Warren Buffett: “People Still Don’t Want to Think It Will Work”

Critics have been writing the obituary of value investing for more than 40 years. The strategy keeps refusing to die, and a recent episode of The Investing for Beginners Podcast explains why the skepticism itself may be part of the edge.

In the segment “What ‘Invest With a Margin of Safety’ Really Means,” co-host Andrew Sather points to a long-standing Warren Buffett observation that value investing “either instantly catches with you or it doesn’t.” Sather paraphrases Buffett’s commentary in The Intelligent Investor, where Buffett noted that “even though there’s been these great track records and it’s all public and you can see it, people still just don’t want to think it will continue to work or just works at all.”

That resistance was already entrenched in the 1980s, when critics first declared Benjamin Graham’s framework outdated. Buffett’s counterpoint was that disbelief is the feature, not the bug. As long as most market participants dismiss the approach, mispriced securities keep appearing for the patient minority willing to do the work.

Why the Math Still Favors Patient Investors

The underlying premise of value investing is that share prices eventually track corporate earnings. The earnings side of that equation has held up. U.S. corporate profits reached $4,392.5 billion in the first quarter of 2026, according to the Bureau of Economic Analysis, growing 12% year over year. Domestic profits alone reached $3,826.8 billion, with the financial sector contributing $894.4 billion.

Profits have climbed from roughly $3,172.5 billion in the first quarter of 2022 to today’s level. That kind of steady aggregate growth gives value investors raw material to work with. When a high-quality business trades below the present value of those cash flows, Graham’s margin of safety concept gives the buyer a cushion against analytical error, recession, or sentiment shocks.

The On-Ramp Problem

Many readers never get to that cushion because they bounce off the source material.

Sather acknowledges that The Intelligent Investor remains challenging to digest, with many readers abandoning it entirely. His suggested workaround is to begin with Peter Lynch’s One Up On Wall Street, which he found “a lot gentler” than Graham’s prose. Lynch’s “invest in what you know” framework is a softer entry point that still trains the same core habit: study the business, then judge the price.

We’ve covered Lynch’s approach in our breakdown of his best-known quote, and Buffett’s own pattern recognition in why he keeps spotting what others miss. Both pieces reinforce Sather’s point that the philosophy has to resonate before the techniques will stick.

The Margin of Safety as Foundation

Co-host Stephen Morris adds that value investing “can scratch multiple itches” even for investors who have tried day trading or momentum strategies and grown weary of the churn. The unifying idea is Chapter 20 of The Intelligent Investor, where Graham defines the margin of safety. Buy an asset for materially less than a conservative estimate of its worth, and the gap absorbs the inevitable mistakes.

For investors evaluating individual names, the practical checklist looks similar to what it did in Graham’s era: durable earnings power, a balance sheet that survives bad quarters, management that allocates capital sensibly, and a purchase price that leaves room for being wrong. The BEA data showing corporate profit growth running at a 12% annual clip suggests the earnings engine driving that framework is still running.

The takeaway from Sather and Morris is straightforward. If the philosophy resonates on first contact, lean in and start with Lynch before working up to Graham. If it doesn’t, that reaction is exactly what keeps the opportunity available for everyone else.