Warren Buffett praises Tim Cook, slams companies that exaggerate their earnings, and underlines the power of interest rates in his shareholder letter. Here are the 7 best quotes.

In his annual letter to shareholders, Warren Buffet praised Apple CEO Tim Cook, slammed companies that adjust their earnings, and reiterated his long-term investing approach.

The billionaire investor underscored his frustration with holding cash instead of owning businesses, emphasized the influence of interest rates on asset valuations, and reflected on his years of teaching.

Here are Buffett's 7 best quotes from his latest shareholder letter:

Buffett and his business partner, Charlie Munger, buy stocks based on their expectations of long-term business performance, not in anticipation. He may have been responding to confusion about the timing of the bet.

Tim Cook, Apple's brilliant CEO, regards users of Apple products as his first love, but all of his other constituencies benefit from Tim's managerial touch as well.

As stocks have risen, deceptive and fanciful adjustments to earnings have become more frequent. Speaking less politely, I would say that bull markets breed bloviated bulls.

From time to time, Charlie and I have had similar cash heavy positions. These periods are never pleasant; they are also never permanent, andBuffett emphasized that he preferred owning businesses at the right price.

Long-term interest rates that are low push the prices of all productive investments upward. Interest rates will always be important, but other factors influence valuations as well.

Teaching has helped me clarify my thoughts. If you sit down with an orangutan and carefully explain to it one of your cherished ideas, you may leave behind a puzzled primate, but will yourself exit thinking more clearly.

My toughest audience was my grandson's fifth- grade class. I mentioned Coca-Cola to the 11-year-olds and they looked at me blankly. I learned that secrets are popular with kids.