Author Topic: Just read something interesting  (Read 2367 times)

skp

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Just read something interesting
« on: October 09, 2018, 08:28:02 PM »
I admire Warren Buffetts frugality but sometimes he comes across as being a phoney.
Warren Buffett is famous for his views on inheritance.  "He wants to leave his children enough that they can do anything but not enough that they can do nothing."   I always wondered how much that would be.  I knew that his first wife who got a hefty divorce settlement had already had left their children plenty, but today I just read exactly what enough that they can do anything but not enough that they can do nothing means.  I just read today that he is going to leave his children 2 billion dollars each.... .
Opionions?

dustinst22

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Re: Just read something interesting
« Reply #1 on: October 09, 2018, 08:50:28 PM »
Meh, maybe he changed his mind.  Or perhaps that was his view if he were to die when his kids were younger.  Maybe he feels they are well past the point that the fortune would cause them to be lazy.  His kids are all in their 60's now, thats much different than inheriting it in your young adult life.  I think there's a significant difference between giving a child or young adult that kind of fortune versus someone who is approaching the age most people retire.

Irregular Joe

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Re: Just read something interesting
« Reply #2 on: October 09, 2018, 10:35:03 PM »
Buffett has given away over $30 billion to charity since 2006, most of it to worthy causes like the Gates Foundation.  He's going to give away 99% of his fortune.  I think he's entitled to do what he wants with the other 1%.

ROF Expat

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Re: Just read something interesting
« Reply #3 on: October 10, 2018, 12:34:58 AM »
skp,

You're certainly entitled to your opinion, but I can't say I agree. 

Warren Buffett seems to have quirks, but I don't see anything "phoney" about him. 

Buffett never divorced his first wife, so she never got a "hefty divorce settlement."   She had a substantial share of Berkshire Hathaway which made her extremely wealthy in her own right. 

And he isn't dead yet, so anything we see now is more or less speculation.  It wouldn't surprise me if some or all of the money he leaves his family goes to their foundations rather than to them personally. 

As has already been pointed out, the guy has given away around $30 billion dollars in just the last 12 years and has pledged to ultimately give 99% of his wealth.  He might well be the world's richest man if he hadn't given so much to charity already.  I respect that he has been vocal in warning about issues like derivatives, CEO pay, and rubber stamp boards.  He has made his personal tax returns public. 

If he's a phoney, I wish we had more of them...

Just my own opinion of course. 




skp

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Re: Just read something interesting
« Reply #4 on: October 10, 2018, 06:12:45 AM »
I agree that Warren Buffet can do whatever he wants with his money. I know he has already donated a lot of money.  I admire him for his generosity  What I find disingenuous is him saying that inherited wealth is a bad idea, that rich people need to donate away their fortunes, and that he is not leaving his children much of an inheritance- definitely not enough for them to do nothing, and then find out he is leaving them more than enough to do nothing.  The 10 million they already inherited from their mother each was already plenty enough to do nothing. 
I took the article at face value.  He IS giving his children 2 billion dollars each. I find it interesting that people are defending him by saying that  we don't know if he will do it, maybe he changed his mind, that maybe the 2 billion isn't really going to his kids but to a charitable trust.  The article said it was going to his kids.
« Last Edit: October 10, 2018, 06:16:55 AM by skp »

I'm a red panda

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Re: Just read something interesting
« Reply #5 on: October 10, 2018, 06:55:01 AM »
What do his kids currently do? Maybe $2 billion is for them to set up extraordinary charity work on their own.
Maybe he is happy that he has raised his children in a way that they won't do "nothing" just because they have the money.

You interpreted his statement in one way- why should you set the dollar amount that is "enough" for them? 

Buffet didn't want his kids to be lie-abouts; if they've shown they will continue to participate in society, he can give them the amount that he sees fit.

There is a world of difference between inheriting 2 billion and 45 billion each.  He's breaking up the vast amount of the "inherited wealth" of his family by giving it to charity.


Rosy

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Re: Just read something interesting
« Reply #6 on: October 10, 2018, 08:34:13 AM »
skp,

You're certainly entitled to your opinion, but I can't say I agree. 

Warren Buffett seems to have quirks, but I don't see anything "phoney" about him. 

Buffett never divorced his first wife, so she never got a "hefty divorce settlement."   She had a substantial share of Berkshire Hathaway which made her extremely wealthy in her own right. 

And he isn't dead yet, so anything we see now is more or less speculation.  It wouldn't surprise me if some or all of the money he leaves his family goes to their foundations rather than to them personally. 

As has already been pointed out, the guy has given away around $30 billion dollars in just the last 12 years and has pledged to ultimately give 99% of his wealth.  He might well be the world's richest man if he hadn't given so much to charity already.  I respect that he has been vocal in warning about issues like derivatives, CEO pay, and rubber stamp boards.  He has made his personal tax returns public. 

If he's a phoney, I wish we had more of them...

Just my own opinion of course.

+1

Freedom2016

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Re: Just read something interesting
« Reply #7 on: October 10, 2018, 08:55:52 AM »
Wow, these replies seem really out of character for the mmm board.

No facepunches for inheriting more wealth than any human being could possibly spend? Everyone being cool with how *relatively* little the kids are inheriting given how big the whole enchilada is and how much good dad has done, when the *absolute* amount they are inheriting is way, way, WAY beyond anyone's actual financial needs?

I don't know, maybe those people haven't shown up yet on this thread. But I get where OP is coming from. :)


I'm a red panda

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Re: Just read something interesting
« Reply #8 on: October 10, 2018, 09:01:05 AM »
Wow, these replies seem really out of character for the mmm board.

No facepunches for inheriting more wealth than any human being could possibly spend? Everyone being cool with how *relatively* little the kids are inheriting given how big the whole enchilada is and how much good dad has done, when the *absolute* amount they are inheriting is way, way, WAY beyond anyone's actual financial needs?

I don't know, maybe those people haven't shown up yet on this thread. But I get where OP is coming from. :)

There are TONS of posts on the boards of people whose FI plans involve inheritances.


Besides, if you are going to take this approach- why is Buffet still working? Shouldn't he have retired 89.9 billion ago?

radram

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Re: Just read something interesting
« Reply #9 on: October 10, 2018, 09:07:13 AM »
Besides, if you are going to take this approach- why is Buffet still working? Shouldn't he have retired 89.9 billion ago?

Is that years, or dollars?

I'm a red panda

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Re: Just read something interesting
« Reply #10 on: October 10, 2018, 09:09:40 AM »
Besides, if you are going to take this approach- why is Buffet still working? Shouldn't he have retired 89.9 billion ago?

Is that years, or dollars?

Dollars.  I just googled his net worth and it told me roughly 90 billion. Surely he has no need for that much. He isn't a known spender.

radram

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Re: Just read something interesting
« Reply #11 on: October 10, 2018, 09:27:18 AM »
Besides, if you are going to take this approach- why is Buffet still working? Shouldn't he have retired 89.9 billion ago?

Is that years, or dollars?

Dollars.  I just googled his net worth and it told me roughly 90 billion. Surely he has no need for that much. He isn't a known spender.

My sense of humor does not come through very well on the internet. I should have quit trying 89.9 billion years ago.

I'm a red panda

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Re: Just read something interesting
« Reply #12 on: October 10, 2018, 09:30:15 AM »
Besides, if you are going to take this approach- why is Buffet still working? Shouldn't he have retired 89.9 billion ago?

Is that years, or dollars?

Dollars.  I just googled his net worth and it told me roughly 90 billion. Surely he has no need for that much. He isn't a known spender.

My sense of humor does not come through very well on the internet. I should have quit trying 89.9 billion years ago.

Well, the guy is old. I'm not quite sure how old. ;)

Freedom2016

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Re: Just read something interesting
« Reply #13 on: October 10, 2018, 09:38:15 AM »
Wow, these replies seem really out of character for the mmm board.

No facepunches for inheriting more wealth than any human being could possibly spend? Everyone being cool with how *relatively* little the kids are inheriting given how big the whole enchilada is and how much good dad has done, when the *absolute* amount they are inheriting is way, way, WAY beyond anyone's actual financial needs?

I don't know, maybe those people haven't shown up yet on this thread. But I get where OP is coming from. :)


There are TONS of posts on the boards of people whose FI plans involve inheritances.


Besides, if you are going to take this approach- why is Buffet still working? Shouldn't he have retired 89.9 billion ago?

I don't track your logic.

I don't have a horse in this race, I've just been on the boards long enough to remember when the mmm forum community would have roundly, and almost unanimously, bitch slapped anyone suggesting that a $1b inheritance was reasonable. There used to be lots of anti-dynastic-inheritance folks around these parts :)

partgypsy

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Re: Just read something interesting
« Reply #14 on: October 10, 2018, 09:40:02 AM »
It doesn't bother me. He probably made that statement when his kids were younger. Now that he has seen what they have done with their lives, he is comfortable with a different amount. Again, he's giving away 90+% of his money. I don't see too many other multi-millionaires doing that. Well, maybe Bill Gates.

You can spoil kids on the way you raise them, their expectations and entitlements and the way you give money to them on amounts far smaller than the ones we are talking about. Far smaller. Or, you can raise a child to be a functional contributing member of society who will not be ruined by far larger amounts of money. In fact will use that money to do good in the world. I'm thinking Buffett is at the point in his life he trusts his kids are in the latter category. And to be truthful that is part of his legacy.


I remember reading about how in Great Britain old money/landed gentry viewed their ancestral homes and estates that they inherited. That for most they did not see it as "inheriting" it per se, more that they were the caretakers of that land until it was passed onto the next generation. It is a different kind of mindset and view of inheritance than Americans may be used to.
« Last Edit: October 10, 2018, 10:29:17 AM by partgypsy »

ditheca

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Re: Just read something interesting
« Reply #15 on: October 10, 2018, 09:45:33 AM »
"He wants to leave his children enough that they can do anything but not enough that they can do nothing."

I assume his kids have now proven that they do things.

Inheritance often comes so late in life that it is meaningless.  I'm in line to inherit about a million dollars one day, but I plan to FIRE long before that point.

If I'm happily FIREd, what will I do with an extra million?  Maybe find some way to use it for my own children, ideally before they are so old that it is irrelevant.


bacchi

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Re: Just read something interesting
« Reply #16 on: October 10, 2018, 09:48:25 AM »
Be careful, OP. You're fighting against the Myth of Omaha. ;)

That said, relatively speaking, he's a sedate spender. He has two homes, like a lot of Americans (main house + beach house), but has owned them for 40+ years. As far as we know, he doesn't have a ski chalet in the Alps or a Central Park penthouse. He's not splashing his name across hotels and highrises across the world.

"Im happy there. Id move if I thought Id be happier someplace else" -- spoken like a true Mustachian.

Granted, they're homes for the wealthy (at least the one in California is) but they're nothing compared to other ultra-wealthy people.

Quote from: https://www.cnbc.com/2016/09/26/warren-buffett-bill-gates-have-similar-ideas-on-how-much-money-to-leave-kids.html
The Washington Post reported in 2014: "Buffett's three kids each have a $2 billion foundation funded by Dear Old Dad. The rest of his money? Going to charity."

It seems the $2B is going to the kids' foundations. Not exactly going their own way but....

I'm a red panda

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Re: Just read something interesting
« Reply #17 on: October 10, 2018, 10:00:21 AM »
Wow, these replies seem really out of character for the mmm board.

No facepunches for inheriting more wealth than any human being could possibly spend? Everyone being cool with how *relatively* little the kids are inheriting given how big the whole enchilada is and how much good dad has done, when the *absolute* amount they are inheriting is way, way, WAY beyond anyone's actual financial needs?

I don't know, maybe those people haven't shown up yet on this thread. But I get where OP is coming from. :)


There are TONS of posts on the boards of people whose FI plans involve inheritances.


Besides, if you are going to take this approach- why is Buffet still working? Shouldn't he have retired 89.9 billion ago?

I don't track your logic.

I don't have a horse in this race, I've just been on the boards long enough to remember when the mmm forum community would have roundly, and almost unanimously, bitch slapped anyone suggesting that a $1b inheritance was reasonable. There used to be lots of anti-dynastic-inheritance folks around these parts :)

Well, if it is unreasonable to give inheritances from a mustachian perspective; isn't it unreasonable to keep working through old age to rack up more money than anyone (or even a small country) would need?

Retire-Canada

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Re: Just read something interesting
« Reply #18 on: October 10, 2018, 10:31:21 AM »
Opionions?

Opinions? Stop worrying about stuff that has absolutely no impact on your existence.

Odiedog859

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Re: Just read something interesting
« Reply #19 on: October 10, 2018, 10:38:48 AM »
I'm relatively new to MMM (about a year) but it seems like Buffet is very MMMish although his scale is a little bigger than almost everyone. Isn't FIRE a scaleable concept?  Anyone who has heard or watched a Buffet speech or interview can easily see he loves what he is doing.  His FI allowed him to make that decision a long time ago and he is allowing his fortune to do good for others and maybe help the world be a better place through the foundation donations.     

I have seen a fair number of posts here and on ER that suggest that the semantics of FIRE might be moving towards more of a FI concept, with RE being one option but FIRE is easier to say.  Most of the folks seem to have picked up another passion that FI allowed.

JM2C 

« Last Edit: October 10, 2018, 11:26:22 AM by Odiedog859 »

skp

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Re: Just read something interesting
« Reply #20 on: October 10, 2018, 11:20:54 AM »
Be careful, OP. You're fighting against the Myth of Omaha. ;)

That said, relatively speaking, he's a sedate spender. He has two homes, like a lot of Americans (main house + beach house), but has owned them for 40+ years. As far as we know, he doesn't have a ski chalet in the Alps or a Central Park penthouse. He's not splashing his name across hotels and highrises across the world.

"I’m happy there. I’d move if I thought I’d be happier someplace else" -- spoken like a true Mustachian.

Granted, they're homes for the wealthy (at least the one in California is) but they're nothing compared to other ultra-wealthy people.

Quote from: https://www.cnbc.com/2016/09/26/warren-buffett-bill-gates-have-similar-ideas-on-how-much-money-to-leave-kids.html
The Washington Post reported in 2014: "Buffett's three kids each have a $2 billion foundation funded by Dear Old Dad. The rest of his money? Going to charity."

It seems the $2B is going to the kids' foundations. Not exactly going their own way but....

[/quoteal
I thought the 2 B was going into their bank accounts..... Dusting Warren off an putting him back on his pedestal.

Pigeon

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Re: Just read something interesting
« Reply #21 on: October 10, 2018, 12:24:46 PM »
If his kids are in their 60s, they aren't going to be "doing nothing" in the sense that his earlier comment suggests.  That ship sailed decades ago and presumably they didn't spend their adulthood sitting in his basement in their bathrobes playing video games.

Caroline PF

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Re: Just read something interesting
« Reply #22 on: October 10, 2018, 01:47:19 PM »
Wow, these replies seem really out of character for the mmm board.

No facepunches for inheriting more wealth than any human being could possibly spend? Everyone being cool with how *relatively* little the kids are inheriting given how big the whole enchilada is and how much good dad has done, when the *absolute* amount they are inheriting is way, way, WAY beyond anyone's actual financial needs?

I don't know, maybe those people haven't shown up yet on this thread. But I get where OP is coming from. :)

I don't think anyone is saying that the size of the inheritance is reasonable as in how much money they need to live. I think everyone is instead responding to this:

Quote from: skp link=topic=97580.msg2164522#msg2164522 date =1539138482
I admire Warren Buffetts frugality but sometimes he comes across as being a phoney.
Warren Buffett is famous for his views on inheritance.  "He wants to leave his children enough that they can do anything but not enough that they can do nothing."   I always wondered how much that would be.  I knew that his first wife who got a hefty divorce settlement had already had left their children plenty, but today I just read exactly what enough that they can do anything but not enough that they can do nothing means.  I just read today that he is going to leave his children 2 billion dollars each.... .
Opionions?

And pointing out that his statement is not falsified due to the kids' ages, meaning that the 'do nothing' boat has already sailed. And that he is still giving away the vast majority of his wealth, in accordance with what he has said he values.

marty998

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Re: Just read something interesting
« Reply #23 on: October 10, 2018, 02:39:29 PM »
Quote from Buffett was many years ago when he had a smaller amount of billions. Now that he has eleventy billion I guess 2 billion is a rounding error in the grand scheme of things for him. His net worth probably goes up and down by that amount every day. Yes it is a lot of money, but virtually every index investor in the world has hitched a ride on his coat tails over the years. Not that it matters, but I think the old fella has earned the right to do what he likes and engage in this indulgence.

Opionions?

Opinions? Stop worrying about stuff that has absolutely no impact on your existence.

And when Buffet and Munger do fall off the perch - Berkshire makes up quite a large % of the S&P 500.... you think they are going to keep compounding their growth at the rate they have been for the last 50 years with non-oracle type chiefs in charge...?

Like it or not those 2 men do have an impact on our existence. At least our investments anyway.*

Off topic, but the thought occurred to me .... A proportion of Berkshire's value is in the investments it holds. Your S&P 500 index fund therefore holds index weights PLUS additional holdings in selected index constituents that Berkshire also holds, therefore doubling up on those companies.

A little quirk in the system there... over here our index excludes listed investment companies for this reason, but I guess Berkshire isn't your typical listed investment company.


*A little edit - Sorry Retire Canada - I think I've quoted you out of context there. Apologies.
« Last Edit: October 10, 2018, 02:41:19 PM by marty998 »

mjs111

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Re: Just read something interesting
« Reply #24 on: October 10, 2018, 02:58:54 PM »
Warren Buffett is giving each if his childrens' charitable foundations $2 billion each.  He's not giving it directly to his kids.

https://www.cnbc.com/2016/09/26/warren-buffett-bill-gates-have-similar-ideas-on-how-much-money-to-leave-kids.html


Mike


Pylortes

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Re: Just read something interesting
« Reply #25 on: October 10, 2018, 03:19:03 PM »
Warren Buffett is giving each if his childrens' charitable foundations $2 billion each.  He's not giving it directly to his kids.

https://www.cnbc.com/2016/09/26/warren-buffett-bill-gates-have-similar-ideas-on-how-much-money-to-leave-kids.html


Mike

Yes, this. The $2B is not to line the kids pockets.  Its still going to charity, but the kids will be the ones who get to direct where the proceeds of their foundations go, according to their philanthropic interests.  Let's get this straight. 

the_fixer

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Re: Just read something interesting
« Reply #26 on: October 10, 2018, 06:39:39 PM »
So here we are a day later and the market drop today was 3.5 billion for Warren Buffett...

That is just s blip on the radar of his wealth much like the amount he is passing along to his kids.

So as a % is it unfair to leave the family what is basically equivalent to a down day in the market?




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koshtra

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Re: Just read something interesting
« Reply #27 on: October 10, 2018, 10:46:48 PM »
I don't think Warren Buffet ever aspired to Mustachianism. Making money is what he *likes* to do. For him it's the great absorbing game, and he loves to play it. More power to him. He's not doing what we're doing, and it doesn't make any sense to judge him as if he were.

ROF Expat

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Re: Just read something interesting
« Reply #28 on: October 11, 2018, 03:27:21 AM »


[/quote]

And when Buffet and Munger do fall off the perch - Berkshire makes up quite a large % of the S&P 500.... you think they are going to keep compounding their growth at the rate they have been for the last 50 years with non-oracle type chiefs in charge...?

Like it or not those 2 men do have an impact on our existence. At least our investments anyway.*

Off topic, but the thought occurred to me .... A proportion of Berkshire's value is in the investments it holds. Your S&P 500 index fund therefore holds index weights PLUS additional holdings in selected index constituents that Berkshire also holds, therefore doubling up on those companies.

A little quirk in the system there... over here our index excludes listed investment companies for this reason, but I guess Berkshire isn't your typical listed investment company.


*A little edit - Sorry Retire Canada - I think I've quoted you out of context there. Apologies.
[/quote]

marty998,

When Buffett and Munger fall off the perch, I don't think their successor(s) will be able to maintain the growth rate of the earlier years of Berkshire Hathaway.  Of course, Buffett and Munger haven't been able to maintain their earlier growth rates, either.  When Berkshire Hathaway was small, a brilliant deal by Buffett added significantly to its bottom line.  Now, even a huge deal makes very little difference.  In this respect, I think BH has changed fundamentally.   

I'm all about index funds, but if when Buffet passes away, if the price drops enough to make it a bargain, I will strongly consider buying (B shares, of course).  Buffett and Munger have assembled an incredible cash generating machine on the foundation of BH's core insurance companies (although not the growth machine it once was).  That isn't going to change instantly just because Buffett passes away.


Askel

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Re: Just read something interesting
« Reply #29 on: October 11, 2018, 04:08:15 AM »
He isn't a known spender.

WHAT?! He takes his clown car through the drive through every day to order TWO SAUSAGE PATTIES?! (https://www.cnbc.com/2017/01/30/warren-buffetts-breakfast-never-costs-more-than-317.html)

Jeez, that's the mustachian equivalent of lighting your cigars with hundred dollar bills.