Warren Buffett and Charlie Munger Fought Over This

In the recent Berkshire AGM, one investor asked the two wise gentlemen about the future of value investing.

Interestingly, both of them disagree with each other.

Charlie Munger, Berkshire Hathaway vice-chairman and Buffett’s long-time right-hand man, has a more pessimistic view on value investing.

“I think value investors are going to have a harder time now that there are so many of them competing for a diminished bunch of opportunities,” Munger said. “My advice to value investors is to get used to making less money.”

On the other hand, Buffett sees more opportunities than his long-time partner.

“What gives you opportunities is other people doing dumb things,” he said.
“And there has been a great increase in people doing dumb things.”

Buffett’s thinking is aligned with his investing mentor Benjamin Graham, the father of value investing. 

Benjamin Graham once said, “Though business conditions may change, corporations and securities may change, and financial institutions and regulations may change, human nature remains the same. Thus, the important and difficult part of sound investment, which hinges upon the investor’s own temperament and attitude, is not much affected by the passing years.” — from The Intelligent Investor

Whose thinking do you agree with more? 😃

In my opinion, I believe Buffett’s view on human nature will stand the test of time.

Think about it:

  • How many times have you bought a stock due to greed or FOMO, only to see the stock price tumbling down?
  • How many times have you sold a stock in a market crash out of fear, only to see it recovering soon after?
  • How many times have you felt lost or paralyzed by your emotions, too afraid to take any action due to market uncertainty?

Emotions are real, and they will always be a part of us.

That’s also why, I believe in learning the right investing mindset and system, so we can start cultivating emotional detachment and grow our wealth safely and substantially in the long run.

And it’s very important to do deep fundamental analysis on the individual company before making any investment decision, so you can have the peace of mind holding onto the company, regardless of the market volatility.

Recently I did a company deep dive on Berkshire Hathaway. By sharing with you how Warren Buffett manages the company, I hope it can give you more clarity on your investment journey.

If you enjoy the little investment insights I shared here, I have more to share with you in my telegram channel @arigatoinvestor. Over there, I will do daily investing updates.

I recently also managed to have a wonderful interview with Matthew Peterson from Peterson Capital Management, and the entire session was simply mind-blowing! Matthew revealed a plethora of investment insights on how he managed to achieve a compounded annual growth rate of over 14% for his fund over the past 11 years.

Here are my key personal takeaways from the 75-minute-long interview. However, Matthew shared many more insights generously. If you want to watch the full interview, be sure to check out the entire Q&A on my YouTube channel!

Together, let’s become better investors!

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