Among the faithful: Learning from Warren Buffett

(MoneyWatch) Warren Buffett just might be the greatest salesperson in the world. Consider how he has for years been selling "confidence" in his company, Berkshire Hathaway (BRK), reassuring the faithful that the conglomerate will continue to thrive with or without him. And by now, Buffett's annual shindig for shareholders in the company gas become the Comic-Con of capitalism.

Berkshire investors camp outside the arena in Omaha, Neb., where Berkshire is based, to get a good seat for the proceedings. For some, it is all about the shopping. Many attend just to score some deals on merchandise at the shareholders' expo. Meanwhile, celebrity watchers can keep an eye out for Bill Gates or other prestigious members of the company's board.

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The annual meeting is certainly wonderful spectacle, and a business happening like no other. An estimated 35,000 people attend the event, including a large media corps. And the price of admission is relatively cheap. Sure, a single class 'A' share in the company will run you more than $121,000, but a 'B' share is only about $80--either class of stock gets you in to the door. The time and cost to attend this crash-course in business excellence is well worth it.

As research for my upcoming book, "How to Make Deals Like Warren Buffett," I attended this year's session and got the chance to meet all sorts of great people, including the CEO of Dairy Queen, founder of the Pampered Chef, chief executive of World Book, senior executives of Burlington Northern Santa Fe Railway, and many other leaders of the various companies owned by Berkshire.

But the best morsels of wisdom came from the 81-year-young Buffett himself. For six hours, he and Berkshire vice chairman Charlie Munger, 88, fielded more than 50 questions from shareholders, journalists, and analysts. The "Oracle of Omaha" (it is a law writers have to use that cliche) was in rare form:

- On his health, after recently being diagnosed with prostrate cancer: "My diet is such that any fool can see that I am eating properly. I have four doctors. And yes, they're Berkshire shareholders." Later he joked that he might be killed by a jealous husband, but not prostrate cancer.

- On his public involvement in politics and criticism he has received over supporting President Obama's proposal to raise taxes on the wealthiest Americans (since dubbed the "Buffett Rule": "I will not put my citizenship in a blind trust."

- On giving advice to China: "We are not in the business of giving advice."

Buffett said he is enjoying work too much to consider retiring. Ironically, the deal to acquire Berkshire, then a textiles company, back in the early 1960s is not one Buffett is proud of. In 1962, he began buying stock in the company. Eventually, he conceded that the textile business was a declining industry and that the company's fortunes would never improve. Buffett had a chance to sell his holding, but because of a minor dispute over price -- $11.38 versus $11.50 a share -- he rejected the offer and instead took the company over.

Becoming majority owner of a failing textile company because of a perceived slight over price, Buffett said later, was the biggest deal-making mistake he has ever made. Buffett estimates that investing those few extra cents in Berkshire's insurance business over the ensuing years would have yielded several hundred times the return.

As chairman of Berkshire, Berkshire began writing his now-famous annual letters to shareholders in 1970, with the plainly written missives famously packed with lessons about dealmaking and investing. Warren told BusinessWeek in 1999 that "Berkshire is my painting, so it should look the way I want it to," adding that "There is nothing remotely as fun as running Berkshire."

"We get the opportunity to paint our own painting every day," Buffett said of Munger and himself at this year's annual meeting. "And we love painting that painting. And that painting will never be finished."