"The key of interviewing is listening. If you don't listen, you're not a good interviewer. I hate interviewers who come with a long list of prepared questions, because they're going to depend on going from the fourth question to the fifth question without listening to the answer. ... I concentrate solely on the answer, and I trust my instincts to come up with [more] questions."

—Larry King, in a 2017 interview. I wrote about his interviewing style over the weekend (Inc.com, hopefully not $), after his death at age 87.

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My Warren Buffet Hobby

I've been reading Warren Buffett's old Berkshire Hathaway shareholder letters. (Weird hobby, I admit.)

They're posted on the Berkshire Hathaway website going back to 1977. Combined, they run more about half a million words.

I've found some shortcuts, of course. Long time readers will remember that a year ago, I ran the full text of Buffett's most recent letter through a word cloud generator.

(The single word that appears most often? “Will,” as in the simple future tense of the verb, “to be.”)

I’ve been working on doing something related but a bit more involved for all 44 years worth of letters, in fact. I’d meant to do it earlier, but then there was like, a pandemic and stuff? Kind of knocked me off my game—but more details coming, soon.

For now, there’s another story worth sharing. It's about one of the big lessons Buffett describes learning, as a result of a “monumentally stupid decision” that he made.

What you need to know is that Berkshire traces its roots to a 19th-century New England textile mill that Buffett bought into during his "discarded cigar butt" investment era. Basically, he’d buy old, decaying companies, hoping to squeeze out returns before the whole thing died out.

He meant to flip Berkshire, but then he got into a dispute with the company’s chairman. He then bought the entire company out of spite, just to be able to fire him.

As I’ve written here before, Buffett says he wound up like “the dog who caught the car,” with 25 percent of his investments tied up in a dying business.

Today’s lesson didn’t come from buying the company, however; it came from trying for two decades afterward to make the textile business work.

If you dig deep into these old letters, you find the story of Ken Chace, a longtime Berkshire executive, whom Buffett put in place as company president.

Buffett seems really to have liked Chace, along with his successor, Garry Morrison. They were "excellent managers, every bit the equal of managers at our more profitable businesses," he wrote in the 1986 shareholder letter—but it didn't matter.

Running a textile company in New England in the latter part of the 20th century was like having the world's best pilots on a plane with no wings. By the end of 1985, after 20 long years, Buffett shut down the textile business.

Berkshire Hathaway became the 100 percent holding company (with a heavy emphasis on insurance) that it is today. Yet, years later, Buffett was still talking about what a great leader Chace had been: "A wonderful guy," he said in a 2010 interview. "Terrific. Honest and able, hardworking.”

However, if you want to be successful in business, Warren also insisted—and this is the key—it makes a lot more sense to be in an industry in which the external forces (the market, the trends, the economy) are like the wind at your back, not a gale force in your face.

It's such a common problem. So many hard-working business owners and entrepreneurs face it. They dream of success--but they choose the wrong industry, in which all the market forces are working against them.

I face it myself. I’ll be honest, there are days when I think: Why the heck am I still in the media industry?

"The interesting thing about business, it's not like the Olympics," Buffett said in that same interview (CNBC, 2010). "You don't get any extra points for the fact that something's very hard to do. So you might as well just step over one-foot bars, instead of trying to jump over seven-foot bars."

7 other things worth your time

• The Biden administration reversed another Trump decision, announcing it will work to have Harriet Tubman replace President Andrew Jackson on the $20 bill—although the timeline isn’t exactly clear. (Yahoo Finance)

• Florida says it’s eager to host the 2020 (make that 2021) Summer Olympics if Tokyo backs out due to Covid. “Florida” here means the state’s chief financial officer, who wrote a letter to the IOC. (AFP)

• The mayor of Portland was confronted outside a brew pub by two men who had a video camera and accused him of being without a mask. He pepper sprayed one of them. “Afterward, [he] said, he provided the man with a bottle of water to rinse his face.” (Oregon Live)

• You know what this country needs? Another cable news network, right? Regardless, WGN is changing its name to NewsNation, hoping to compete with CNN, Fox News, MSNBC, OAN, Newsmax, and whatever else is out there. (LA Times)

• Optimistic people wind up with healthier hearts, according to a new study out of Baylor College of Medicine. (Heart.org)

• A judge in Texas dismissed a theft charge against a doctor who’d been accused of theft for giving nine Covid vaccine doses that were about to expire to people who were not on a priority list. Apparently the most controversial detail was that he took the last one home and gave it to his wife. (Houston Chronicle)

• There are four million U.S. government employees. The highest paid among them? Dr. Anthony Fauci, who made $417,608 in 2019, at least according to a group that said it did a freedom of information request to get the data. Does that really seem excessive to anyone though? It seems a fraction of what he’d make in the private sector. (Forbes)

Thanks for reading. I’ve touched on this Buffett story before at Inc.com.  If you liked this post, and you’re not yet a subscriber, gosh, what are you waiting for? Please sign up for the daily Understandably.com email newsletter, with thousands and thousands and thousands and thousands of 5-star ratings from happy readers.  

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