A Chronological History of the Oracle of Omaha

A Chronological History of the Oracle of OmahaA Chronological History of the Oracle of Omaha: 1930-1956∙August 30, 1930: Warren Edward Buffett is born to his parents, Howard and Leila Buffett, in Nebraska.∙1941: At eleven years old, Warren buys his first stock. He purchases 6 shares of Cities Service preferred stock [3 shares for himself, 3 for his sister, Doris], at a cost of $38 per share. The company falls to $27 but shortly climbs back to $40. Warren & Doris sell their stock. Almost immediately, it shoots up to over $200 per share.∙1943: Warren declares to a friend of the family that he will be a millionaire by the time he turns thirty, or "[I'll] jump off the tallest building in Omaha."∙1945: Warren is making $175 monthly delivering Washington Post newspapers. At fourteen years old, he invests $1,200 of his savings into 40 acres of farmland.∙1947: In his senior year of high school, Warren and a friend purchase a used pinball machine ata cost of $25.∙Buffett begins to think about the potential profit, and places it in a nearby Barber Shop. Within months, he owns three machines in three different locations. The business is sold later in theyear for $1,200 to a War Veteran.∙1947: Warren has earned over $5,000 delivering newspapers. His father presses him to attend college, a suggestion Warren does not take well. Nevertheless, that year, he enrolls as afreshman at the Wharton School of Finance and Commerce in Pennsylvania. Buffett hates it,complaining he knows more than the teachers.∙1949: Classmates return to find that Warren is no longer enrolled at Wharton. He has transferred to the University of Nebraska.∙1949: Warren is enrolled in classes, but has already begun his life. He is offered a job at J.C.Penny's after college, but turns it down. He graduates from college in only three years by takinghis last three credits over the summer. His savings have reached $9,800.∙1950: Buffett applies for admission to Harvard Business School and is turned down. He eventually enrolls at Columbia after learning that Ben Graham and David Dodd, two well-knownsecurity analysts, are professors.∙1951: Warren discovers Graham is on the Board of GEICO insurance. He takes a train to Washington, D.C., and knocks on the door of its headquarters until a janitor lets him in. Afterasking if anyone is working, he find a man on the sixth floor, who ends up being high up in thecompany. They talk for hours while Warren questions him on the business and insurance ingeneral. [Buffett now owns GEICO entirely].∙1951: Buffett graduates and wants to go to work on Wall Street. Both his father [Howard] and mentor [Graham] urge him not to. Warren offers to work for Ben Graham for free but Grahamrefuses.∙1951: Warren returns home and begins dating Susan Thompson.∙1951: Buffett purchases a Texaco station as a side investment. It doesn't work out as well as he hopes. Meanwhile, he is working as a stockbroker∙1951: Buffett takes a Dale Carnegie public speaking course. Using what he learnt, he began to teach a night class at the University of Nebraska, "Investment Principles". The students weretwice his age [he was only 21 at the time].∙April, 1952: Warren and Susie get married. They rent an apartment for $65 a month, and have their first child, also Susie.∙1954: Ben Graham calls Warren and offers him a job at his partnership. Buffett's starting salary is $12,000 a year.∙1956: Graham retires and folds up his partnership. Since leaving college six years earlier, Warren's personal savings have grown from $9,800 to over $140,000.∙1956: The Buffett family returns home to Omaha. On May 1, Warren created Buffett Associates, Ltd. Seven family members and friends put in a total of $105,000. Buffett himself invested only$100. He was now running his own partnership, and would never again work for anyone else.Over the course of the year, he opened two additional partnership, eventually bringing thenumber under his management to three. Years later, they would all be consolidated into one.A Chronological History of the Oracle of Omaha: 1957-1974∙1957: Buffett adds two more partnerships to his collection. He is now managing five investment partnerships from his home.∙1957: With Susan about to have her third child, Warren purchases a five-bedroom, stucco house on Farnam street. It cost $31,500.∙1958: The third year of the partnership completed, Buffett doubles the partner's money.∙1959: Warren is introduced to Charlie Munger, who will eventually become the Vice Chairman of Berkshire Hathaway, and an integral part of the company's success. The two get along immediately.∙1960: Warren asks one of his partners, a doctor, to find ten other doctors who will be willing to invest $10,000 each into his partnership. Eventually, eleven doctors agreed to invest.∙1961: With the partnerships now worth millions, Buffett made his first $1 million dollar investment in a windmill manufacturing company.∙1962: Buffett returns to New York with Susie for a few weeks to raise capital from his old acquaintances. During the trip, he picks up a few partners and several hundred thousanddollars.∙1962: The Buffett Partnership, which had begun with $105,000, was now worth $7.2 million.Warren and Susie personally own over $1 million of the assets. Buffett merges all of thepartnerships into one entity known simply as Buffett Partnerships, Ltd. The operations aremoved to Kiewit plaza, a functional but less-than-grand office, where they remain to this day.The minimum investment is raised from $25,000 to $100,000.∙1962: Buffett consults Munger on Dempster, the windmill manufacturing company. Munger recommends Harry Bottle to Warren; a move that would turn out to be very profitable. Bottle cutcosts, laid off workers, and caused the company to generate cash.∙1962: Warren discovers a textile manufacturing firm, Berkshire Hathaway, that is selling for under $8 per share. He begins to buy the stock.∙1963: Buffett sells Dempster for 3x the amount he invested [The almost worthless company had built a portfolio of stocks worth over $2 million alone during the time of Buffett's investment].∙1963: The Buffett partnerships becomes the largest shareholder of Berkshire Hathaway.∙1964: Due to a fraud scandal, American Express shares fall to $35. While the world is selling the stock, Buffett begins to buy shares en masse.∙1965: Warren's father, Howard, dies.∙1965: Buffett begins to purchase shares in Walt Disney Co. after meeting with Walt personally.Warren invested $4 million [which was equal to around 5% of the company].∙1965: The American Express shares which were purchased shortly before are selling for more than double the price Warren paid for the them.∙1965: Buffett arranges a business coup - taking control of Berkshire Hathaway at the board meeting and naming a new President, Ken Chace, to run the company.∙1966: Warren's personal investment in the partnership reaches $6,849,936.∙1967: Berkshire pays out its first and only dividend of 10 cents.∙1967: In October, Warren writes to his partners and tells them he finds no bargains in the roaring stock market of the '60s. His partnership is now worth $65 million.∙1967: Buffett is worth, personally, more than $10 million. He briefly considers leaving investing and pursuing other interests.∙1967: American Express hits over $180 per share, making the partnership $20 million in profit on a $13 million investment.∙1967: Berkshire Hathaway acquires National Indemnity insurance at Buffett's direction. It pays $8.6 million.∙1968: The Buffett Partnership earns more than $40 million, bringing the total value to $104 million.∙1969: Following his most successful year, Buffett closes the partnership and liquidates its assets to his partners. Among the assets paid out are shares of Berkshire Hathaway. Warren'spersonal stake now stands at $25 million. He is only 39 years old.∙1970: The Buffett Partnership is now completely dissolved and divested of its assets. Warren now owns 29% of the stock outstanding in Berkshire Hathaway. He names himself chairmanand begins writing the annual letter to shareholders.∙1970: Berkshire makes $45,000 from textile operations, and $4.7 million in insurance, banking, and investments. Warren's side investments are making more than the actual company itself.∙1971: Warren [at his wife's request], purchases a $150,000 summer home at Laguna Beach.∙1973: Stock prices begin to drop; Warren is euphoric. At his direction, Berkshire issues notes at 8%.∙1973: Berkshire begins to acquire stock in the Washington Post Company.∙1974: Due to falling stock prices, the value of Berkshire's stock portfolio began to fall. Warren's personal wealth was cut by over 50%.∙1974: The SEC opens a formal investigation into Warren Buffett and one of Berkshire's mergers.Nothing ever comes of it.PrevioA Chronological History of the Oracle of Omaha: 1977-1989∙1977: Berkshire indirectly purchases the Buffalo Evening News for $32.5 million. He would later be brought up on antitrust charges by a competing paper.∙1977: Susie leaves Warren, although not officially divorcing him. Warren is crushed.∙1978: Susie introduces Warren to Astrid, who eventually moves in with him.∙1979: Berkshire trades at $290 per share. Warren's personal fortune is approximately $140 million, but he was living solely on a salary of $50,000 per year.∙1979: Berkshire begins to acquire stock in ABC.∙1981: Munger and Buffett create the Berkshire Charitable Contribution plan, allowing each shareholder to donate some of the company's profits to his or her personal charities.∙1983: Berkshire ends the year with $1.3 billion in its corporate stock portfolio.∙1983: Berkshire begins the year at $775 per share, and ends at $1,310.∙Warren's personal net worth is $620 million. He makes the Forbes list for the first time.∙1983: Buffett purchases Nebraska Furniture Mart for $60 million. It turns out to be one of his best investments yet.∙1985: Buffett finally shuts down the Berkshire textile mills after years of sustaining it. He refuses to allow it to drain capital from shareholders.∙1985: Warren helps orchestrate the merger between ABC and Cap Cities. He is forced to leave the Board of the Washington Post [Federal legislation prohibited him sitting on the Boards ofboth Capital Cities and Kay Graham's Washington Post.∙1985: Buffett purchases Scott & Fetzer for Berkshire's collection of businesses. It costs around $315 million, and boasts such products as Kirby vacuums and the World Book Encyclopedia.∙1986: Berkshire breaks $3,000 per share.∙1987: In the immediate crash and aftermath of October, Berkshire loses 25% of its value, dropping from $4,230 per share to around $3,170. The day of the crash, Buffett loses $342million personally.∙1988: Buffett begins buying stock in Coca-Cola, eventually purchasing up to 7 percent of the company for $1.02 billion. It will turn out to be one of Berkshire's most lucrative investments.∙1989: Berkshire rises from $4,800 per share to over $8,000. Warren now has a personal fortune of $3.8 billion.。