... In describing how Buffett's mind works, and why it is so well suited to his chosen career, Schroeder is particularly good. A shrewd evaluator of businesses and the people who ran them, Buffett turned himself, at a young age, into a kind of odds-calculating machine. As Schroeder puts it, "he tended to extrapolate mathematical probabilities over time to the inevitable (and often correct) conclusion that if something can go wrong it eventually will." This habit of mind informed not just his investment decisions but also much else--for instance, his obsession with nuclear proliferation. In Buffett's mind, it is not a question of if but when a nuclear bomb explodes in a big city, and the goal should be not to prevent it but to reduce the odds, and put the terrible day off for as long as possible.
To his natural gifts as a bookie Buffett coupled an incredibly keen sense of self-preservation. He seems always to have been something of a physical and emotional coward. He is actually less wary in his financial life than he is outside of it. He avoids social conflict, unless there is money on the line, and also all sorts of new experiences. His long-time partner Charlie Munger likes to call Buffett a "learning machine," but there are whole swaths of human activity he actively resists learning anything at all about, such as the entire high-tech industry. He confines himself to the diet of an eight-year-old, refusing to eat anything much beyond spaghetti, hamburgers, and grilled cheese sandwiches. Schroeder describes a bizarre scene in which Katharine Graham escorted Buffett to dinner at the Manhattan apartment of Sony Chairman Akio Morita. Japanese chefs served plate after plate that Buffett left completely untouched. "By the end of fifteen courses, he still had not eaten a bite," writes Schroeder. "The Moritas could not have been more polite, which added to his humiliation. He was desperate to escape back to Kay's apartment, where popcorn and peanuts and strawberry ice cream awaited him. 'It was the worst,' he says about the meal he did not eat. 'I've had others like it but it was by far the worst. I will never eat Japanese food again.'" Buffett ate what he needed to eat to remain alive--and learned what he needed to learn to invest shrewdly.
Finally, and most critically, Schroeder stresses Buffett's obsession with money, which he famously views less as a unit of exchange than a store of value. Kay Graham once asked him for a dime to make a phone call and Buffett, finding only a quarter in his pocket, went off to make change. In telling the tale of Buffett's rise, Schroeder returns over and over to his pathological stinginess. As rich as Buffett became, he never stopped measuring himself by how much money he had. He tells Schroeder that he pretty much measures his whole life by Berkshire Hathaway's book value, and the reader can't help wondering if that is ultimately how he measures other people, too. "He was preoccupied with money," Schroeder remarks. "He wanted to amass a lot of it, and saw it as a competitive game. If asked to give up some of his money, Warren responded like a dog fiercely guarding its bone, or even as though he had been attacked. His struggle to let go of the smallest amounts of money was so apparent that it was as if the money possessed him, rather than the other way around."
Buffett's single-minded pursuit of money seems to have left him with little interest in anything else. His detachment from his children became a running joke in the Buffett family. Schroeder quotes a friend's description of the first Mrs. Warren Buffett as "sort of a single mother. ... He was so used to her attention and remained so undomesticated that once, when she was nauseous and asked him to bring her a basin, he came back with a colander. She pointed out that it had holes; he rattled around the kitchen and returned triumphantly bearing the colander on a cookie sheet. After that she knew he was hopeless." In the late 1970s Susie Buffett moved to San Francisco and pursued other relationships, and even told one lover that she would seek a divorce. In the bargain she persuaded her housekeeper back in Omaha, an attractive younger woman named Astrid Menks, more or less to replace her as Buffett's caretaker. Buffett apparently leapt rather more enthusiastically into this arrangement than his wife expected. "Susie herself was shocked," writes Schroeder. "This wasn't what she had in mind when she stressed to her husband that they both had needs. But it might have been predicted. Warren had searched his whole life for the perfect Daisy Mae, and whatever he wanted Astrid did: buy the Pepsi, do the laundry, take care of the house, give him head rubs, cook the meals, answer the telephone, and provide all the companionship he needed."
Through it all, Buffett maintained his desire to present to the outside world a life simple and ordinary. He only ever made one public statement on his polygamous family arrangements ("[I]f you knew the people involved, you'd see that it suited all of us quite well"), though he added to Schroeder that "they both need to give, and I'm a great receiver, so it works for them." His life was structured to maximize the time and energy he could devote to Berkshire Hathaway, and he seems to have spent very little time questioning that structure. From time to time he seems to have backed away from his life with what sound like tiny spasms of self-doubt. As early as 1970, he wrote to his shareholders that "I don't want to be totally occupied with outpacing a market rabbit all my life." But always he takes a deep breath and waits for the feeling to pass. ...
Read it here.
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