By Alice Schroeder
It has been a long time in coming but the authorized biography of Warren Buffet, the world’s greatest
investor, finally hit the shelves in September 2008.
Unlike previous works on the Oracle of Omaha, this is the best insight into what makes Buffet tick and explores how the deep but often complex relationships around him have shaped his vast fortune and his commonsense outlook to life.
Buffet in 2008 was named the richest man in the richest man in the world by Forbes magazine with an estimated wealth of $62 billion. He supplanted Bill Gates, who has been top of the heap for the last 13 years. What makes Buffet unusual is that he has ascended to this position by investing mainly by buying stock on the open market, and therein lies the attraction to his story, the feeling that if he could do it anyone else can – a notion he himself believes to be true.
Born in 1930 Buffet was child of the depression and therefore learnt thrift from a generation ravaged by unemployment and economic uncertainty. This appreciation for the value of money served as the bedrock of an early foray into business and his eventual vocation as an investor.
Buffet who showed an early affinity for numbers, adored his father – a stock broker and Senator, was in awe of his disciplinarian, social climbing mother and grappled with feelings of social awkwardness and inferiority that have plagued him throughout his life.
At six Buffet entered his first business venture, selling chewing gum, which hinted at his doggedness and steely determination as a negotiator. He became obsessed with attaining the freedom that came with being rich and worked out before his tenth birthday, the miracle of capital, that money works for its owner.
The young Buffet dabbled in everything from hawking soft drinks, selling newspapers, owning pin ball machines , leasing land and charting stocks before he came into contact with the teachings of
Benjamin Graham. Graham crytallised the thinking around stock investing whose cornerstone philosophy was that shares should be treated as part ownerships of businesses as opposed to fluctuating prices, and that that decision to invest should only be made when shares were selling a significant discount to their true worth.
Buffet tracked Graham to Columbia University, studied at his feet and eventually worked at his mentor’s investment firm before returning to Omaha, Nebraska to open the most successful investment concern in the history of capitalism.
His company
Berkshire Hathaway, which ironically came out of one of his investment failures, is a multi-billion dollar conglomerate which owns numerous companies in insurance, furniture, jewelry, clothing and shoes while holding significant shareholding in such icons as Coca Cola, Gillette, American Express and Wal-Mart. The company started as a textile business owned by Buffet’s original investment partnership before it folded from the assault of lower cost producers that was.
Buffet comes through as a complex character who, while confident in his abilities as an investor in businesses, is socially inept and over dependent on a line of strong mother figures who at once lead by the hand through life’s minefields and provide the shield for him against the social obligations that would serve as a distraction from his life mission.
His personal tardiness, monkish reclusiveness and inadequate grasp of the niceties of social interaction are all papered over by a raft of ladies that included his free-spirited wife Susan, his friend and confidante media doyen Kay Graham, bridge champion Sharon Osberg, his second wife Astrid Menks and daughter Susie.
His complex relationships play more than a background role in this biography, making useful links to explaining his investing success.
The 900-page plus tome on his life does justice to the life and times of the man and benefitted more than suffered at the low expectation of the result some thought would not be best served when Alan Schroeder, a former accountant was awarded the contract to write one of businesses most awaited chronicle.
The book is a candid narration of a life well lived, peppered with interesting life lessons and charts an era, can be read by even those who are not admirers of Buffet or have little interest in the world of investing.