We all have epiphanies that change our lives, and for Warren Buffett it was the moment that he realized the lengths that people will go to engage in gambling behavior, even when they know the odds insure that in the end they will lose. It was a moment that cemented the advantage the disciplined investor has over the gambler.
“I walked into this casino, the Flamingo, it was kind of a motel-like arrangement, and I was 21 and my bride was 19,” Warren Buffett said at the 2022 Berkshire Hathaway Annual Meeting. “And I looked around the room and there were all of these people, and they were better dressed then, it was a more dignified group than, perhaps, currently, but they had flown thousands of miles in some cases, you know, in planes that weren’t as fast as the current ones and were more expensive, probably, on a per-mile basis, adjusted, then. They’d gone to great lengths to come out to do something that was mathematically unintelligent, and they knew it was unintelligent. And, I mean, they couldn’t do it fast enough, in terms of rolling the dice, you know, and trying to determine whether they were hot or whatever they may be. And I looked around at that group. And everybody there knew that they were doing something that was mathematically dumb, and they’d come thousands of miles to do it. And I said to my wife, I said, ‘You know, I’m going to get rich. I mean, how can you miss? If people are willing to do this, you know, this is a land of opportunity.'”
Hear Buffett’s full explanation
© 2023 David Mazor
Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.