Long-Term Investing in a Short-Term World: How Psychology and Incentives Shape the Investment Industry

When our long-term competitive position improves as a result of . . . almost unnoticeable actions, we describe the phenomenon as “widening the moat.” And doing that is essential if we are to have the kind of business we want a decade or two from now. We always, of course, hope to earn more money in the short-term. But when short-term and long-term conflict, widening the moat must take precedence. If a management makes bad decisions in order to hit short-term earnings targets . . . no amount of subsequent brilliance will overcome the damage that has been inflicted.
--Warren E. Buffett, Berkshire Hathaway Letter to Shareholders (2005)

Long-Term Investing in a Short-Term World: How Psychology and Incentives Shape the Investment Industry, Michael J. Mouboussin(2006년 5월 18일)