Thread by @BRK_Student

$DJCO Daily Journal meeting starting now!

I love how the broadcast opens with Munger already into the box of See's peanut brittle.

Charlie's first question on the new CEO, Steve Myhill-Jones.

Interesting discussion on Gannett and its fall from a giant. "They used to be treated like the lords of England"

$DJCO using its net worth to help win business. Customers wouldn't want to deal with a small undercapitalized company.

Munger: "I'm 99 years old for goodness sake."

Munger is talking about deferred taxes and how DJCO is better off holding and taking their bank stock dividends than paying 40% tax.

Munger: A willingness to slug it out in the mud leads to fewer competitors. The big software companies just want the easy money.

Munger quoting Demosthenes: What people wish they will believe. (Talking about money management fees and the denial that many have.)

Lesson Charlie took from BYD: Using shares he paid for to compensate employees.

Munger on leverage. He used to ask himself a question: What is the appropriate % of net worth to put in this stock if you think it's a cinch? Sometimes it's 100% or 150% or 200%. "He used a little leverage on his way up."

Munger said he was "charmed" by Alibaba. One of his biggest mistakes.

"We live in a world of sin, sorrow, and misdecision." On China and how the US or democracy isn't perfect either.

Sidenote: What is that bling Charlie is wearing on his wrist?

Semiconductor business is tough b/c you have to take all your profits and reinvest it in the next technology.

"I think the people who oppose my position [on bitcoin] are idiots...sometimes I call it crypto-crapto, sometimes I call it crypto-shit." (The man can say what he wants at 99.) He goes on to talk about how much of a blessing a national currency is.

Hmm, it's not clear if Charlie has changed his mind on crypto...jk. I think he said "crypto-shit" about 10x now.

On taxing stock buybacks: strongly opposed b/c a good fiduciary should be able to increase per-share value by making good capital allocation decisions. "I'm not vehemently opposed...it's not like cryptocurrency."

On BRK buyback pace, why didn't they up the pace when shares go down: I don't pay attention to it. But we bought a lot of stock back over the past 3 years.

On BRK breakup post-Buffett: It's not likely to be broken up for a long, long time. Some co's are worth more dead than alive. Not $BRKA $BRKB. You can only do it once, you pay a big tax, and then you have to do something with the cash. "I don't worry about it much I'll be dead."

Key to longevity is See's peanut brittle. (Charlie is 99.) "I've done no exercise on purpose almost my whole life." Steve Myhill Jones interjects: "Others' milage will vary."

"I'm paying a price for old age but it's better than being dead...Rosevelt did it...I'm hoping to keep this fairytale alive for a long time."

Loved that Becky asked my question about age. Charlie made it even more fun...you can do a lot into your old age but "my sex life would be a different story."

The thing that makes me proudest of my gov't is how we made Germany and Japan our best friends. Done on a bipartisan basis.

Jerome Powell is about as good as we can expect. Glad we have him.

@ChrisFried78 was that your question on index funds? Impact on boardrooms/co's. Not smart for index funds to try to influence companies.

$COST compensation system is damn near perfect. Talks about how they buy in stock to offset dilution (Sidenote: Buffett has said they're two separate decisions. I assume CM wouldn't approve of paying too high a price just to buy shares.)

Breaking: Charlie Munger doesn't use Twitter. LOL!

Apparently, the $5.2 million suit against GEICO for the woman contracting an STD in a vehicle insured by the company was overturned: cbsnews.com/news/geico-std….

@CNBC @BeckyQuick

Munger: I've avoided the movie business my whole life. I don't like the agents, the lawyers, the actors, the drug dealers serving the actors, etc. It's a hard place to make money if you're an investor.

Threat of world overpopulation: prosperity has allowed us to feed more people. Now looks like population in advanced countries will self-limit.

On his mistakes assessing management: Everyone makes mistakes. One of the most interesting things in his life was the rise and fall of IBM. IBM missed the boat. So did Kodak to change in digital photography.

Munger thinks racism has gone down a lot in his lifetime.

Impact on insurance industry b/c of climate change. Thinks climate change could be less of an impact than others. Not catastrophic.

Munger: "I can only teach what the other person almost knows." "On removing idiocy I've never succeeded." "Teach the ones that can learn and throw out the ones who can't keep up."

On low expectations: "You climb as hard as you can by advancing one inch at a time. That's the secret of life."

Munger had covid: "I had a tiny sniffle for about 10 minutes." LOL!

Charlie noticed friends who used canes fell down. Instead, he used a walker for 6.5 years and never fell down. Advice to old people: Just be a little more cautious. Now he's in a wheelchair and is just as cautious. [Interesting the contrast to taking risks earlier.]

Having a big position in the Permian Basin is a good thing. On $OXY and $CVX. Sidenote, interesting Munger knew the name of Oxy's CEO 50 years ago. Incredible.

Where his willingness to pay up for good businesses comes from: "I'm good a doing the obvious."

Ben Graham made more than half of his money in a good stock, GEICO.

$DJCO just put in a 401k. The only options are index funds, no other options. "Of course I'm right."

2/20 managers are very rare indeed. Way less than 5% of managers.

Another question from @ChrisFried78! On destroying your good ideas. What ideas did you destroy recently? Was overcharmed by online retailing (Alibaba). It's still retailing. $BABA

Does Charlie get up/go to bed at the same time? He's pretty regular and lucky to be a good sleeper in his old age.

On Ben Franklin: Was an unusual genius. "He invented the goddam bifocals." Haha, oh, Charlie. Played 4 musical instruments. Invented glass harmonica.

New edition of Poor Charlies Almanack in the works --- online edition!

On delayed gratification. It's innate. Almost sad so much is inborn. Should a 99-year-old delay gratification? He buys apartment buildings. He's trying to find ways to make them better and invest in them. And of course, they get the best tenants, etc.

On Buffett: He has a strong fiduciary gene. He cares about what happens to the shareholders. "Helps if you're good at loyalty."

In his own life and Warren too is a big self-insurer. Has no fire insurance on his house. Hasn't had collision insurance. Should insure against things you can't afford to take the bumps. "Intelligent people do it my way." Telling it the way it is even if it's not good for BRK.

On Greg Abel: "He's just sensational at being a business leader, both as a thinker as a doer." Good at smoothly getting things done by other people. As good as Warren at being a learning machine. Some things he's better than Warren. WB keeps dumping things on Greg.

Charlie said "Cheif Executive". Saying it right here: I think $BRKA $BRKB will announce Greg as CEO this year.

Munger: Greg Abel runs the utility like a regulator. Regulators love him.

Munger chuckling while taking a personal finance question on taking social security early or delaying. Take it now if you think you're going to be dead soon.

What has surprised him most: How much the business world is like the physical world. All the animals and species eventually die. That also applies to businesses and capitalism. So other things can replace them and live. Practically everything dies in business. Dept. stores, Kodak

Who CM admires: Jim Senegal at $COST, one of the best in the whole world. Greg Abel is in many ways just like Senegal. Genius in how he handles people, runs utilities like he was the regulator, reducing costs. Guy who ran TTI was a genius (Paul Andrews).

What quality has helped him most in life: Rationality. If you're just not crazy you have a big advantage over 95% of people. If you're patient and delay gratification it's nearly a cinch. And if you're good at delivering to other people. You get better but it's never easy.

Whatever you are, age and wealth make you more so. Becky quoting/paraphrasing Charlie.

BYD remarkable. Founder was 8th son of a peasant. Older brother sacrificed himself to get his brother into engineering school.

BYD his best investment inside BRK. $270 million investment worth $8 or $9 billion. BRK best investment was exec recruiter that found Ajit Jain.

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