NEW YORK (Reuters) - Berkshire Hathaway Inc's stock price touched $300,000 for the first time on Monday, reflecting investors' confidence in Warren Buffett's conglomerate despite four straight quarters of lower operating profit.
Crossing the $300,000 threshold put Berkshire's Class A shares up 22.9 percent for the year, compared with a 20 percent gain in the Standard & Poor's 500.
Berkshire's Class B shares, worth about 1/1500th of Class A shares, traded at around $199.75. Neither class pays dividends.
The gain occurred even though 2017 has been Berkshire's second straight year of mediocre operating performance relative to prior periods.
11 ways Warren Buffett lives frugally:
11 ways Warren Buffett lives frugally
11 ways Warren Buffett lives frugally
Warren Buffett’s House Is the Same One He Bought in 1958
Billionaires live in mansions, right? Not Buffett.
He lives in the same residence in Omaha, Neb., that he bought in 1958 for $31,500, the equivalent of roughly $270,000 in 2017 dollars. Buffett has no intention of putting his own home up for sale. "I wouldn't trade it for anything," he told CNBC earlier this year.
In today's money, Buffett would have paid about $41 per square foot for the 6,570-square-foot home. But these days, you'll pay about $143 per square foot for a home in Omaha of that size and era, based on the listing of a home in the neighborhood of the multi-billionaire.
If you want to live like Buffett, consider buying less home than you can afford. Instead of paying pricey mortgage payments, you'll be able to put more of your money toward savings, retirement or vacations.
And if you must take out a loan, perhaps get a 30-year mortgage — it's "the best instrument in the world," Buffett told CNBC. In fact, Buffett took out a 30-year mortgage in 1971 when he bought a vacation home in Laguna Beach, Calif.
"If you're wrong and rates go to 2 percent, which I don't think they will, you pay it off," he said. "It's a one-way renegotiation. It is an incredibly attractive instrument for the homeowner and you've got a one-way bet."
Wrong. Adopting Buffett's lifestyle doesn't include paying high prices for daily gourmet French toast prepared in the comforts of your own home.
When it comes to food, the billionaire investor has been known to save money by taking the fast-food route. In fact, he might kick off his day with a trip to McDonald's during his five-minute drive to work, reports CNBC.
If he's feeling rich, he'll splurge by spending $3.17 on a bacon, egg and cheese biscuit sandwich. If the market's down, he might spend $2.95 on a sausage, egg and cheese sandwich instead. On a really bad day, he buys two sausage patties for $2.61, puts them together and washes it down with a Coke he pours himself.
Buffett also is known to opt for cheap food when he's on the road — but forget the cholesterol-soaked bacon and eggs at a local restaurant. Buffett's travel breakfast might consist of a pack of Oreos, his friend Bill Gates — yes, his good buddy is the Microsoft founder — wrote on his blog.
"One thing that was surprising to learn about Warren is that he has basically stuck to eating what he liked when he was 6 years old," Gates wrote. "He did move past baby food, of course, but he mostly eats hamburgers, ice cream and Coke."
Buffett explained his diet in a 2015 interview with Fortune: "I checked the actuarial tables, and the lowest death rate is among 6-year-olds. So I decided to eat like a 6-year-old. It's the safest course I can take."
In a BBC documentary, his daughter, Susie Buffett, said he bought cars that he could get at reduced prices — like those that had been damaged by hail. The cars were fixed and didn't look hail-damaged and became a regular part of the Buffett lifestyle.
"You've got to understand, he keeps cars until I tell him, 'This is getting embarrassing — time for a new car,'" said his daughter in the documentary.
Buffett also told Forbes in 2014 about his car-buying habits — or lack thereof. "The truth is, I only drive about 3,500 miles a year so I will buy a new car very infrequently," he said.
Remember this the next time you're in the market for a car: Cars tend to depreciate quickly, so it can be better for your finances if you try to keep your well-working car for as long as possible — or at least opt to buy a used car instead of new.
Buffett Enjoys Affordable Hobbies
A commitment to live like Warren Buffett doesn't mean all work and no play. After all, even billionaires have hobbies. But compared to other famous CEOs, investors and entrepreneurs, Buffett's hobbies are much more affordable. For example, he enjoys playing bridge.
"If I play bridge and a naked woman walks by, I don't even see her," laughed Buffett during a CBS News "Sunday Morning" interview. Yep, Buffett is a self-proclaimed bridge addict, and you might even catch him playing the game about 12 hours a week.
"I one time said that I wouldn't mind going to jail if I had the right three cellmates so we can play bridge all the time," he also said in the interview.
When Buffett's not busy being a business mogul, you might find him strumming his ukulele and singing as well. He's played for investors and at charity events. A video of him playing the instrument with Gates even went viral after it was posted on Gates' blog in 2016.
Buffett Treats His Friends Well, But Not Extravagantly
What do you give a friend who's also a billionaire? Buffett's long-standing friendship with Gates is legendary. The Microsoft magnate explained on his blog what's kept their friendship strong over the years:
"I've learned many things from Warren over the last 25 years, but maybe the most important thing is what friendship is all about," he said. "It's about being the kind of friend you wish you had yourself. Everyone should be lucky enough to have a friend who is as thoughtful and kind as Warren. He goes out of the way to make people feel good about themselves and share his joy about life."
And those special touches don't have to be expensive. For example, Buffett drives personally to the airport to pick up Gates whenever he's in town, calls frequently and sends news clippings by mail that he thinks Gates and his wife will enjoy.
Those special touches that mean a lot to friends just might be the best takeaway for those seeking to live the Warren Buffett lifestyle.
Buffett Used a Nokia Flip Phone Long After Smartphones Existed
Buffett likely won't be shelling out $999 for the iPhone X. The billionaire revealed in a 2013 interview with CNN that he still used a Nokia flip phone.
"This is the one Alexander Graham Bell gave me," he joked about his phone. "I don't throw anything away until I've had it 20 or 25 years."
While it's tempting to always splurge on the latest technology, take a page from Buffett's book and only upgrade your phone when you really need to. If you insist on buying the latest iPhone to hit the market, look for other ways to save on your phone expenses, such as using a no-contract phone plan or buying a family plan to share data.
Buffett Doesn’t Splurge on Wallets and Designer Suits
Buffett revealed in the CNN interview that he's used the same black wallet for 20 years. He also shuns high-end designer suits. Instead, he exclusively wears suits created by a Chinese sewing entrepreneur named Madam Li, whom he met in 2007.
"They fit perfectly," he said of the suits in a 2017 CNBC interview. "We get compliments on them. It's been a long time since I got compliments on how I looked but, since I am wearing Madame Li's suits, I get compliments all the time."
The takeaway: Opt for quality goods that will last you a long time, rather than buying something just because it has a brand name attached to it.
Buffett Clips Coupons
Buffett proves that even billionaires still appreciate an opportunity to save money. In Bill and Melinda Gates' 2017 annual letter, Bill recalled a trip he took with the investor, during which Buffett paid for their fast-food lunch using coupons. He even provided photographic proof of this.
"Remember the laugh we had when we traveled together to Hong Kong and decided to get lunch at McDonald’s? You offered to pay, dug into your pocket, and pulled out…coupons!" Bill wrote. "Melinda just found this photo of me and 'the big spender.' It reminded us how much you value a good deal."
Save on your next purchase — even if it's something as inexpensive as a McDonald's meal — by using applicable discounts, which you can easily find on online coupon sites.
Buffett Has Worked in the Same Office Building for More Than 50 Years
Buffett has remained in the same office building since he joined Berkshire Hathaway in the 1960s.
"It's a different sort of place," Buffett said of the company's Omaha headquarters in the 2017 HBO documentary "Becoming Warren Buffett," CNBC reports. "We have 25 people in the office and if you go back, it's the exact same 25. The exact same ones. We don't have any committees at Berkshire. We don't have a public relations department. We don't have investor relations. We don't have a general counsel. We just don't go for anything that people do just as a matter of form."
Even if you're not a business owner, you can still benefit from Buffett's way of thinking. It boils down to the old saying: If it ain't broke, don't fix it.
Buffett Thinks Outside the Box to Save Money
In Roger Lowenstein's biography of the businessman, "Buffett: The Making of an American Capitalist," the author says that after Buffett's first child was born, he converted a dresser drawer into a space for the baby to sleep instead of spending money on a bassinet, reports Forbes. When it came to the family's second child, he borrowed a crib rather than buy one.
Perhaps making your baby sleep in a drawer seems a little extreme, but it's just an example of thinking outside the box. Use resources that are already available to you to prevent unnecessary spending.
Buffett Values Relationships Over Material Things
Buffett explained his choice to live frugally during a 2009 Q&A session he conducted with a group of business school students.
"You can’t buy health and you can’t buy love," said Buffett, according to the Underground Value blog. "I’m a member of every golf club that I want to be a member of [...] I’d rather play golf here with people I like than at the fanciest golf course in the world. [...] I’m not interested in cars, and my goal is not to make people envious."
And in a 2017 interview with People, Susie Buffett said of her father: "...it’s really true that he does not care about having a bunch of money." Instead, she said, he emphasizes family.
“I don’t think people realize, he’s got a bunch of great-grandchildren and he could tell you everything about what they’re all doing. He knows every one of those kids and he knows about their lives,” she said.
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Operating profit, which rose 1 percent in 2016, was down 16 percent from January to September, reflecting losses from storms such as Hurricanes Harvey, Irma and Maria, and the accounting for a transaction with American International Group Inc.
But book value, or assets minus liabilities, was up 8.9 percent. Buffett considers this a good measure of Omaha, Nebraska-based Berkshire's growth.
15 highly successful people on how they stay healthy and happy:
15 highly successful people on how they stay happy and healthy
15 highly successful people on how they stay happy and healthy
Warren Buffett Reading and spending time alone
There's no denying that Warren Buffett, commonly known as the "Oracle of Omaha," is one of the most successful people alive. In fact, Forbes ranked Buffett as the third-wealthiest man in America in October 2017. Chairman and CEO of Berkshire Hathaway, Buffett is also a highly successful investor and well-known philanthropist.
So, how does he stay so happy and healthy (and wealthy)?
Buffett, according to MarketWatch, likes to spend at least six hours a day reading newspapers and annual reports. Buffett also tends to keep to himself, opting to spend time alone or with a close inner circle of friends and family.
Founder and president of My Mom Knows Best, Josephine Geraci, notes that success hasn't affected Buffett's core values. "Warren Buffett always lived within his means, never cared what other people thought about him, followed his gut and found his happiness in life's simple pleasures — family, a modest home and an honest living."
Elon Musk Books and video games
Elon Musk is a gifted engineer and successful inventor. CEO of SpaceX and the visionary architect behind Tesla Motors, Musk has always been an avid reader, according to an article by Inc. In fact, as a child, he sometimes read two books in a single weekend.
While his commitment to self-education has certainly paid off, Musk admits his eating habits are not always so admirable.
In a video interview by AUTO BILD TV, Musk said, "I think it's probably true that having a good breakfast is a good idea, but usually I don't have time for that. I'll have a coffee or something like that … and a Mars bar, sure. But I'm trying to cut down on sweet stuff." Musk also admitted to drinking eight cans of Diet Coke and several large cups of coffee a day.
Additionally, Musk confessed to being something of a workaholic: "For a while there, I was just doing constant 100-hour weeks [in order to be the CEO of both Tesla Motors and SpaceX], and that's definitely wearing. And now I'm kind of in the 80 to 90 [hours-per-week range], which is more manageable."
Despite his hectic schedule, Musk does save time for leisure activities. According to his Reddit AMA (Ask Me Anything), Musk enjoys video games such as "Bioshock," "Fallout" and "Mass Effect," as well as classics like "Civilization" and "Warcraft."
Tony Robbins Mental and physical exercise
Tony Robbins, the No. 1 life and business strategist and The New York Times best-selling author, is an example of a highly successful individual who prizes routine.
Robbins shares his commitment to a healthy life in his many YouTube videos, believing that physical strength is as crucial as mental wellness. He talks about "feeding your body" through exercise, and pushing past limits until you realize you can achieve more.
Additionally, Robbins believes that individuals should watch what goes into their minds just as they would monitor how much sugar goes into their coffee. He suggests feeding your mind nutritiously by "reading, listening and re-tap[ping] into your ability to thrive."
Jim Cramer Pre-dawn training sessions
A former hedge fund manager and current host of the TV show "Mad Money," Jim Cramer is known for his unconventional approach and fiery personality. Baron describes this highly successful individual as a "high-energy, out-of-the-box" personality.
According to Business Insider, Cramer is also an early riser who gets up at 3:45 a.m. or earlier on the days he sees his personal trainer. He writes his first story for RealMoney.com after his hour-long workout session and has a chauffeur drive him to and from work. At home in the evening, he has dinner and watches TV — either football or Netflix.
Cramer confesses that his schedule is intense, and it's not uncommon for him to skip dinner and lose up to a pound a week during earnings season. However, he believes his lifestyle is what allows him to be successful.
"If I slept more, I wouldn't be able to do it," said Cramer.
Mark Cuban Listening to his body
Well known for his role on the popular TV show "Shark Tank," Mark Cuban is a businessman, investor, film producer, author, television personality, philanthropist and perhaps even a potential presidential candidate.
According to Baron, Cuban is an "early bird" who loves lists and exercises regularly. Still, when it comes to pushing himself physically, Cuban believes in listening to his body. In a video interview with Business Insider, Cuban shares his belief in tuning into one's own body to maximize potential.
"I go with how my body feels," said Cuban. "I get to make my own schedule, so if I'm tired I take a nap. I've met some guys who don't need sleep; I've met others who if they think they haven't got their 10 hours, I don't want to be anywhere near them. Everybody's body is wired differently; it's a math equation. I don't think there is any one size that fits all for anybody."
Bill Gates Philanthropy and spending time with his family
Co-founder of Microsoft Bill Gates boasts a net worth of more than $89 billion. Although no longer the chair for Microsoft, Gates continues in his role of chief technology adviser while focusing on his family and philanthropic works through the Bill and Melinda Gates Foundation. Worth approximately $41.3 billion, the organization provides funding to reduce global health problems and education inequality in the U.S.
As part of his philanthropy, Gates takes his children on visits to locales such as garbage dumps, power plants and missile silos. However, he also saves time for relaxation.
Along with reading and playing tennis, Gates is reported by MyFirstClassLife to enjoy indulging in exotic vacations to Rome, Belize, Croatia and even Antarctica.
Mark Zuckerberg Reading one book a week
Yet another avid reader and reflector is Mark Zuckerberg, the co-founder and CEO of Facebook, computer programmer, internet entrepreneur and philanthropist.
According to an Inc. article, Mark Zuckerberg's tries to read a new book every other week, focusing on those exploring different cultures and belief systems, such as "The End of Power" by Moises Naim.
"I take a lot of time just to read and think about things by myself," he said. However, Zuckerberg might struggle to find the time to do all this reading, as a CNN Money article reported that the billionaire works 50 to 60 hours a week. He does save time deciding what to wear by donning the same T-shirt every day, the Muse reported.
Larry Page Modest living and personal challenges
Larry Page is one of the two brilliant mathematicians who co-founded Google. According to The Viral Hub, Page lives modestly, driving a Toyota Prius — when he's not cruising around in his Tesla Roadster, that is — and predominantly wears T-shirts and jeans.
In an interview with the Academy of Achievement, Page revealed his desire for balance in life.
"You can only work so many hours, and I try to have some balance," said Page. "At some point, you want to have a family. You want to have more time to do other things."
Page also believes in challenging himself and others on a daily basis. He told Fortune magazine that he makes do without a computer for much of his day, takes only his phone to meetings and encourages engineers and product managers to work only on their mobile devices at least one day a week. It's all part of his effort to keep the company's focus on mobile and to keep pushing people further.
Tim Cook Early starts
Tim Cook took over for Steve Jobs as the CEO of Apple in 2011. He succeeds in this high-stress position, in part, by getting an early start.
After rising at 3:45 a.m. each day, Cook straps on his Apple Watch so he can measure all of his activities, according to an article in The Telegraph. He arrives at the gym at 5 a.m. and is in the office by 6:30 a.m. While he retires early, generally between 9:30 p.m. and 10 p.m., Cook frequently works weekends, holding Sunday evening phone meetings to discuss the upcoming week.
The Wall Street Journal noted Cook's discipline while he was still working under Jobs. "His stamina was inhuman," the article said. "He could fly to Asia, spend three days there, fly back, land at 7 a.m. at the airport and be in the office by 8:30 a.m., interrogating someone about some numbers."
Oprah Winfrey Transcendental meditation
Billionaire Oprah Winfrey is most famous for her hugely successful TV show, which ran from 1986 to 2011. However, she is also an actress, producer, publisher and philanthropist, and has accumulated a massive fortune over the course of her career.
How does Winfrey stay happy and healthy? In an article on her website Oprah.com, Winfrey acknowledged she was a huge proponent of Transcendental Meditation.
"I give myself a healthy dose of quiet time at least once (and when I'm on point, twice) a day," said Winfrey. "Twenty minutes in the morning, 20 in the evening."
Winfrey also arranged for teachers to instruct interested employees at her company in the practice of meditation.
"The results have been awesome," said Winfrey. "Better sleep, improved relationships with spouses, children, coworkers. Some people who once suffered migraines don't anymore. Greater productivity and creativity all around."
Arianna Huffington Weekend time to decompress
Arianna Huffington is an author, syndicated columnist, co-founder of The Huffington Post and creator of Thrive Global. While Huffington works hard all week, her weekends are spent relaxing.
"I love wearing no makeup and sweatpants," Huffington told Into the Gloss. "I get to have a complete break from the week, which for me is intense."
Like Winfrey, Huffington is a strong proponent of meditation and encourages the practice at work. In a TED Talk, Huffington said that her employees enjoy "weekly breathing exercises, yoga classes, meditation, two nap rooms." Additionally, she shared her commitment to exercising regularly and getting a good night's sleep. In fact, Huffington avoids charging her phone in her bedroom at night.
A relaxing shower also does wonders, Huffington told Into the Gloss. "I also have a bench in my shower because it's a steam shower. This way, you can sit down and have a steam; it's just so detoxifying."
Richard Branson A morning routine and lots of tea
Richard Branson is worth an estimated $5.1 billion, according to Forbes, thanks to his conglomerate of businesses under the Virgin umbrella, which include Virgin Atlantic and Virgin Galactic.
With major businesses under his watch, Branson makes the most of his day by getting an early start. In an April 2017 blog post on the Virgin website, Branson wrote that one of his secrets to success is that he usually wakes up at 5 a.m. and begins his day with a workout, which can be tennis, walking or running, biking or kite-surfing.
After exercising, he eats breakfast and spends time with his family. "Exercise and family time put me in a great mind frame before getting down to business," he said.
Branson doesn't usually go to bed until 11 p.m. As for how he stays energized for his long day, Branson credits drinking tea — and lots of it. "I'm talking 20 cups a day," he said. "Don't tell my doctor."
Barack Obama Exercise, alone time and seven almonds
Former President Barack Obama made sure to carve out time for exercise and relaxation, even when he held arguably the most stressful job in the world.
Obama told Men's Health that he typically worked out for 45 minutes a day, six days a week while heading up the Oval Office. "I'll lift one day and do cardio the next," he said of his usual routine.
He also made sure to carve out alone time, which he used to stay productive, but also to relax. According to a 2016 profile in The New York Times, Obama would spend four to five hours at the end of each day by himself, preparing speeches and reading briefing papers, but also watching ESPN, reading novels or playing Words With Friends on his iPad.
In addition, he does not consume caffeine or alcohol, and his go-to nighttime snack is a very specific and health-conscious seven almonds.
Jeff Bezos Eight hours of sleep
Jeff Bezos is now the richest person in the world, according to Forbes, which estimates his net worth at $98.1 billion. And even though he runs Amazon, one of the most successful companies in the world, he still makes sure to get a good night's sleep.
Bezos told Thrive Global that he aims to get eight hours of sleep every night. "I try hard to make that a priority," he said. "For me, that's the needed amount to feel energized and excited."
He also said having a good work-life balance — or "harmony," in his words — helps him to be more productive in both worlds. "If I'm happy at work, I'm better at home — a better husband and better father," Bezos said. "And if I'm happy at home, I come into work more energized — a better employee and a better colleague."
Bob Iger VersaClimber and long flights
Disney CEO Bob Iger swears by the VersaClimber cardio machine to stay fit. According to Variety, Iger wakes up every work day at 4:15 a.m. and gets on his climbing machine by 4:25 a.m. for an intense 45-minute workout.
And while some business professionals might see work travel time as a drag, Iger makes the most of all the hours he spends on his company's corporate jet. "I can catch up on things," he told Variety. "I can screen things. I can read things. I can satisfy my curiosity. I like it. It's peaceful."
Getting organized, Transcendental Meditation, voracious reading and other quiet, reflective practices are just a few characteristics shared by leading business professionals. Consider copying a few of these helpful habits to give yourself the best shot at success.
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Berkshire has more than 90 operating units, including large businesses such as the BNSF railroad, Geico auto insurance and Berkshire Hathaway Energy utilities, and smaller businesses making Dairy Queen ice cream, Duracell batteries, Fruit of the Loom underwear, Ginsu knives and the World Book encyclopedia.
Buffett, 87, has run Berkshire since 1965, when it was a struggling textile company whose shares were worth barely $11 each. Shareholders who hung on for the ride have had gains topping 2,400,000 percent.
Only a handful of U.S. companies have stock prices that have reached even four figures.
Other members of the exclusive club include Amazon.com Inc, Google parent Alphabet Inc and Priceline Group Inc, and lesser-known companies such as Seaboard Corp, a pork producer that also ships cargo by sea.
A high share price can reduce trading and encourage long-term ownership.
But companies can encourage retail ownership by splitting their stock or, as Berkshire did, creating lower-priced shares.
In 1996, Buffett created Class B shares worth 1/30th of Class A shares, but with lesser voting rights, to stop fee-hungry managers from creating "unit trusts" that sliced up Class A shares for smaller investors seeking "Berkshire look-alikes."
Then in 2010, when it bought BNSF, Berkshire split the B shares 50-for-1, letting more of the railroad's shareholders swap their stock for Berkshire stock if they wished.
(Reporting by Jonathan Stempel in New York; Editing by Jennifer Ablan and Steve Orlofsky)