Warren Buffett’s greatest investment: Clear communication
Dollar by dollar, he built a fortune. Word by word, he cemented his legacy.
Not many 94-year-olds retire from a job they’ve held for more than half a century.
Even fewer spark immediate international news headlines by doing so.
But billionaire Warren Buffett, the “Oracle of Omaha” and probably the world’s most famous investor, broke big news Saturday by announcing that he will step down at the end of the year from his role as CEO of Berkshire Hathaway.
Buffett announced his succession plan during his company’s 60th annual shareholder meeting—an event focused on open, unscripted dialogue in Omaha’s CHI Health Center whose other headline events this summer include WWE professional wrestling, comedian Shane Gillis, and Swedish heavy metal band Ghost.
The Wall Street icon said he hadn’t given his successor, Greg Abel of Des Moines, 62, or other directors in the company advance notice of the announcement—except his two children on the board, Howard and Susie Buffett.
CNBC called it “the end of an era.”
Buffett was just being perfectly on brand: Divulging his plans to the arena crowd was consistent with the role of plainspoken sage he has perfected over decades.
“The prospects of Berkshire will be better under Greg’s management than mine,” Buffett told shareholders with a dose of his signature aw-shucks humility.
Jason Zweig in the Wall Street Journal said there will never be another Buffett because of three factors:
his unique personality (a lifelong obsession with the stock market),
the time period of his career (starting before the rise of index funds and giant institutions), and
the Berkshire Hathaway package (a publicly traded holding company rather than a hedge fund or other financial structure).
But I propose that Buffett’s communication style could be considered his greatest “investment” throughout his career. The consistent means of his message elevated him from a mere financial success to a cultural landmark—the Mark Twain of the markets.
The consistent means of his message elevated Buffett from a mere financial success to a cultural landmark—the Mark Twain of the markets.
He often gets described as “folksy,” but that’s a regionally biased and reductive nod to his Midwestern roots.
The CEO’s parlance has seeped so deep into the culture of his company that even the rules printed in the weekend’s meeting program were hewn in the Buffett style: “Do not ask what we are buying or selling. Even if the information is public, we do not discuss how we arrive at our decisions. We also will not discuss politics. Any other subjects are fair game.”
Short, direct sentences full of conviction and rooted in core values.
Buffett is worth $168 billion according to Forbes, and his company currently sits on some $350 billion in cash at an opportune time. I don’t think anybody, whether they work on Wall Street or in an Omaha back alley, questions Buffett’s sophistication. That’s why he’s such a great example of how clear, direct communication is the true mark of the sophisticate—not industry jargon, pretentious vocabulary, or stilted sentences. The more your words make awkward attempts to obscure blame, dodge commitment, or inflate expectations, the less sophisticated you sound to all audiences—even if some pick up on it sooner than others.
Early in his most recent shareholder letter, Buffett took pains to note that since 2019 he has “used the words ‘mistake’ or ‘error’ 16 times in my letters to you. Many other huge companies have never used either word over that span.”
The 60-year evolution of Buffett’s shareholder letters itself could be a mini-master class in communication.
“Be fearful when others are greedy and greedy when others are fearful.”
His most famous investing aphorism may be this: “Be fearful when others are greedy and greedy when others are fearful.”
In his most recent letter …
He’s also deft with several paragraphs when he clarifies that he values higher education while building to his point that “a very large portion of business talent is innate with nature swamping nurture.”
He knows how to convey impact with just a couple of key figures, such as how he puts his company’s record tax payment into context: “Berkshire last year made four payments to the IRS that totaled $26.8 billion. That’s about 5% of what all of corporate America paid.”
He even provides another way to comprehend the huge sum: “If Berkshire had sent the Treasury a $1 million check every 20 minutes throughout all of 2024—visualize 366 days and nights because 2024 was a leap year—we still would have owed the federal government a significant sum at yearend.”
From his 2019 letter: “In reviewing my uneven record, I’ve concluded that acquisitions are similar to marriage: They start, of course, with a joyful wedding—but then reality tends to diverge from pre-nuptial expectations.”
From 2008: “The stock market is designed to transfer money from the active to the patient.” (A similar pithy line on patience from 1986: “We continue to make more money when snoring than when active.”)
Through four hours of live answers at this month’s shareholder meeting, Buffett, despite his age, doled out more gems as he talked himself hoarse:
His investment in Apple: “I’m somewhat embarrassed to say that (Apple CEO) Tim Cook has made Berkshire a lot more money than I’ve ever made Berkshire Hathaway.” (Cook returned the favor in a post on X:“There’s never been someone like Warren, and countless people, myself included, have been inspired by his wisdom. It’s been one of the great privileges of my life to know him.”)
His trust in human ingenuity in the era of artificial intelligence: “I wouldn’t trade everything that’s developed in AI in the next 10 years for Ajit (Jain, vice chairman of insurance operations for Berkshire). If you gave me a choice of having a hundred billion dollars available to participate in the property casualty insurance business for the next 10 years and a choice of getting the top AI product from whoever’s developing it or having Ajit making the decisions, I would take Ajit anytime—and I’m not kidding about that.”
His abiding faith in the future of America: “The luckiest day in my life is the day I was born, because I was born in the United States.”
One more quote from the oracle at this month’s meeting, to drive home his rhetorical impact: “One of the great pleasures—it is the great pleasure actually in this business—is having people trust you. That’s really why I work at 94 when I’ve got more money than anybody could count. It means nothing in terms of how I’m going to live or how my children are going to live or anything else.”
How did Buffett earn trust? Not only by steadily compounding and calculating figures. He earned trust primarily through his words and how he lived up to them.
His greatest investment.
Iowa Writers’ Collaborative
I’m proud to be a member of the Iowa Writers’ Collaborative. Meet our writers here, or subscribe to our free weekly roundup and our Wednesday “Flipside” edition featuring sports, music, culture, and other topics.