Earlier this month, tens of thousands of investors made the journey to Omaha, Nebraska, to attend Berkshire Hathaway Inc‘s annual shareholders’ meeting to hear the company’s top-two leaders – Warren Buffett and Charlie Munger – spend hours fielding questions and waxing lyrical about investing and life.
The meeting has become something of a bucket-list event for die-hard investors. This year, Buffett and Munger were once again asked a long series of questions that covered a wide range of topics, such as the potential of trade wars to happen, thoughts on Elon Musk’s comment on economic moats, mistakes in their career, the threat of cyber-attacks, and more.
Over the nearly 6-hour long meeting, there were many takeaways that investors can no doubt learn from both Buffett and Munger. It is difficult to summarise all that was said in the meeting in a short article. So, in this piece,I just want to highlight three notable quotes from Buffett that were shared during the meeting.
“I’m bullish on the future of the United States, but I’m bullish on the future of China, and to a significant extent the rest of the world. People are going to be living better 10, 20, 50 years from now, and I don’t think that’s something that can be stopped, absent weapons of mass destruction.”
Despite the threat of a trade war between the two largest economies in the world – the US and China – Buffett was typically still optimistic about the long-term future of the world. And with good reason too.
Technological advancements and the opening of previously close-minded economies, have been catalysts for strong economic growth in the past few years. Put all these together, and we are likely to see the standard of living for the global population improve over the foreseeable future.
“…and cryptocurrencies will come to bad endings. And along with the fact that there’s nothing being produced in the way of value from the asset, you also have the problem that it draws in a lot of charlatans and that sort of thing, who are trying to create various sorts of exchanges or whatever it may be.
It’s something where people who are of less-than-stellar character see an opportunity to clip people who were trying to get rich because their neighbor’s getting rich buying this stuff neither one of them understands. It will come to a bad ending.”
Once again, Buffett emphasised his disdain for cryptocurrencies. He believes that despite the surge in price, Bitcoin and other cryptocurrencies are not “productive assets” such as stocks or real estate. He believes the price surge is largely due to people buying into cryptocurrencies in the hope of getting rich quick.
Munger added that “someone else is trading turds and you decide I can’t be left out.” In the scramble to get in on the latest technological fad, such as the dot com boom in the late 1990s and early 2000s, people often lose sight on what the asset actually is and simply pour their money into something just because everyone else is doing so. This can easily lead to heartbreak and huge losses.
“What we do is not a complicated business. It’s got to be a disciplined business, but it does not require a super high IQ or anything of the sort.
And there are a few fundamentals that are incredibly important. And you do have to understand accounting, and it helps to get out and talk to consumers and start thinking like a consumer in many ways and all of that, but it just doesn’t require advanced learning.”
Contrary to what many financial “experts” want you to believe, investing is not something out of reach for the layperson. Anyone can invest successfully if they simply follow a set of sound principles and learn the basics of business.
As Buffett had mentioned before on other occasions, investing does not require a supreme intellect to deliver good returns. On the contrary, anyone who puts in a little bit of effort to learn the fundamentals of a company and invests with a long-term mindset can achieve good returns in the stock market.
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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Jeremy Chia owns Berkshire Hathaway Inc Class B shares.