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Here’s a Christmas story, StormWatchers,
…that you can tell your grandchildren. It is the story of an old, very rich, very clever man, and I’ll tell it to you pretty much as I remember it.
The man in this story is Warren Buffett, rich like I say, but frugal.
Not a man to change his car, or tie come to think of it, before they were worn out completely. Among the items he kept was his billfold but, after 25 years, even that needed replacing.
He gave the old wallet to a charity to auction off (it fetched a quarter of a million!), but before parting with it he extracted an old $50 bill he’d kept in there, signed, as they used to be, by Eugene Abegg, owner and founder of Illinois National Bank.
Abegg’s philosophy of banking was: Build trust in the community and treat your responsibility as sacred.
During the Depression, Abegg opened his banks’ doors to any depositor who wanted his money back. Few did, because they trusted him completely.
We have come a long way since then, it seems.
Abegg and Buffett became friends, and Illinois National Bank become one of Buffett’s first and ultimately most fruitful purchases. He left Abegg alone and was rewarded handsomely. Abegg so loved his job that he worked well into his 70s, I believe.
If all this sounds impossibly Dickensian to you today, check yourself. Abegg is the future. We have known Chuck Prince, CEO of Citigroup, and he was no Gene Abegg.
Here, at the tail end of ’08, look at all the Emperors and Princes with no clothes.
Where are today’s Abeggs? Mark Hurd at Hewlett-Packard has turned his customers into his sales force. It’s not brilliant, like leverage is brilliant, but it is effective.
Or look at John Stumpf, CEO of Wells Fargo. Sticks to the knitting. His purchase of Wachovia positions his bank to come out a leader in the recovery.
The Abeggs are out there. They are the future, make no mistake. I’ll tell you more about them next week—and we’ll prepare ourselves to buy a couple of them.
Rest up, StormWatchers, we’ve got a busy week ahead.
Now, where did you hide the remote?
Richard
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