We all know it: 2008 was a terrible year. However, despite the fallout, some words of wisdom rose like phoenixes from the ashes of what we used to call Wall Street.
Let's revisit the nominees for must-read prose of 2008. There are some philosophical gems here, with thoughts we shouldn't forget anytime soon, if ever. After all, we have all been witness to historic times. Please vote at the end of this article on the one you think was the major "must-read" of the year. (And if you want a good laugh, be sure to check out this awesome, scathing goodbye letter to clients from hedge fund manager Andrew Lahde.)
- Berkshire Hathaway's (NYSE:BRK-A) (NYSE:BRK-B) Warren Buffett's op-ed in New York Times' (NYSE:NYT) flagship paper in October, "Buy American. I Am," provided words of calm and common sense for investors. Stuffing cash in the mattress doesn't really make sense, and Buffett reminded us all of his famous words: "Be fearful when others are greedy, and be greedy when others are fearful."
- In Conde Nast's Portfolio magazine, Michael Lewis documented the culture of greed, lack of conscience, and frequent cluelessness in his article "The End of Wall Street's Boom." Too bad Lewis' '80s-era book, Liars Poker, was interpreted by some as a how-to manual.
- The Paulson Plan (talking here about the $700 billion plan, not the plan for sweeping financial regulation) was highly controversial but also wildly important in this harrowing year. So far, it has resulted in the bailout of companies as disparate as Wells Fargo (NYSE:WFC), Goldman Sachs (NYSE:GS), AIG (NYSE:AIG), and General Motors (NYSE:GM). I think many of us won't forget the crisis and controversy any time soon, although some of us may wish there had been a Plan B.
- Jack Bogle, the founder of Vanguard, has been a prolific writer in addition to being a great financial mind, handing out wisdom and some warnings in books like The Little Book of Common Sense Investing and The Battle for the Soul of Capitalism. His newest book, Enough, is a call for responsibility and moderation in business, investing, and life.
- While debt can be a tool, it can also be incredibly dangerous. And if you can't understand a company's balance sheet, or if there's reason to question the validity of the numbers (think of the toxic waste on the financial stocks' balance sheets), then you should steer clear. This has reminded us that balance sheets matter, and investors should pay close attention to cash and debt levels.
