I am a huge fan of Warren Buffett's investment philosophy because I think it applies not only to investments in stocks, bonds, and other cash equivalents but to entrepreneurs as well.  Today I was reading Buffett's letter to the shareholders of his enormously successful company Berkshire Hathaway Inc.  Now, believe me, with the exception of a notable few, I don't spend my time reading annual reports because most are pretty boring.  But I always find that I learn something new when I read Buffett's annual letters to the shareholders, and they can be quite entertaining as well.  One of the important take-aways from this letter was the idea that "when investing, pessimism is your friend, euphoria is the enemy."  That should come as relief and encouragement to entrepreneurs who, like Buffett, believe that now is precisely the time to find the best deals, whether that be a great lease rate on office space or bigger discounts from your suppliers.  When the media and the doom and gloom Congress spout their negative view of things (usually for their own agenda), it's time to use that pessimiism to your advantage.  If everyone else is holding back, maybe it's time to move forward!  Maybe, like Buffett, you should refuse to participate in the recession.

Buffett and his long-time partner Charlie Munger have followed four simple rules in good times and bad.  Maybe we should too.

1. Stay liquid and maintain multiple sources of earnings.
2. Expand the competitive advantages your business has - create a huge moat around your business.
3. Acquire and develop new and varied streams of revenue
4. Expand and nuture your outstanding employees - surround yourself with people smarter than you.

Good advice for uncertain times.  if you want to read Buffett's letter to the shareholders, you'll find it here.