82 Reasons We Love Warren Buffett

Today is Warren Buffett's 82nd birthday. Each year, I celebrate the Babe Ruth of Investing's birthday by adding another reason we love our hero.

1. Intricate, occasionally contradictory complexity hides beneath the aw-shucks folksy charm. As a Forbes writer once put it, "Buffett is not a simple person, but he has simple tastes."

2. Many people talk about avoiding the madding crowd, but Buffett actually does it by living 1,250 miles away from Wall Street.

3. He has a fortress-like internal scorecard on all things investing, but a vulnerable, endearing external scorecard on many aspects of his personal life. See his penchant for seeking mother figures.

4. Perspective: "In the 20th century, the United States endured two world wars and other traumatic and expensive military conflicts; the Depression; a dozen or so recessions and financial panics; oil shocks; a flu epidemic; and the resignation of a disgraced president. Yet the Dow rose from 66 to 11,497."

5. He is that guy in school who tells you he may have failed the test ... only to bust the top of the curve.

6. His time frame for the long run consistently exceeds his life span.

7. Him saying it better: "Someone's sitting in the shade today because someone planted a tree a long time ago."

8. He's human. He fears nuclear war and his own mortality. He's frequently more adept at business relationships than personal ones. He can hold a grudge. His hero is his daddy.

9. Classic line: "Rule No.1: Never lose money. Rule No.2: Never forget rule No.1."

10. Once branded a stingy miser (rightly or wrongly), Buffett has evolved (assuming it wasn't his intention from the start) into one of the most effective philanthropists I know. After growing his potential givings at a 20% compounded rate per year, he set a plan to give most of it away.

11. Perhaps as importantly, he put ego aside and outsourced the charitable decision making to the Bill & Melinda Gates Foundation. Circle of competence at its finest.

12. "I never attempt to make money on the stock market. I buy on the assumption that they could close the market the next day and not reopen it for five years." Contrast that with computer algorithm-based trading, day trading, and some of the moves you've made in your own account.

13. Buffett's smarter than you and I, but he's kind enough to let us feel otherwise.

14. David Sokol was once an heir apparent and arguably Buffett's most trusted operations guy. But when Sokolgate erupted, Buffett stayed true to his word: "We can afford to lose money -- even a lot of money. But we can't afford to lose reputation -- even a shred of reputation."

15. "Derivatives are financial weapons of mass destruction." He said it early, and we are reminded of it often.

16. In a glimpse of the nuance that some commentators call hypocrisy, Buffett uses derivatives himself. But he does so in a way that doesn't threaten the entire financial system and explains exactly why in his annual shareholder letters.

17. He doomed himself from ever holding public office: "A public-opinion poll is no substitute for thought."

18. I like juxtaposing these two quotes: (1) "It's better to hang out with people better than you. Pick out associates whose behavior is better than yours and you'll drift in that direction." (2) "Wall Street is the only place that people ride to in a Rolls-Royce to get advice from those who take the subway."

19. "You only have to do a very few things right in your life so long as you don't do too many things wrong."

20. He has the ability to resist the allure of the quick fix or quick buck when longer-term dynamics are at play.

21. Not sure if this quote was before or after the Internet: "Let blockheads read what blockheads wrote."

22. For those hoping to become famous and respected, he's a testament that the challenges and doubts keep coming regardless of the length of the track record. He's publicly prevailed so far.

23. An investing truism: "Price is what you pay. Value is what you get."

24. The business side of that investing truism: "Your premium brand had better be delivering something special, or it's not going to get the business."

25. He uses colorful language and analogies when drab jargon could do the trick.

26. Boring example: moat vs. competitive advantage.

27. Not-so-boring example: sex.

28. "Look at market fluctuations as your friend rather than your enemy; profit from folly rather than participate in it."

29. Classic line: "Only when the tide goes out do you discover who's been swimming naked."

30. He backs up his saying, "Our favorite holding period is forever," by keeping past-their-prime subsidiaries others would "spin off to unlock value."

31. His Robin (Charlie Munger) can kick your Batman's butt.

32. He makes loophole-free handshake deals.

33. "Risk comes from not knowing what you're doing."

34. Keep it simple, stupid, quote No. 1: "The business schools reward difficult complex behavior more than simple behavior, but simple behavior is more effective."

35. Keep it simple, stupid, quote No. 2: "There seems to be some perverse human characteristic that likes to make easy things difficult."

36. The Berkshire Hathaway (NYSE: BRK-A  ) (NYSE: BRK-B  ) annual meeting is an unrivaled spectacle in investing, truly living up to its billing as the Woodstock for Capitalists.

37. One of the most succinct summations of why America is great: "There are 309 million people out there that are trying to improve their lot in life. And we've got a system that allows them to do it."

38. Trash-bin-diving caution No. 1: "It's far better to buy a wonderful company at a fair price than a fair company at a wonderful price."

39. Trash-bin-diving caution No. 2: "Time is the friend of the wonderful company, the enemy of the mediocre."

40. He's an eternal optimist in a sound-bite culture that often rewards pessimists.

41. His shareholder letters reveal an artisan-like craftsmanship only seen when the proprietor cares deeply about his creation.

42. The contrarian credo: "We simply attempt to be fearful when others are greedy and to be greedy only when others are fearful."

43. Genius fails: "When a management with a reputation for brilliance tackles a business with a reputation for bad economics, it is the reputation of the business that remains intact."

44. Like so many great thinkers, Buffett is able to ignore noise and whittle a decision down to its core variables. After he explains those variables, the decision sounds elementary.

45. Why banking can be dangerous: "When you combine ignorance and leverage, you get some pretty interesting results."

46. He allows me to see the word "Buffett" without thinking of Jimmy.

47. Buffett maintains a high thought-to-speech ratio.

48. Buffett's librarian fantasy: "If past history was all there was to the game, the richest people would be librarians."

49. He converts a deadly sin into a virtue: "You do things when the opportunities come along. I've had periods in my life when I've had a bundle of ideas come along, and I've had long dry spells. If I get an idea next week, I'll do something. If not, I won't do a damn thing."

50. Averaging 20% returns for almost half a century results in beating the S&P 500 78:1!

51. Even as he has fewer and fewer meaningful investing options because of the size of Berkshire Hathaway, he continues to wow us.

52. On a chili-dog-and-onion-ring-flavored note, Berkshire Hathaway owns Dairy Queen, my favorite fast-food chain.

53. Many of Buffett's managers were wildly successful entrepreneurs before selling out to Berkshire. Convincing successful, often headstrong, boss-less superstars to voluntarily subjugate themselves and to keep those people motivated and happy is a feat.

54. On a related note, Buffett doesn't micromanage. Good thing, with an empire this large.

55. He gets doubted again and again and again and proves the doubters wrong most of the time. Yet, you never hear him say "I told you so."

56. Well, maybe sometimes he gloats. Harvard Business School rejected him, which led him to study under his mentors Benjamin Graham and David Dodd at Columbia. His "how do you like me now?" statement: "Harvard did me a big favor by turning me down," he said. "But I haven't made any contributions to them in thanks for that."

57. He has become America's de facto investing teacher. And he's done so willingly.

58. Perhaps my favorite Buffett line: "We like things that you don't have to carry out to three decimal places. If you have to carry them out to three decimal places, they're not good ideas."

59. Not that he can't be ruthless, but Buffett tends to look for win-win situations where possible. Contrast that with the Wall Street art of "ripping the face off" of clients.

60. He's often described as a "learning machine," extending his natural abilities and allowing him to make behemoth investing decisions over the span of just hours.

61. He added to Ben Graham's teachings with the help of that learning-machine ability and Munger's counsel.

62. Here's a good place to point out that available-to-all company annual reports are the primary fuel in his learning machine. He reads them voraciously to compare and contrast companies and build his business knowledge base. See the next point.

63. When asked what the most important key to his success was, Buffett answered, "focus." His biographer Alice Schroeder elaborates: He has "focus like you have never seen on anybody else." For good or ill, Buffett's entire life has been dedicated to investing. It's much harder than he lets on.

64. Plenty of business fish in the sea: "There are all kinds of businesses that I don't understand, but that doesn't cause me to stay up at night. It just means I go on to the next one, and that's what the individual investor should do."

65. How many people can pull off being a contrarian by buying shares of Coca-Cola?

66. Even with an investing world full of Buffett students and imitators, he manages to surprise.

67. He takes every legal, ethical advantage available in the current system, but lobbies for a better system. For example, he supports higher taxes for the rich, more severe estate taxes, and a level playing field. As he puts it, "I don't like anything where the bottom 20% keep getting a poorer and poorer deal."

68. He is grateful for the advantages he has had in life -- as many of us have, he won the "ovarian lottery."

69. When he talks, E.F. Hutton listens.

70. Like many geniuses, he is frequently the confounding exception to the rule. For example, Berkshire Hathaway has never paid a dividend and only started share repurchases recently. It also doesn't split the chairman and CEO roles. And we shareholders thank him for it.

71. Buffett buys what he knows (and frequently loves), but he doesn't overpay out of affection. He has the discipline to wait decades for the right opportunity.

72. He gives credit to his direct reports.

73. Not only is Buffett a great investor and manager, he's one hell of a writer. My jealousy grows.

74. He once picked up a date in a hearse he co-owned.

75. Before having his money work for him, he worked for his money early on with a series of jobs, schemes, and ventures. These included a paper route, selling chewing gum door-to-door, a pinball business, a sales job at J.C. Penney's, caddying, marking up refurbished golf balls, and founding a horse-racing tip sheet.

76. It's very possible the house you live in is worth more than the house Buffett lives in -- the house in Omaha he bought in 1958.

77. Over the years, he has relied on a similar set of answers to oft-asked questions. That his philosophy has stayed stable throughout that time is remarkable.

78. His wealth has bought him the ultimate trophy: He does whatever he wants to do just about every single day.

79. He's the outsized calming influence a lot of us need. From his biography Snowball: "If a tornado were barreling straight toward Kiewit Plaza [where his office is], Buffett would say that things were 'never better' before mentioning the twister."

80. Anyone who can make the hyper-opinionated Charlie Munger regularly utter "I have nothing to add" must be saying something impressive.

81. When his time to step down finally comes, it will take a village (a CEO, a chairman, and multiple portfolio investors) to perform his current responsibilities.

82. That said, he fully expects this list to one day reach well into the triple digits. And I look forward to adding those lines. Happy birthday, Mr. Buffett!

If you enjoyed this article, The Motley Fool is celebrating "Worldwide Invest Better Day" on Sept. 25 by sharing revealing and actionable wealth-building insights via articles, videos, podcasts, and more! Join the movement!

Fool contributor Anand Chokkavelu owns shares of Berkshire Hathaway (are you shocked?). He thanks fellow Fool Mike Klesta for the idea to celebrate Buffett's birthday. You can follow Anand on Twitter. The Motley Fool owns shares of Berkshire Hathaway and Coca-Cola. Motley Fool newsletter services have recommended buying shares of Coca-Cola and Berkshire Hathaway. The Motley Fool has a disclosure policy. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.


Read/Post Comments (23) | Recommend This Article (79)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On August 30, 2012, at 10:31 AM, TMFNewCow wrote:

    8/30 was my birthday first!

    Wait, no it wasn't.

    -- Evan

  • Report this Comment On August 30, 2012, at 11:54 AM, TMFBomb wrote:

    Birthdays aren't a zero sum game so a very happy birthday to you too, Evan!

  • Report this Comment On August 30, 2012, at 2:53 PM, NickD wrote:

    Warren Buffett has averaged about 72k dollars usd for every hour hes been alive.........

  • Report this Comment On August 30, 2012, at 3:01 PM, TMFBomb wrote:

    @iseeksafestocks,

    That's a great one!

    Fool on,

    Anand

  • Report this Comment On August 30, 2012, at 3:38 PM, mikecart1 wrote:

    Every second Warren Buffet has been alive, he has generated $20 which is nearly 20x as much as the worldwide poverty line of $1.08/day.

  • Report this Comment On August 30, 2012, at 5:31 PM, rhealth wrote:

    48. Buffett's librarian fantasy: "If past history was all there was to the game, the richest people would be librarians."

    My librarian fantasy is not fit to publish...at least not here.

  • Report this Comment On August 30, 2012, at 5:54 PM, GrumpyOldGuy wrote:

    I love Warren because he will charm you with his "Aw Shucks, I'm just a simple man" talk while he is emptying your pockets of anything valuable..

    The man is the Great White Shark of the investing world and can smell blood in the water from across the globe.

  • Report this Comment On August 30, 2012, at 6:26 PM, DoctorLewis4 wrote:

    Happy birthday Mr. Buffett. You are an inspiration and a great American.

  • Report this Comment On August 30, 2012, at 6:34 PM, Zankudo wrote:

    Money is merely a tool, not an end in itself. What is the point to piling up that much wealth other than the fact of such adoring adoration for a life spent in pursuit of mammon. How much do you really need. The rest of it is just a game.

  • Report this Comment On August 30, 2012, at 6:50 PM, dgmennie wrote:

    A Warren Buffett lovefest? My God!

    You Fools all need to read the August 2, 2012 Wall Street Journal column "When Will Retail Investors Call it Quits?" by Jason Zweig who says "The hearts of many small investors have been broken by the serial setbacks of the past few years...."With events like the flash crash and this week's stumble,...you could buy and hold a company for 15 years and have everything you've built up disappear in five minutes."

    When is the MF going to take off those rose colored glasses and regularly address investing reality? Stocks are not a road to riches. Rather they are near-certain disaster (now on autopilot thanks to computerized trading) for the vast majority of investors. "Markets spinning out of control and trading machinery gone mad" says Zweig. Amen.

  • Report this Comment On August 30, 2012, at 10:28 PM, Isetta wrote:

    Mr. Buffett:

    Your family and you are truly inspirational. An example of the way your children follow your values: I bought Peter's book a couple of years ago at the shareholder's meeting. He was kind enough to sign it for me. After I read it, I thought of my cousin who had helped me deal the loss of my dog. I emailed Peter and asked if I could buy a copy for her. About three days later, a copy arrived on my doorstep autograped for my cousin without any expectation of payment. I was truly touched. Susan and Howard are equally as kind, always stopping to speak with the many people who stop them in the hall of the meeting.

    I have heard you say how lucky you are to have your friends. Please count me as one!

    Happy Birthday; I wish you many more happy years!

    Bryan

  • Report this Comment On August 30, 2012, at 10:57 PM, JadedFoolalex wrote:

    dgmennie

    WHAT CRAP!!!

    Jason Zweig should know better!! Having penned the intro to the book "The Intelligent Investor" authored by Warren Buffett's teacher, Benjamin Graham, the father of modern value investing, perhaps, he hasn't read the book??? Doubtful, but possible! Still, an investor is just that. He/she invests!! He/she doesn't trade, doesn't bounce in or out of stocks at a whim, doesn't follow the herd!!! Anyone who does is NOT an investor. Anyone who wants to pit themselves against machinery will get slaughtered! That's why you invest, not TRADE!!!!!

    As well, you seem to be a "doubting Thomas" yourself! Why are you here? Read the book "The Davis Dynasty" and you will see that anyone who INVESTS, you listening....can amass a fortune in the stock market. If humanity stopped living, stopped buying food and shelter and clothes, stopped banking and traveling and putting money in banks, stopped using electricity and gasoline and other types of fuel, then maybe, just maybe, you and Mr. Zweig might be right, but I'm betting on humanity, Thank you very much!

  • Report this Comment On August 31, 2012, at 1:46 AM, Prospero13 wrote:

    dgmennie

    To reiterate what JadedFoolalex just said, why are you here if you believe "stocks are near-certain disaster (now on autopilot thanks to computerized trading) for the vast majority of investors"? Also, why are you reading the WSJ? Shouldn't you have all your cash under a mattress somewhere earning -3% interest when accounting for inflation?

    I'm sure people who bought Apple in 2005 and are still holding are glad they don't share your beliefs. The same goes for shareholders of Priceline or McDonald's or Intuitive Surgical.... I could go on, but I'd be here all night.

  • Report this Comment On August 31, 2012, at 2:01 AM, sikiliza wrote:

    @Zankudo

    I feel you brother. And that's why you need to talk to someone. Your comment is misplaced more so since Warren Buffett has always spoken of the pursuit of value, which is not quite the pursuit of money.

  • Report this Comment On August 31, 2012, at 8:53 AM, howboutme wrote:

    Lest we forget,

    He mast much of his fortune by making deals of quantity purchases for a great lower end price, gaurranting a return in the black no matter the outcome of the stock as long as it did not crash. The little fool does not have that option in the market. With that buying power- failure is not in the equation.

    Apples to oranges!

  • Report this Comment On August 31, 2012, at 10:14 AM, mikecart1 wrote:

    dgmennie, if in investing is a path to near-certain disaster, then I'm a hurricane, tornado, earthquake, and volcano rolled up in one. I am the apocalypse in the making. I am the asteroid from outerspace. I'm the supernova burning everything on earth in its place. I'm the aliens that are from War of the Worlds. I'm Galactus that eats up entire worlds!

    :)

  • Report this Comment On August 31, 2012, at 9:51 PM, NickD wrote:

    if stocks lose your money then how is my dad making over 100k in dividends when he never once in his 51 years made more then 75k a year working...he now sits home or w/e he wants n makes 100k a year dotn think he lost money in stocks

  • Report this Comment On September 02, 2012, at 6:47 PM, dgmennie wrote:

    Regarding those who disagree with my pessimistic take on the stock market:

    Yes, there is always inspirational first-person testimony arriving from those who bought into Apple, Wal-Mart, Microsoft, Intel, Netflix, and a small cadre of other corporate winners at just the right moment. But where is the larger universe of investors who were steered into Lehman Brothers, General Motors, AIG, Facebook, etc. (up to and including Bernie Madoff's schemes) by "expert" money-managers and others that dispense overly-optimistic and/or downright stupid investing advice? I expect these shorn sheep don't own a computer anymore and no longer partake of the daily wisdoms dished out by The Fool, Warren Buffett, and all loyal fellow-travelers.

  • Report this Comment On September 02, 2012, at 8:53 PM, NickD wrote:

    WMT MCD will own India/China and other countries people want what America has Warren Buffett wishes he could invest for the next 50years its beyond me why people invest in tech/internet

  • Report this Comment On September 05, 2012, at 2:53 PM, djkorova wrote:

    dgmennie, let me guess, you have no money in the stock market but you read about it every day. I was like you for a while, but i decided to jump in last November. Playing it very conservatively and using dollar cost averaging, i'm up about 6%. Not exactly getting rich but not losing money!

  • Report this Comment On September 07, 2012, at 12:14 PM, whyaduck1128 wrote:

    I respect Mr. Buffett as much as anyone, but Geez, could you suck up to him a little more?

  • Report this Comment On September 07, 2012, at 1:53 PM, strelna wrote:

    Well, I have to agree. Much too fawning. The man's a shrewd businessman and investor. However, his preference for big government solutions is as unAmerican as it is unfortunate for being influential.

  • Report this Comment On September 09, 2012, at 11:45 AM, lilyvalenzuela wrote:

    Tengo 12 años de vivir en usa ayer por primera ves lei sobre este Sr. yo leo en ingles pero escribirlo es bastante dificil me gustaria mandarle una carta a el Sr. warren si el va a dejar su dinero a los pobres quiero pedirle q empieze por mi que lo necesito ahora q el esta vivo y yo tambien con respeto escribo esto y confiando que el me respondera

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