5 Reasons Warren Buffett Is a Better Heisenberg Than Bryan Cranston


Sources: Mark Hirschey and Gage Skidmore.

Spoiler alert: The following article contains Breaking Bad plot information.

Breaking Bad's Walter White, a.k.a. Heisenberg, and Berkshire Hathaway's Warren Buffett possess some strikingly similar traits.

Both dominate their respective businesses from relatively obscure areas of the country -- Albuquerque, N.M., and Ohama, Neb. Both have battled cancer. Despite enormous wealth, both continue to live in modest homes. And both continually recognize lucrative opportunities to exploit the power of their reputation -- or name.

But however many similarities, there are five differences that set the two apart and ultimately make Buffett more successful and, thus, a better Heinsenberg than the character Bryan Cranston portrays.

1. Management style: centralized vs. decentralized
While burying his head in chemistry books, White must have missed the lesson from Organization Management 101 on the benefits of a decentralized management system. When "cooking," White rarely cedes control of the operations to any of his sous-chefs. Jesse, Gale, and Todd are never given autonomy in the lab, and operations become inefficient when White is unavailable.

Buffett, on the other hand, has learned to take the hands-off approach. Delegating insurance duties to Ajit Jain and some investing duties to portfolio managers Todd Combs and Ted Weschler. This delegation will allow Buffett's conglomerate to continue thriving even after he is gone.

Source: AMC, YouTube.

2. Investment philosophy
By stashing his cash under his house, in a storage unit, and ultimately, in the New Mexico desert, White's fortune is slowly being eaten away by inflation. Outside of choosing his dark career path in meth-cooking, not investing may be White's biggest mistake.

Buffett would undoubtedly put a stack of cash that big to work. Famous for this supremely successful stock picks, including Coca-Cola and Wells Fargo, Buffett has also been extremely savvy using cash to acquire companies outright.

3. "It's better to hang out with people better than you. Pick out associates whose behavior is better than yours and you'll drift in that direction."
This is a Warren Buffett quote. Unfortunately, Walter White has not followed this advice. Despite his few redeeming qualities, Jesse Pinkman has continually dragged White into new conflicts and quagmires. And when opting for legal advice, Heisenberg probably could have chosen better.

Meanwhile, Buffett has teamed up with one of the brightest investing minds of his generation in Charlie Munger. Munger's advice and temperament have surely aided Buffett along the way with poignant tidbits such as: "Someone will always be getting richer faster than you. This is not a tragedy."

Source: AMC YouTube

4. Buy-and-hold ... forever
Buffett doesn't like to sell his stocks. He's said he plans to never sell a share of Coca-Cola and has held tight on his shares of his own company Berkshire Hathaway. The same can't be said for White, who founded Gray Matter Technologies with his friends Gretchen and Elliot and ultimately sold his stake for $5,000. It is revealed that the company is now presumably public and worth more than $2 billion. White admits that he checks the valuation on a weekly basis -- something else Buffett would never do.

5. Transparency
While Mr. White gets an "A+" on growing the bottom line of his business, he get a "F" for corporate governance. After lying to his wife, endangering his family, and killing a business partner, Heisenberg cannot be trusted. Even after his wife is filled in on his enterprise, he continues to bend the truth, hide operational problems, and put stakeholders at risk.

Buffett runs Berkshire Hathaway in stark contrast. Each year, at the Berkshire Hathaway annual shareholder meeting, he and Munger field questions for hours about the business, management's outlook, and possible threats. Something tells me that Walt Sr. will never sit down and honestly respond to Walt Jr.'s questions about his health and "car-wash" operations.

The empire breaks bad
"I'm in the empire business." That's something Walter White once said. But Warren Buffett has lived it. Berkshire Hathaway is one of the few modern-day (and legal) empires. Despite its raging success, White's business would be nothing more than a "bolt-on" acquisition for Berkshire. However, with three episodes remaining, Heisenberg still has time to right the ship and heed the ways of Warren.

More Buffett wisdom
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The article 5 Reasons Warren Buffett Is a Better Heisenberg Than Bryan Cranston originally appeared on Fool.com.

David Hanson has no position in any stocks mentioned. The Motley Fool recommends Berkshire Hathaway, Coca-Cola, and Wells Fargo and owns shares of Berkshire Hathaway and Wells Fargo. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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Originally published