Warren Buffett cautioned people not to think that investing is an easy way to make money as he answers a variety of questions at his Berkshire Hathaway Group’s annual meeting.
A legendary billionaire investor in Los Angeles said choosing a long-term winner can be difficult. He pointed out that in 1903 there were more than 2,000 auto companies and nearly all of them failed, even though the cars had rebranded the country since then.
“There’s so much more to stock than thinking it’s an incredible industry in the future,” said 90-year-old Buffett. “I just want to tell you it’s not as easy as it sounds.”
Online meetings are held for the second year due to the epidemic. Held on the West Coast for the first time instead of at the company’s Omaha home to accommodate Charlie Munger, Buffett’s vice president of California firm.
Buffett said most people would be better off by owning an S&P 500 index fund instead of betting on individual stocks. He said many novice investors have entered the market recently and are driving the value of video game retailer GameStop as a staple in gambling.
Stock trading platforms that allow people to buy and sell stocks for free, like Robinhood, are just a boost. “Impulse gambling” only
“Nothing is illegal, nothing is immoral. But I don’t think you can build a society out of people who do it, ”he said.
He spent hours answering questions on Saturday afternoon with Munger and fellow vice-presidents Greg Abel and Ajit Jain.
Executives held on topics at the conference, including US Federal Reserve policy and the stimulus passed by Congress, which Buffett said has done a good job of boosting the economy and keeping interest rates going. Low
He said the government clearly learned lessons from the Great Recession in 2009 and took action swiftly in response to the epidemic. But it is difficult to predict the long-term consequences of those policies.
“The economy right now – 85% of the economy is going at a very high rate and you are seeing inflation and all of that. It’s incredibly responsive, ”Buffett said.
Regarding the value of cryptocurrencies, Munger said he does not welcome currencies that are “very useful for kidnappers and extortionists… and I don’t like to throw a few more billions and billions of dollars into it. Someone who has just come up with a new thin air financial product, I think I should humbly say that I think all the offensive developments are offensive and against the interests of civilization. ”
Buffett said he did not regret selling Berkshire’s $ 6 billion stake in all of the major airlines last year, although those shares have grown significantly since he sold last spring. Buffett also said he thinks airlines might not be able to provide as much government aid as they had during the epidemic if they still had “very wealthy big shareholders. Like us “
Berkshire, based in Omaha, Nebraska, has $ 145.4 billion in cash and short-term investments as Buffett has struggled to find major acquisitions for the company for years.
Cole Smead, an investor, said he would love to see the company get more active next time the markets spin.
“We are not questioning whether Buffett and Mangers have patience. Obvious The question is, are they aggressive? It’s not clear, ”Smead said.
Buffett, who is 90, said he wants to invest more in Berkshire’s cash, but the current competition he faces from private equity and other investment funds has made it difficult for Berkshire to acquire a reasonably priced venture. He said a year ago it was difficult to predict how the economy would respond to all government outbreaks and stimulus.
The meeting has become a legendary event over the years, drawing as many as 40,000 investors to Omaha.
Author Bob Miles said he had missed it. “Meeting with like-minded and self-selected shareholders” and talking to executives who run Berkshire affiliates, who often take part of the meetings in the company’s booths in the large exhibit hall adjacent to the company. stage
Berkshire companies such as Geico Insurance, See’s Candy and Fruit of the Loom sell their products to shareholders each year.