Major Accomplishments and Awards

by Jack Westerfil

This chapter is a free excerpt from Warren Buffett: A Biography.

Buffett's investment business was wildly successful. As the fifties disappeared and the sixties came into full view, Buffett's place in the finical world was solidified. He was often looked to as a financial prop for some of the nations largest corporations. Such was the case with American Express. In 1963 he invested in the floundering credit company after it lost half its value due to the “salad oil scandal.”

A crooked reseller by the name of Tino De Angelis bought and sold ships full of vegetable oil. Along the way he figured out that he could fill the large tankers with a majority of water and just a partial amount of oil, and since oil and water don't mix, the oil would stay suspended on top. Inspectors would test the surface oil and loans would be extended based on the speculation of sale. He used the ships and their cargo to secure loans in excess of $175 million from AMEX. When the story broke, AMEX stock collapsed and Buffet swooped in to save the crippled giant. Buffett saw that the company was operationally sound even though they had been deceived by De Angelis. The reduction to the price of the AMEX stock put the company well within Buffett’s scope of investing - buy undervalued stock of a solid company. He sunk $13 million dollars in their stock and restored investor confidence and AMEX flourished.

Soon after, in 1965, Buffett and his partnerships started securing stock in the diversified insurance company Berkshire Hathaway. Buffett soon closed his firm to new investors. His company had been enjoying success at a much higher rate than the stock market at that time, with Buffett's stock increasing over 1,100% while the Dow only rose 123%. By the end of ‘68, in the midst of the Vietnam War, Buffett's partnerships had over $104 million in assets.


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Buffett's investment business was wildly successful. As the fifties disappeared and the sixties came into full view, Buffett's place in the finical world was solidified. He was often looked to as a financial prop for some of the nations largest corporations. Such was the case with American Express. In 1963 he invested in the floundering credit company after it lost half its value due to the “salad oil scandal.”

A crooked reseller by the name of Tino De Angelis bought and sold ships full of vegetable oil. Along the way he figured out that he could fill the large tankers with a majority of water and just a partial amount of oil, and since oil and water don't mix, the oil would stay suspended on top. Inspectors would test the surface oil and loans would be extended based on the speculation of sale. He used the ships and their cargo to secure loans in excess of $175 million from AMEX. When the story broke, AMEX stock collapsed and Buffet swooped in to save the crippled giant. Buffett saw that the company was operationally sound even though they had been deceived by De Angelis. The reduction to the price of the AMEX stock put the company well within Buffett’s scope of investing - buy undervalued stock of a solid company. He sunk $13 million dollars in their stock and restored investor confidence and AMEX flourished.

Soon after, in 1965, Buffett and his partnerships started securing stock in the diversified insurance company Berkshire Hathaway. Buffett soon closed his firm to new investors. His company had been enjoying success at a much higher rate than the stock market at that time, with Buffett's stock increasing over 1,100% while the Dow only rose 123%. By the end of ‘68, in the midst of the Vietnam War, Buffett's partnerships had over $104 million in assets.

In an unprecedented move in 1969,  Buffett sent a letter to his investors saying that he could not find any good deals on the market, and proceeded to sell of all of the accumulated assets to relieve his responsibilities to the partners, keeping onlyBerkshire and a women's apparel store Diversified Retailing.  Buffett and his partners had accumulated majority share holdings of these two companies and they were the ones he felt could prosper the best. The stock market had made major financial gains and Buffett felt that the only gains the partnership could make would be with investments over $3 million. Mostly, Buffett felt hindered by being 100% responsible for the rest of the group’s money.

Buffett partnered again with Charlie Munger, his long time business partner, when Berkshire purchased See's Candies in 1972. Buffett paid more than three times the book value for the company, and he still holds the company today. In a 1974 interview in  Forbes Magazine Buffett said, “People have been successful investors because they've stuck with successful companies. Sooner or later, the market mirrors the business.”

With his entire fortune residing in stocks of Berkshire and its holdings, Buffett lived on only his $50,000 a year salary. He held no private stock of his own. He had placed such a significant interest in managing the money of his partnerships, he had neglected to make personal investments. He stated this in the letter dissolving the partnerships. To shore up his personal finances, he started to invest in copper futures and soon amassed over $3 million in profits.

His company continued to build a successful portfolio and withstand the rise and fall of the market. He acquired companies in a number of industries to keep his investments diversified, including GEICO, Nebraska Furniture Mart, and Executive Jet. Buffet also bought a large majority of Coca Cola stock, one of his favorite soft drinks. In a  survey conducted in 1999 Buffett was recognized as the top money manager of the century.

Buffett would soon find that he could give of his time and energy to benefit the financial industry. In 2001, Buffett took part in a round table interview video hosted by Ben Stein about proper financial disclosure released by the Financial Accounting and Standards Board. He also started serving on panels for the SEC, a group that he became very familiar with during the Salomon scandal, about financial disclosure and auditing reforms.

In 2007, Buffett was given the distinguished  University of California at Berkeley’s Financial Reporting Award. They cited his contribution and advocacy to the regulation of the financial industry and outspoken support for transparency in business. Additionally he was listed as one of  Time Magazines 100 Most Influential People in the World. Buffett has also graced the top of the  Forbes Worlds Richest People list while tracking at nearly 500th on their Executive Pay.

In 2008, the stock market plummeted after the real estate bubble burst, which itself was caused by the under-regulated trading of sub-prime mortgages.  One of the industry leaders to succumb to the wake of bad practices was Goldman-Sachs. Goldman leaders approached Buffett for a possible loan, and he granted them $5 billion in the suppressed economy. They repaid the loan in Spring 2011.

The year after, Buffett partnered with a long time friend Andy Heyward to produce three-to-five minute cartoons to teach children about fiscal responsibility entitled the Secret Millionaires Club. The series was distributed online by AOL. He was quoted in a  news release about the webisodes, saying, "What better time to help educate our kids about financial responsibility ... I am excited to introduce a series that is as fun as it is informative."

In light of all of his accomplishments, his philanthropy, and his major investment into the economy when most people pulled their money out, Buffett was given the 2010 Medal of Freedom by President Barack Obama. The award is the highest award that can be bestowed on a civilian by a President. When asked by a reporter from Buffett's  Buffalo News about what it felt like to receive the honor, he replied "Well, you pinch yourself, basically. This is not what you expect."

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