The Snowball_ Warren Buffett and the Business of Life - Alice Schroeder [116]
The partners quickly split into two camps: the teetotalers and the rest. From his end of the table, Doc Thompson suggested, in a paternal way, that the other faction was going to hell. It was Warren, however, who was the preacher that night; they were there for him to hold forth.
“I started with an agreement with the investors, which has not needed to be changed much as we’ve evolved. All kinds of good things have flowed out of that, you know. It is the least complicated thing I can imagine.
“I gave them a little summary of the ground rules: Here’s what I can do. Here’s what I can’t do. And here are some things I don’t know whether I can do or not. Here’s how I’ll judge myself. It was fairly short. If you don’t feel this way you shouldn’t join, because I don’t want you unhappy while I’m happy or vice versa.”8
After Warren launched the partnership, the Buffetts returned to New York for their final summer. Warren would be helping Ben Graham and Jerry Newman as the partnership wound down. Mickey Newman was now the CEO of Philadelphia & Reading, a full-time job. With neither he nor Warren available to serve as general partner, Graham had decided to shut down the firm.9 Warren had rented a rustic seaside cottage on Long Island for his family from his friend Tom Knapp. The house, part of a group built for people fleeing an influenza epidemic many years before, sat on West Meadow Beach, near Stony Brook on Long Island’s North Shore, and faced Connecticut, across Long Island Sound.
During the week, Warren saved money by bunking in the city with his stockbroker friend Henry Brandt, whose wife and children were also summering on Long Island. On the weekends he joined his family at the shore and worked in a tiny bedroom in the house. The neighbors told the Knapps they never saw him.10 While Warren worked, Susie, who was afraid of the water and never swam, beachcombed with the kids along the bluffs near the water’s edge. Since the cottage had minimal plumbing facilities, the Buffetts fetched drinking water from a spring across the street, and Susie bathed Little Susie, now almost three, Howie, eighteen months old, and herself in the unheated outdoor shower.
That summer brought them two pieces of shocking news. The father of Warren’s boyhood friend Bob Russell had committed suicide. And Anne Gottschaldt and Catherine Elberfeld, the mother and aunt of Fred Kuhlken, Warren’s friend from Columbia, called to say that Fred had been killed in Portugal after his car skidded eighty feet and rammed into a cork tree.11
As the summer ended, the Buffetts made their plans to return to Omaha. The extreme caution Warren displayed in trying never to disappoint anyone stood in sharp contrast with his risky decision to pursue an investing career working on his own outside of New York City. The market was composed of relationships, people who lunched together at the Stock Exchange or played poker once a week. It hummed along on tips and rumors, gossip passed on by personal contacts and connections made at investor luncheons, in bars, on squash courts, at chance meetings at university-club coat checks. While every small regional city had its little brokerage firm or two—like Buffett-Falk—these were not important players. The hinterlands were staffed by stockbrokers—prescriptionists who survived or prospered by filling the scrips written by the Manhattan money doctors. At that time, no serious American money man worked anywhere but