The Warren Buffett Way

by Robert G. Hagstrom

To help us understand, Buffett shared one of Ben Graham’s favorite stories in Berkshire Hathaway’s 1985 annual report. An oil prospector, moving to his heavenly reward, was met by St. Peter with bad news. “You’re qualified for residence,” said St. Peter, “but as you can see, the compound for oilmen is packed. There’s no way to squeeze you in.” After thinking for a moment, the prospector asked if he might say just four words to the present occupants. That seemed harmless to St. Peter, so he gave his okay. The prospector cupped his hand and yelled, “Oil discovered in hell.” Immediately the gates to the compound opened and all the oilmen rushed out. Impressed, St. Peter invited the prospector to move in and make himself comfortable. The prospector paused. “No,” he said, “I think I’ll go along with the rest of the boys. There might be some truth to that rumor after all.”