I started reading Warren Buffett: The Making of an American Capitalist by Roger Lowenstein around March of this year. Nearly eight months later, I just finished it. During that time, I had gone through my own process of change, as I moved to a new city, experienced training on the east coast, and began working at a bank, something that was never part of my career aspirations in college.
To structure this blog post, I will first summarize what I believe were key points in The Buffett Way of doing things, which do have merit, but should not be seen as a concrete scripture to live by. Although he does have very successful practices, it is not best to copy another's path to success because that may not be the path for you. I believe that everyone has their own path that they need to discover for themselves and can use others' ideas as a framework or a foundation, but still tweak it to fit their own personal situations.
The Buffett Way
Warren Buffett's entire life's purpose was to accumulate capital. As a young boy, he scoured horse tracks for dropped winning tickets and even made entrepreneurial businesses such as a newspaper route and a pinball machine business. With this capital, he used it to start his investment fund following the principles of Graham and Dodd. He saw each investment as a long-term investment and invested in businesses, not stocks. He was able to evaluate these different businesses by reading through publicly available information such as annual reports and analyzing their financial statements. He treated his family members the same rational way, not wanting to spoil his children and living a very plain and austere life for himself as well. Buffett is greatly scared of death, and despite his brilliance in investing does have oddities and externalities in his social behavior (he is charismatically weird).
My Interpretations
Buffett does have some great strategies to life and investing that many people overlook today. So much of investing can come from simply reading the annual reports of companies, of those that you are interested in investing in and of its competitors, but most people are too lazy nowadays to look through all the pages in a document. Instead, they settle for EBITDA and projected EBITDA as being the main representation of what a business' prospects will look like in the future.
On his accumulation of capital, Buffett is indeed an extreme case. The book is clearly biased in its glorification of Buffett because they overlook the fact that Buffett did come from a family of great means, as his father was a United States Senator. It would be interesting to hear of a story of an individual who came from the means of an average middle-class family and see the strides that they can make besides the rare success stories that involve not only great skill, but also tremendous luck: the Michael Dells of the world. In all reality, the world is full of great ideas, and it does take some luck to get the right pieces into place for a great success such as these.
Finally, the most disagreeable aspect of The Buffett Way that I have found is the way he dealt with his personal matters. Buffett is so scared of change and death that he seemingly did not embrace or live life. He did mention in his book that being rich lead him to be in "certainly interesting environments" such as playing golf with Bill Clinton and being friends with Bill Gates, but life can be even made much simpler than that. The sheer thrills of trying a new restaurant, bringing a smile to a close family member or a friend, or even accomplishing the small feat of losing five pounds here and there are small joys that life can offer anyone at anytime. This is something that Buffett has probably overlooked. Thus, although he will be remembered as one of the most successful people in history, I can see people more successful than him on a daily basis in terms of daily living.
Just as I prefaced this opinion in my introductions of this post, I do welcome people to offer their own opinions to this theory, and I welcome those that are differences to mine. I am far away from being near Buffett's net worth and may never reach such a level, but I will certainly try to live my life as best as it can be lived, which is all I can ask for at this moment.
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