Buffett hopes to give his fortune away through Gates' foundation, but that job gets harder as the hoard gets bigger. Imagine -- Gates now has to find a way to put over $130 billion to work for good causes. What 2013 shows is that job may actually grow.
Buffett's annual letter to Berkshire-Hathaway (BRK.A) shareholders shows him taking a very conservative tack. His big investments are in insurance, regulated utilities, financial companies and manufacturing. He admits to not understanding technology and his one big tech investment, IBM (IBM), lost money.
That conservatism is also reflected in his advice. At 83, he still emphasizes long-term value, he still likes index funds and bonds over more active investments, he still invests mainly in America and he still doesn't like pundits, even though reporters insist on treating him like one.
During good years -- and 2013 was a very good year -- fortunes rise almost by themselves. It's important to realize when you're counting your own wins from last year that it takes no special genius to make money during a boom.The real lesson Buffett wanted to emphasize this year was staying the course in a bust. He described in detail two real estate deals he made during the course of his long career. Both were distressed properties managed by government. Avoiding panic during a panic is the real key to getting wealthy, he wrote. But the deeper lesson of both Gates and Buffett is this. Anyone can look smart when things are going well. When things are going well, wealth can grow faster than it can be given away. Gates and Buffett have barely begun to give, and the result of that giving will transform the world of your grandchildren, as Carnegie's giving transformed the world for Buffett and Gates. At the time of publication, the author held no positions in any of the stocks mentioned. Follow @danablankenhorn This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV