Why does Warren Buffett keep 16 lakh crores in cash: The biggest investor made 99% of his wealth after the age of 50; eats burger and coke for breakfast

It was summer, 1950. A young man from America reached Harvard Business School for admission. After an interview that lasted about 10 minutes in Chicago, he was told, 'Forget it, you cannot study in Harvard.' After this rejection, he wrote a letter to Columbia Business School professor David Dodd – 'Dear Professor Dodd, I thought you had died, but you are teaching in Columbia. I also want to study from you.' Professor Dodd was so happy after reading the letter that he immediately called the young man to Columbia. After learning the tricks of investment there, this young man became the world's biggest investment banker Warren Buffett. Today is his 94th birthday. With a total wealth of 11 lakh crores, he is the sixth richest person in the world. His company Berkshire Hathaway has invested about 24 lakh crores in 41 companies including Apple, Coca-Cola and Bank of America. On August 28, Berkshire Hathaway became the first non-tech company in America to have a market cap of one trillion dollars i.e. 84 lakh crores rupees. Berkshire Hathaway is the company with the most cash in the world, with 189 billion dollars i.e. about 16 lakh crores rupees in cash. Interesting story of the world's biggest investor – Bought 3 shares with sister at the age of 11, earned 5 dollars Warren Buffett was born on 30 August 1930 in Omaha city of America. Father Howard Buffett was a stock broker. Later he also became an MP. Due to his father, Buffett started taking interest in stocks since childhood. At the age of 6, he raised 120 dollars by selling golf balls, popcorn and peanuts. With this money, in 1942, 11-year-old Buffett bought 3 shares with sister Doris. These shares were of American petroleum company Cities Service. After three months, the price of these shares fell. After this, sister Doris started pressuring Warren Buffett to sell the shares, but Warren decided to wait. Finally, after 4 months, these shares gave a profit of 5 dollars. He understood the power of compounding, made 99% wealth after the age of 50 Warren Buffett became a billionaire at the age of 56. He earned 99% wealth after the age of 50. Buffett made full use of the power of making money from money. In English, it is called 'compounding'. Buffett had wealth of 20 thousand dollars at the age of 21, which increased seven times i.e. 1.40 lakh dollars at the age of 26. By the age of 30, Buffett's wealth became 10 lakh dollars. This is from the 1960s. At that time, the annual income of an American family was 5600 dollars. According to today's rate, it is about 50 lakh rupees annually. That is, when it took two years for an average American family to earn one crore rupees, 30-year-old Warren Buffett had already earned more than 8 crore rupees. At the age of 76, he married his wife's friend. On 19 April 1952, Warren Buffett married a girl named Suzanne. They have three children- Susie, Howard and Peter. Warren converted the drawer of the dresser into a cradle for Susie. For Howard, he borrowed a cradle from his friend. In 1977, Warren Buffett and Suzanne separated. However, they did not get divorced. During this time, Suzanne felt that Warren must be having difficulty running the house alone. So she asked her friend Astrid to take care of Warren. Astrid hesitated initially, but after a year, both started living together. On 29 July 2004, Suzanne died in San Francisco. In 2006, Warren and Astrid got married. In an interview in 2008, Buffett had said, the biggest mistake of my life was to let Suzanne go. It was 95% my fault. I could not adjust. When people raised questions, he named his jet 'The Indefensible' Warren Buffett bought an old Falcon-20 jet in 1986. The price was 8.5 lakh dollars. About 7 crore rupees today. 38 years ago, people found this purchase very expensive. Questions started being raised on Buffett. In response, he named his jet The Indefensible. The meaning of this name was something that cannot be defended. Actually, this name was a taunt of Buffett. After 3 years, Buffett sold this jet and bought another old jet for 6.7 million dollars i.e. 55 crore rupees. This time he named it – The Indispensable, meaning something that is very important. When his friend asked for money, Buffett went to get the change for dollars. Warren Buffett is very miserly. Once at the airport, his friend Katherine Graham asked him for 10 cents for a phone call. Buffett took out a 25 cent coin from his pocket and went to get change. When he could not find the 10 cent coin for a long time, Buffett hesitantly gave his friend a 25 cent coin. Katherine was the publisher of the American newspaper Washington Post. The world's biggest investor, but lives in a 66-year-old house. Buffett lives in a 66-year-old house in Omaha city. He bought this house in 1958 for $31,500. Today's value is about Rs 3 crore. This house is built in 6,280 square feet, it has 5 bedrooms and 2 bathrooms. Buffett wrote in a letter to Hathaway's shareholders – this house is his third best investment. Buffett also bought a house in California in 1971 for $1.5 lakh. He sold this house built on the shores of Laguna Beach in 2018 for $ 7.5 million i.e. about Rs 62 crores. Warren Buffett uses old cars instead of buying new cars. He has a Cadillac XTS car since 2014. In 2006, he had the DTS model of Cadillac. In 2001, he bought a Lincoln Town Car. He had Thrifty written on the number plate of this car. Thrifty means frugal, that is, one who spends less. In 2006 itself, he auctioned this car for charity. Regarding his cars, Buffett says that 'I drive only 3,500 miles in a year, so I do not buy a new car.' Buffett continued to use a cheap phone till 2020. Despite having a 5% stake in the Apple company, Buffett did not use the iPhone. He had Samsung's SCH-U320 phone with a flip screen. He started using iPhone 11 for the first time in 2020. This phone was given to him by Apple CEO Tim Cook. Buffett uses iPhone only for making calls. He uses Apple's iPad for share prices and other research. Buffett has only 20 suits, gets a cheap haircut Warren Buffett does not have a hair stylist. He gets his hair cut at a general shop near his office. He spends only $18 on this. Buffett wears cheap suits made in China instead of customized Italian suits. He told in an interview that he has 20 suits. All of them have been designed by Chinese designer Madam Li. Cold drink 5 times a day, only Rs 263 spent on food Buffett says that he eats like a 6-year-old child. He has breakfast at McDonald's every morning. He drinks Coke and eats burgers for breakfast. In 2017, Buffett had said in an interview that he does not spend more than $3.17 i.e. Rs 263 on food. He orders food and pays with change. He had told in HBO channel's documentary 'Becoming Warren Buffett' that he drinks cold drinks at least 5 times a day. Buffett's company has around 16 lakh crore rupees in cash Warren Buffett's company Berkshire has 188 billion dollars i.e. around 16 lakh crore rupees in cash. It means that he has neither invested this amount anywhere. Neither has he bought gold with it. Neither has he made a fixed deposit. Nor has he deposited it in the bank. Due to inflation, the value of this huge amount reduces by 2% to 4% every year, still why does Buffett do this? Experts say that Buffett waits for the opportunity that comes once in a decade. Such as the 2020 Corona pandemic, the 2008 Lehman Brothers Crisis and the 2000 Dot.com Bubble Crisis. At such times when most companies start going bankrupt, Warren Buffett buys stocks at a 40% to 50% discount. Buffett uses cash for this. In a shareholders meeting in 2020, Buffett said, 'In the next 20-30 years, there will be two or three times when it will be raining gold. Then we will just have to go out to collect it, but no one knows when this will happen.' Experts say that Buffett considers the stock market to be overvalued. That is, the boom in the stock markets is not real. They will crash someday. This trend is also visible in big companies of America. Many big companies have invested in government bonds instead of other companies. *********** References- 1. The Snowball: Warren Buffett and the Business of Life – Alice Schroeder 2. Buffett: The Making of an American Capitalist – Roger Lowenstein

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