Peter and Warren BuffettPeter Buffett believes he's received the best investing education anyone could ever hope for. After all, his father is the Oracle of Omaha, Warren Buffett, chairman of Berkshire Hathaway (BRK.A).

But though he ranks No. 3 on Forbes' list of the world's richest people, the value of the elder Buffett's advice wasn't wrapped up in ways to make money and a killing on Wall Street. Rather, says his son, a 53-year-old New York musician and author, it was laced with more fundamental ideas about how a person should live their life.

"He would talk to us a little bit about finances, but it was more about his general philosophy on life. He would say, 'You don't have to swing at every pitch. When you're ready to invest [in a stock], it looks like a fat, slow-moving ball.' But that's so true in many things in life. You don't have to swing at every pitch," Peter Buffett says. "The money is the goal for so many people. My dad's goal is about being right."


Buffett's father is a conservative value investor, renowned for his ability to delve deep and uncover the intrinsic value of companies. And that strategy of striving to be "right" has paid off handsomely. Over the past decade, Berkshire Hathaway has consistently outperformed the broader markets by impressive margin.

When considering investments in companies, the elder Buffett found his family dinner table fertile ground for informal market research

"He would ask some question about a product, especially from my sister who was older. He would try to determine the demographic interest in something like a newspaper. He'd ask questions like 'how often do you read it.' We knew we were being tested," the younger Buffett laughs.

In 1977, when Peter Buffett was a teen, Berkshire Hathaway purchased the Buffalo Evenings News, a New York local newspaper. And despite the beating the newspaper industry has suffered over the past two decades, as circulation and advertising have declined and a shift toward online advertising has emerged, Buffett continues to hold the investment, citing his love of newspapers.

Following Dad By Walking His Own Path


Buffet's dad is definitely not one to be swayed into dumping things just because they are old or out of favor. Peter still visits his father in the same modest Omaha, Neb., family home in which he was raised, despite his father's immense wealth.

"The thing that I admire most about my dad is his authenticity. Authenticity is No. 1. He is who he says he is and all that goes with having integrity and honesty," says the younger Buffett, adding with a chuckle. "His brothers names are Frank and Ernest. You can't get much better than that."
Peter Buffett says the greatest gift he could give his father is to follow in his footsteps by being authentic to himself.

"I think he is aware of this in me," says the younger Buffett, citing incidents in his own career as a musician.

After he scored a song used in Dances with Wolves, the Oscar-winning movie directed and starred in by actor Kevin Costner, Buffett was told by a number of Hollywood agents he would have to uproot his family from Milwaukee and move to Los Angeles if he wanted to become a serious film composer.

"I seriously thought about moving for a couple weeks, but then I thought, no, I don't want to move and I want to focus on something that is more real to me," recalled the younger Buffett. "I thought about my dad and how he could have moved to New York to be closer to Wall Street. But in watching my dad operate over the years, I learned you don't do things just because they looked sexier over there. This has served me well because it's taken me to different places than the norm."


Warren Buffett's parenting style also included letting his kids fail and succeed on their own. In other words, he wasn't a helicopter parent, always hovering about.

"His management style is the way he is in life. In a business environment, he finds great management and says 'I believe in you,' and then leaves them alone," Peter Buffett says. "I'm a big believer that experience is everything. And when you fall down and get up by yourself, you feel so much better about yourself."

He added that if he believed his father would financially bail him out every time he got into trouble, it would undermine any success he encountered.

Peter's Only Inheritance: From Granddad's Farm


Peter Buffett's financial standing did not come from his father's wealth, nor any hot stock tips from dad. In fact, the younger Buffett has never purchased a share of stock.

He received $90,000 in Berkshire Hathaway stock in 1979, purchased from proceeds from the sale of his grandfather's farm. The younger Buffett said his dad had been in a conundrum about what to do with the farm. Neither he nor his sister or brother, all young adults, were capable of running a farm.

"My dad didn't believe in misallocated capital and he didn't believe in inherited wealth," says Peter Buffett. "The Berkshire Hathaway stock was my big head start and it was kicked in my head that it would be all I would get. People wrongly assume we [kids] get piles of money from our dad."

Indeed. Warren Buffett in 2006 pledged $37 bilion to the The Gates Foundation, earmarking the vast majority of his wealth with the nonprofit and not his children upon his death.

Says Peter Buffett: "I watched someone who transferred values to me, and not wealth."



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motmotiee

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June 20 2011 at 8:55 AM Report abuse rate up rate down Reply
croone22

Warren's God is money. He is frugal,pragmactic,and has a great work ethic for making money which is proved by his record. But Warren's values and principles evolved from his ideology of patience and belief that Wall Street would ultimately give you everything you need in life when you reduce the risk in your investments. And the growth of the American economy was the best assurance that his investment model would work. Again, he was right. But where are the values and principles in that scenario. Warren is Godless,he doesn't believe in a Supreme being as did some of the great geniuses like Einstein,Von Braun,and others with whom I had discussed the subject during my life.And although Einstein was not religious in the sense of belonging to any denomination, he admired the Quaker life and thought Jesus Christ was the greatest philosopher that ever lived. Von Braun was devout in his Christian beliefs and often stated his amazement at those who seemed to need a candle to see the Sun. These men were true geniuses and made major contributions to humanity and neither died rich.But their legacy was beyond measure. Warren has made billions in the monopoly game called Wall Street, but so have many intellectual morons who got lucky or benefited from inside information and association. Warren has made major commitments to the Bill Gates Foundation but that does not prove his humanitarian nature or his genius.And certainly doesn't say much about his motivations for distributing his wealth this way. It does say that he does not think his family is worthy of inheriting his money,his life's work. And ,the irony of it all is that Warren's money has made him spiritually poor. Something,I believe,he will regred when he faces that Supreme being in which he believes does not exist..

June 19 2011 at 11:54 PM Report abuse +1 rate up rate down Reply
bja6

I think the kids deserve $1B each...after all, they're HIS KIDS! Some father! You can give advice, but the kids deserve a head start from ''daddy''...and if you don't agree, then you can shun the Ford family...the Hilton family...and so many more...

I'm providing for my kids to have a better life than me...BUT NOT WARREN!

nooooooooooooooooooooooooo...not Warren...

this is what happens when Genius is mixed with true admiration for one's self!

Yes, Warren is a Genius...proven time and time again...but the kids would have had it better in a middle class family that provided more than $90k for their welfare...and the welfare of their children...and their children's children...

Good going, Warren! Good Investing! But you forgot the kids!

June 19 2011 at 3:22 PM Report abuse +2 rate up rate down Reply
jimacura

Dad may be giving away all his money but Mom(deceased) who raised the kids gave BILLIONS to the children. Maybe that is why he could does not care how his father leaves his money. The man who is living in same house is also flying around in G-5.50 which I see nothing wrong with but please stop painting a picture of everyday father . I love it when wealthy people pretend - ask the son how he liked his father's girlfiend or better yet how was that to deal with growing up.

June 19 2011 at 9:43 AM Report abuse rate up rate down Reply
ingrahamkaren

On Father's Day, I would like to thank my Dad for giving me my memory of The First Dollar I Have Ever Made. When in Second Grade I came home with a Zero Average in Math. After looking it over, he said that he would give me $10.00, if I my average would climb to an A (thinking that this was impossible). Well, at the end of the School Year I skipped happily home with my Report Card. I waited, happily for him to arrive home. When he did, I was at the door, with Report Card in hand. He opened it, and there it was Math, A. Well I am fifty now, and we did not have $10.00 to spend on a Grade, but two weeks later, there it was, $10.00. My First Dollar Made.

June 18 2011 at 5:50 PM Report abuse rate up rate down Reply
hikingtoday

Rather refreshing story in our greedy world!

June 18 2011 at 8:28 AM Report abuse rate up rate down Reply
fhwildcat

Warren buffett has an inspiring story, however, i would hope this writer would have done a little research or frame their story to investing values vs, family values. Mr. Buffett had an interesting family relationship, wife 1, girlfriend(s).....she never asked the son how that aspect affected him, or his mother. Dad having a girl-friend and a wife at the same time. Some families are able to get pass the bitterness of a divorce, others get destroyed. The Buffett family seems to have survived and thrived....how did they do that? Would have been interesting to hear that angle.

June 18 2011 at 8:06 AM Report abuse rate up rate down Reply
vpqueen

Give me just a minute libs. I've got to get out my violin to give the proper backdrop for all of your inane class warfare posts.

June 18 2011 at 7:37 AM Report abuse -2 rate up rate down Reply
hman570

It is a pitty that the poor won't see much of his money as I am sure that the people running this trust will take there fair share of it for them sleves!!!!!

June 18 2011 at 6:56 AM Report abuse -2 rate up rate down Reply
1 reply to hman570's comment
LEE Resolution

the 'poor' have not right to his money, professor.

June 18 2011 at 9:23 AM Report abuse rate up rate down Reply
Holli, Chaney

Warren Buffet is Greedy..and He wants to make sure no one in his family is ever as famous as himself.

June 18 2011 at 5:21 AM Report abuse -1 rate up rate down Reply
1 reply to Holli, Chaney's comment
LEE Resolution

Warren Buffet greedy ? Buffet is second only to Bill Gates in money donated to the Gates Foundation. Money that goes all over the world (including America), in the pursuit of causes that aid those in need.

June 18 2011 at 9:26 AM Report abuse rate up rate down Reply