Warren Buffett & Charlie Munger Disagree About the Future of America (2005)

thank you I'm a physician from st. Louis and I want to thank you and everyone here because I'm one of these doctors that really doesn't know anything about money or finance the money comes in but I don't know what to do with it I'm not able to really evaluate the financial strength of a company but I can evaluate the ethical strength of the company and that's why I feel real comfortable most of us here having our savings in Berkshire Hathaway and thank you this question has probably been asked in different ways already but several years ago fellow I know who was had been manager of Magellan fund warned that we were going to have a terrible decade or so in the stock market because of all the things people have brought up so far the increasing interest rates and runaway spending and decreasing dollar and stagflation may be right around the corner or social security problems and even what Charlie Munger referred to is that most of our best and brightest graduates I find are going into money management rather than they're not becoming doctors or molecular biologists or PhDs and in chemical engineering and so in view of the fact that a year or two ago people there were still on a billions of emotion about the stock market going up and making everyone rich just by having their money in the stock market it seems like that ebullience --is dropped in and I'm hearing an anticipation of a bear market and you wrote I think several years ago that it's hard to make money in a bull market and the real opportunities come in a bear market so I'm wondering if you would give us a clue as to what your strategies are going to be if it's really true that the market gets dismal over the next few years well if the market gets cheaper we will have many more opportunities to do intelligent things with money now whether we will blow on the money in the mean time or something of it is another question but but you know we are going to be buying things one thing or another operating businesses stocks high-yield bonds whatever we're gonna be buying things for as long as I live just as law just like I'm gonna be buying groceries yeah Charlie's just waiting to take over after I and I'm gonna be buying groceries the rest of my life now would I rather have grocery prices go up or down if I'm gonna be buying groceries tomorrow and next week and next month the next year and the answer is obviously if I'm a net buyer I would I will do better if prices are lower we have no we're not good at forecasting market so I mean knew that we were getting enormous bargains in the mid-70s we knew that the market went crazy to some extent in the in the late 90s but we don't have much we don't spend any time charlie I spent no time thinking or talking about what the stock market is gonna do because we don't know we do know sometimes that we're getting very good value for our money when we buy some some stocks or some bonds as it may be but we are not operating on the basis of any kind of macro forecasts about stocks and there's always a list of reasons you gave a few there's always a list of reasons why the country will have problems tomorrow there but there's always a list of opportunities which don't get mentioned quite as often so we don't sit down and make a list of the bad things that are happening in the economy and the good things that are happening and therefore expecting the stock market it might not it doesn't behave that way even if you if you could correctly forecast some of the bad things or good things overall I'm an enormous bull on the country I mean over time I mean this is the most remarkable success story in the history of the world if you think about it I mean in 1790 we had less than 4 million people in this country we had there were 290 million people in China or a hundred million people in Europe you know and and they all have the same intellect we had they're in the same general climate they had lots of natural resources and 215 years later that the 3.9 million people I think actually you know I have 3 million people I think actually you know I have 30% or so of the world's GDP so it does not make sense to bet against America that doesn't mean all our policies are smart or anything but I would not I do not get pessimistic on the country you know I worry about the I mean the big the big worry is is what can be done by either terrorists or government governments that have access to nuclear chemical or biological weapons but but in terms of the basic economics of the country your children are going to live better than you live and your grandchildren are gonna look bad then your children live and and we we do not focus on macro factors charlie well I agree with you that the economics of the country are probably good on increase for a considerable period ahead but I suspect that in very important ways we are at or near the apex of a great civilization you heard it here first folks if you leave the ncb nuclear chemical biological but I do not feel that way but you'll get to see which one of us is right 20 or 30 years from now I have seen more people pass up opportunities because they get they get focused on a single economic variable or a single problem of the country faces and they forget about about the good thing that if you can buy very good businesses and attractive prices it's crazy to say I think I'll sit this out because it might get a little cheaper next year or something of the sort and because the world's gonna go to hell we just we've never operated that we've never decided not to buy a business we like because of a macro view have we not yeah it's hard to get him to really agree with you I've been working at it for years you

Channel: The Financial Review

Views: 143,720

Keywords: buffett america, buffett s&p 500, munger s&p 500, stock market, investing, buffett investing, munger investing, munger buffett, charlie munger america, finance, business, investment, berkshire 2005, berkshire hathaway, buffett stocks, munger stocks, stocks, invest stocks, business advice, future of america

Id: zgMTARf0ryk

Length: 7min 4sec (424 seconds)

Published: Wed Jun 05 2019