Beyond restaurants, consumers showed a growing interest in many of the newer categories on our Marketplace in 2021. The votes in favor of that are 995,356 against 120. And so I dont think its necessarily crazy that good companies sell at way higher multiples than they used to. We are subject to the orders and directions of those counties which, before, really didnt impact anything. I have a bust of Lee Kuan Yew in my house. Im not saying that oil and gas is going to be a wonderful business but I dont think its going away. In his closely read annual letter to shareholders, Jamie Dimon says he expects no more than 10% of JPMorgan employees to permanently work from They just copied Adam Smith and left out the free speech and it worked fine for them. Its been amazing that one little company starting up not that many decades ago could become as big as Costco did as fast as Costco did. Ellen Ireland will be inspector of elections. He was a one party system but he could always be removed by the electorate. Read the full transcript of the 2022 Daily Journal annual meeting featuring Charlie Munger and Gerald Salzman. The best venture capital operation probably in the whole world is Sequoias and they are very good at this early stage investing. He was just a very old-fashioned sound thinker. What do you look for in a leader? I hope that that will continue in the future. Key Points. Were not enlarging it. Theres an old German proverb Ive always liked. And, of course, its all worked. 24 Feb 2021 Charlie Munger, Vice Chairman of Berkshire Hathaway, speaks at the Daily Journal Annual Meeting 22 Jan 2021 Warren Buffett's right-hand man flags a 2021 Key Results Total net revenue grew 55% year-over-year (YoY) to $2.765 billion Platform revenue increased 80% YoY to $2.285 billion Gross profit was up 74% YoY to $1.409 billion Active Accounts reached 60.1 million, a net increase of 8.9 million active accounts from Q4 2020 Streaming Hours increased by 14.4 billion hours YoY to We discuss the company Berkshire Hathaway and the economic context in which it operates. Charlie Munger: Well, its most egregious in the momentum trading by novice investors lured in by new types of brokerage operations like Robinhood. We are in fact being a more difficult type of software business than Microsoft. When these people go, there is none replacing them. But the Chinese have proved that you dont need free speech to have a wonderful economy. And I think the world would be better off without them. Opportunities to invest in underpriced stocks (banks in 2009, in particular, I believe) Nothing is very Theyre in a place thats gotten more valuable. How can you not? But I wont be following him. Because we have the proxies those directors are now reelected. Charlie Munger: I dont think so. In a shareholder letter, Barra said 2023 will be a "breakout year" for GM's Ultium-based EVs. Where does it appear most egregious? And its really stupid to have a culture that encourages as much gambling in stocks by people who have the mindset of race track betters. But, of course, you should start out by studying the history of capitalism, how it worked, and why before you start studying business. We were trying to save the whole economy under terrible conditions. WebThe rapid collapse of BYD's H-share price caused by (1) the news that Citibank was holding Berkshire's shares, and (2) that Berkshire, owner of 20.5% of the H-shares is now selling Question: You famously run investments through your mental checklist. If you dont spend the money, you and your heirs get to spend it eventually. On balance, we hold in certain of these position when, normally, we wouldnt buy a new position. The only opinion I have there is that I dont think anybody knows whats going to happen for sure. The number of people who ever got a chance to do it again is zero. WebThe Annual Meeting of Shareholders of Daily Journal Corporation (the Company) will be held virtually on February 16, 2022 at 10:00 a.m. Pacific Time. Any tips for someone who wants to work on and improve their ability to hold two opposing views at the same time? Thats been greatly curtailed. I expect that and I welcome it. Thats true whether youre Benjamin Franklin or Joe klutz. The total number of shares, represented by proxies at this meeting, are 995,682, which are more than enough to constitute a quorum making the meeting duly held. Question: How do you control your investments in a world where reasonable companies with a good image like General Electric sink rapidly into the bottomland of the stock market. I call it deworsificationwhich I copied from somebody. While there were only 410 shareholders of record of Daily Journal's common stock as of Dec. 15, according to its annual report, Munger attracts a sizable February 11, 2022. You can hardly think of anything more important in life than being reliable for the people who trust you. A lot of people assume that since England led the Industrial Revolution and had free speech early that free speech is required to have a booming economy as prescribed by Adam Smith. Charlie Munger: Im a great admirer of Jeff Bezos whom I consider one of the smartest businessmen who ever lived. And my advice would be if you have a fixable disadvantage, remove it. 2022 . What are the main sources of ancillary revenue expected once the products have gone live and how meaningful will the products like eFile-it, ePay-it, cloud hosting services, and others become? I think theyre a bad investment when interest rates are this low. The stock appreciated probably way more than intrinsic value. These actions have given some shareholders more visibility and comfort on their investment. As a result of holding those two positions, we have a lower cost than anybody else and we make more money than practically everybody else. Youve said recently that Sequoia is the greatest investment firm ever. In other words, when we shout our knowledge out, were really pounding it out. Charlie Munger: I think everybody is willing to hold stocks at higher price-earnings multiples when interest rates are as low as they are now. And you mentioned technologythats very, very important. And I was like Rip Van Winkle; when I tried to come back to it, I found that the world had changed. I think the Chinese have behaved very shrewdly in managing their economy and theyve gotten better results than we have in managing our economy. At this rate, \h_^cBa\"BfuLj@`}Ze jZ*l!-;LUe=v3+adjh4Sz8h*`iQ5>dZ;c8sgu[9|7$t}HkN5xv.,GqwYp0Y,53Urn i*5"x~z0GYkgPU0gbivl:"[Z@"S5mdY = 14M.6X!8&[R-p;a)}P5Y^wE7>L>39ju oH*crZRYTf 0@N',.>BP%M72HY=eY\ |Lt[kC&15YsATr*z=%4;mSH4%ZJ[WI]da f1u#{z)`|Es5dH^,X"I3V4&F@N]6# 7V}cDCY$P(Xa:FVPfl\V!ZA~jtSBtrleZuV"Nr7cA_ u!LC36Mh]82(M+ RR)mnk d=#:v4P^^xEbt:x85!K-yQK Nu=?vL]'.vq|1b* pS67-K^sqj stream A lot of things are going to change. WebShareholder Letter Q2 2022 AUGUST 9, 2022. And I think that were crazy to allow it. I do think that a properly run bank is a great contributor to civilization and that the central banks of the world like controlling their own banking system and their own money supplies. <>>> These are very difficult questions and most people assume that its simple. You know what her mottoes were? The second proposal is to ratify the appointment of our certified public accountant: Baker Tilly US, LLP. We hope theyll continue doing magnificently well. I dont think well change on that. FOURTH QUARTER 2021 FINANCIAL RESULTS AND SHAREHOLDER LETTER We generated $97 million of free cash flow in the quarter and $477 million for the year, inclusive of a $191 million increase in inventory of which approximately $60 million is due to increased transit times and the balance targeted to alleviate our unshipped Has the quality gone down? I was very lucky. And if there is one thing the world could learn from Singapore, what would that be? If so, how do you think society should address it, especially because poor countries require much more cheap energy to reduce poverty? Its just not gonna work. We do know one thing and that is that the courts of the whole world are going to be taken into the modern age. Question: Many believe that inequality accelerated by this pandemic has reached alarming levels that demand drastic solutions such as a wealth tax. Question: Charlie, you are known as an advocate for learning from ones mistakes. And I dont know whether hes right or not. For example, Coca-Cola in the past. Bitcoin at 50,000 or Teslas fully diluted enterprise value of 1 trillion. Every value investor tries to get more value than he pays for. I own some apartment houses, so I like that investment, provided youve got a perfect management which is hard to get. Of course, thats a useful thing. Question: Is the oil and gas industry the new newspapers? So, I dont think Bitcoin is going to end up as the medium of exchange for the world. In fact, what a lot of shareholders actually do is crowd in buying stocks on frenzyfrequently on creditbecause they see that theyre going up. In a shareholder letter, Barra said 2023 will be a "breakout year" for GM's Ultium-based EVs. Question: What is the wisdom behind holding bank stocks compared to other stocks. Buffetts donations to the foundation have obviously helped to save many millions. I think all good investing is value investing. By rejecting non-essential cookies, Reddit may still use certain cookies to ensure the proper functionality of our platform. A lot of the people who are doing this remote worka lot are going to work three days a week in the office and two days a week at home. Were all pretty forgiving of ourselves too which is probably a good thing. He really knew everything you had to do to avoid credit losses in a small town in Illinois. Theyve served us well over the years. We take the situation as it is and try to solve it. Question: What is the biggest competitive threat to U.S. banks like Bank of America and US Bankboth equity holdings of the Daily Journal Corporationover the long term? WebCharlie Munger at the 2021 Daily Journal annual meeting spoke once again at great length. If anybody can fix it, he can. <>/ExtGState<>/XObject<>/ProcSet[/PDF/Text/ImageB/ImageC/ImageI] >>/Annots[ 18 0 R 19 0 R] /MediaBox[ 0 0 612 792] /Contents 4 0 R/Group<>/Tabs/S/StructParents 0>> If youre willing to count small nations in the group, he had probably the best record that ever existed in the history of the world. We bought all these buildings cheaply. We admire the company and like its position. What prevents the wide use of helpful psychological insight is the fact that psychology gets really useful when you integrate it with all other knowledge. Do you think the Daily Journal would have hundreds of millions of marketable securities now if Gerry didnt know how to learn something new? Gerald Salzman: None. Or, has the digital revolution caused enormous productivity improvements in those businesses? Due to the COVID-19 And if you believe Jeff Bezos is one of the best businessmen you have ever known, would you consider investing early in any of the new projects he will inevitably focus his attention on now that he will not have to be as concerned about the day to day responsibilities of Amazon? Sure, we all love the kind of civilization we have. WebIn 2021, we continued adding new restaurants to our Marketplace and third-party data suggests we remain the selection leader in the U.S. For shareholders and others who are interested, a book that compiles the full unedited versions of each of Warren Buffetts letters to shareholders between 1965 and 2014 is available for sale at this link. % Question: Why, almost two years ago, did you believe that Costco was the only U.S. stock worth buying? Charlie Munger: Well, I think all stocks can fluctuate. You get crazy booms. Question: Last February, you spoke about the wretched excess in the financial system. And the next time around the poor will get richer faster than the rich. Is there anything that you wish you had added to your checklist sooner? The kind of executives who have a Buffett-like mindset and never get in trouble are a minority group, not a majority group. And, for example, here, we must have 30 or 40 deaths. Given the developments over the past year, could you give us an update on your assessment of wretched excess in the system? And I think the directors of GE deserve a lot of credit for making Larry Culp the CEO. I dont define that as value investing. It was totally required. Its doing a big public service. So, the people part has changed quite considerably being a small company. Charlie Munger: Well, thats a very good question. Washington State is actually considering a wealth tax at the state level. One thing I can promise is that I wont contribute much to it because I dont understand it. And were gonna play that as hard as we can. Of course, that history is useful to know. I think management should tell it like it is at all times and not be a big promoter of its own stock. You can argue that I got close to Sequoia when with Li Lu we bought into BYD. By the way, the Harvard Business School, when it started out way early, they started out with a history of the business. Latest statistics and disclosures from Daily Journal Corp's latest quarterly 13F-HR filing: Top 5 stock holdings are BAC , WFC , BABA , USB , and represent I find it much easier to find four or five investments where I have a pretty reasonable chance of being right that theyre way above average. If you suffered losses exceeding $100,000 investing in SVB stock or options (i) between January 22, 2021, and March 10, 2023, inclusive (the "Class Period"); and/or (ii) 2021 Letter to Shareholders. You can hardly think of a decision that matters more to human felicity than who you marry. 2023 Junto Investments, all rights reserved. Charlie Munger: I dont have any wonderful new thoughts. Has the quality of the publication suffered as the employment levels have decreased? Now, it sounds like anybody would know that made sense. Charlie Munger: Were really old both of us. Charlie Munger: I cant think of a We paid high prices for some little companies in the course of trying to enter the court software business. Question: Mr. Munger is a champion of Chinese stocks. His method for doing it was so simple. Join 4,000+ investment professionals and curious generalists by getting my latest articles, research, and insights directly to your inbox. But he could play chess blindfolded at just below the Grandmaster level. He doesnt mind at all not getting credit for his charitable donations. Charlie Munger spreads wisdom at the annual meeting for the Daily Journal. In fiscal 2021, we reached revenues of $50.5 billiona significant milestone that represents 11% growth in local currency and the addition of $6.2 And if you cant do that, youre not gonna win the great chess championships of the world and youre not gonna do as well in business as Henry Singleton did. Charlie Munger: Well, heres what I meant. You know, its just, its incredible whats happened in terms of the destruction. I dont think that hydrocarbons are going. Web2021. If a civilization can progress only when it invents the method of invention, you can only progress when you learn the method of learning. See our Terms, Privacy Policy, and Disclaimer. We all live with that problem. Reddit and its partners use cookies and similar technologies to provide you with a better experience. I think office buildings are now in some trouble and, of course, commercial real estate rented to stores has been in a lot of trouble for a long time. By using our website or by closing this message box, you agree to our use of browser capability checks, and to our use of cookies as described in our Cookie Policy. I feel the same way about those choices. Charlie Munger: Well, I dont think its required that we be exactly the same on everything. And what did the Chinese communists do with respect to death taxes? What happened is that BYD is very well positioned for the transfer of Chinese automobile production from gasoline-driven cars to electricity-driven cars. Whoever dreamed when I was young that Kodak and General Motors would go bankrupt. Question: What books are you currently reading and what can you reccomend? Question: It seems likely that the current Fed policy of keeping interest rates near zero will only exacerbate the income disparity in this country by benefiting those who own the financial assets. This years annual report suggests that the traditional business has 97 full-time employees. Charlie Munger: Well, Lee Kuan Yew had the best record as a nation builder. Charlie Munger: I think Warren and I are better at buying mature industries than we are at backing startups like Sequoia. As we can see from the deteriorating U.S. relationship with China, the Western world does not understand China. What happens is that every human being tends to believe way more than he should in what hes worked hard to find out or where hes announced publicly that he already believes. And they dont do that very wellIm talking about the business schools. At the age of 97, Charlie Munger wasnot surprisinglysharp as a tack. Change value during the period between open outcry settle and the commencement of the next day's trading is calculated as the difference between the last trade and the prior day's settle. Furthermore, hed gone through the Great Depression. Also, fortunately before the pandemic, we got out of the conference-type events and we were not subjected to the problems of no conferences nobody to attend. Question: Do you think its best to invest in the common stocks of businesses early or while they are more nascent and the industry is smaller, or wait until they are the clear winner of a more mature industry? Sources: FactSet, Tullett Prebon, Currencies: Currency quotes are updated in real-time. It just created the most unholy mess. Data are provided 'as is' for informational purposes only and are not intended for trading purposes. She created a business with like 500 depression dollars that became a huge business. Buffett recommended it. I was good at having low expectations and that helped me. There are factories in China that are just absolutely full of robots and are working beautifully. The letter is 1,617 words. In the past few years, equity prices have increased significantly and cash has arguably become riskier due to central banking policy. And he made a very favorable impression. How do you decide to hold on to a stock or sell some? So human greed and the aggression of the brokerage community create these bubbles from time to time. I tend to avoid the ones which Im not good at and Im not good at a lot of different problems. And when the old CEO of the Daily Journal died, Gerry was managing the business affairs of the Munger Tolles law firm. We paid two and a half million for it. In 1978, the year Deng Xiaoping took over, it was 300. For a quarter in which we made only a handful of portfolio changes and essentially broke even, lot You are going to be flabbergasted. Question: You are one of the oldest and greatest thinkers of our time. WebThe U.S. economy is strong. So its very difficult. Inside Daily Journal Corp's 10-K Annual Report: Financial - Expense Highlight. Thanks u/Arceus122. Generally speaking, people assume that were a normal software company like Microsoft or something. On the other hand, as you say, I didnt get rich by buying stocks at high price-earnings multiples in the midst of crazy speculative booms. I think that would be insanity. But its hard for anybody. So far the evidence would be that maybe the monetary modern monetary theory is right. In 2020 and 2021, enormous QE approximately $4.4 trillion, or 18%, of 2021 gross domestic product (GDP) and enormous fiscal stimulus (which So, I dont mind a little inequality and what I notice is that the rich families generally lose their power and wealthand pretty fast. And he said; I cant decide the order of presidency between a flee and a louse. Charlie Munger: I dont know anything about Haven. Look around all this real estate. Always on point. I think the Chinese were very smart. Will we have fewer gas stations or truck stops in the future? When I was young, I rezoned some properties very successfully. Classified advertising is down significantly. And we probably have more of those shortcuts than others. Nothing is particularly obvious for everybody to do the same thing. And there arent many people that can do that. Give me a new question. How do you reconcile the idea of paying 50 or 60 times revenue for a growing but unprofitable business with the more traditional value investing concept of a margin of safety? Its such a simple idea. But, I hardly think the editorial quality could go way up when employees were going down. All the buses. 5. Today, it hovers around 9500. I have a very simple idea on the subject. tzJ/wa*''=`R9+eJ}hv&iA+sn\/t`5q2(5l.h% dD2)ls.sz M4Z6X_h+ak,+,D^'a%&2K~SO@z'9f)xC? 6ZERFyGh.Q{BoM$k2YNNV'Vq3yd;6. Question: In 1999, the year the Daily Journal bought Sustain Technologies, the traditional business employed 355 full-time employees and 61 part-time employees. Bitcoin reminds me of what Oscar Wilde said about fox hunting. Theron Mohamed Jan 22, 2021, 11:41 AM Charlie Munger. And, of course, its going to create trouble as it did. Cryptocurrencies: Cryptocurrency quotes are updated in real-time. We were together in that for a long, long time, and then Rick and I did the Daily Journal together on another occasion. Would you mind elaborating on how a professor or individual should go about building a curriculum around this approach? It reminds me of the key phrase and Bunyans Pilgrims Progress in which he says: My sword I leave to him who can wear it. If you were offered a fresh start today, what would you do differently in life and in investing? Im not trying to move mountains. I dont know which is worse. When I saw that psychology was necessary and I didnt have it, I didnt just learn the little tendencies well enough to get As in psychology. I recognized early that Gerry could run anything he wanted to run. To meet the surge in Daily Active Users (DAUs) totaled 53.3 million in June 2022, year versus 3.571 billion hours in May, up 10% over May 2021. Culture is very important. Thats our system. It seems to involve a lot of your standard causes of human misjudgment. Im not saying I wanted to live in China. I dont think it was a mistake to buy the Daily Journal when we did, paying the price we did. And some bankers yield to the temptations. I hope the newspaper survives too. Theyd take you through the building of the canals and the building of the railroads and so on and so on. Kipling once wrote a poem called The Women (The Ladies) and the concluding line was to the effect that you should learn about women from him instead of doing it yourself, because, he says, I know you wont follow my advice. Always intelligent. In Singapore, you get a savings account the day youre born. Question: We have a couple of questions about J.P. Rick Guerin. And it was probably wise that we acted exactly as we did. If you have unrealistic expectations, youre going to be miserable all your life. The psychology professors dont know all that much about the rest of knowledge and they have no incentive to master it. WebDaily Journal.

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