At this point, writing a book about Warren Buffett is a little like writing another commentary on the Bible--so many have gone before you that you must work hard to say something new, to approach the subject from a new angle. Yet another "How to Get Rich by Imitating Buffett" simply won't do. A good new Buffett book, in other words, should be like a good Buffett investment--its theme should be undervalued by the market, overlooked, even a little unpopular.
Matthews manages this by focusing on two Berkshire Hathaway annual meetings he attended. He gives Buffett his due by retelling all the familiar stories, and recounting all the familiar instances of Buffett's genius, but the strength of the book is that it confronts, in a polite way, the simple fact that Warren Buffett is the leader of a cult.
I define cult as a group of followers of a leader where the following is true:
1) The followers invest the leader with extraordinary authority. "He is the leader because he is right" gradually becomes "he is right because he's the leader."
2) The leader is charismatic and even a little seductive, in the sense of manipulating human psychology to guide the behavior of others in a way that furthers his aims.
3) The followers can get a little weird.
Read the book and ask yourself if the relationship between Buffett and many of his attendees meets this definition.
Strictly speaking a cult doesn't have to be a bad thing (good ones eventually come to be known as movements, or religions), but all cults contain the potential for abuse. Usually it's the cult leader who abuses the followers: Jim Jones, or even Bernard Madoff. The Buffett cult is remarkable in that Buffett does this so little.
Rather the abuse that occurs in the Buffett cult is, as Matthews shows, that which the followers inflict on themselves. How much of their own ability to reason do they outsource to the leader? How willing are they to question the leader on his mistakes? How much attention is focused on who the leader is instead of on what he does ("Too much about Buffett, not enough about the businesses" is how one of Matthews' friends summed up the whole thing)? Is there a risk of a kind of psychological Heisenberg uncertainty principle, in which the followers' close observation of their leader's behavior ends up affecting that behavior, potentially for the worse? Finally, when the cult leader departs, as he must, what happens to the followers? I confess that I think about this all the time because in my honest moments I'm forced to admit that I'm a member of this cult. Furthermore, I make my living (sort of) evaluating other value investors, so the fact of the Berkshire cult complicates my professional life, forcing me always to ask "Is this person like Buffett, or more like a Buffett follower?"
Buffett emerges from this book with his repuation intact. He is about the most benign cult leader you can be, and in fact he himself is remarkable good at self-correcting the potential deficiencies that his followers won't. But that doesn't let us, his followers off, the hook. The great irony of the book is that Buffett is the leader of a cult whose highest value is rationality as applied to investing, but whose followers have gotten a little irrational themselves. To borrow from Groucho, he happily leads a club he would never join himself.