Magazine article Global Finance

Old-Fashioned Value Investor

Magazine article Global Finance

Old-Fashioned Value Investor

Article excerpt

The Oracle of Omaha shows that honesty, integrity and hard work can pay off.

Warren Buffett is widely considered to be one of the greatest investors of all time. He became the second-richest man in America by relying on the old-fashioned values of honesty, integrity and hard work.At the age of six he bought six-packs of Coca-Cola from his grandfather's Omaha, Nebraska, grocery store for a quarter and sold the bottles of soda to thirsty kids in the neighborhood for a nickel each.

Always good with numbers, Buffett learned the art of value investing from the masters, Benjamin Graham and David Dodd, at NewYork's Columbia University in 1951. He refined their approach by noting that a company's management and potential for growth were also important factors.

In 1965 Buffett took control of Berkshire Hathaway, the textile business that he would eventually turn into his investment and insurance holding company. A $10,000 investment then would be worth more than $50 million today.The Oracle of Omaha, as Buffett came to be known, hasn't let his riches go to his head. He lives in the same gray, stucco house he bought 40 years ago for $31,500. His usual lunch is a hamburger and a cherry Coke.

When old-line investment bank Salomon Brothers got into deep trouble in 1991 for manipulating the market for US government bonds, the bank turned to Buffett, a major shareholder, to restore its reputation. Buffett told investigators to call him if his people were not cooperating and he would fire them on the spot. …

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