Saturday, June 12, 2010

WARREN BUFFETT: THE RICHEST MAN IN THE WORLD


How he made it to the Corporate Ladder?

Have you ever wondered how financially favored individuals seem to get all the penny heads in the world? It could be hard-won or smooth and easy, while we are, in our own hard work, kept scratching our heads how to kick few income boosts.

Few individuals believed in life's boundless possibilities. You might as well do the way I do, because they did.

Yes, there are big guys on the corporate ladders that besides believing, seems to possess a King Midas' “magic touch.” Every investment they found turns to 'gold' at a spell of their mighty economic wand. Electively, I have picked one among the array of wealthy mongers around the world. It could be the Microsoft President Bill Gates, the Mexican telecommunications tycoon Carlos Slim Hel├║ or the Indian industrialist Lakshmi Narayan Mittal. Nonetheless, Warren Buffett is on the top of it all.

Respectively as of 2008 he is the richest man in the world when it comes to financial mark-up, weighing $62 billion dollars on his treasure chest.

Warren Buffett, like any others, is a believer of something. He pulls few of his rhetoric brainchild ranging from the Holy Bible to an American actress-playwright Mae West as well as other few advises from Midwestern thinkers. His speeches are also whipped with intelligent to otherwise satiric humor.

However, he fails to please everybody else despite of the glimmering richness in his smile. There are those who buy his thoughts and sail with him, and there are those who run counter against his idealism. Perhaps, they could just be the minority of the few who never buy his views and 'sarcasm.'

There are things, however, that Warren do not buy too. He points, "I don't believe in dynastic wealth," quoting those born with golden spoons in their mouths as "members of the lucky sperm club." He is indifferent or rather against the transfer of wealth from generation to generation.

Action is still the best policy in his wealthy method. He himself never inherited a wealth so great to manipulate, rather he generates it over time.

Buffett asserted once, “I want to give my kids just enough so that they would feel that they could do anything, but not so much that they would feel like doing nothing".

Obviously, most of his wealth will go to the charity funds with his partnership with the Bill and Melinda Gates Foundation. 2006 breaks the biggest charitable donations ever made in history when he donated a gross amount of USD 30.7 billion dollars to the Bill and Melinda Gates Foundation.

Warren explains about his conscious relationship with his money. This could be his renowned catchphrase every time a query surfaces.

“ I don't have a problem with guilt about money. The way I see it is that my money represents an enormous number of claim checks on society. It's like I have these little pieces of paper that I can turn into consumption. If I wanted to, I could hire 10,000 people to do nothing but paint my picture every day for the rest of my life. And the GNP would go up. But the utility of the product would be zilch, and I would be keeping those 10,000 people from doing AIDS research, or teaching, or nursing. I don't do that though. I don't use very many of those claim checks. There's nothing material I want very much. And I'm going to give virtually all of those claim checks to charity when my wife and I die. (Lowe 1997:165–166) ”

Meanwhile, hear few of his transcendent as well as methodical approaches to getting practically richer, if you can't be the richest man in the world (Source:www.warrenbuffett.com)

Reinvest your profits: When you first make money, you may be tempted to spend it. Don't. Instead, reinvest the profits. Warren Buffett learned this early on. In high school, he and a pal bought a pinball machine to pun in a barbershop. With the money they earned, they bought more machines until they had eight in different shops. Warren Buffett used the proceeds to buy stocks and to start another small business. By age 26, he'd amassed $174,000 -- or $1.4 million in today's money. Even a small sum can turn into great wealth.

Be Willing To Be Different: Don't base your decisions upon what everyone is saying or doing. He worked in Omaha, not Wall Street, and he refused to tell his parents where he was putting their money. People predicted that he'd fail, but when he closed his partnership 14 years later, it was worth more than $100 million.Instead of following the crowd, he looked for undervalued investments and ended up vastly beating the market average every single year.

Never Suck Your Thumb: Gather in advance any information you need to make a decision, Warren Buffett prides himself on swiftly making up his mind and acting on it. He calls any unnecessary sitting and thinking "thumb sucking." When people offer him a business or an investment, he says, "I won't talk unless they bring me a price." He gives them an answer on the spot.

Spell Out The Deal Before You Start: Your bargaining leverage is always greatest before you begin a job -- that's when you have something to offer that the other party wants. Warren Buffett learned this lesson the hard way as a kid, when his grandfather Ernest hired him and a friend to dig out the family grocery store after a blizzard. The boys spent five hours shoveling until they could barely straighten their frozen hands. Afterward, his grandfather gave the pair less than 90 cents to split. Warren Buffett was horrified that he performed such backbreaking work only to earn pennies an hour. Always nail down the specifics of a deal in advance -- even with your friends and relatives.

Watch Small Expenses: Warren Buffett invests in businesses run by managers who obsess over the tiniest costs. He also admired a friend who painted only on the side of his office building that faced the road. Exercising vigilance over every expense can make your profits -- and your paycheck -- go much further.

Limit What You Borrow: Living on credit cards and loans won't make you rich. Warren Buffett has never borrowed a significant amount -- not to invest, not for a mortgage. He has gotten many heart-rendering letters from people who thought their borrowing was manageable but became overwhelmed by debt.

His advice:

Negotiate with creditors to pay what you can. Then, when you're debt-free, work on saving some money that you can use to invest.

Be Persistent: With tenacity and ingenuity, you can win against a more established competitor. Warren Buffett acquired the Nebraska Furniture Mart in 1983 because he liked the way its founder, Rose Blumkin, did business. A Russian immigrant, she built the mart from a pawnshop into the largest furniture store in North America. Her strategy was to undersell the big shots, and she was a merciless negotiator. To Warren Buffett, Rose embodied the unwavering courage that makes a winner out of an underdog.

Know When To Quit: Once, when Warren Buffett was a teen, he went to the racetrack. He bet on a race and lost. To recoup his funds, he bet on another race. He lost again, leaving him with close to nothing. He felt sick -- he had squandered nearly a week's earnings. Warren Buffett never repeated that mistake. Know when to walk away from a loss, and don't let anxiety fool you into trying again.

Assess The Risk: In 1995, the employer of Warren Buffett's son, Howie, was accused by the FBI of price-fixing. Warren Buffett advised Howie to imagine the worst-and-bast-case scenarios if he stayed with the company. His son quickly realized that the risks of staying far outweighed any potential gains, and he quit the next day. Asking yourself "and then what?" can help you see all of the possible consequences when you're struggling to make a decision -- and can guide you to the smartest choice.

Know What Success Really Means: Despite his wealth, Warren Buffett does not measure success by dollars. In 2006, he pledged to give away almost his entire fortune to charities, primarily the Bill and Melinda Gates Foundation. He's adamant about not funding monuments to himself -- no Warren Buffett buildings or halls. "I know people who have a lot of money," he says, "and they get testimonial dinners and hospital wings named after them. But the truth is that nobody in the world loves them. When you get to my age, you'll measure your success in life by how many of the people you want to have love you actually do love you. That's the ultimate test of how you've lived your life."

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