As many of you know, the past three years have presented me with challenges in the form of injuries and surgeries. I've worked hard to return to full competitive form. But I also know my body's capacities and limits, and its message to me lately has been clear. I am 41 years old. I have played more than 1,500 matches over 24 years. Tennis has treated me more generously than I ever would have dreamt, and now I must recognize when it is time to end my competitive career.

You gave a six-year-old boy his Laker dream And I'll always love you for it. But I can't love you obsessively for much longer. This season is all I have left to give. My heart can take the pounding My mind can handle the grind But my body knows it's time to say goodbye.

No, because I was set for it. My core, my whole life was medicine. I wanted to become a specialist. So for ten years I concentrated solely on medicine. It took ten years to become a consultant in neurology.

As a very young singer, I was invited to the opera house in Berlin by the then-director of the opera house, Egon Seefehlner, and I had one opera to my name that I knew. He felt that there was a lot that I could learn there, which was very true, and I was so lucky to be able to have this opportunity. The thing that was happening is that I kept being offered operas that I knew that I wasn’t ready to sing, just from an experience point of view, as well as being 24 years old. So I was always asked to sing things that I thought, “Well no, I really don’t think I should sing that now. I need to sing that maybe in five years, or maybe in 10 years, but not right now. Couldn’t I please sing something else?” And that became a difficulty for me. And after being at the opera house for three years, and singing Elsa and Elisabeth — the Wagner roles that are not sort of the heavy Wagner roles — and then Mozart operas that suited my voice at the time, I was continually invited to sing things that I just felt I shouldn’t. So I took it upon myself to go to speak with the artistic director to say that I thought I should leave the opera house, and come back in some years when my maturity sort of chronologically would have caught up with the invitations that I was being offered. Of course, considering that he’d taken me into the opera house when I knew one role, he wasn’t all that happy. I thought he’d say, “Oh, what a smart girl. Oh yes, absolutely. That’s what we’ll do.” No, no. He was absolutely furious.

Most investors, of course, have not made the study of business prospects a priority in their lives. If wise, they will conclude that they do not know enough about specific businesses to predict their future earning power. I have good news for these non-professionals: The typical investor doesn't need this skill. ... The goal of the non-professional should not be to pick winners – neither he nor his "helpers" can do that – but should rather be to own a cross-section of businesses that in aggregate are bound to do well. A low-cost S&P 500 index fund will achieve this goal.

And now, you've got nine countries, including, you know, a guy in North Korea. I mean, and there will be, something will happen. And we worried enormously about it when there were two. And we had perfectly, we had really pretty sane leaders in Kennedy and Khrushchev. You know, I mean, you were not dealing with unstable people or anything like that.

Yeah and we get calls all the time, and there's so many calls, but the like I said, it takes me five seconds to say no. It takes, Greg's a little more polite than I am, but I just as soon get the calls just to see what people are doing. But they aren't offering anything that's at an attractive price, and what they want is a trade.

My first mistake, of course, was in buying control of Berkshire. Though I knew its business - textile manufacturing - to be unpromising, I was enticed to buy because the price looked cheap. Stock purchases of that kind had proved reasonably rewarding in my early years, though by the time Berkshire came along in 1965 I was becoming aware that the strategy was not ideal. If you buy a stock at a sufficiently low price, there will usually be some hiccup in the fortunes of the business that gives you a chance to unload at a decent profit, even though the long-term performance of the business may be terrible. I call this the "cigar butt" approach to investing. A cigar butt found on the street that has only one puff left in it may not offer much of a smoke, but the "bargain purchase" will make that puff all profit. Unless you are a liquidator, that kind of approach to buying businesses is foolish.

We've just passed a milestone: Twenty years ago, on January 3, 1972, Blue Chip Stamps (then an affiliate of Berkshire and later merged into it) bought control of See's Candy Shops, a West Coast manufacturer and retailer of boxed-chocolates. The nominal price that the sellers were asking - calculated on the 100% ownership we ultimately attained - was $40 million. But the company had $10 million of excess cash, and therefore the true offering price was $30 million. Charlie and I, not yet fully appreciative of the value of an economic franchise, looked at the company's mere $7 million of tangible net worth and said $25 million was as high as we would go (and we meant it). Fortunately, the sellers accepted our offer. The sales of trading stamps by Blue Chip thereafter declined from $102.5 million in 1972 to $1.2 million in 1991. But See's candy sales in the same period increased from $29 million to $196 million. Moreover, profits at See's grew even faster than sales, from $4.2 million pre-tax in 1972 to $42.4 million last year.

We have two pieces of regrettable news this year. First, Gladys Kaiser, my friend and assistant for twenty-five years, will give up the latter post after the 1993 annual meeting, though she will certainly remain my friend forever. Gladys and I have been a team, and though I knew her retirement was coming, it is still a jolt.