Warren Buffett steps down as Berkshire Hathaway CEO after six decades
latimes.com464 points by ValentineC 7 hours ago
464 points by ValentineC 7 hours ago
We should never idolize a person (in my opinion). Here are some things Buffet has done that I admire (notice that phrasing):
- He consistently communicated with shareholders of Berkshire in a straight-forward and transparent way in his letters and annual reports. If you read these documents, I believe that you will have a solid understanding of how he built Berkshire.
- He maintained a disciplined approach to investing and managing risk over 60+ years.
- He still lives in the same home he bought when he was 28 years old.
That said, it makes me a little sad that we've read the last of his annual letters.
I agree, however I don’t think the last two of your bullets are necessarily something to learn from on the surface.
Disagree. The last one is important.
You can buy a bigger and bigger house car tv stereo whatever, but it will not make you happy.
>You can buy a bigger and bigger house car tv stereo whatever, but it will not make you happy.
Well that seems like an assumption! Plenty of people are happier with nicer things. I don't think we need to tell people what should make them happy.
Though Buffet has kept that first house, he also bought several others along the way.
It's true (I live in Omaha). He is still in the same house.
I didn't grow up here—my wife did. Very early on, when I first visited Omaha, she drove me by his place. After three decades or so in California, I retired and we moved back to her hometown. Buffett is still there.
> You can buy a bigger and bigger house car tv stereo whatever, but it will not make you happy.
Speak for yourself. There are a lot of aspects to being happy, and having to not want for things certainly helps.
This is what I’m talking about. You’re assuming a lot about why and how people move.
Nowhere did anybody say “moving house for any reason is bad”. Buffet could’ve moved if he wanted to, I presume. So, evidently, he didn’t have any of those ‘other reasons’. What we *can^ say is that he didn’t move, which shows that he didn’t allow lifestyle inflation to extend to his place of residence.
The house he bought at 28 is 3500 square feet in a very very nice neighborhood and was worth $1.2 million a few years ago. It's humble by billionaire standards, not by average person standards. He never needed to size-up because of children, or size-down because of a bad economy, he was already set for both space and finances. Let's not create a moralistic myth out of his lack of need.
For reference, this is the house: https://en.wikipedia.org/wiki/Warren_Buffett#/media/File:Dun...
It's insanely humble by billionaire standards. Any FAANG SWE over 30 or so in the United States can get that. Contrast with multiple compounds, entire islands, etc.
Buffet surely made lots of upgrades and has added plenty of material comforts.
But it is quite possible to be a kind of lazy where even 10-20x current wealth, people would live where they currently live. American neighborhoods are reasonable that way. It is just primary home and they would holiday/vacation wherever.
It is highly unusual for someone to stay put after their net worth increases tenfold. Normally, you would expect an individual to seek out more elite social circles and embrace a significantly more opulent lifestyle. Not having that isn’t a sign of laziness (one can be certain that someone like Warren Buffett lives exactly as he chooses) but rather a reflection of the rare ability to decide that what he has is already enough.
I think it's more that he didn't build a gaudy billionaire mansion, even though he easily could have.
>>Here are some things Buffet has done that I admire (notice that phrasing):
Perhaps the best thing Buffet has managed to do is to live long. Most of compounding magic begins at ages 60-65, a time where most investors start to die out.
Second best thing he did was to start/acquire a insurance firm. The 'float' helps them to run a kind of in house index fund on other peoples money, without having to pay TERs/Fees. Thats basically no effort bogle style compounding. Even if you end with a situation where you have to return ALL the premiums collected, you still get to keep the returns.
Other wise everything else is just fairly normal, if you are sitting in front of charts for long, its impossible to miss something that's going up on a weekly timeframe for long periods of time. You just pyramid upwards and wait, patiently.
The real issue is waiting doesn't work too well for most people as you start to die out after 60.
> - He still lives in the same home he bought when he was 28 years old.
Really makes me wonder what drives him. For many people it's the money, but with him it doesn't seem that way. But I haven't read too much about him, so if anyone has insight I'd love to hear about it.
For some people, money is not for buying things, but just for keeping score. That can make it rewarding and addictive to accumulate money, even if you don't buy anything (like a giant house) with it.
The score keeping aspect makes it interesting, just like playing tennis while keeping score is more interesting than just hitting a ball back and forth across the net without counting.
Maybe he just likes building things that others find useful.
When I was younger I rented furniture from a company called CORT. I happened to notice on the contract or receipt or something, that it was a Berkshire company (I didn't know that before then).
If I were Warren Buffet, I would have been happy to know that someone was a satisfied customer of one of his companies. I got some decent furniture for a few months at a reasonable price.
Just like I'm happy when someone is a satisfied user of my software.
Yeah, I kind of agree. I read Andrew Tobias's (did I get the apostrophe right?) book on investing and he made a point very early on: the people who are rich like money. No, not like you and I like money, they like money the way you and I like fishing, or reading, or hiking or whatever. It's their hobby, their love, the thing they like to learn about, read about…
Warren Buffett wouldn't be where he was if he wasn't obsessed with money. But to your point, that doesn't have to translate to material goods: the bigger house, yachts, etc.
Homes and physical community are a pretty personal thing.
Also, given that he is a billionaire, I do kind of assume that he has paid money to upgrade his home at some point, probably also owns additional homes elsewhere, maybe has done other things with his vast amount of money that normal people don't do, that are still consistent with living at the same address as when he was 28.
Driving 7 minutes to work and stopping at a drive-thru to pick up McDonalds breakfast every day. The man is a true American hero.
Being genuine here - what is heroic about those two things?
> what is heroic about those two things?
America threw off a king and founded a republic. Equality is a founding value and one we still respect. A rich man keeping his habits despite his wealth, and doing so next to the rest of us, is a role model for other up and comers.
(The Romans had a similar thing about pastoral farmers. Every culture has its myth, and we like it when those in power try to live up to it.)
Nothing. We shouldn't dilute the term hero. Let's call it what it is "groundedness"
I think they just meant it's very stereotypically american to drive a very walkable distance and eat McDonald's every day
I’m familiar with this neighborhood. If this were my commute I’d probably walk often.
But:
It’s 42 minutes by foot one way, which is on the longer end for most people. About half of it is pleasantly walkable, the rest looking like no trees and along a busy street.
… For probably six months out of the year, the rest being too uncomfortably hot or windy/cold for most people.
And he’s probably wearing a suit and leather shoes every day, so you risk wet/muddy shoes, road salt, or dripping in sweat or rain. Mess up your hair with a hat in the winter.
And if you are going anywhere after, you’ll need a car anyway. The rest of Omaha is not walkable and quite hilly.
And he’s old, quite old. He’s been old for decades. Some people can do 3.6mi/day in their 50s-80s but most will not.
And his time value in literally among the… top ten in the world or so? And has been for decades?
I say all this as a relatively extreme walking advocate: for most people in some locales (including most of America), it just doesn’t make sense, and this criticism is very silly.
He’s Warren Buffet, so he could make this work if he wanted to. He could insist everyone come to him at his home while he wears pajamas.
But it’s not unreasonable to drive this commute.
And you can get a decent breakfast at McDonald’s too :D
A 7 minute drive for me is about a 10 minute walk. A 7 minute drive in America could be 5 miles!
Any American worth that much is safer in a discretely armored car than on foot.
If you let fear dictate your life, you are correct.
You should. And you do too. Otherwise, you would’ve never looked both ways before crossing the street, and you would already be dead.
It's down to earth.
We expect the ultra-wealthy to eat at the French Laundry in California, to have chauffeurs, to live in New York penthouses…
It's just a sarcastic take. I wouldn't read into it too much. If it didn't make you grin like a goofball, it failed and you should just move on to the next comment.
On the one hand yes, on the other hand I would hope that if I was a bazillionaire that I would still keep the comforting habits that worked for me when I was a normie.
I would argue “normie habits” are more depressing than this. Habits like stressing out about feeding your family. Counting the number of days until your money runs out and figuring out what odd jobs you can cover the shortfall with. Not going to the doctor because of the cost.
For many people, stopping by McDonalds inspires guilt, and not just because it’s a bad nutritional choice, but rather because that’s how thin the margins are. I still remember all of these things about my 20s. Now, a couple decades later and by no means super-wealthy, I will happily ignore grocery prices, pay for specialist care and sort of just eyeball my checking account every week or so to make sure I don’t need to shuffle something around.
Not dogging anyone who wants to enjoy the “simple” things in life, and I’m probably one of the more pro-billionaire people on this site (which is hilarious given what this site is really about), but I think most of us are out of touch with what the average American experiences. Midnight Taco Bell runs are an escape for those folks as much as they are a guilty pleasure. I’m happy that for me they can just be the latter.
Not just relative to other billionaires, relative to the average American, he never went after get rich quick schemes, has a reputation less dirty, values life-long relationships more, and fell to not one of so many traps and dynamics that see many successful people trash their own legacy.
The internet citizen is so often convinced that everyone with a high net worth is crooked, cheated to get where they are at, and would be even more morally corrupt if only they weren't so undeserving as to be incompetent of the ways to do so.
So often the ambitious can believe that to succeed one must perform ultra sexy acts of innovation multiplied by inhuman hours of naive young team members. This pressure can drive us to be impatient, reckless, and unscrupulous.
When we look at most startup CEOs who make it big, we say "don't try to emulate them" because we know they took huge risks and rolled at least a few good numbers. A person can emulate Warren Buffet. It's just patient and prudent, avoiding self-deception for decades. Yet it is excruciating. If not for Warren Buffet, so many would say, "It's not worth it" or "It will never work because you'll slip up."
Being at least an anecdote that being honest and right can work out in the long run is a herculean counterweight against the vast traps of cynicism that can lead many to defeat themselves before they even try. It's tough to keep going or commit to that path, especially as your options keep going up. Few else tried because it takes an entire lifetime. Making it work saved a lot of people from a lot of imprudent choices and will continue to save more. That is heroic.
In his youth he was heavily inspired heavily by the book "1000 ways to make 1000 dollars", quite literally a get rich quick book.
Also his bets on GEICO were probably a little impatient, reckless, and unscrupulous, but that's fine.
He is one of the finest businessmen to study and certainly one of the more moral billionaires.
I think they meant hero in the sense of archetype rather than heroic.
But I agree with the person suggesting not diluting the word.
I always salute at the McDonalds drive-thru.
The man has enviable health.
Take a Caesar salad at a McDonald's every day, and your health will likely also be enviable.
The word "salad" doesn't imply "healthy".
It has plenty of green vegetables, and croutons, sauce, and chicken nuggets are all optional. (Ask me how I know.)
Stress is the #1 killer. Being rich likely helps the stress levels. Not worrying about rent/mortgage can likely extend someone's life by 10% easily.
Wealth does that.
Also, consistently eating 1 item from McDonald's every day is probably not going to tank your health (if it's one of your few diet vices).
We've got people drinking 600 calorie frappucinos before they touch a bite of food.
Yet another example to me of how he literally engineered his life for success, using principles like choosing which variables to hold fixed. What discipline.
If he was poor, people would call him lazy for eating mcdonalds everyday...
Whole point of being rich is to have freedom to do whatever you want. Including fancy dress like poor and eat like them for personal marketing at times.
Pretty sure Mr Buffet mostly eats salads.
Poor people should properly budget and cook at home to avoid staying poor
If you can afford to eat McDonald's nobody cares (well it's not healthy either but that's a different matter that doesn't really have to do with being poor or not)
> Poor people should properly budget and cook at home to avoid staying poor
You can't budget your way out of being poor. Most actually poor people (as opposed to people who have a substance abuse problem) I know have a very good grasp of their budget as they are constantly shifting money around figuring out which bills they have to pay and which bills they can put off.
You get out of being poor by getting more money. Period. Nothing else works.
Yes, more money doesn't guarantee you get out of being poor, and we all know people who got a windfall and then were worse off than before.
However, insufficient money absolutely does guarantee that you will be poor indefinitely.
You can't budget your way out of a genuine lowest-quintile income without going to ridiculous lengths that are more difficult than getting a higher-paid job.
You can absolutely reconsolidate and budget your way out of debt, though. Or budget your way to having a savings account when you're earning the median income.
How much money you have depends on how much you make and how much you spend
While you can't budget your way out of being poor if you have a very low income you absolutely can keep yourself poor by not budgeting no matter how much you make
I don't know why you seem to take offense with a simple suggestion that will help reduce how much you spend
There are people who make six figures who are in debt because they overspend and food is often one of the biggest factors in that
> There are people who make six figures who are in debt because they overspend and food is often one of the biggest factors in that
Those people aren't "poor". They aren't worried about eating or staying warm.
"Poor" is when you are deciding between fixing the car you need for work and whether or not you will have electricity the last 4 days of the month. You don't fix that with "clever budgeting".
If you have a negative net worth then I consider you poor no matter how much money you make
But yes obviously there are levels to it however regardless if you are buying overpriced fast food when you could be cooking at home for much cheaper that's not good for anybody especially if you don't make a lot of money... So what's your point other than trying to argue over the definition of poor?
If you don't have an emergency fund and your car breaks down and then you have to get into debt to fix it and then you have to spend more paying interest on that debt and you get stuck in a cycle... Compare that to reducing your expenses by not buying fast food and building up an emergency fund and not getting stuck in that situation to begin with
You don’t have time to do those things if you are poor and working 2-3 jobs. Properly budgeting and analyzing costs takes a lot of time, and unexpected expenses and cost of living increases destroy your budget a lot more than McDonald’s.
> You don’t have time to do those things if you are poor and working 2-3 jobs
I know multiple folks who did this. Poor people aren’t mentally deficient. (Often they’re sturdier than those of us who grew up comfortably enough.)
> unexpected expenses and cost of living increases destroy your budget a lot more than McDonald’s
This is correct. But it’s true for most Americans when we consider medical debt.
Budgeting and analyzing spending and risk is still sensible.
Most poor humans managed to store food for the winter prior to the industrial revolution avoid overeating and draining their stores. I'm sure the poor 2-3 job worker can meal prep with cheap easy meals.
> Properly budgeting and analyzing costs takes a lot of time
For family? Not really
"Poor people should" You should demand more of people with power before you criticize those with none
I'm not demanding anything just giving common sense advice but I guess common sense isn't very common these days
also incredible that america is safe enough for a billionaire to do this alone without security
By several accounts, Buffet has a "McGold" card - good for free food for life, at least at Omaha-area McDonalds locations.
Combined that with his "frugal" and "creature of habit" reputations, that might explain is morning routine.
His whole "I love fast food and coca cola" thing is a fake persona
As a red blooded capitalist who loves this country as much as the next patriot, I can assure you admiration for fast food and coke is 100% real.
Admiration for how American it is maybe but it’s goddamn preservative and sugar ridden slop.
Coca-Cola is a great energy drink. But you have to expend this energy, say, by thinking really hard.
if one is to make a fake persona, fast food and coke (the drink) probably won’t make top-100 list
I seem to recall the secret service was driven crazy by Bill Clinton going for a run out of the white house only to pick up a Big Mac at McDonald's.
Berkshire Hathaway holds over 9% of Coca Cola's shares, worth $28 billion and returning over $800 million a year in dividend payments. Isn't that worth being seen visibly supporting Coca Cola products?
https://3.bp.blogspot.com/-xXwAtQqkN6c/XM3Brj-ZkuI/AAAAAAAAv...
Au contraire, larger-than-life people may desire to pass off as normal & common.
Or that's just what he feels. He also sleeps in a fairly normal home. Wouldn't he have a secret mega mansion if he was just putting on a show?
It's all fake to fool you!! Coca cola is only the popular beverage it is because the illuminati chose Warren to shill for it!!
Well, impossible to prove of course but it reminds me of Ingvar Kamprad (the man behind IKEA) who used to drive an old Volvo when in Sweden to appear as a "man of the people".
In fact he had his main residence in Switzerland and was filthy rich which is a bit of a hard swallow especially in Sweden, a country still very much affected by the "Law of Jante".
https://en.wikipedia.org/wiki/Law_of_Jante
A reporter that was doing a documentary about his wealth asked him once directly when stepping out of his old Volvo and Kamprad kinda lost it; it was a big kerfuffle at the time on the telly.
For those paying attention it was really revealing about the true nature of the man (let me add he was a young Nazi back in the day).
Most people came to his defense like the red-blooded capitalist gentleman commenting above about Buffet being a 100% American.
The older generation still swallow the farce hook, line and sinker. For the rest of us it's pretty clear it was a well thought-out facade to placate the plebeians to sell more cheap furniture.
> he was a young Nazi back in the day
He remained a Nazi member well into the 1950s, which I find truly bizzare.
I didn't know that, talk about being late to the party.
On a tangent I also found this recently about Le Corbusier:
---
Research from the last decade, primarily from a series of books published in 2015 and released correspondence, has confirmed that the influential modernist architect Le Corbusier was a fascist and antisemite with ties to the Nazi-collaborationist Vichy regime in France.
--
He wanted to build this in Stockholm in 1933:
Buffet is not a good guy. Our society’s greatest problem right now is concentrated corporate power being used to destroy the ability of working people to prosper.
Buffet had an active and direct role in making this happen. He supported and advocated for monopoly, and profited from it.
He lived a lavish life that included opulent mansions and private jets, and used his resources to deftly drive a media narrative of himself as a regular guy, with apparent success as your post demonstrates.
Not doubting you, but any specific examples of him supporting monopoly?
Or are you saying the general environment of high finance supports this?
No doubt he had more money than he needed but if this is referring to his preference for coka-cola and apple stock / any stocks with the ability to set their own prices because of market dominance, I feel like that’s not a totally fair criticism.
Tons of evidence it’s all hiding in plan sight:
https://www.thebignewsletter.com/p/warren-buffett-americas-f...
The Verisign investment was a minority holding.
And this bit is tripe: “Buffett is the avatar of monopoly. This is a guy whose investments philosophy is literally that of a monopolist. I mean, he invented this sort of term, the economic ‘moat,’ that if you build a moat around your business, then it's going to be successful. I mean, this is the language of building monopoly power.”
Seeking moats isn’t monopolistic. It’s inherent to competition.
Which “opulent mansions”?
He lives in the same home in Omaha that he had in the 60's. BH does not own any corporate jets but they do own NetJets that sells/leases fractional shares of their jet fleet of which Buffet uses for his travel.
The 6000 sq ft home in Omaha. The $10m+ home in Laguna Beach. Plus purchasing the home next door as overflow
It's very obvious that some of the lesser plutocrats have public PR campaigns now. Zuck obviously got a stylist too.
Can’t even remember if Zuck testified before the Congress or Senate, but his super weird fucking haircut on that day is indelibly etched into my brain. So a stylist is probably a solid strategic choice for him.
Legend has it that Meta was having difficulty making their metaverse Mii characters look human, so Zuck solved that problem by making himself look like a Mii.
Do you feel this way about all billionaires or is it something about Buffet?
I do feel exactly that with few exceptions.
What would warrant an exception? I generally don’t like billionaires either, but I wouldn’t put Buffet at the top of my shit list just for curating a public persona.
There are couple of artists for example that had managed to become near- or full billionaires. Of course I do not know the details but in my view this warrants an exception
Do artists who make business deals also warrant an exception?
https://www.penguinrandomhouse.com/books/180675/trump-the-ar...
I think you must have at least some sort of antisocial and sociopathic personality qualities to become a billionaire.
Sorry, a person who life is built around greed is no hero.
I respect Buffett greatly on a professional level, and think it's the height of arrogance to believe any one of us personally has the moral right to decide which level of lawful activity becomes turpitudinous greed.
THAT SAID...
My uncle (he's 98) had a passing acquaintance with Buffett during their overlap at Penn, and in the one econ class they shared, he remarked having heard Buffett say in almost salivating eagerness as he rubbed his hands that if only there could be another Great Depression, he would make a killing. The dude has value investing in his DNA beyond anything else, I truly believe. But he's argued for changing complex and unfair taxation, and always been a good citizen as far as I can tell. I think if all of Wall Street were like him, the world would be a much better place.
With $150 billion dollars he could have done a lot more than "argue for" changing taxation. If he had spent that money actively fighting for a better system, maybe that'd be worth something. To sit back on your billions and say "aw shucks, this really shouldn't be possible" is not much of an effort.
Edit: Some people seem to be misunderstanding me. I'm saying if he thought taxation was unequal or thought wealth inequality was a problem, he could have used his wealth specifically to fight against billionaires like himself, not just give money towards generic charitable causes.
It seems buffet has taken “the giving pledge” along with Bill Gates and others. “More than 99% of my wealth will go to philanthropy during my lifetime or at death.” - https://www.givingpledge.org/pledger/warren-buffett/
Yes, that's giving it away (some after death), not specifically using it to address wealth inequality.
> that's giving it away (some after death), not specifically using it to address wealth inequality
Because the money isn’t being spent on your pet issue it’s being mis-spent?
I was responding to a comment that defended Buffet by saying he "argued for changing complex and unfair taxation". I'm saying if you have billions that could be spent on taking tangible action to change such taxation, simply "arguing for" changing it is not very impressive.
> if you have billions that could be spent on taking tangible action to change such taxation
Do you have evidence he didn’t try? He’s been a prolific (albeit measured) donor to candidates who have pushed for this [1].
From what I can tell, Buffett enjoyed making money. He outsourced his philanthropy to Bill & Melinda Gates. Their focus has tended to be global poverty.
[1] https://www.opensecrets.org/search?order=desc&q=warren+buffe...
