"Buffett summed up 2008 perfectly when he said in his annual report, 'By year end, investors of all stripes were bloodied and confused, much as if they were small birds that had strayed into a badminton game.'

"Yet – like us – Buffett remains optimistic. He and his partner, Charlie Munger, have become two of the world's richest men by following – and improving – the value discipline pioneered by Benjamin Graham.

"When you own a share of Berkshire Hathaway, you have a stake in dozens of fine companies, including GEICO, Benjamin Moore, Dairy Queen, Fruit of the Loom, MidAmerican Energy, See's Candies, ConocoPhillips, American Express, Burlington Northern, Costco, General Electric, Johnson & Johnson, Kraft Foods, Nike, Proctor & Gamble, Wal-Mart, Washington Post and many others.

"Buffett has not been sitting on his hands lately, either. In recent weeks, he has been:

• Maintaining Berkshire's Gibraltar-like financial position.
• Widening the "moats" around his businesses to give them durable competitive advantages.
• Expanding and nurturing the cadre of outstanding managers who, over the years, have delivered Berkshire exceptional results.
• Adding to those companies he feels are undervalued.

"Sure, Berkshire's stocks – like everyone else's – got a substantial haircut over the past year or so. Yet Buffett remains philosophical: 'This does not bother Charlie and me. Indeed, we enjoy such price declines if we have funds available to increase our positions ... I like buying quality merchandise while it is marked down.' We couldn't have said it better ourselves."

Steven Halpern's TheStockAdvisors.com offers a free daily overview of the favorite stock picks and investment ideas from the nation's leading financial newsletter advisors.