There is a person who is called the genius of investment, legend of investment, and wise man of Omaha and is known to be the most successful investor in the world, he is the biggest shareholder, chairman, and CEO of 'Berkshire Hathaway' Warren Buffett. According to Bloomberg Billionaires Index in February 2021, his asset's worth 93.2 billion dollars, it's about 103.3 trillion won! Warren Buffet who became one of ten richest persons in the world only by stock investing was born in 1930 and he is 92 years old in Korean age this year, yet he's still working in the field. Moreover, more fascinating fact is that more 90% of his wealth were accumulated after he turned 60. What was the trick that enabled him to make such tremendous fortune? In this video, we'll take a look at Warren Buffett who is known to be the greatest investor in the history of investment. August 30th, 1930, Warren Buffett was born as a middle child under the father Howard Homan Buffett and Leila Buffet in Omaha, Nebraska. Apparently, the family of Warren Buffett was making the ends meet by running a grocery shop up until his grandfather's generation. While doing so, Warren's father Howard Buffett had his success as a realtor and was elected to be a Republican congressman, and he became a local notable with money and power. When Buffett was young, he was a shy kid who lacked social skills, but he was interested and talented in numbers and money. Apparently, there was no one who was better at remembering and calculating numbers. He started reading stock books since the age of 8 with his father who was a realtor, and by the time he turned 10, he had read all the stock investment books in Omaha library. Buffet who had to wear glasses for that is still famous for spending 80% of his time reading even these days, and he once said this at a general meeting of stockholders. "Read the books as much as you can" "I already read all the investment-related books in Omaha Public Library when I was 10" "I read some of them twice" "I still read the books I read when I was 19" "I'm still keeping the frame of thinking that I obtained from the books I read when I was 19" When Buffett turned 11, he bought the shares of City Service for the first time. He bought 3 shares for $38 each and the stock price dropped to $27 after he purchased them. Young Buffett got anxious and he quickly sold the stock when it hit $40. After watching it going up to $200 after he sold it, he realized something important. The importance of long-term investment and how patience is important in investment. Buffett was also deeply interested in sales. He started saving up when he was 6 selling gums, Coke, golf balls, popcorn, and etc. and by the time he turned 15, he had saved up 2,000 dollars to purchase a farmland of 40 acres. When he was 17 and in high school, he started a pinball game machine rental business with his friend Don Danley. He bought used pinball game machines and installed them at barbershops and he would share the profit with the owner of the barbershop, and it went viral so that more and more barbershops asked for it and his wealth had increased to $6,000 by the time he graduated high school, which is about 74 million won in the current worth. Don Danley who ran the business with Buffett remembers Buffett as this. "Warren was very bad with machinery to an extent where he couldn't even put the nuts and bolts together" "However, he was talented enough to calculate 20 two digit numbers in his head" "He probably read more than 100 economic books before he graduated high school" Don Danley was sure that Buffett was going to be successful so that he invested 25,000 dollars when Buffett made an investment association and he became a billionaire that way. Buffett who opened his eyes in investment and business was able to enter the college before his friends because he skipped a grade in elementary school. However, he didn't want to go to college. He thought he had nothing to learn from the college. However, Buffett entered a college as his father convinced him, he studied his bachelor's at Department of Economics at Wharton School, University of Pennsylvania and graduated early from Nebraska University, and then he applied to the graduate school of business in Harvard. Unlike his expectation, his application was rejected. With a scar in his heart, he was looking for other graduate schools and the school that he found was Columbia University. Master of value investment, the author of 'Stock Analysis', 'Wise Investor' the books that he was inspired by when he was young, Benjamin Graham was there as a professor. Fortunately, Buffett was admitted at Columbia University and met Benjamin Graham who he had been wanting to meet. He read the books written by Graham repeatedly so that he almost memorized them, and he was the first one to answer the questions that Graham posed during classes. For that, Buffett was able to get A+ for all classes of Graham when he was famous for not giving out high grades. Apparently, Buffett was the only student who had such grades among the students of Graham. So, Buffett learned the investments that could see the future and the long-term investment of owning the good companies for a long time. Professor Graham played a very big role in making today's Buffett to an extent where he could even say "15% is from Fisher and 85% is from Graham" In 1951, upon the graduation of Buffett, he asked his professor Graham for a job working for him even if it may mean no compensation. However, because of his principle of only hiring Jews, he rejected Buffet's proposal. Buffett returned to Omaha and he was using his potential in working as a stock broker at his father's realtor company. Back then Buffett met the person who cannot be missed out from Buffett's life, it's his wife Susan Thompson. Buffett came on to Susan after he fell in love at first sight, and they got married in April of 1952. They had one son and two daughters and were living happily. Buffett depended on Susan emotionally and mentally and he was able to focus only on his investment. In 1977, as the children had grown up and as Buffett was becoming a big fish in the field of investment, Susan moved to San Francisco for her dream to be a musician, and they started living separately. Buffett was having a hard time so that he even called everyday, almost crying, asking her to come back and he said letting her go was 'the biggest mistake in my life' and he said letting her go was 'the biggest mistake in my life' Then, in 2004, his wife Susan passed away at age 72, due to oral cancer. Then in 2006, Buffett remarried Astrid Menks, the chef who had been taking care of him with his wife's pleading. In July of 1954, Buffett received a joyful news while enjoying their honeymoon in Omaha, his hometown. His teacher Graham called him to work along. Buffett accepted it without asking about the salary or working conditions. Buffett trusted Graham so much that when his first son was born in December of 1954, he named him Graham Buffett. Buffett gained experience as he worked with Graham, and his talent started to see the light. Then, in 1956, Graham declared his retirement and said he would turn his business Graham-Newman Corporation to Buffett. However, Buffett turned down the good offer from Graham, because he missed his hometown so much. That's how Buffett ended up in his hometown, Omaha. After liberating from his teacher, Buffett of age 26 came back to his hometown to establish his own investment company named Buffett Associates Limited and started writing history about investments. From 1956 to 1969, until the company is disbanded, Buffett Associates Limited achieved an average annual profit of 29.5%. In total, they achieved a shocking profit of 2,794.9%. This is 29 times more than the starting principal in 13 years, which means Buffett's assets which were around $170,000 when he established the business 56 years ago turned into $26,500,000 in 13 years! At only 39 years of age, he obtained around 200 billion won in current value. In 1965, Buffett bought a company called Berkshire Hathaway, which was originally working for textile manufacturing. With that, he entered the world of investing with the corporate body instead of investing directly. After the 1960s, most of Buffett's investment was made through Berkshire Hathaway, making it the whole history of Buffett's investment life. Buffett started buying countless businesses through successful investments and established a large empire with over 400 affiliates and 400,000 employees. The businesses that Berkshire Hathaway invested were the Coca-Cola Company, Apple Inc., Goldman Sachs, Moody's Corporation, Walt Disney, etc. Most of the world-renowned businesses were hand-picked by Berkshire Hathaway. Not to mention that the profit was amazing. From 1965, when the S&P of the USA started rising by 15,000%, Berkshire made an astonishing development where the stock value rose 2,400,000%. In short, Berkshire stock which was around $18 per week 65 years ago turned $350,000 (390 million won). However, it doesn't mean that Buffett never tasted failure. Berkshire Hathaway weaving company which Buffett bought was one of his failures which he spent $200 billion, and he also regretted not buying Google and Amazon by not realizing the value. Of course, he got some stocks later by realizing the value such as Amazon. In the end, Buffett was chosen by Forbes to be the person with second-most assets with $4.2 billion in 1990, the richest man in 1993 with $15.2 billion, the second richest man in 2005, the richest man in 2008 with $62 billion, and 4th richest man in 2020. Warren Buffett is still in the top game despite his age. There are two fundamental rules that Buffett emphasizes when investing. "Rule Number One: Never Lose Money." "Rule Number Two: Never Forget Rule Number One." Along with them, he also emphasizes the snowball effect. The snowball effect is something that he always talks about when explaining long-term investments and welfare, by comparing it to the snowball that turns gigantic after rolling it for a while to make a snowman. The starting asset may be small, but when you get profits from a lot of places, it can grow into a whole fortune like a snowball. With that, Buffett makes a joke about that one thing he regrets about his life is that he started investing at age 11. He added that when he gets another chance to live, he would like to start at age 5 or 7 considering the snowball effect. Although Buffett obtained a massive fortune, it doesn't show his lifestyle. Even now he is living in an ordinary two-story house in Omaha that he bought with 38 million won back in 1958. His children didn't know that their family was that rich until they were grown up. Buffett retains his thrifty lifestyle where he still enjoys a morning meal at McDonald's which costs around $2-3 and drives his 2001 model Lincoln Town Car without a driver. "A lot of fortune would spoil a child" My children are already enjoying 99% more than average children of the USA, "so they shall not gain my position" "and I believe that the wealth to make their kingdom should not exist" He claimed that he will only give each child $3 million and return the rest 90% of his fortune to society. In 2010, Buffett also established a club called The Giving Pledge with Bill Gates couple, where people pledge to give away half of their assets. Last year, when he got a massive loss due to the pandemic, Buffett still donated 3.8 trillion won to the charity, which adds to the 43.7 trillion won he donated so far. When someone asked Buffett what a success is, he answered: "The success is to have people around you after you age" "However, it is hard to achieve in real life" "The famous and richest people around the world all have gatherings and parties day and night" "but may not have anyone who truly considers them" "Even if it's ordinary, the life where you are surrounded by those who love you is a successful one" That's all for Warren Buffett, Omaha's sage and the greatest investor in human history.
