Lane Hickenbottom/Reuters
- Charlie Munger trashed crypto, called Elon Musk bright but strange, and crowed about his BYD bet.
- Warren Buffett's right-hand man also bemoaned his Alibaba wager, and cast doubt on AI's potential.
- The 99-year-old investor joked his longevity was due to eating See's Candies and never exercising.
Charlie Munger has eviscerated cryptocurrencies, called Elon Musk an exceptional but strange individual, and touted Chinese carmaker and Tesla rival BYD as one of his best investments ever.
The billionaire investor and vice-chairman of Warren Buffett's Berkshire Hathaway fielded dozens of questions on a wide range of topics during Daily Journal's annual meeting on Wednesday, which was broadcasted live by CNBC.
Munger bemoaned purchasing Alibaba stock, and cast doubt on the artificial-intelligence boom sparked by ChatGPT's release. Moreover, he joked that munching on See's Candies and never exercising was key to reaching his ripe age of 99.
Here are Munger's 16 best quotes, lightly edited for length and clarity:
1. "It's asinine, it's massively stupid, and of course it's very dangerous, and the governments were totally wrong to permit it. I'm not proud of my country for allowing this crap, what I call the 'cryptocrappo' or 'cryptoshit.' It's worthless, it's no good, it's crazy, it'll do nothing but harm, and it's antisocial to allow it."
2. "It's just unspeakable, it's an absolute horror, and I'm ashamed of my country that so many people believe in this kind of crap and that the government allows it to exist. It is totally, absolutely, crazy-stupid gambling with enormous house odds for the people on the other side." (Munger was referring to crypto.)
3. "My policy on Elon Musk is that he's a very talented man but also peculiar, and so I don't buy him and I don't sell him short. I just say, 'Well he's a very unusual person.'"
4. "BYD is so much ahead of Tesla in China it's almost ridiculous." (Munger noted that BYD raised its car prices in China last year while Tesla cut prices, and touted the automaker's large domestic profits and manufacturing capacity.)
5. "I have never helped do anything at Berkshire that was as good as BYD." (Munger convinced Buffett to invest $232 million for a stake that grew more than 30 times in value within 15 years.)
6. "We've made one better investment, you know what it was? We paid an executive recruiter to get us an employee and he came up with Ajit Jain. The return that Ajit has made us compared to the amount we paid the executive recruiter — that was our best investment at Berkshire." (Jain is the boss of Berkshire's insurance operations.)
7. "Greg is just sensational at being a business leader, both as a thinker and as a doer. He's also just a tremendous learning machine — you can argue that he's just as good as Warren at learning all kinds of things. There's some things he's better at than Warren is, and Warren knows that, and he just keeps dumping on Greg everything that Greg can do better, and that's a lot. (Munger was referring to Greg Abel, Buffett's planned successor.)
8. Jack Ma got up and made a public speech where he basically said: 'The Communist Party is full of malarkey, they don't know their ass from their elbow, they're no damn good and I'm smart.' Pretty soon he just disappeared from view for months on end. It was pretty stupid, it's like poking a bear in the nose with a sharp stick. He got way out of line by popping off the way he did to the Chinese government."
9. "I regard Alibaba as one of the worst mistakes I ever made. I got charmed by the idea of their position in the Chinese internet; I didn't stop to realize they're still a goddamn retailer. It's going to be a competitive business, the internet — it's not going to be a cakewalk for everybody." (Munger added Alibaba stock to Daily Journal's stock portfolio in early 2021.)
10. "Coca-Cola was run for years by a man with very severe mental impairment, and the directors just assumed he was drunk and let him stay there year after year. Now that's my idea of a wonderful business — that you can be mentally defective and run it pretty well. That was Coca-Cola in its heyday."
11. "As long as Costco keeps the faith with its strong culture and extreme low-markup policy, I don't see any stopping it. The trouble with Costco is its stock trades at 40 times earnings, but except for that it's a perfect damn company. It has a marvelous future and it has a wonderful culture and it's been run by wonderful people. I love everything about Costco, I'm a total addict, and I'm never going to sell a share."
12. "All factors considered, and with Berkshire buying in its own shares when they're reasonable priced, I think Berkshire's a pretty damn good bet for shareholders to hold for the long term. Everybody that bought Berkshire and held it for 20 years has done well. I think that will be true for those who buy it at the current price."
13. "Artificial intelligence is very important, but there's also a lot of crazy hype on the subject. AI is not going to cure cancer, it's not going to do everything that we want done, and there's a lot of nonsense in it too. So I regard it as a mixed blessing." (Munger said AI could be useful in insurance underwriting, but not much help in buying an office building.)
14. "I have avoided the movies like a plague as an investor all my life. I've never made an investment in a movie business in any way, shape, matter, or form. I don't like the unions, I don't like the crazy agents, I don't like the goddamn crazy lawyers, I don't like the crazy movie stars, I don't like the people who sell dope to the musicians — everything about it is not my culture. Movies is not my scene so I've avoided it."
15. "95% of the people who are America's professional asset managers, I wouldn't want working for me — investing is that hard. I think you need to be in the top 5% to have a reasonable chance." (Munger was underlining the difficulty of beating the market.)
16. "I hate to advertise my own product but this is the key to longevity. I've done almost no exercise on purpose in my life. For the first 99 years I've gotten by without doing any exercise at all." (He was referring to a box of See's Candies, a Berkshire-owned business.)