The Snowball Warren Buffet

THE SNOWBALL WARREN BUFFET AND THE

BUSINESS OF LIFE

AUTHOR: ALICE SCHROEDER

CONTENTS• ABOUT THE AUTHOR• AUTHORS DESCRIPTION • ABOUT WARREN BUFFET • A THOUSAND WAYS • RULES OF THE RACE TRACK • INNER SCORECARD• PHILANTHROPY • LEARNINGS

ABOUT THE AUTHOR • ALICE SCHROEDER IS THE AUTHOR OF "THE SNOWBALL: WARREN BUFFETT AND THE

BUSINESS OF LIFE." BEFORE BECOMING A FULL-TIME WRITER, SHE WAS A TOP-RANKED INSURANCE ANALYST ON WALL STREET.

• SCHROEDER BEGAN HER CAREER AS A CERTIFIED PUBLIC ACCOUNTANT, THEN BECAME A PROPERTY-AND-CASUALTY INSURANCE ANALYST.

• IN 1999, SHE INTRODUCED WALL STREET CLIENTS TO WARREN BUFFETT AS PART OF HER COVERAGE OF BERKSHIRE HATHAWAY'S ACQUISITION OF THE UNDERWRITING COMPANY GENERAL RE. FOR MANY YEARS BEFORE HER BIOGRAPHY OF BUFFETT WAS PUBLISHED IN 2008,

• SHE INTERVIEWED BUFFETT ANNUALLY AT BERKSHIRE SHAREHOLDER MEETINGS. SHE HAS MASTER'S IN FINANCE FROM THE UNIVERSITY OF TEXAS, AND LIVES IN GREENWICH, CONN.

Author’s description • IT IS THE WINTER OF WARREN’S NINTH YEAR. OUTSIDE IN THE YARD, HE AND

HIS LITTLE SISTER, BERTIE, ARE PLAYING IN THE SNOW.

• WARREN IS CATCHING SNOWFLAKES. ONE AT A TIME AT FIRST. THEN HE IS SCOOPING THEM UP BY HANDFULS.

• HE STARTS TO PACK THEM INTO A BALL. AS THE SNOWBALL GROWS BIGGER, HE PLACES IT ON THE GROUND. SLOWLY IT BEGINS TO ROLL.

• HE GIVES IT A PUSH, AND IT PICKS UP MORE SNOW. HE PUSHES THE SNOWBALL ACROSS THE LAWN, PILING SNOW ON SNOW. SOON HE REACHES THE EDGE OF THE YARD.

• AFTER A MOMENT OF HESITATION, HE HEADS OFF, ROLLING THE SNOWBALL THROUGH THE NEIGHBORHOOD.

• AND FROM THERE, WARREN CONTINUES ONWARD, CASTING HIS EYE ON A WHOLE WORLD FULL OF SNOW

ABOUT WARREN BUFFET

• WARREN EDWARD BUFFETT ( BORN AUGUST 30, 1930) IS AN AMERICAN BUSINESS MAGNATE, INVESTOR AND PHILANTHROPIST.

• HE IS THE MOST SUCCESSFUL INVESTOR OF THE 20TH CENTURY. BUFFETT IS THE CHAIRMAN, CEO AND LARGEST SHAREHOLDER OF BERKSHIRE HATHAWAY, AND CONSISTENTLY RANKED AMONG THE WORLD'S WEALTHIEST PEOPLE.

• HE WAS RANKED AS THE WORLD'S WEALTHIEST PERSON IN 2008 AND AS THE THIRD WEALTHIEST IN 2015. IN 2012 TIME NAMED BUFFETT ONE OF THE WORLD'S MOST INFLUENTIAL PEOPLE.

• BUFFETT IS OFTEN REFERRED TO AS THE "WIZARD OF OMAHA" OR "ORACLE OF OMAHA," OR THE "SAGE OF OMAHA," AND IS NOTED FOR HIS ADHERENCE TO VALUE INVESTING AND FOR HIS PERSONAL FRUGALITY DESPITE HIS IMMENSE WEALTH.

•  BUFFETT IS A NOTABLE PHILANTHROPIST, HAVING PLEDGED TO GIVE AWAY 99 PERCENT OF HIS FORTUNE TO PHILANTHROPIC CAUSES, PRIMARILY VIA THE GATES FOUNDATION.

A THOUSAND WAYS • AT AGE OF 6 HE SOLD CHEW GUMS FOR CENTS • LATER HE DISCOVERED THAT HE IS FETCHING MORE MONEY IN SELLING

SODA BOTTLES • HE USE TO DELIVER NEWSPAPERS IN HOMES • AT THE AGE OF 11 HE HAS INVESTED IN STOCKS • HE HAS INSTALLED PINBALL MACHINES IN SALOONS NEAR BY HIS

LOCALITY• HE USE TO EARN MORE THAN WHAT HIS TEACHERS USE TO EARN

RULES OF THE RACE TRACK

• WARREN BUFFET IN HIS CHILDHOOD WAS VERY MUCH FOUND OF COLLECTING MARBLES ,BOTTLE CAPS,COLLECTING DATA AND PLAYING WITH NUMBERS .

• HE HAD INTEREST OF HORSE RACING,WARREN WANTED TO GO TO HORSE RACES,HIS UNCLE MR.FRANK HAS TAKEN HIM.

• IN SUMMER HOLIDAYS BUFFET WENT TO WASHINGTON DC AND ASKED HIS FATHER TO GET HIM BOOKS ON HANDICAPPING

• HE READ MANY BOOKS ON HANDICAPPING AND HE FIGURED OUT THE DAILY RACING FORMS WHICH WERE BROUGHT BY ONE OF THE EMPLOYEE IN HIS DAD’S OFFICE

• HE RETURNED FROM WASHIGNTON DC AND ONE DAY ALONG WITH HIS FRIENDS HE WENT FOR RACING TRACK TO WAGER

• IN FIRST RACE HE LOST,BUT HE DIDN’T GO HOME ,HE KEPT ON BETTING AND WAS CONTINUOUSLY LOOSING AND HE LOST 175$ ON THAT DAY

• WHAT HE HAS LEARNED IS 1“NOBODY EVER GOOES HOME AFTER THE FIRST RACE”• 2 “YOU DON’T HAVE TO MAKE IT BACK THE WAY YOU LOST IT”

THE INNER SCORECARD

• THROUGH THE LATE 1990’S BRK HAD BOOSTED HIS PROFILE BY OUTPACING THE MARKET ,UNTIL IT PEAKED AT 80,900 $ PER SHARE IN JUNE 1998.

• HE PREDICTED THAT THE MARKET COULD DISAPPOINT INVESTORS FOR SEVENTEEN YEARS, HE WAS STANDING ON THE EDGE OF A CLIFF, AND HE KNEW IT.

• WARREN REMEMBERS WHAT HIS FATHER SAYS • HE WAS REALLY A MAVERICK. BUT HE WASN’T A MAVERICK FOR THE SAKE OF BEING A MAVERICK. HE JUST DIDN’T CARE

WHAT OTHER PEOPLE THOUGHT. MY DAD TAUGHT ME HOW LIFE SHOULD BE LIVED. I’VE NEVER SEEN ANYBODY QUITE LIKE HIM.”

• IF ALL THE EMPHASIS IS ON WHAT THE WORLD’S GOING TO THINK ABOUT YOU, FORGETTING ABOUT HOW YOU REALLY BEHAVE, YOU’LL WIND UP WITH AN OUTER SCORECARD.

PHILANTHROPY

• IN JUNE 2006, HE ANNOUNCED A PLAN TO GIVE AWAY HIS FORTUNE TO CHARITY, WITH 83% OF IT GOING TO THE BILL & MELINDA GATES FOUNDATION.

• IN 2006, HE AUCTIONED HIS 2001 LINCOLN TOWN CAR ON EBAY TO RAISE MONEY FOR GIRLS, INC. IN 2007, HE AUCTIONED A LUNCHEON WITH HIMSELF THAT RAISED A FINAL BID OF $650,100 FOR THE GLIDE FOUNDATION.

• BUFFETT HAS BEEN AUCTIONING OFF A "POWER LUNCH" SINCE 2000 AT HIS CHARITY EVENT FORGLIDE FOUNDATION.

• THE HIGHEST BIDDER GETS TO BRING UP TO SEVEN PEOPLE TO DINE WITH THE STEAK-LOVING BUSINESS MAGNATE AT SMITH & WOLLENSKY STEAKHOUSE IN MANHATTAN, AND THE MOST RECENT WINNER PAID $2,345,678.

MY LEARNINGS • HAVE INNER SCORE CARD NOT OUTER SCORECARD

• LEARN FROM YOUR MISTAKES

• COMMUNICATION IS KEY TO SUCCESS(DALE CARNEGIE )

• DETERMINE WHAT YOU WANT TO BE

THANK YOU