Buffett: The Making of an American Capitalist.

It's hard not to like Warren Buffett, the so-called Sage of Omaha. With his aw-shucks manner, his homespun sayings, his unquestioned honesty--not to mention his preference for Cherry Coke over Bordeaux, hamburgers over filet mignon, and Omaha over New York--he presents a most appealing persona. Yes, it's true, he travels in a private jet, but he had the wit to name it "Indefensible." And yes, he now hobnobs with the likes of President Clinton, but no one can ever accuse him of disloyalty to his Nebraskan friends.

And it's hard not to admire the way Buffett made his fortune. From a standing start--his father was a small businessman and three-term congressman but left no great wealth behind--Buffett has become the second richest man in America, worth $10.7 billion. This entire fortune comes not from creating new companies (a la Bill Gates, the only man in America richer than Buffett), but rather by investing in them. This is astounding. For most of us, investing is the diciest of enterprises. Yet for over 30 years, the great bulk of Buffett's investments have gone in only one direction: up. And in an age when money managers often turn over their portfolios every six months, Buffett stays steady: He holds many of the same stocks today that he did 10 and even 20 years ago. His favorite time horizon, he likes to say, is "forever."

With Wall Street as full of scoundrels as ever--brokers who "churn" accounts to reap commissions; portfolio managers who leak their "favorite" stocks to the press, only to sell when the unwashed start buying--Buffett's probity stands in stark relief. He explains in simple English what he does and why to the shareholders of Berkshire Hathaway, his holding company and chief investment vehicle. Through it all, Buffett has gotten rich by staying true to himself--to his sense of the "right" way to invest and to live as well.

Thus has Buffett come to stand as a kind of living rebuke of this cynical time. He would seem to be proof--maybe the only proof left--that virtue can still be its own reward. That is why he has become an American icon. As Roger Lowenstein elegantly puts it towards the end of this sweet biography:

We see him in his inner sanctum, without advisor

or lackeys, opposite the framed and fading newspapers

and the looming picture of his father...

Hours pass without interruption; the telephone

scarcely rings. He pursues his craft, looking not

for patterns on a screen but for the fundamental

values, the time-honored merchants, the shoe

companies ... the universal Coca-Colas.... He

judges them not according to the 'season' but by

the sound principles and aphorism that his father

or grandfather or Ben Graham [his mentor] might

have recognized. Buffett has not always lived up

to his heroes. He is only human, and he certainly

has strayed. But he has been faithful enough to

his bygone idols to rouse a memory of their more

simple. more certain world.

Is "sweet" an odd choice of words to use in connection with what is, after all, a biography of an investor? Perhaps it is; but I can't think of a better way to describe this book. Lowenstein is one of a handful of genuinely fine writers who work at The Wall Street Journal and the prose he displays here is an admirable mixture of the clear-eyed and the poetic. The book is both empathetic and intelligent, without ever slopping over into fawning.

All the great Buffett triumphs are here: his decision to invest in such bedrocks of his portfolio as GEICO, the insurance company, The Washington Post, and Coca-Cola. Lowenstein also details the occasional Buffett misstep, such as his decision in the early seventies to invest money in an obscure new magazine called The Washington Monthly--an investment that may earn him a few chits when he meets his maker, but one that stubbornly refuses to yield him an earthly return.

Lowenstein is equally good at delineating Buffett's character, piercing the patina of humility to reveal a man who needs to be at the center of any orbit he's in, and looking past Buffett's outward friendliness and finding a father who has largely ignored the emotional needs of his own children. Even his refusal to loan his kids money when they're in need strikes one as a bit ... much. Always, though, Lowenstein bursts these balloons gently, never failing to remind us of the quality of decency that is at Buffett's core.

Yet hanging over this entire enterprise--by which I mean not only Lowenstein's book, but also Buffett's career--is a central question which remains unanswered, and is perhaps unanswerable. The question is: why?

As Lowenstein describes it, even as a child Buffett had a deep-seated need to make money--and then to see that money grow through the miracle of investing and compounding. As a young man working under the legendary "value" investor Ben Graham, Buffett loved ferreting out overlooked companies whose stock prices did not reflect the inherent value Buffett could see in them. Even then, though, he didn't seem much interested in what his money could do, either for himself or for others. "The money was a proof," Lowenstein writes, "a scorecard for his favorite game."

To read this biography is to realize that Buffett never outgrew that child-like desire to continue "piling and heaping"--to borrow the apt phrase of his friend Ann Landers--even after he had bigger piles than everyone else. "Money," adds Lowenstein, "was the pivotal motivator of his life." As a result, he has been perfectly willing to own RJR Nabisco junk bonds (and also R.J. Reynolds stock, before he began to get queasy about cigarettes), and to drive the number two newspaper in Buffalo out of business.

Indeed, the newspaper business is to Buffett merely a means to make more money; whatever larger purpose it might have is incidental to that central one. When the journalists who had slaved on his behalf during the Buffalo newspaper battle asked him afterwards for a share of the rewards, he said no. "There is nothing anybody on the third floor [the newsroom] can do that affects profits," he told them flatly. Buffett's legendary decency has not necessarily trickled down to the hired help.

Even as he approaches senior citizen status (he's 65), Buffett seems loath to reduce his piles of money. He is adamantly opposed to passing on his fortune to his children--certainly a defensible view. But he also seems unwilling to put his fortune to charitable uses in any significant way (the sole exception is population control), or to try to use it to do anything beyond compounding. The piles just keep growing, as does the praise Buffett gets for his investing acumen and his down-to-earth approach. The message that never seems to come through to Buffett is that you can't take it with you.

So yes, give him his due, as Lowenstein certainly does. Warren Buffett will undoubtedly go down in history as the greatest investor of all time. The tragedy of Warren Buffett, though, is that's all he seems destined to be.