Banking: "If you can just stay away from following the fads and making bad loans, [it] has been a remarkably good business."
Is there anything different in investing than there is in business as far as the quality of decisions go? Not really. That's part of the point Warren Buffett makes in talking about banking as a business and investment possibility.
With investing, most people know that you don't throw a large part of your money into things like options and commodities, they're almost impossible to guarantee any success with. Only the very best experts in these fields know how to make money with these. And even if you hired the best to advise you, you would still only take a small percentage of your capital to invest there.
That's similar to what Buffett is saying about fads above: we need to stay away from them, no matter what business we're in. As far as banking goes, I lived in Texas when the Savings & Loan business fell, and it was unbelievable the risk these financial institutions had taken in reference to the oil industry. The whole thing almost collapsed; it would have if not for government intervention. This is all connected to the lure of fads.
