The Oracle of Omaha

Thursday, April 8, 2010

I recently finished reading “The Snowball: Warren Buffet and the Business of Life” by Alice Schroeder.  I’ve been reading it on-and-off for several months now, and I’m pretty sure that it’s by far the longest book I’ve ever read at 707 pages.  I think there are a lot of reasons why someone might pick up a book about one of the top three richest people in the world, but my motives were less a result of awe and a desire for emulation than simple curiosity.  The thing about Bill Gates’ rise to the peaks of financial success was that he was working with something novel and innovative; he pioneered the world of personal computing.  Buffet is different in that he became one of the richest men in the world while playing the exact same game as everyone else with the same resources, but just did it much, much better.  Yes, in the bell curve of financial prosperity, there are always going to be outliers.  But something about this guy blows the bell curve out of the water.

Schroeder paints a unique picture of the dichotomy that is Warren Buffet’s personality.  On the one hand there’s the Buffet we all know and admire: the brilliant and business-savvy man of integrity, always willing to provide economic advice or insight to business colleagues and the American public.  This is balanced against a profile of Buffet that few would expect: a deeply insecure, emotionally-needy man with a necessity to please and avoid conflict at all costs.  The two halves of Buffet seem contradictory — he’s the greatest emotionally-insecure businessman in American history.

While I have no real desires to be as rich as Warren Buffet or to devote the amount of my life to work that he has, I can’t help but admire the man.  There is no back-stabbing in a Warren Buffet-run business meeting, he has an incredibly keen sense of value and opportunity, and his success can be legitimately attributed to hours upon hours of hard work and an incredible intellect.  His passion in life was money, and he put in the studies, work and experience necessary to give himself credibility in that area.  In short, he became so good at what he did that nobody could possibly ignore him, even while in his mid-20s.  That’s a lesson applicable to any pursuit in life.

In anticipation of starting work in a few months I’ve been doing a lot more reading and research into the world of personal finance.   I don’t like the idea of paying others to manage my hard-earned money without an active understanding of how they’re doing it, and I’d rather my financial future be in my own control than at the whims of some random mutual fund manager.  Interestingly enough, on page 685 of the book, the greatest value investor of all time offers this piece of advice:

Stocks are things to own over time.  Productivity will increase and stocks will increase with it.  There are only a few things you can do wrong.  One is to buy or sell at the wrong time.  Paying high fees is the other way to get killed.  The best way to avoid both of these is to buy a low-cost index fund, and buy it over time… If a cross-section of American industry is going to do well over time, then why try to pick the little beauties and think you can do better?  Very few people should be active investors.

There’s probably a reason they waited until pg 686 to put that nugget of wisdom in there.  This is by no means a “become-the-next-Warren-Buffet” dummies guide.

Some of the financial terminology in the book was over my head, but I’m confident that understanding will come with time and experience.  I look forward to re-reading it again when I have that knowledge.  In the meantime, on to my next book.

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This WordPress blog is now in business

Tuesday, April 6, 2010

So after a moderate redesign of a theme I found online (link), this blog is finally in business.  I’ve never worked with WordPress before on the back-end side of things, so it was a valuable experience to go through installing and configuring the necessary files and have the opportunity to look at things under the hood.  I think WP is pretty ingenious; it combines a very modular (and thus easily editable) source code with a really well developed user interface.  I’ve learned a lot from the past day of tinkering with it.

One lingering question in my mind is if using WP for this site will make it a pain to include pages outside of the WP framework.  I only really wanted WP for it’s blogging capability, but it almost seems like it’s an all-or-nothing type deal.  Google searches proved minimally useful, with the consensus seeming to be “cater your site to WP,” as opposed to the other way around.

As for manipulating WP, it boils down to a lot of CSS editing and some minor PHP changes, assuming you find a pre-existing theme that provides a general style that you like.  Going completely organic and making a theme from scratch is a viable option too, but personally seemed like a waste of time given the thousands of free themes out there.

I’ve used MAMP (Mac, Apache, MySQL, PHP) on my Mac for several classes in the past, and I love it — it really is a painless way to set up a local development environment. While I would like to eventually learn the more detailed aspects of server administration, MAMP lets me accomplish the same ends without needing the resources (i.e time and money) to do so. For those Windows folks out there, I’ve used xampp successfully in the past, and here’s a more exhaustive list of WAMP alternatives.

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