Exploring Markets

Charlie Munger on China, Bitcoin, and Healthcare

Yes, Charlie Munger is invested in China. Just listen to this:

Here's how Munger feels about politics:

Here's how Charlie Munger feels about healthcare in the US:

Why Cash Matters Most According to Warren Buffett

We found a special excerpt for you. It's more than five years old, and a lot of people missed it. Why? Because it happened inside a private classroom in 2013 at the University of Maryland. Warren Buffett sat with students and delivered some of his best thoughts ever on markets, and investing.

We found the notes to this talk, and linked them below. In the meantime, read this quote about needing cash and how to invest in times of crisis:

"In September 2008, we came right to the abyss. If Paulson and Bernanke had not intervened, in two more days it would have been all over. Berkshire Hathaway always has $20 billion or more in cash.

It sounds crazy, never need anything like it, but someday in the next 100 years when the world stops again, we will be ready. There will be some incident, it could be tomorrow. At that time, you need cash. Cash at that time is like oxygen. When you don’t need it, you don’t notice it. When you do need it, it’s the only thing you need. We operate from a level of liquidity that no one else does. We don’t want to operate on bank lines.

There is no authority for the US Treasury to guarantee money market funds. Their power comes from Congress. Paulson set up an exchange stabilization fund in September 2008 to guarantee money market funds. This stopped the run of money market funds and it was all over. Something like that will happen maybe a couple of times in your lifetime. Two things when it happens again:

1. Don’t let it ruin you!
2. And if you have money/guts, you’ll have an opportunity to buy things at prices that don’t make sense!

Fear spreads fast, it is contagious. Doesn’t have anything to do with IQ. Confidence only comes back one at a time, not en masse. There are periods when fear paralyzes the investment world. You don’t want to owe money at that time, and if you have money then you want to buy at those times."

Warren Buffett at the University of Maryland (notes and a talk with students)