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The Snowball: Warren Buffett and the Business of Life |
HenryTo
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 Posted: Sat Sep 20, 2008 11:59 am Post subject: The Snowball: Warren Buffett and the Business of Life |
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First print is a million copies:
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Buffett biography reveals flaws, recounts triumphs
Saturday September 20, 2:07 am ET
By Josh Funk, AP Business Writer
AP: Billionaire investor Warren Buffett's biography reveals flaws, recounts triumphs
OMAHA, Neb. (AP) -- Warren Buffett's youthful confidence about his business acumen hid a self-doubt about nearly everything else, yet the son of a Nebraska congressman grew into one of the world's greatest investors.
The tale of how the brilliant but needy Buffett built a fortune by investing in undervalued companies is recounted in the first authorized biography of the chairman and CEO of Berkshire Hathaway Inc. The Associated Press obtained an audio version of the book Friday, ahead of its Sept. 29 release.
The book's author, former insurance analyst Alice Schroeder, writes that when Buffett was a newlywed in his early 20s, he relied on his wife Susan to help cut his hair, stock the pantry and help him deal with other people.
"In every area of life except business, Susie was discovering her husband was riddled with self-doubt," Schroeder wrote. "He had never felt love, and she saw, he did not feel lovable."
The new book, "The Snowball: Warren Buffett and the Business of Life," goes on to explain how Susan Buffett left Warren Buffett in 1977 and moved to San Francisco. But the couple never divorced before her death in 2004, even though he lived with another woman most of those years.
Buffett married his longtime companion, Astrid Menks, in a private ceremony on his 76th birthday in 2006.
Some of the information in Schroeder's book is new, but much of it will seem familiar to Buffett's legions of fans.
More than most previous books about Buffett, Schroeder examines the billionaire's flaws as well as his successes.
Buffett declined an interview request through a spokeswoman Friday.
Buffett picked Schroeder in 2003 to write the book after getting to know her while she worked as an insurance analyst at Morgan Stanley and wrote a report about Berkshire.
Schroeder wrote in the book's introduction that Buffett encouraged her to take a hard look at his life.
"Whenever my version is different than somebody else's Alice, use the less flattering version," Buffett told Schroeder, according to the book.
Buffett spent thousands of hours talking to Schroeder, and he gave her access to his files and friends. A spokeswoman for Schroeder's publisher has said Buffett reviewed the book but didn't change anything.
The book details Buffett's life and his investing career, which began to take off in 1956. That's when he gathered $105,000 from four relatives and three close friends to start the Buffett Partnership. Later, the partnership began buying the stock of Berkshire Hathaway, a New England textile firm, for $7 and $8 a share in 1962. After 1969, Berkshire became Buffett's investment vehicle.
In 2006, Buffett announced plans to gradually give away his billions to five foundations, with the biggest share going to the Bill & Melinda Gates Foundation.
Schroeder describes how Buffett and his first wife Susan gradually began to spend more time apart as Susan became more involved in community groups and Warren relentlessly pursued investing.
"Susie understood his work as a sort of holy mission," Schroeder wrote.
The book says Susan Buffett thought she and Warren had an understanding that he would quit investing once he amassed $8 million to $10 million.
But her husband's pace never slowed.
In 1977, Susan Buffett visited a friend in San Francisco and decided she wanted to have an apartment there, to be in an art-friendly city and be closer to friends and their youngest son, who was attending Stanford.
After she moved, Susan Buffett encouraged her friend Menks to check in on her husband, and Menks eventually moved in and became Warren's companion.
In 1984, Susan Buffett returned to Omaha for a birthday party for Warren's mother. At that time, Susan told Warren Buffett that her move to San Francisco was related to a relationship with another man.
Buffett did not tell anyone -- even Menks -- about the loss of his beautiful image of his marriage. Instead, Schroeder wrote, he focused on running Berkshire and flushed the painful memory from his mind.
Susan and Warren Buffett remained married and were together often and talked frequently when apart over the years.
Berkshire is now a major player in the insurance field and owns more than 60 companies including furniture, clothing, candy, brick, electricity and corporate jet firms. And at last report, Berkshire had total assets of nearly $278 billion, including significant stakes in well-known companies such as Wells Fargo & Co., American Express and the Washington Post Co.
Pre-orders of the book have already pushed it into the top 75 of Amazon.com's best-seller list. The publisher says the first printing is 1 million copies. |
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The Snowball: Warren Buffett and the Business of Life Replies |
rffrydr
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HenryTo
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| Posted: Sun Sep 28, 2008 10:27 am Post subject: |
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Second excerpt - Buffett reflecting on his Salomon experience:
http://www.ft.com/cms/s/0/43b6f064-8c2c-11dd-8a4c-0000779fd18c.html
| Quote: | Brady went back to his fellow regulators and talked. Most of them felt that this was special pleading. Buffett was asking for some kind of gold-star treatment for Salomon, and the firm did not deserve it. Salomon’s board couldn’t understand why Buffett’s arguments weren’t getting through to the regulators. They ran the financial markets. Why wasn’t it obvious to them that Salomon was going down?
As the afternoon wore on, Buffett’s logic failed, on this most critical occasion, to win over a key ally. He had only one choice left. Of all avenues open to him, of all resources on which he could draw, this one was the most precious, the huge pool of crystal essence that he was most reluctant to tap. Buffett would undertake almost any item from his short list of most-loathed tasks – get into an angry, critical confrontation; fire someone; cut off a long friendship carefully cultivated; eat Japanese food; give away a vast sum of money; almost anything – than make a withdrawal from the Bank of Reputation. For all these many decades, he had brooded over, nurtured, cultivated, and stored that priceless commodity in its vault. Never had he drawn down so much as a drop on behalf of himself or anyone else, except when the odds hugely favoured getting back even more in return.
Now the debacle at Salomon had exposed him utterly, putting the entirety at stake. And the only remaining hope was to ask, to literally beg as a personal favour, drawn purely on his own credibility, for help.
He would be putting himself eternally in Brady’s debt. He was staking his entire reputation – the reputation that takes a lifetime to build and five minutes to lose – on whatever happened afterward. He had to summon more courage than he knew he had.
Buffett’s voice cracked. “Nick,” he said, anguished, “this is the most important day of my life.”
Brady had his own problems to deal with. He didn’t think Buffett’s arguments were any good. But he heard the feelings behind the words. He could hear in Buffett’s voice that the man thought Salomon had thrown him over Niagara Falls in a barrel.
“Don’t worry, Warren,” Brady finally said. “We’ll get through this.” He hung up the phone and went off to consult. |
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HenryTo
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| Posted: Fri Sep 26, 2008 10:59 pm Post subject: |
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First in a series of excerpts courtesy of the Financial Times:
http://www.ft.com/cms/s/0/e804eb80-8b5f-11dd-b634-0000779fd18c.html
| Quote: | Yet even though they did not brag about it outside the bunker walls, some of these mercenaries were doing very well indeed. Howard Buffett took his son down to lower Manhattan and dropped in on the top man at one of the largest brokerage firms. Little Warren Buffett was getting a peek inside the bunker’s gold-plated doors.
“That’s when I met Sidney Weinberg, who was the most famous man on Wall Street. My dad had never met him. He had this little tiny firm out here in Omaha. But Mr Weinberg let us in, maybe because a little kid was along or something. We talked for about 30 minutes.”
As the senior partner of the investment bank Goldman Sachs, Weinberg had spent a decade painstakingly repairing the firm’s reputation after its disgrace for misleading investors with a notorious pyramid scheme in the market crash of 1929. Warren knew nothing about that, nor that Weinberg had grown up an immigrant’s child and started as a porter’s assistant at Goldman, emptying cuspidors and brushing the partners’ silk hats. But he certainly understood that he was in the presence of a big shot once he found himself in Sidney Weinberg’s walnut-panelled office, its walls hung with original letters, documents, and portraits of Abraham Lincoln. And what Weinberg did at the end of their visit made a huge impression on him. “As I went out, he put his arm around me and he said, ‘What stock do you like, Warren?’
“He’d forgotten it all the next day, but I remembered it forever.” Buffett would never forget that Weinberg, a big shot on Wall Street, had paid such attention to him and seemed to care about his opinion. |
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