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Warren Buffett became rich by picking stocks better than anyone else. Buffett focuses on three basics: tolerable risk, a company's value and its stock price. Bill Gates, Sam Walton and John D. Buffett is a simple man with simple tastes. Using fascinating historical detail and colorful anecdotes, Lowenstein explains how Buffett did it. Forbes recently listed him as the world's richest man, but he lives in the same Omaha house he bought for $31,500 in 1958. Financial journalist Roger Lowenstein does a masterful job of reporting on Buffett's life and explaining his straightforward, common sense investing approach without speculation, fancy charts or complex technical analysis.
Buffett used this easy-to-understand formula to build his fortune. Rockefeller became immensely wealthy by developing innovative businesses. If the price is well below the true value, he's interested. He drives his own car, prepares his own taxes, wears inexpensive suits and does not employ servants beyond an "every other week" housekeeper. He likes hamburgers, Cherry Cokes and peanuts. It must work: When the book went to print, Buffett had a net worth of $64 billion. If you want to know, getAbstract recommends reading this book.
That's what Lowenstein seeks - and that's what I want to know as well.I could attempt a weak rewrite of the book, summarizing some of the highlights of Buffett's life, but you could get that same information from Buffett's Wikipedia entry. He learns from success and from failure, and the progression of this knowledge and wisdom is apparent throughout the book. If you're looking for a book on investing according to Buffett's principles, look elsewhere - I recommend starting with a good book on the principles of value investing, like "The Intelligent Investor".Instead, this book belongs solidly in the biography section. It's also about the value of seeing the different kinds of value that something holds. It's pretty clear early on that he's intelligent but not wise - only after many years of learning does he seem wise.Don't buy more than you need. In fact, it was so disrespected that Buffett was able to buy the company for less than the value of its assets.
The only times he seems to stumble is when he takes his eye off the ball.Never stop learning. A lot of people saw a disaster - Buffett saw a bargain.This is a brilliant principle to apply in all avenues of life, and it is one that inevitably points towards frugal living. Buffett's frugality is well known, but what's fascinating is how that frugality drifts over into his investing. The one overarching theme from this book is intensity, at least from my reading. When Buffett bought Berkshire Hathaway, it was a textile company that was seriously on the decline.
Buffett seems to keep his eyes on the prize all of the time, even in his early childhood. What kind of person finds such success in investing. It's about the value of being honest - and the value of being yourself. Instead of focusing on the exact financial moves and techniques, it focuses on capturing a picture of the man himself. A lot of people thought this huge investment was foolish, but Buffett began selling off those assets and using Berkshire Hathaway as a holding company, buying other companies. Along those same lines, Buffett seems to constantly be learning as well, in terms of study, street smarts, and investigation. There are amazing strokes of genius, and there are flaws as well. He lives in what I'd call an upper middle class home because he sees no reason to live in anything else.
Buffett - The Making of an American Capitalist tells in a leisurely fashion the life story of Warren Buffett, perhaps the most well-known investor of the modern era. If you question what exactly you're buying all the time, you tend to buy less stuff - and have more money for the important things.In the end, this book actually does explain, in an indirect way, "how to win the Warren Buffett way." It's not a matter of following rules or stealthily following investment tips. It's about figuring out and understanding who you are, understanding cold the principles that you live your life on, and using them to invest. All of this sounds really eye-rollingly simple, but yet it's so hard to actually execute, because one can really only reach that level after years of introspection and learning.Who would have ever thought that, in the end, the story of Warren Buffett would have a lot in common with "Zen and the Art of Motorcycle Maintenance".Buy or Don't Buy.Let's get this straight right off the bat: this is not a book of investment advice. Similarly, he passed up (over and over again, actually) seemingly good investments simply because he didn't see the reason to make the leap. A good biography takes a one dimensional image that we all know (Warren Buffett, investor extraordinaire) and fills him out as a three dimensional person, a person with love, with passion, with sadness, with high points and low points, with character and vitality."Buffett - The Making of an American Capitalist" is a very good biography. Instead, I thought I would just give a handful of general reflections from the book, particularly in terms of how they relate to my own life and money.Intensity wins. Buffett is a highly compelling subject, and with Lowenstein's skill, it's easily the best biography I've read of a modern investor, and it's one of the rare books that I will keep and read again.
In no aspect of his life does he spend a dime without clear purpose. It's pretty obvious, then, that Buffett follows his principles adamantly, especially later on in his career.Similarly, look at the actual value of what you have. This is a portrait of a person, and like any person, there are a lot of interesting facets and features. If you have any interest in who Warren Buffett is as a person, pick this up and read it - it's well worth the time.
His buildup to Buffett's investments in the Nebraska Furniture Mart and the Washington Post also show where he agreed and differed with Graham. This is by far the more enjoyable and informative of the two biographies of Warren Buffett on the market (the other is THE SNOWBALL).Lowenstein wrote the first biography of Warren Buffett and it remains the definitive book if you are looking for a biography of his life and of his investments. Buffett would invest 100% in stocks (Graham's max was 75%) if the price was right and felt that explaining how to identify great businesses was a necessary, but omitted, part of Graham's book, INTELLIGENT INVESTING. Lowenstein makes his living writing books about business, and his craftsmanship helps him do justice to his topic. His details of Buffett's fascination with Geico when it was still a tiny company (Ben Graham was on the board when Buffett attended Columbia), became a troubled company (Graham still had his savings in Geico), and finally a Berkshire Hathaway holding, are unmatched. Yet, what they agreed upon was more important than their minor disagreements. They both sought value for the long term, and at that, Buffett excelled.
Lowenstein's book is the benchmark for all other Warren Buffett biographies. True to the man, the book focuses much more on his business dealings (including the early partnership, the original Berkshire Hathaway, Washington Post, Nebraska Furniture Mart and Salomon) than his personal dealings. The book is routinely included on business school reading lists for good reason. This book is a very readable journey through Warren Buffett's private and business life. But still, the author is careful to offer details of Buffett's dealings with others, leaving the reader with a feeling that he/she has a general understanding of the subject.Some have been critical of the book for not offering details on Buffett's "investment secrets," but this criticism is misplaced since his investment methodology is clearly spelled out in his annual shareholder letters. Any attempts to rehash these writings in this book may benefit a small portion of the readership while creating a tedious feel for the large majority.[.].
While Warren Buffett was by no means poor growing up, his story is one of inspiration to all to reach beyond their current situation to their dreams. This is a well-written story of a determined boy who grows to a young man, and finally an adult all the while being self-motivated to achieve what he desires. Very interesting and well worth the read.
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