I guess it's about time for me to

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Koppenheffer: Switching gears, circle of competence. This is something that we hear Warren Buffett talk about so much. What would you consider that your circle of competence is, in terms of investing?

Gayner: "Sugar, money, and dirt" are the three catchwords that I use to describe my circle of competence over the years.

One is the sense that, in sugar, you're talking about food, candy, chocolate, alcohol, things of that nature. Those are things that human beings, in general, like very much; understandable businesses, businesses that produce cash flows that you can make sense of. You can think about what they did the last five years, and what they're likely to do the next five years. That makes a lot of sense to me.

Money -- financial intermediation, banks, brokerage firms, insurance companies, financial advisory businesses, investment management -- things that deal in the inventory of money naturally resonate and make sense to me. I feel very comfortable operating in those worlds.

Dirt are real estate or businesses that you can touch and feel, and have tangible assets to them, and again the cash flows from those businesses tend to be relatively predictable, compared to many others, and reasonable people can make reasonable judgments about those kinds of businesses.

That would tend to define the circle of competence as I would define it right now.

It's also important to never be satisfied with anything, including your circle of competence. One of the things you should always be doing with your circles of competence is see if you can push it a little bit more, because the world changes. It keeps spinning, and things don't stay the same, so you always need to be working and learning and studying to make sure that your circles of competence are relevant.

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