Below statement by Charlie Munger on contracts is worth reading:
In May 2009, when the world was emerging out of the credit crisis, Buffett’s partner Charlie Munger said something fundamental about Berkshire Hathaway that resonated with the 35,000 people present at the annual meeting: “Our model is a seamless web of trust that’s deserved on both sides. That’s what we’re aiming for. The Hollywood model, where everyone has a contract and no trust is deserved on either side, is not what we want at all.” To which Buffett had added, “We don’t want relationships that are based on contracts.” It is this seamless web of deserved trust that is unique to Berkshire.
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