Buffett to be world's richest man?

LEGENDARY investor Warren Buffett is poised to trump his sometime bridge partner Bill Gates as the world's richest man.

The Sage of Omaha, 71, who was playing the stock market 15 years before the Microsoft founder was born, famously sat out the boom and bust in internet stocks because he did not understand the technology.

By sticking to a share portfolio that reflects his passion for Cherry Coke and Dairy Queen ice cream, Buffett's paper fortune has grown to about $36 billion (£26 billion) - a whisker off its peak. Meanwhile, Gates, 46, has seen his net worth plunge more than 60% in the past two years.

He is down to his last $42 billion after the value of his Microsoft stake, once worth more than $100 billion, tumbled with the slide in technology stocks and antifavoured-monopoly court rulings in the US.

The gap between the two is so small that a minor percentage swing in either of their shareholdings would hand the mantle to Buffett.

Neither has all his wealth locked up on Wall Street, but their respective holdings are their main assets. Buffett controls Berkshire Hathaway, the holding company for his interests in insurance, shoes, insulation, paint, jet-leasing and the International Dairy Queen chain.

His major investments include Coca-Cola, American Express, Gillette and The Washington Post. 'Try to control your excitement,' the droll Buffett told Berkshire Hathaway shareholders last year when he was rattling off the company's major shareholdings.

'The Prophet of Profit', as an Omaha newspaper dubbed him, has a cult following with his no-frills, long-term buy-and-hold investing philosophy. He has said his life was transformed when he read The Intelligent Investor by Benjamin Graham, published in 1949 - six years before Gates was born.

Buffett, a stockbroker's son, bought his first shares, in an oil company, at the age of 11. He still lives in the house he bought for $31,500 in Nebraska 40 years ago.

He drives his own car and prefers to eat in Dairy Queen diners rather than the fancy restaurants that are

by Microsoft executives. 'I get to do what I like to do every single day of the year,' he has said. 'I get to do it with people I like and I don't have to associate with anyone who causes my stomach to churn. I tap-dance to work.'

But life has not been all cartwheels for Buffett recently. In November he wrote to investors to explain why Berkshire Hathaway posted a $679 million third-quarter loss against a $797 million profit the year before.

The dramatic turnaround in Berkshire Hathaway's fortunes was due to a $2.28 billion charge for pre-tax insurance losses linked to September 11. Buffett's investment company owns two of the world's biggest reinsurance companies - General Re and Berkshire Hathaway Reinsurance Group.

In a frank admission, Buffett blamed himself for underestimating insurance risks. 'We did not price for manmade mega-catastrophes and we were foolish in not doing so,' he said. 'In effect, we, and the rest of the industry, covered terrorist acts in policies for other risks - and received no additional premium for doing so. That was a huge mistake.'

Trailing in the wake of Gates and Buffett in the race to be the World's Richest Man are Larry Ellison, boss of US software group Oracle, and Masayoshi Son, founder of Japanese internet company Softbank.

In the past two years, Ellison's wealth has plummeted by just over half to $24 billion. But Son has fared even worse. His net worth - $60 billion two years ago at the height of the internet bubble - is thought to have dwindled to mere millions.