Charlie Munger, Warren Buffett’s right-hand man and vice-chairman of Berkshire Hathaway, recently gave his first long-form podcast interview with Acquired. In the interview, Munger criticized day traders and venture capitalists, emphasizing that investing is more challenging today than in the past. He highlighted that truly great investment opportunities are incredibly rare.
During the conversation, Munger covered a wide range of topics, including his thoughts on companies like Heinz and Hermès, quant funds, self-insurance, and his upcoming 100th birthday party. He also touched on Buffett’s concerns about the retail sector and discussed Berkshire Hathaway’s inspired bet on Japan.
Munger’s interview included several notable quotes, which have been lightly edited for brevity. He expressed his disapproval of dog tracks, race tracks, and casinos, stating that they are not beneficial for America. He also criticized day traders and speculators, emphasizing the need for a tax on short-term gains to discourage their activities.
Munger highlighted the difficulty of finding profitable investments in today’s market, stating that “the low-hanging fruit for the idiot” is now very scarce. He also shared his opinion on venture capitalists, claiming that many of them prioritize their own financial gains over the success of their investors.
The vice-chairman of Berkshire Hathaway discussed quantitative-trading firms like Renaissance Technologies, noting that their large returns are often attributed to high leverage. Munger advised investors to bet heavily on their best opportunities when they have a clear edge.
He emphasized that truly great investment opportunities only come along a few times in a lifetime and cautioned against thinking that investing is easy. Munger stressed the importance of intelligence, hard work, and luck in achieving exceptional success.
Munger also touched on Buffett’s aversion to the retail sector and his unyielding dedication to the safety of Berkshire Hathaway shareholders. He mentioned the extraordinary success of an idea like Buffett’s bet on Japanese companies, comparing it to having “God just pouring money into a chest.”
The interview highlighted Munger’s admiration for certain companies, such as Hermès, while acknowledging the decline of once-mighty businesses like General Motors. He reiterated that these truly great companies are rare and finding an opportunity to invest in them is challenging.
Munger expressed his distaste for dealing with investment bankers, consultants, and venture capitalists, advocating for independence and self-reliance as a wealthy individual. He also encouraged self-insurance to avoid covering the costs of others’ claims.
When asked about advice for young people, Munger admitted that the current environment is challenging but emphasized the importance of navigating through the noise and avoiding misinformation.
Discussing the competitive nature of nature’s selection process, Munger noted that although it produces advanced creatures like humans, it does so through brutal competition.
The interview concluded with Munger’s plans to celebrate his upcoming 100th birthday, expressing his excitement and joking that there is no more room for additional guests.
Overall, Munger’s podcast interview provided valuable insights into his investment philosophy and perspective on various topics, solidifying his reputation as a prominent figure in the world of finance.
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