This is not a good moral. You’re generalizing from one example.
Warren Buffett has made many successful investments for example, over a damned long period. There’s clearly skill in his story. Skill that Masa didn’t have.
Warren Buffett has made many successful investments for example, over a damned long period. There’s clearly skill in his story. Skill that Masa didn’t have.
> So some people are more talented than average and some are less so, but nobody is orders of magnitude more talented than anybody else.
It seems likely that in some domains, some people are orders of magnitude more talented. Assuming this is false begs the question.
For example I go to the gym regularly (at least before the pandemic). I'm probably in the upper 10% of the population when it comes to strength. But compared to the regulars in the gym I'm below average.
I have no trouble believing that there is someone theoretically more talented than Warren Buffett who a less lucky life. I have great difficulty believing Buffett is untalented.
Buffett did have losses! And made mistakes. And you’re missing the point. I’m not arguing Buffett himself didn’t have luck. He himself has written extensively about this.
But he also had skill. Luck + skill. Why some believe it must be one or the other and not both baffles me.
* A good upbringing * Early exposure to stock brokering (his dad ran a small brokerage) * Being sent to university and having his costs covered
Warren actually made the bulk of his early money himself, I think. He ran an enormous paper route operation, and also repaired and sold pinball machines at a large profit.
He started all this around age 11 and it grew from there. He had amassed $5,000 by age 14.
But not having to take money out for university made a lot of difference I expect. It would have cut his compounding. I don't remember him getting much in the way of inherited wealth from his father though.
It's been over a year since I read his bio, so perhaps I'm misremembering. Happy to be corrected if you have specific info.
You get the freedom to experiment without fear of dire consequences, whether that's by building a paper route, repairing pinball machines, or expanding your family's business partnership to buy a textile mill called Berkshire.
If, however, you are child who has to work to put food on the family table, or pay the rent, you're playing a whole different game, one that has life and death implications.
Of course Buffett isn't unique in having the advantage of a financially stable and prosperous family and household. Clearly his entrepreneurial streak started early. But compared to the average person of his time, he did have extraordinary advantages, including a university education, and exposure to investing from an early age through is father's brokerage firm. His experience is not directly comparable to that of most Americans.
It wasn't his family's business partnership by the way. He ran his own investment fund.
Nor is is generalizable to the equivalent of that 97% in recent generations, despite their being more likely to have college degrees.
Talent increases your surface area to catch luck.
Talent doesn't increase surface area, it increases the probability of success. Wealth is the only thing that can increase surface area. See the problem here?
Whereas a billionaire usually gambles on the margins of their wealth. They definitely don't gamble with the roof over their head or their next meal, or their childrens' security. They can make any non-ergodic game appear ergodic for longer since they can survive many losing hands for far longer than others.
Basically, if Buffet's father was anything other than a US Rep and businessman, he never would've stood a chance. He would be working 40 hour weeks making someone else rich like the rest of us.
He made his early money repairing and selling pinball machines at a profit, and running a massive paper route operation. He started around age 11 or so.
There are many many people who were born as privileged as Buffet was, who got as many doors opened as he did, but there is only one Buffet. He may be extremely lucky, or he is a genius. It's impossibly hard to quantify the reasons.
> Basically, if Buffet's father was anything other than a US Rep and businessman, he never would've stood a chance. He would be working 40 hour weeks making someone else rich like the rest of us.
Mark Cuban was a counter example. Or Oprah Wilfrey. They stood a chance despite not having rich parents.
A single datapoint can't prove a general claim. But a single counterpoint can disprove a claim.
It could be argued that Warren Buffet does exactly this.