Warren Buffett American billionaire Date of Birth: 30.08.1930 Country: USA

1. Warren Buffett: The Legendary Investor
2. The Othmers and their Unusual Legacy
3. The Early Years of Warren Buffett
4. The Journey to Success
5. Warren Buffett's Personal Life

Warren Buffett: The Legendary Investor

Warren Edward Buffett, the American entrepreneur and investor, is often referred to as the "Oracle of Omaha" and is widely regarded as one of the greatest investors of all time. Despite his immense wealth, Buffett is known for his frugal lifestyle, living in a house he purchased for $31,500 and enjoying simple meals like his favorite pastry, the 'Mae West'. However, his net worth currently stands at around $36 billion, making him one of the richest individuals in the world.

The Othmers and their Unusual Legacy

Donald and Mildred Othmer were an ordinary couple, living seemingly ordinary lives. Donald, a professor of chemistry at the Polytechnic University in Brooklyn, and Mildred, an art history teacher in New York, had no children and appeared to be just like any other couple. However, upon their deaths, it was revealed that they were far from ordinary. The couple bequeathed over $340 million to various charitable institutions in Brooklyn, including a donation of $175 million to the financially struggling Polytechnic University. This left many wondering how an average couple accumulated such vast wealth. It turns out that the Othmers were long-time friends of Warren Buffett.

The Early Years of Warren Buffett

Warren Edward Buffett was born in Omaha in 1930. His father, Howard Buffett, was a stockbroker and a Republican Congressman. Even as a young boy, Warren displayed an exceptional memory for numbers, often astonishing his friends with his ability to remember the population figures of numerous American cities. At the age of 11, Warren developed an interest in his father's line of work and purchased his first three shares of Cities Service Preferred stock for $38 each. When the price immediately dropped to $27, Warren sold the shares, making a profit of $5. This taught him the importance of patience and the risks of impulsive decision-making.

As a teenager, Warren displayed a relentless entrepreneurial spirit. He would buy and sell various items and at the age of 14, he purchased 40 acres of farmland in Nebraska for $1,200, which he then leased to a local farmer. Warren's interest in investing deepened when he discovered Benjamin Graham's book, "The Intelligent Investor", which became his investment bible. Graham's book taught investors to ignore the trends of Wall Street and instead hunt for undervalued stocks. Warren's exceptional mathematical memory proved to be a valuable asset in analyzing the financial statements of numerous companies.

The Journey to Success

After being rejected by Harvard Business School, Warren persevered and eventually found a place at Columbia University under the guidance of Benjamin Graham himself. Graham approached the market from a profit-oriented perspective, but Warren soon realized the limitations of Graham's approach. He began to question whether it was more profitable to buy good businesses at fair prices or dying businesses at significantly cheaper prices. In 1957, Warren returned to Omaha and formed his first investment partnership. Surprisingly, he managed to convince a group of investors from Omaha to entrust him with $25,000 each, while Warren himself contributed only $100 to the partnership. His success as a manager led to substantial returns for his investors, consistently outperforming the Dow Jones Industrial Average.

In 1962, Warren made a significant investment in a textile company named Berkshire Hathaway. Despite the decline of the American textile industry due to foreign competition, Warren saw the potential in transforming the struggling company into a conglomerate. Berkshire Hathaway proved to be a pivotal move for Warren as he realized that insurance companies provided better investment opportunities than other businesses. Insurance premiums served as upfront payments, providing a reliable cash flow that could be used to create various investment funds. This strategy became the cornerstone of Warren's investment approach, and Berkshire Hathaway began generating millions of dollars. When Warren took control of the company, its stock was worth less than $8 per share, but over time, its value soared.

Warren Buffett's Personal Life

While Warren became a legendary investor, his personal life was not as successful. His wife, Susan T. Buffett, worked alongside him in Berkshire Hathaway and was one of the company's largest shareholders. However, since 1977, they have lived separate lives. Warren introduced his new companion, Astrid Menks, a Latvian waitress from an Omaha cafe, and the couple signed their gifts and cards as "Warren, Susie, and Astrid". Warren's relationship with his three children has also been strained, characterized by his strict frugality. He even made his daughter, Suzy, sign a promissory note for $20 when she asked for money to retrieve her car from the airport garage.

Despite his immense wealth, Warren is not a fan of philanthropy. He has been criticized for his reluctance to donate more to charitable causes, with his annual contributions to the Buffett Foundation totaling only $11-12 million. However, in recent years, Warren has announced his intention to donate 99% of his wealth to the foundation, making it one of the most influential philanthropic organizations in the country.

As Warren Buffett continues to shape the investment world, the question of his succession at Berkshire Hathaway looms large. While he claims to have found a worthy successor, he has yet to reveal their identity. Regardless of what the future holds for Berkshire Hathaway, Warren's teachings and investment philosophy have already shaped the minds of aspiring investors worldwide. The story of Donald and Mildred Othmer serves as a reminder that many unassuming individuals, like the Othmers, have amassed great wealth and are often overlooked.