Yeah, its insane to claim talent isn't orders of magnitude apart. I'm probably a better programmer than 99% of the population, but then I see those insane luajit or llvm people and realize I'm just another noob.
I think you're misunderstanding talent. You always have to compare yourself to people who invested an equal amount of time training the skill.
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.
> Are you saying they're all 10,000x smarter than us?
You don't make billions by being billion times smarter than other people, but by either deploying raw materials, or labor or capital to scale billion times more.
But in order to do that, you can't be 1x of the average person (generally speaking), but you don't need to be billion times better either.
That’s different than what your article claimed. It said it was all luck.
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.
Any of his investments could've gone bad through no fault of his own. You can be the smartest person in the room and still get punched in the face, metaphorically, when an unknown unknown presents itself. Buffett himself bet $1 million that index funds were superior to active management (and won) [1].
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.
Sort of. I'd say the best things he got from his father were:
* 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.
The biggest advantage wealth affords that it allows you to fail, and then get up to try again, because you haven't lost your basic life security (a roof over your head, good food, education, community, healthcare when you're sick or injured).
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.
This exactly. The amount of money that you are willing to throw away at an investment without any internal resistance is what makes a difference. For many people even though talented, this amount is close to zero. Even more so, if you grow up with this mentality, it is a lot harder to change when you are e.g. in your 30s and already have some buck behind your back to eventually invest in something other than education/property.
Not if you go broke on your first or second hand. Most of us only have enough cash to play one or two hands. If you're the son/daughter of a million/billionaire though, you get to play way more hands, and thus have a much better chance of being successful.
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?
To continue the metaphor, the table stakes at the tables that provide the big payoffs require the average person to go "all-in".
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.
You're right, not pure luck -- it's 99% luck and 1% talent. If Buffet was born the child of a goat herder in Azerbaijan, he would not be anywhere near the position he is today.
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.
Correct me if I'm wrong, but I don't think Buffett got all that much money from his family. Probably the best part of his upbringing was early exposure to stocks at a time they were not popular, and having school expenses paid. Lucky, but not like he was handed $1 million, which seems to be what you're implying.
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.
He got something worth more than $1M. A father who was a US Representative who was smart enough to be operating his own investment firm, and who was probably able to guide him to the right schools and network of people to magnify odds of success. Knowing the right people is such a huge lever in the investment business, especially back in those days without computer trading and internet.
"99% luck and 1% talent" essentially means Buffet's success is down to luck.
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.
> 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.