After I finished last night, I realized I had a few more things to say. First I need to correct what I wrote in part two regarding the separation of Warren Buffett and Susie. Here’s some help from one of my readers:
I do have a bone to pick with your review of the Snowball, part two: in describing the Buffett’s separation and arrival of Astrid Menks, you have substituted your own judgment for that of Schroeder and Buffett, without making it clear that it is your own viewpoint. I certainly understand your assessment of the marriage and perhaps your desire to defend Buffett, as he is someone you clearly respect (as do I). But Buffett’s own view, expressed in the book that Susie’s leaving was “99% [his] fault”. Schroeder also indicates that Buffett was quite difficult, and of course, he was totally driven, and in any case, not terribly emotionally supportive.
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The ethical judgments that I made in parts two & four were mine. They were not those of Alice Schroeder, Buffett, or anyone in Buffett’s family. That said, because of the role I play in my church, I have had to counsel some people on marriage. My results have been good, bad, and indifferent. Usually I think that I have been called in on the late side, when hope is almost non-existent. Better to call in a counselor on the early side.
I have known many men, and some women who I would call “pieces of work,” where they are very difficult to get along with. I’ve seen cases where the spouses of such people succeed, and more where they failed. In marriage, it takes two to make a failure, leaving aside adultery and desertion.
My opinion is this: if Susie could bear with it for 20 years, she could bear with it for 40 or more. Buffett was maturing emotionally, and was better able to interact with others. Susie missed the best years of Warren.
As it is, children are affected even if adults when parents separate; they become more prone to divorce. Buffett’s children had their own marital problems. It also doesn’t help when you didn’t get a lot of attention from your father when young.
On the Patience of Buffett
Buffett does not have to deploy capital; he does not have to grow. He can live with a lot of cash on hand, earning zero. He knows human nature. As a group, we tend to panic every five years or so. Buffett picks up a lot of bargains, whether by sector, or across the market as a whole. He finds good companies that are out-of-favor, and he gives them a good home. This is very different than how most people invest.
Buffett waits until he sees a return on book capital with reasonable certainty that exceeds his threshold, and then he buys aggressively. He can do that because he has a balance sheet, and he has simple goals for return on capital. So long as he continues to be careful he never has to worry about insolvency — his balance sheet is conservative.
Final note on Religion
Because of who I am, I was interested in how Buffett’s and Susie’s parents viewed religion. Buffett and Susie were a lot like my in-laws: raised in the church, but turned against God. There was something in the era, as people sought bad interpretations of the Bible so that they could live their own way, and not God’s way.
Already expressed. This is a great book if you are looking to read about the life of Buffett, rather than the aspects of Buffett’s investing that you can’t imitate.
Who would benefit from this book: This book will not help you invest like Buffett, unless you are bright, and know all of the details that lay behind Buffett’s strategies. This book is the best to help you know Buffett the man. It is a great book. If you want to, you can buy it here:Think, Act, and Invest Like Warren Buffett.
Full disclosure: I borrowed it from the local library.
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By David Merkel, CFA of Aleph Blog