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He knew that this was taking a risk. Some of the hot new mutual funds were doing much better than the partnership, doubling their money in a year. Each January, the partners could add money to the partnership—or take it out. Many other skippers were forecasting sunnier skies.

Yet his timing in announcing that he was cutting the goal worked in his favor. The Dow produced an unusually poor year in 1966.13 Some of the partners, shaken by the market’s roiling, had advised him to sell stocks. He paid attention neither to the market nor to advice, and the partnership beat the Dow by thirty-six points, the best record in its ten-year history. “If you can’t join ’em, lick ’em,” he wrote.14 So, it was not a bad time to be offering his partners the chance to take their money elsewhere.

One side effect of this strategy would be to test their trust in him. They would be making their decision without knowing the actual results of his latest year—and for 1967 he was about to report his second stellar year in a row. If they stayed in, it would be because of that trust and because they were willing to accept his more modest goal. Beating the market by five points a year, compounded over any long-term period, would produce stupendous wealth.*25 Even Ben Graham had beaten the market by just 2.5 percent a year. Buffett’s revised goal of nine percent put a floor on their results that was still two percent or more better than owning an average bond. That consistency, year after year, and not losing money, would lead to a stunning result. Sticking with him, an investor took only a modicum of risk, could achieve these extraordinary returns, and do so safely. Nevertheless, by lowering his target, Buffett had just taken his partners down a peg psychologically, and the results reflected that.

For the first time, instead of investors rushing to put more money into the partnership, they pulled out a net $1.6 million of capital in January 1968. Yet it was a fraction of what might have been. Less than one in thirty dollars had gone elsewhere. And when he reported his 1967 results a few weeks later, Buffett Partnership, Ltd. had advanced thirty-six percent—versus the nineteen percent rise in the Dow. Thus, in two years, a dollar in Buffett’s stewardship grew more than sixty cents, while a dollar in the Dow was still a measly dollar.

He wished the departing partners Godspeed with what might be perceived as the subtlest trace of irony: “This makes good sense for them, since most of them have the ability and motivation to surpass our objectives and I am relieved from pushing for results that I probably can’t attain under present conditions.”15

“Financial genius is a rising market,” as Kenneth Galbraith would later say.16

Now Buffett had more time to pursue the personal interests he had spoken about, and less pressure—at least in theory. After King’s speech, Rosenfield easily recruited Buffett to become a Grinnell trustee. Given Buffett’s dislike of committees and meetings, this signified how much he had been touched by the convocation—as well as how close he had grown to Rosenfield. Naturally, he went straight onto the finance committee, where he found the trustees to be a group of like-minded men. Bob Noyce, who ran a company called Fairchild Semiconductor, which made electronic circuits—something about which Buffett knew little and had even less interest—was chairman. Noyce, a former Grinnell graduate who had once been expelled from school for stealing a pig to roast at a luau—a serious offense in a pig-farming state—had the aura of a man who knew what he was about.17 Yet “he was really a regular guy. He didn’t seem like a scientist at all,” says Buffett. Above all, Noyce had an overarching hatred of hierarchy and a love of the underdog, in keeping with the guiding spirit of Grinnell.

Buffett seemed to feel a sense of urgency to do something more for civil rights too. He felt he could best serve the cause by using his brains and financial savvy behind the scenes.