Profile

Warren Buffett

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74 , self made Source: Berkshire Hathaway Net Worth: $44 bil Country of citizenship: United States Residence: Omaha, NE, United States Industry: Investments Marital Status: widowed , 3 children University of Nebraska Lincoln, Bachelor of Arts / Science Columbia University, Master of Science Newspaper delivery boy filed first 1040 at age 13; claimed $35 deduction for bicycle. Studied under Benjamin Graham at Columbia. Applied value-investing principles to build Berkshire Hathaway to $133 billion (market cap) holding company: insurance, energy, carpets, jewelry, furniture, paint (Benjamin Moore), apparel (Fruit of the Loom). Also big stakes in American Express, Coca-Cola, Gillette (now set to merge with Procter & Gamble). Admits Berkshire's $30 billion-plus cash hoard is underutilized: "It's a painful condition to be in, but not as painful as doing something stupid—[Vice Chairman] Charlie [Munger] and I detest taking even small risks." Recent bets include Pier One Imports, Comcast, food distributor McLane. Bought mobile-home maker Clayton Homes after reading autobiography by company founder. "If we fail, we will have no excuses." Since taking control of Berkshire has delivered compound annual return of 24%. Outspoken opponent of Bush tax cuts, courted as adviser to pols Arnold Schwarzenegger and John Kerry. Critic of lax corporate governance, became target of failed campaign to vote him off Coca-Cola board. Fanatical supporters still far outnumber critics: Berkshire's folksy annual meeting crowds routinely top 15,000. Warren Buffett’s determination and creativity have made him who he is now: the chairman of a long-term investment company which has more than $2 billion in holdings. As a child, Buffett was already ambitious. He was an enthusiastic and industrious paper boy for the Washington Post, and tried to cover more than one route at the same time. He also made money by collecting and selling lost golf balls. Buffett’s interest in finance was clear extremely early on in his life. He started playing the stock market with one of his sisters when he was eleven. At twelve, he was betting on horses, and by high school he had started a business (pinball machines) with a friend, which earned him fifty dollars a week. Not only did he own a business by graduation, but he also had bought himself forty acres of Nebraskan farm land with his profit. Graduate school was a formative time for Buffett. It was there that he met Benjamin Graham, an economic scholar whose work Buffett had begun studying in college. Buffett believed strongly in Graham’s theory that it is wise to look for stocks of companies which are undervalued, which will most probably prosper with a little time. Thus began Buffett’s untraditional approach to portfolio management. After working for his father’s investment banking company for the three years after business school, Buffett returned to Graham and worked as a security analyst at Graham’s company for two years until 1956. In that year, at the age of twenty-five, Buffett started his own investment company, the Buffett Partnership, using $5,000 of his own funds and collecting $100,000 from interested friends and family. One of the smartest moves made by Buffet’s company at that time was to invest in American Express. In 1963, a scandal surrounded AmEx, and Wall Street believed the company was near the end. But Buffett, always with his wits about him and his thinking cap on, noticed when in restaurants and shops that customers were still using the card to buy. He went ahead and bought 5 percent of the stock, which by 1961 had risen from 35 to 189 market points. Buffett is now chairman of Berkshire Hathaway Inc., which makes the long-term investments which Buffett is so adept at choosing.