The myth-busts, hot takes, explainers, and tools worth keeping.
◆Hot Take· 1
◆Hot Take2:10:00
Buffett's Biggest Miss: Passing on Intel's Seed Round
Despite personally approving a Grinnell College endowment investment in Intel's seed round via board colleague Robert Noyce, Buffett refused to ever invest in technology himself.
Buffett sat on Grinnell College's board with Intel co-founder Robert Noyce and approved Grinnell's $100,000 Intel seed investment.
He declared he would never invest in technology companies for his own partnership.
The self-imposed rule held for roughly 45 years until Berkshire eventually bought Apple stock.
“We will not go into businesses where technology, which is way over my head, is crucial to the investment decision.”
“I know about as much about semiconductors or integrated circuits as I do about the mating habits of the shranched.”
#Intel#missed opportunity#circle of competence
✶Explainer· 2
✶Explainer15:30
How Local Stockbrokers Worked Before Discount Brokerages
An explanation of how retail investors accessed the stock market in the 1920s, long before Charles Schwab and electronic trading existed.
Local brokers acted as combination financial advisors and access points to the New York Stock Exchange.
Big Wall Street firms relied on networks of local brokers to distribute and sell securities to retail clients.
Investing at the time was viewed more as gambling than as analytical business ownership.
“You've got a local broker who is your sort of like combination financial advisor plus, you know, exchange access.”
#financial history#brokerage#1920s
✶Explainer1:13:00
Mr. Market: Ben Graham's Price vs. Value Concept
An explanation of Ben Graham's foundational idea that market price and intrinsic value are distinct, and that a rational investor can exploit the gap between them.
Graham personified the market as 'Mr. Market,' an emotional business partner offering daily prices.
Price reflects momentary sentiment; value reflects the business's actual underlying worth.
Investors can choose to buy or sell each day based on whether Mr. Market's offer is favorable.
“Price is what you pay, value is what you get.”
“Mr. Market comes to you every day and quotes prices for what you own and what you're looking what you're contemplating owning, but he's schizophrenic”
#Ben Graham#value investing#mental models
❝Story· 9
❝Story10:00
Sidney Buffett Heads West to Boomtown Omaha
The origin of the Buffett family in Omaha, starting with Warren's great-great-grandfather leaving a Long Island farm to chase opportunity in a booming railroad town.
Sidney Buffett left his father's Long Island farm because he felt underpaid.
Omaha was booming after Lincoln made it the headquarters of the Union Pacific Railroad.
Sidney opened the first grocery store in Omaha, starting a multi-generational family business.
“And like so many young people, young men of his generation, he decides to go west to seek his fortune, and he ends up in…”
#family history#Omaha#origins
❝Story24:30
Warren's Childhood Obsession With Counting and Money
Even as a small child, Buffett displayed an unusual, almost compulsive fascination with numbers, counting, and accumulating money.
Buffett counted bottle caps, his own weight, and letter frequencies in newspapers as a kid.
He received a coin-changer for Christmas at age six and became obsessed with filling it.
The behavior foreshadowed his lifelong analytical, quantitative approach to money.
“He's counting bottle caps, he's counting his weight, he's running all sorts of analysis, even as a little kid.”
#childhood#personality#obsession
❝Story26:00
The Coin Changer and Door-to-Door Gum Empire
Young Warren's earliest entrepreneurial ventures selling gum, soda, and magazines door-to-door around his Omaha neighborhood.
Buffett bought gum in bulk from his grandfather's store and resold it door-to-door.
He expanded into selling soda and magazines using the same distribution model.
These small ventures were the seed of his lifelong wealth-building focus.
“he starts going around door to door in the neighborhood and selling individual packs of gum to mothers in the neighborhood for five cents a…”
A trip to New York with his father exposes ten-year-old Warren to Wall Street's elite and crystallizes his desire for financial independence, not wealth for its own trappings.
Buffett's father took him to meet Goldman Sachs' Sidney Weinberg at age 10.
A visit to the NYSE trading floor left a lasting impression on him.
Buffett later said he wanted wealth for the independence it provided, not for luxury.
“What stock do you like, Warren?”
“I realize wealth could make me independent. Then I could do what I wanted with my life.”
#childhood#Wall Street#independence
❝Story19:30
Black Tuesday and the Buffett Family's Great Depression Gamble
The 1929 crash wipes out the bank holding the Buffett family's savings and Howard Buffett's job, prompting him to found his own contrarian brokerage in the depths of the Depression.
The Dow lost about 90% of its value over the three years following Black Tuesday.
Howard Buffett lost his job when Union State Bank failed, taking the family's savings with it.
Howard started his own brokerage advising ultra-conservative investments and thrived despite the Depression.
“the market loses 90% of its value”
#Great Depression#1929 crash#family history
❝Story37:00
The Cities Service Stock and Three Early Lessons
Buffett's first stock purchase with his sister Doris teaches him formative lessons about price, patience, and managing other people's money.
Buffett pooled money with his sister to buy shares in Cities Service at age 11.
The stock dropped sharply before recovering, and he sold too early to appease his sister's anxiety.
He concluded that managing others' emotions around their money is as important as the investment itself.
“The first that he says he learns is don't fixate on the price you paid for something, it's irrelevant.”
#first investment#lessons learned#family
❝Story49:00
Rejected by Harvard, Rescued by Ben Graham at Columbia
Buffett's rejection from Harvard Business School leads him to discover Benjamin Graham teaching at Columbia, where a personal appeal gets him admitted after the deadline.
Buffett was rejected from Harvard Business School despite his early investing success.
He discovered Ben Graham and David Dodd taught a course at Columbia and wrote them a pleading letter.
Dodd, who chaired admissions, personally let him in without an interview.
“I thought you guys were dead. Uh I didn't realize you were alive and teaching classes.”
#education#Ben Graham#Columbia
❝Story1:04:00
Discovering Insurance Float Through Geico's Lorimer Davidson
A chance Saturday visit to Geico's Washington office as a Columbia student introduces 19-year-old Buffett to the concept of insurance float for the first time.
Buffett cold-called on Geico's office and spent four hours with head of investments Lorimer Davidson.
Davidson explained how Geico invested premium 'float' before claims came due.
The conversation planted an insight that would define Buffett's investing career decades later.
“Davey tells Warren all about how Geico works, how the insurance industry works, tells him about this magical thing called float.”
#Geico#float#origin story
❝Story2:02:00
The Berkshire Hathaway Boardroom Coup
A broken handshake deal over a tender offer price sends the normally unemotional Buffett on an uncharacteristic mission to seize control of Berkshire Hathaway and oust its chairman.
Seabury Stanton's tender offer came in 12.5 cents below the price he'd verbally agreed with Buffett.
Buffett, uncharacteristically emotional, canvassed shareholders to gain control instead of walking away.
By April 1965 he won a board seat, then staged a coup to force Stanton out and install himself as chairman.
“he starts canvassing the entire shareholder base, trying to get anybody to sell him shares. He is on a mission, like a man possessed that…”
#Berkshire Hathaway#takeover#Seabury Stanton
?Q&A· 1
?Q&A3:01:00
Grading the Buffett Partnership: Fund Returns vs. Company Returns
Ben and David debate how to fairly grade the partnership's performance, concluding it ranks among the greatest fund track records ever recorded.
Viewed as a fund, a 28x return over 12 years rivals or beats legendary venture fund returns.
Viewed as a single company investment, the multiple is less unusual by modern standards.
The hosts settle on an A+ grade given the consistency and lack of down years.
“Any fund that returns 28x over uh, you know, 12 year standard ish lifetime of a fund, that's incredible.”
#grading#fund performance#analysis
▲Takeaway· 1
▲Takeaway2:30:30
Buffett Partnership's 28x Track Record (1957-1969)
A summary of the staggering, never-down compounded returns the Buffett Partnership generated over its twelve-year existence, dramatically outperforming the Dow.
The partnership never had a losing year across its full run.
Compounded results from 1957-1969 were 2,795% versus the Dow's 153%.
This represents roughly a 28x return over 12 years, a rare feat for any investment vehicle.
“the compounded results of the Dow were 153%. The compounded results of the partnership were 2,795%.”