LIVE: Billionaire investor Charlie Munger touts Apple, slams crypto, and rings the inflation alarm at Daily Journal's annual meeting
Lane Hickenbottom/Reuters
- Charlie Munger tackled a slew of subjects during Daily Journal's annual meeting on Wednesday.
- Warren Buffett's business partner touted Apple, blasted cryptocurrencies, and praised China.
- The 98-year-old investor is famously outspoken and unafraid of causing controversy.
Charlie Munger warned of dangerous speculation in markets, blasted cryptocurrencies, and rang the inflation alarm during Daily Journal's annual shareholder meeting on Wednesday. Yahoo Finance tweeted some clips of the meeting earlier in the day; we'll be following along with the platform's delayed livestream of the event.
Munger, best known as Warren Buffett's business partner and the vice-chairman of Berkshire Hathaway, has also served as Daily Journal's chairman since 1977, and continues to manages the company's investment portfolio.
The 98-year-old investor, polymath, and amateur architect is notoriously blunt; his most memorable comments include dismissing bitcoin as "rat poison" and calling Robinhood a "gambling parlor" that's "beneath contempt."
Here's our live coverage of the meeting:
Disclosures
Munger was asked to reveal the security which Daily Journal purchased with margin debt in the fourth quarter. He declined to reveal it, noting both Berkshire and Daily Journal only disclose what they have to so other investors don't know what their buying.
Investing in China
The Daily Journal chairman was asked why he's happy to invest in China, whereas other top investors such as Jeff Gundlach are wary of doing so. Munger highlighted China's huge population and technological advances, and explained that he invested in the country because he could get better value.
"I feel about Russia the way he feels about China," Munger says about Gundlach, saying he empathizes with the DoubleLine Funds chief's concerns.
Munger was questioned about the risks tied to his Alibaba and undisclosed margin-debt bet. "We don't mind a tiny little bit of margin debt," he said.
The veteran investor elaborated on why he and Buffett invest in China, saying Chinese companies are stronger relative to competitors and cheaper than US rivals.
"Warren like many other intelligent people likes to invest where he's personally comfortable," Munger said, adding that he's more comfortable than China than Buffett.
"I don't think Alibaba is as entrenched as something like Apple and Alphabet," Munger said, predicting the internet will be highly competitive space regardless of size.
Crypto
"I'm proud of the fact I've avoided it. It's like some venereal disease ... I just regard it as beneath contempt," Munger said about cryptocurrencies. He asserted that people welcome the tokens because of their usefulness in extortion, kidnapping, tax evasion, and said he admired the Chinese for banning them.
Munger welcomed the idea of the Federal Reserve launching a central bank digital currency (CBDC), noting that in his view bank accounts are digital currencies.
Market speculation
"The great short squeeze in GameStop was wretched excess, certainly the bitcoin thing was wretched excess," Munger said, adding that too much money is being thrown at venture capital. He warned that some people are using the stock market as a "gambling parlor," and says if he was the dictator of the world, he would have put a tax on short-term gains that made the stock market less liquid and discouraged short-term investment.
"It's not a good marriage and we need a divorce," he says about stocks being bought and sold so frequently.
Munger compared the rampant speculation in markets to a drunken brawl and warned it could have devastating consequences for humanity. He predicted the current asset-price bubble would end badly, but said he couldn't predict when it would burst.
Inflation
"The troubles that come to us could be worse than what Volcker was dealing with, and harder to fix," Munger said, when he was asked to compare the current spate in inflation to the surge in prices during the 1970s.
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