Warren Buffett, in his first Annual letter to shareholders since Charlie Munger's death, credited his long-time partner with being “the architect” of Berkshire Hathaway.
Munger, who died at the end of November, became deputy chairman of the conglomerate in 1978. But long before that, he gave important advice on how to run the company.
Buffett wrote that Munger told him in 1965 to “forget about ever buying another company like Berkshire,” but now that he had control of it, he should “add wonderful companies at fair prices and stop buying fair companies at wonderful ones.” give up prices”. ”
Buffett followed his instructions.
After joining Berkshire, Munger “repeatedly talked me back into reason when my old habits surfaced,” Buffett wrote. “He remained in that role until his death and together, along with those who invested in us early on, we did far better than Charlie and I could have ever imagined.”
In addition to advising Buffett, Munger also made key decisions that accelerated Berkshire's success. His best call, he said a year agowas an investment in the Chinese automaker BYDwhich has recently overtaken Tesla in global sales of electric vehicles.
After betting on BYD at Munger's urging, Berkshire saw the value of its investment in the automaker rise from $230 million to $9.5 billion in 2008 14 years later.
“I have never helped Berkshire make anything as good as BYD,” Munger said said during the annual meeting of Daily Journal Corp., where he served as a director.
Munger was also known for his colorful language and candid remarks. He called Bitcoin “rat poison” and compared other cryptocurrencies to a type of “venereal disease.” Last year he wrote in the Wall Street Journal that the federal government should prohibit The entire industry described a cryptocurrency as “a gambling contract with an almost 100 percent edge to the house.”
Buffett suggested that Munger's role at Berkshire was far more important than most outsiders realized.
“In reality, Charlie was the 'architect of today's Berkshire, and I served as the 'general contractor' to carry out the day-to-day implementation of his vision,” Buffet wrote.
He added: “Charlie never wanted to take credit for his role as creator, instead leaving it to me to bow and accept the awards. In a way, his relationship to me was part older brother, part loving father. Even when he knew he was right, he gave me the reins, and when I made a mistake, he never – ever – reminded me of my mistake.”
Later in the letter, Buffett lamented the lack of worthwhile acquisition targets. notice that The mere “handful” of U.S. firms capable of tipping the scales for Berkshire “have been endlessly exploited by us and others.”
Meanwhile, however, Berkshire's cash pile grew to a record $167.6 billion in the fourth quarter.