The Snowball_ Warren Buffett and the Business of Life - Alice Schroeder [283]
The Buffalo Evening News immediately rolled out a morning edition and changed its name to the Buffalo News. With victory in hand, Buffett and Munger went to a meeting of employees at the Statler Hilton downtown. Somebody asked about profit sharing. “There is nothing that anybody on the third floor”—where the newsroom sat—“can do that affects profits,” Buffett said. Capital took the risk and reaped the rewards. He and Munger had staked $35 million on a series of decisions. They might have lost every dime; to them went all the profits that followed. The workers got a paycheck for the time and effort they put in—no more, no less. A deal’s a deal. But after everything they had all been through, the staff was stunned at his lack of empathy.
As Buffett and Munger left the office, Munger walked past publisher Henry Urban, who was “waiting for at least a small accolade,” said Ron Olson. Munger was famous for getting into cabs while people were talking to him as if he did not hear them and for disappearing through doors the second he finished talking without waiting for a response. Nonetheless Urban stood open-mouthed. Buffett followed along right after Munger without looking at anyone. Nobody said thanks. Olson, following in their wake, moved around the room shaking hands in an effort to make up for it.46
A year later, with higher ad rates and soaring circulation, the News was earning $19 million pretax, more than all the previous years’ losses combined. About half of that went straight to Buffett. And as the excitement ended, his attention waned. While he still spoke well of the Buffalo News in his annual report, his interests had moved on to the next new thing.
PART FIVE
The King of Wall Street
43
Pharaoh
Omaha • 1980–1986
Five hundred of the grateful rich, wearing black tie and ball gowns, walked up the red carpet and into New York’s swanky Metropolitan Club for Buffett’s fiftieth birthday party. With Berkshire Hathaway trading at $375 a share, the Buffetts’ net worth had more than doubled in the past year and a half. They could easily afford to rent the place.1 Dotted among the Buffett Group members were semi-demi-celebrities like the actor Gary Cooper’s daughter. Susie had ordered a cake shaped like a six-pack of Warren’s beloved Pepsi-Cola. He had asked his old pinball partner Don Danly to bring him the balance sheet for Wilson’s Coin-Operated Machine Company.2 Buffett was beginning to gather materials from his early business efforts—treating these objects like totems and showing them to people with a slight tinge of reverence. They seemed like tangible evidence of himself, reassuring artifacts.
Susie brought her band from San Francisco and took center stage to sing a version of “Shuffle Off to Buffalo” to her husband:
Warren got fed up with candy
With stamps he wasn’t handy….
The song continued for verse after verse on the theme of Buffett’s latest caper: packing up his duffel and shuffling off to Buffalo to buy an undervalued paper.
Susie’s star turn, corny but sweet, was the beginning of a new tendency. Buffett’s family and friends had started to recount—in his presence—the list of the companies and investments he had collected like the beads on a rosary. The man himself, with eyebrows sprouting like ivy tendrils over the frames of his glasses, now looked less awkward in black tie. The modern Berkshire Hathaway that he had created churned out new beads for the rosary almost like a clockwork. Buffett’s hunt for things to buy had become more ambitious, free of the cigar butts and lawsuits of the decades before. The great engine of compounding worked as a servant on his behalf, at exponential speed and under