Why Charlie Munger Hates The Financial Sector

yeah the one place that I feel we're making a huge mistake is not learning enough from the big mess that came from Wretched access in our financial system I don't think we 've throttled the sin and Folly out of that aspect of the economy nearly enough and I think if you look at all the panics and depressions of the United States they all came from Financial collapses usually preceded by perfectly asinine and greedy Behavior and I think there would be a lot to be said for taking uh an ax to our financial sector and willing it down to a more constructive size well tell us more about how you use that ax well Warren I'll make myself ridiculous but I guess I'm so old I'm entitled to do that I wouldn't have the tax system discourage Trading I would have various kinds of Tobin taxes I would have Securities trading more with the frequency of real estate than the trading way computer algorithms were one person's computers outwit another person's computers and what amounts to sort of legalized front running I don't think we need any of that stuff and I think making Heroes out of the people who succeed at it is not good for the fiber of the country either I hate the idea that 25 percent of our best Engineers are going into the financial sector so I think it's crazy what we've allowed and I think the lack of Contrition in our financial sector after the disgraceful stuff they got us into is perfectly awesome it makes Dave Soca look like a hero he's getting warmed up just as a side light you know how many of you know that if you trade an s p future contract uh 500 S P 500 contract and you hold it for 10 seconds and you have a profit that 60 of the gain is long-term gain and forty percent of short-term gain so essential our Congress has said that this activity should be more likely taxed you know than cleaning washrooms or or doing all the things that you people do every day that uh they've got a special tax treatment now that illustrates one of the problems with the tax code in that there's a few people that care intentionally about having that in there and the cost of it in terms of less revenue for the US government is diffused among a large group none of whom have enough interest to want to go out and write their Congressman or hire a lobbyist to fight the other way but it's pretty extraordinary that we have decided that that particular form of activity should should get 60 percent taxed at a 15 percent maximum rate even though it may only take 10 or 20 seconds and be just a little flicker on the screen and the hedge fund operators of America get a much lower tax rate than the professors of physics or the drivers of taxis this is demented [Applause]

Channel: The Long-Term Investor

Views: 18,959

Keywords: personal finance, stock market, stock investing, investing, stock picks, value investing, dividend stocks

Id: xoMOAxJpNpE

Length: 3min 57sec (237 seconds)

Published: Sun Mar 05 2023