quote:Buffett has pledged to gradually give 85% of his Berkshire stock to five foundations. A dominant five-sixths of the shares will go to the world's largest philanthropic organization, the $30 billion Bill & Melinda Gates Foundation, whose principals are close friends of Buffett's (a connection that began in 1991, when a mutual friend introduced Buffett and Bill Gates).
Wow. this more then doubles the already large Bill and Melinda Gates Foundation. Sometimes we tend to focus the negative aspects of extremely rich individuals. Let's celebrate the good.
[ June 26, 2006, 09:35 AM: Message edited by: Wowbagger the Infinitely Prolonged ]
Posted by Dr Strangelove (Member # 8331) on :
I saw that earlier today. That amount of money is ... mind blowing. It's cool that he's being philanthropic with it.
Posted by Lyrhawn (Member # 7039) on :
So how many small, impoverished African nations have a smaller budget, or GDP than the money now in the B&MG Foundation?
Just curious.
I think it's great that he decided to do it before he died, so he can make sure that the money goes to where he wants it to go.
I think it's great in general that he is donating his money, and I really like what the Gates family have done so far, I trust they'll do even greater things now.
Posted by BlueWizard (Member # 9389) on :
I heard about this on the news tonight. They said Buffet is worth $40 BILLION, if he gives away 85%, he will then be worth a paltry $6 BILLION.
What a shame his poor heirs will have to scrap by on a paltry $6 billion divided among them; it's a hard life.
Steve/BlueWizard
Posted by sarahdipity (Member # 3254) on :
I think Warren Buffet had always planned on pretty much all of his money going to charity. I think it's neat that he is doing it earlier. Actually, BlueWizard, we don't know that his heirs will even get the $6 billion. Buffet is a very interesting character. He has some very set ideas about money. I've seen his house, it's nice but not that nice. He drives an old car. And I think I read somewhere that his heirs weren't going to get much because he thought they should work for their money.
[ June 26, 2006, 08:45 AM: Message edited by: sarahdipity ]
Posted by Dr Strangelove (Member # 8331) on :
quote:Sticking to his long-term intentions, Buffett says the residual 5%, worth about $6.8 billion today, will in time go for philanthropy also, perhaps in his lifetime and, if not, at his death.
Posted by Elizabeth (Member # 5218) on :
"I've seen his house, it's nice but not that nice. He drives an old car. And I think I read somewhere that his heirs weren't going to get much because he thought they should work for their money."
SOme of people I went to school with in the east who had the most money often appeared to have the least money. Old cars, simple lifestyles, and they had to work their tails off in the summers. It was just not cool to talk about money, or to show off how much you had. Still, it sort of oozed from them. Can't quite explain that one.
It is so different in our little town. One way or another, people are able to let you know if they make more money than you do, have a bigger house, or whatever.
Money can't buy class. It seems to me that Buffett has class.
Posted by Stephan (Member # 7549) on :
Buffett doesn't believe in keeping fortunes tied up in inheritence. I guess he wants his descendents to work for their money like he did.
Posted by msquared (Member # 4484) on :
You know BlueWizard, you have a beef with a guy not giving everything away? I mean he gives away 95% of his fortune and you are still whining that is heirs may get a billion? He could have left it all to his family but didn't. Did you compliment him on that? No, you just deride him for maybe possibly caring for his family. Not that he ever said he was going to leave his heirs that money, you just assumed.
msquared
Posted by James Tiberius Kirk (Member # 2832) on :
I didn't think he was being completly serious.
*
In any case, I hope the money does a lot of good.
--j_k
Posted by Elizabeth (Member # 5218) on :
You know, I wonder if he is doing this now not so that he can see the good his money does, but to make sure that his money does good, and goes where he chooses for it to go.
I have seen some really sad and angry battles in very close families over inheritance. It can break families apart.
Posted by erosomniac (Member # 6834) on :
quote:Originally posted by Elizabeth: "I've seen his house, it's nice but not that nice. He drives an old car. And I think I read somewhere that his heirs weren't going to get much because he thought they should work for their money."
SOme of people I went to school with in the east who had the most money often appeared to have the least money. Old cars, simple lifestyles, and they had to work their tails off in the summers. It was just not cool to talk about money, or to show off how much you had. Still, it sort of oozed from them. Can't quite explain that one.
It is so different in our little town. One way or another, people are able to let you know if they make more money than you do, have a bigger house, or whatever.
Money can't buy class. It seems to me that Buffett has class.
The most successful people have often noted that it's not about the money, it's about the success; the numbers are just a means of keeping score. Those are the people who ultimately don't flaunt their money, because it's not necessary.
Kind of like the guy who owns IKEA, one of the world's 10 wealthiest people. The guy still flies coach everywhere he goes, because he doesn't believe in wasting money.
Posted by aretee (Member # 1743) on :
How Carnegian of Mr. Buffet.
Posted by camus (Member # 8052) on :
I read somewhere that Bill Gates planned on eventually donating 95% of his wealth to this fund as well. Combined with Buffet's donation, that's a lot of money. Hopefully it can be used wisely.
Posted by Xavier (Member # 405) on :
quote:I read somewhere that Bill Gates planned on eventually donating 95% of his wealth to this fund as well. Combined with Buffet's donation, that's a lot of money. Hopefully it can be used wisely.
I heard something similar myself.
I hope that the B&MG foundation doesn't become so bloated that over 50% of its money goes to administration. Must be very hard to provide an infastructure for the accounting and allocation of over 100,000,000,000 dollars though. Overhead may well be a problem. It would probably take a small corporation just to determine where best to donate.
Posted by katharina (Member # 827) on :
In the Express this morning, the paper quoted Buffett as saying something like "It's not the only way to get into heaven, but it's a good one." Maybe he wants to make sure he's doing enough to good deeds to make that happen. *amused*
Posted by ElJay (Member # 6358) on :
xavier, I read an interview with Buffett where he said one of the reasons he was giving most of the money to the B&MG foundation instead of his own, smaller one is that they're already set up to deal with large amounts of money, and the two of them keep close enough oversight on it that he knows they're doing it wisely. His foundation would have to spend money to hire more people to ramp up and deal with the higher amount of giving, and he'd rather more of the money went to actually doing good instead of replicating the administrative stuff in another foundation. The Gates' foundation has two years to adjust to the higher amount, and then all the money they get from Buffett has to be actually distributed each year. And the money keeps going to them only as long as one of them is on the board, because he trusts them to spend it effectivly.
It was a pretty interesting interview, I'll see if I can find it and link it later.
Posted by Jhai (Member # 5633) on :
The Fortune interview with him is very, very good. If you go to the main article linked, then there's a link to the interview.
I have a lot of respect for the guy. His kids have gotten some money already, but not much by "rich people" standards. The other 1/6 of the money being given away will go towards the charities his kids run, and the one set-up by and named for his now-deceased wife. He says his kids had a ton of opportunies growing up, and thus they don't need the money - they're already way ahead of the curve.
He was gonna keep the money until his death, but he's seen the Gates are doing, and wants to be a part of it now. He also hopes that other super rich people will follow his lead and donate their money to a current charity instead of founding their own - why pay all those start-up costs when perfectly good foundations already exist? Especially when one may not be as good at heading a charity as others are.
ElJay - as I read the interview, the Gates' foundation doesn't have to use the money immediately. There's even a bit about how they can hold onto the stock for awhile if they wish, since they have so much liquidity already.
Posted by ElJay (Member # 6358) on :
Right, but that's just saying if they want to hold the Berkshire stock because they think it's a better investment than other stock they're holding, they can sell the other stock instead. But they have to give away the value of the donated stock each year, whether it's by selling the Berkshire stock and donating the money or selling the equivilent amount of other stock and donating the money.
Posted by ElJay (Member # 6358) on :
It was actually in the main article, not the interview.
quote:With so much new money to handle, the foundation will be given two years to resize its operations. But it will then be required by the terms of Buffett's gift to annually spend the dollar amount of his contributions as well as those it is already making from its existing assets.
Posted by Jhai (Member # 5633) on :
Ah - didn't catch that. Thanks!
Posted by Dagonee (Member # 5818) on :
I wondered about the effect on BH stock if they had to sell so much each year. I never doubted that Buffett and Gates knew how to handle it. I just wondered how they would.
Posted by ElJay (Member # 6358) on :
Buffett actually addresses that in the interview, too. It's a pretty interesting read. Posted by Jhai (Member # 5633) on :
Basically, he says that about 15% of the stock is churned around every year. Even if all the charities sell all of their stock at the same time, it'll only raise the amount of selling up to 17% per year - hardly a huge jump. And it may actually help the price with the higher liquidity.
Posted by Orincoro (Member # 8854) on :
Can I just point out, that even at a moderate interest rate, that kind of money returns something on the order of millions per day? That's CRAZY!
You could, for one thing, build a university funded in perpetuity by the interest on a small portion of that money. That's what I would do. Orincoro University, home of the Pnematoads (sic).
Posted by cheiros do ender (Member # 8849) on :
That could work out well. You'd still have student fees, but no other "donations" *cough*bribes*cough* accepted. And spoilt rich kids (not that they're all like that) would have to actually earn they're qualifications.
Posted by Elizabeth (Member # 5218) on :
cheiros, a good many of those "spoilt rich kids" are extremely bright and accomplished, and accepted to college on their merits, even when their families have donated scads of money. At a small, liberal arts college, or an Ivy League college, it is very difficult to follow a course of study which would not weed out weak students.
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