31st, the Dow-Jones Industrials showed an overall loss, including dividends received, of approximately 16.8%. We intend to use the same method or valuing our controlling interest in Dempster Mill Manufacturing at this yearend that we did at the end of last year. This involved applying various discounts to the balance sheet items to reflect my opinion as to what could be realized on a very prompt sale. Last year this involved a 40% discount on inventories, a 15% discount on receivables, estimated auction value of fixed assets, etc., which led to an approximate value or $35.00 per share.
从这里开始，我们将大致介绍在1962年的投资表现。直到10月31日，道指总体收益在-16.8%。对于控股公司Dempster Mill Manufacturing （DMM）我们使用和去年相同的估值方法。该方法对于资产负债表上的各个条目的价值都打了很大的折扣以便能及时出手。对于去年资产负债表，对于存货价值按照60%计算，对于应收账款85%，固定资产以拍卖价格计算，等等，总计大概$35/股。
The successful conversion of substantial portions of the assets of Dempster to cash, at virtually 100 cents on the dollar, has been the high point of 1962. For example, inventory of 4.2 million at last yearend will probably be about 1.9 million this yearend, reducing the discount on this item by about 920,000 (40% of 2.3 million reduction). I will give this story my full journalistic treatment in my annual letter. Suffice to say at this point that applying the same discounts described above will probably result in a yearend value of at least 50.00 per share. The extent of the asset conversion job can perhaps best be illustrated in a sentence by pointing out that whereas we had 166,000 of cash and 2,315,000 of liabilities at November 30, 1961 (Dempster fiscal yearend), we expect this year to have about $1 million in cash and investments (of the type the Partnership buys) against total liabilities of 250,000. Prospects for further improvement in this situation in 1963 appear good, and we expect a substantially expanded investment portfolio in Dempster next year.
今年最大的收获是成功地将Dempster的大多固定资产等价转换成现金（基本上就是100美分换1美元）。例如：存货从去年的420万美元降到190万美元，因此去年的折价92万美元将会以现金形式计入到今年的价值中（230万美元的40%）。我将会在年度股东信里面仔细聊聊这个故事。仅从这一项折价的回归就可以使我们的年末价值达到$50/股。下面这句话可以清楚地概括我们今年资产转换工作：在1961年11月20日（Dempster 财报日）我们有16.6万现金和231.5万负债，在今年我们拥有1百万的现金和投资等价物以及25万元的负债。可预测地1963年这部分资产的变化会比今年更好，我相信明年在Dempster上面的投资收益会显著增加。
Valuing Dempster at $50 per share, our overall gain (before any payments to partners) to October 31st for the Partnership has been 5.5%. This 22.3 percentage-points advantage over the Dow, if maintained until the end of the year, will be among the largest we have ever had. About 60% of this advantage was accomplished by the portfolio other than Dempster, and 40% was the result of increased value at Dempster.
按照$50/股的价格计算Dempster的价值，我们截止10月31日合伙企业总体收益为5.5%（不算任何合伙人支付款）。总共领先道指22.3个百分点，这是我们历史最佳成绩。优势中有60%来自投资组合，40%来自Dempster的净值增加。
I want all partners and prospective partners to realize the results described above are distinctly abnormal and will recur infrequently, if at all. This performance is mainly the result of having a large portion of our money in controlled assets and workout situations rather than general market situations at a time when the Dow declined substantially. If the Dow had advanced materially in 1962, we could have looked very bad on a relative basis, and our success to date in 1962 certainly does not reflect any ability on my part to guess the market (I never try), but merely reflects the fact that the high prices of generals partially forced me into other categories or investment. If the Dow had continued to soar, we would have been low man on the totem pole. We fully expect to have years when our method of operation will not even match the results of the Dow, although obviously I don't expect this on any long-term basis or I would throw in the towel and buy the Dow.
我希望所有的合伙人和未来的合伙人了解以上的投资结果是非常少见而且很有可能无法再现。之所以能超越道指这么多，是由于我们大多数的资产都在控股公司和套利中而非股票市场，正好道指有了大幅下挫。如果在1962年道指大幅上涨，我们相对的收益就会很难看，同时1962年收益的大胜绝不是因为我成功地预测了市场（从未试过），仅仅是因为目前股票市场的高位促使我去寻找其他的投资种类。如果道指继续高歌猛进，那我们一定会是图腾柱上那个矮子。我们对投资收益逊于道指有充分的预期，但是显然不希望长期被道指超越，否则我就撂挑子去买指数了。
I’ll cut this sermon short with the conclusion that I certainly do not want anyone to think that the pattern of the last few years is likely to be repeated; I expect future performance to reflect much smaller advantages on average over the Dow.
长话短说，衷心的希望各位不要觉得过去几年的超额收益是可复制的，我预计未来的投资表现相对于道指的优势会小的多。
Each letter ends with the request that you let me know about anything that isn't clear. Please be sure that you do this. We are all geared up with secretarial help, a new typewriter, etc., and we want to be sure that this letter and agreement are understood by all.
每封信的最后都希望各位可以问我一些问题，请各位确保会这么做。我们增加了秘书服务，新打字机等等，衷心希望各位能完全理解新合约和这封信的内容。
Cordially,
Warren E. Buffett