The 2024 Berkshire Hathaway Annual Shareholder Meeting occurred on May 4th, 2024, and while there are lots of articles offering highlights (including this one), it’s never the same feeling as tuning into the actual thing. I always find a few nuggets that mean something to me, even if just a small side remark. Warren Buffett, Greg Abel, and Ajit Jain answered questions while we felt the palpable absence of the late Charlie Munger.

CNBC again has the broadcast rights. You can find the full 7+ hour live re-broadcast on CNBC YouTube (at least for now) and they have also uploaded most of it (not all) to the CNBC Buffett Archives site. Their official transcript is not yet available, but you can find a helpful transcript from Steady Compounding or listen to the audio podcast version here. Personally, I like to listen to the audio in the car once, and then read through the transcript for the second round.

Here are a few personal takeaways and notes.

Charlie Munger tribute. The meeting started with a video tribute to Charlie Munger, but that part is not included in many of the video links. Be sure to watch it here on the full video starting at 30:34. It is a very nice and touching tribute, including many classic Charlie Munger quotes. He did things his way, all the way to the end. I always loved that Buffett and Munger genuinely had fun together. When asked about “one more day with Charlie”, here was part of Buffett’s response:

We always lived, in a way where we were happy with what we were doing every day. I mean, Charlie. Charlie liked learning. He liked, as I mentioned in the movie, he liked a wide variety of things. So he was much broader than I was.

But I didn’t have any great desire to be as broad as he was. And he didn’t have any great desire to be as narrow as I. But we had a lot of fun doing anything. And, you know, we played golf together, we played tennis together, we did everything together. And this you may find kind of interesting.

We had as much fun, perhaps even more to some extent, with things that failed, because then we really had to work and work our way out of them. And in a sense, there’s more fun having somebody that’s your partner in digging your way out of a foxhole than there is just sitting there and watching an idea that you got ten years ago just continually produce more and more profits. So it wasn’t, you know, he really fooled me, though. He went to 99.9 years. I mean, if you pick two guys, you know, he never publicly said he never did a day of exercise except where it was required when he was in the army.

He never did a day of voluntary exercise. He never thought about what he ate. You know, we started every day, and Charlie had. He was interested in more things than I was, but we never had any doubts about the other person, period. And so if I’d had another day with him, we’d probably have done the same thing we were doing the earlier days and we wouldn’t have wanted another.

The only book available at their on-site bookstore this year was the new 2023 edition of Poor Charlie’s Almanack: The Essential Wit and Wisdom of Charles T. Munger.

Current Berkshire Hathaway stock price is close to intrinsic value. Berkshire’s cash pile keep growing, and sometimes it buys back shares when Buffett thinks it’s a good deal for existing shareholders. Right now, it seems like Buffett thinks it is only slightly undervalued to intrinsic value. Historically, buying BRK when BRK buys a lot of BRK has been a pretty good bet. (Say that three times fast!)

And our stock is at a level where it adds slightly to the value when we buy in shares. But we would. We would really buy it in a big way, except you can’t buy it in a big way because people don’t want to sell it in a big way, but under certain market conditions, we could deploy quite a bit of money in repurchases. And as you’ll see on the final slide, we have bought it in the last five years. We can’t buy them like a great many other companies because it just doesn’t trade that way.

Buffett sees higher tax rates as likely in the future, at least for corporations. When asked why he trimmed his position in Apple stock, Buffett (as he often does) redirected the question a bit to taxes.

We don’t mind paying taxes at Berkshire, and we are paying a 21% Federal rate on the gains we’re taking in Apple. And that rate was 35% not that long ago, and it’s been 52% in the past when I’ve been operating. And the government owns. The Federal government owns a part of the earnings of the business we make. They don’t own the assets, but they own a percentage of the earnings, and they can change that percentage any year.

And the percentage that they’ve decreed currently is 21%. And I would say with the present fiscal policies, I think that something has to give, and I think that higher taxes are quite likely, and the government wants to take a greater share of your income, or mine or Berkshire’s, they can do it. And they may decide that someday they don’t want the fiscal deficit to be this large, because that has some important consequences, and they may not want to decrease spending a lot, and they may decide they’ll take a larger percentage of what we earn and we’ll pay it.

[…] And if I’m doing it at 21% this year and we’re doing it at a higher percentage later on, I don’t think you’ll actually mind the fact that we sold a little Apple this year.

Living a good life. As usual, he dropped some good general life advice.

But the opportunity in this country is basically limitless. When you think of going back not that many centuries, if you were going to be a shepherd or something like that, 100 years from now, your grandson was a granddaughter, was going to be a shepherd, nothing really happened. And what has happened in the last 200 years with the combination of the industrial revolution, whether it’s science or education or health, you name it. We are so lucky to be born when we were the people in this room, and many of us were lucky enough to be born in the United States as well, that you.

You’re entering the best world that’s ever existed, and you want to find the people to share it with and the activities to participate in that fit you. And if you get lucky, like Charlie and I did, you find things that interest you young. But if you don’t find them right away, you keep looking. And I always tell students to take the job. I mean, find the job that you would like to have if you didn’t need a job.

And sometimes you can find that very early, and sometimes you go through various experiences, but don’t forget what you actually are trying to do, and there’s no place to do it like this country. Find the person that you like to share your life with in many cases. And, you know, sometimes you get lucky into that early, and sometimes you make mistakes.

But I would try to, in a very, very general way, I would try to figure out how you’d want to look back on your life and think about yourself and start today to go on the path that leads to that goal and expect some difficulties along the way. But if you’re thinking that way, you’re more likely to get there.

Keep trying, expect bumps, appreciate what you already have, and don’t let envy ruin it all. This Munger quote from the 2023 Daily Journal shareholder meeting sticks in my head: “I can’t change the fact that a lot of people are very unhappy and feel very abused after everything’s improved by about 600% because there’s still somebody else who has more.”

Berkshire shareholders as both savers and givers. Buffett reinforced the stereotype that Berkshire Hathaway shareholders are different and tend to be relatively frugal, practical, and not focused on outward appearances. Not only did a shareholder donate $1 billion dollars to a medical school in the past year (such that tuition will be free in perpetuity), but it didn’t even require them to change the name of the school. Another BRK shareholder just anonymously donated $500 million.

The next generation is fully in place. My overall impression was that while Buffett is still the top guy, with the passing of Charlie he has psychologically already passed the baton to Greg Abel and Ajit Jain. Abel is who all the subsidiary business managers deal with on a daily basis. Ajit is fully in control of the insurance side. Buffett basically said that Berkshire should be good for the next 20 years and he’s done the best he can (knock on wood).

We’ve really got the problem solved for the next 20 years unless something untoward happens. And if something untoward happens, then. Then the directors need to find, probably within our own organization, somebody that they’ve got confidence in to maintain the special advantages we have over another 20 years period. There’s various things that are low probabilities, but you still have to think about them, and we are in that position now. Now, if you asked me whether.

If something happened to Greg today, everybody says, don’t travel on the same plane. The thing to do is not travel in the same auto. Planes don’t go down that often. Autos crash all the time. I’ve seen all these corporate policies on that, which are kind of crazy when you think about the real risk.

But in any event, Greg is going to have to tell the directors about what if something happened tomorrow. He has to tell the directors about what should be done if anything happens to him. And that’s not an easy thing to do, and I don’t have.

Buffett will still be there to make sure that they properly pounce during the next crisis when everyone is scared but Berkshire. I get the sense that is really the only thing left that would get him really excited: the possibility of a future big moment with lots of buying opportunities. A few last big brush strokes for his masterpiece.

And that’s sort of the story of Berkshire. We’ll try to increase operating earnings, and we will try to reduce shares when it makes sense to do so. And we will hope for an occasional big opportunity. And we’re quite satisfied with the position we’re in.

Berkshire Hathaway (BRK) released its 2023 Letter to Shareholders (also see full 2023 Annual Report), which Warren Buffett also uses as an educational instrument. As always, I recommend reading it yourself (only 17 pages total this year). I prefer to read the letter first (with no spoilers), then peruse the various newspaper and media commentary, and finally re-read the letter again. Here are my personal highlights and commentary.

Tribute to Charlie Munger. The letter starts with a tribute to the late Charlie Munger, to whom he credits as the “architect” of Berkshire Hathaway, while Buffett was the “general contractor” performing the day-to-day construction work.

…Charlie, in 1965, promptly advised me: “Warren, forget about ever buying another company like Berkshire. But now that you control Berkshire, add to it wonderful businesses purchased at fair prices and give up buying fair businesses at wonderful prices. In other words, abandon everything you learned from your hero, Ben Graham. It works but only when practiced at small scale.” With much back-sliding I subsequently followed his instructions.

This also serves as a good reminder of a central idea within Berkshire. First, you identify the wonderful businesses, the durable ones that you believe you could buy and then forget about for 10 years. Then, only after that is satisfied, you buy them only if available at a fair price. The hardest part is to maintain this discipline even in boom times.

Berkshire Hathaway shareholders are (still) different. In the same way, Berkshire Hathaway wishes to attract shareholders that believe that Berkshire is one of these wonderful businesses and wish to own their shares permanently, only selling a bit perhaps for spending in retirement or for estate reasons. Often, these Berkshire shareholders end up with far more than they need and make generous charitable contributions. Not a bad way to do things, in my humble opinion. You may have heard about the recent $1 billion donation to a New York medical school (NY Times gift article). Many news articles omitted that those were Berkshire Hathaway shares that were donated (WSJ gift article).

Annual reminder on reported earnings. Buffett reminds us again that, due to current accounting rules, Berkshire must count any changes in the value of their stock holdings in outside companies (Apple, American Express, Coca-Cola, etc.) as “earnings”, which leads to funny things when they reports their profits each year. The rest of the company could be doing great, but if the share values fall, then they have to report a loss. The rest of the company could be struggling, but if the share values rise, then they have to report a profit.

Own American businesses! Buy them, keep them, be patient.

I can’t remember a period since March 11, 1942 – the date of my first stock purchase – that I have not had a majority of my net worth in equities, U.S.-based equities. And so far, so good. The Dow Jones Industrial Average fell below 100 on that fateful day in 1942 when I “pulled the trigger.” I was down about $5 by the time school was out. Soon, things turned around and now that index hovers around 38,000. America has been a terrific country for investors. All they have needed to do is sit quietly, listening to no one.

A carefully-worded warning about dealing with people of questionable moral fiber. You may have read about the drama between Berkshire Hathaway while trying to finalize the purchase of the Pilot Travel Centers truck stop business. As Reuters put it, “Buffett did not mention Pilot in his annual letter to Berkshire shareholders […] but offered an anecdote about the risk of disappointment in acquisitions.” Here’s the anecdote 💀:

We also hope these favored businesses are run by able and trustworthy managers, though that is a more difficult judgment to make, however, and Berkshire has had its share of disappointments.

In 1863, Hugh McCulloch, the first Comptroller of the United States, sent a letter to all national banks. His instructions included this warning: “Never deal with a rascal under the expectation that you can prevent him from cheating you.” Many bankers who thought they could “manage” the rascal problem have learned the wisdom of Mr. McCulloch’s advice – and I have as well. People are not that easy to read. Sincerity and empathy can easily be faked. That is as true now as it was in 1863.

Don’t expect Berkshire to outperform the S&P 500 by a lot in the future, but do expect it to be a fortress in times of crisis. One way they could beat the S&P 500 by a lot is if a market crash occurs and they buy a lot of businesses at low prices.

With that focus, and with our present mix of businesses, Berkshire should do a bit better than the average American corporation and, more important, should also operate with materially less risk of permanent loss of capital. Anything beyond “slightly better,” though, is wishful thinking. This modest aspiration wasn’t the case when Bertie went all-in on Berkshire – but it is now.

Extreme fiscal conservatism is a corporate pledge we make to those who have joined us in ownership of Berkshire. In most years – indeed in most decades – our caution will likely prove to be unneeded behavior – akin to an insurance policy on a fortress-like building thought to be fireproof. But Berkshire does not want to inflict permanent financial damage – quotational shrinkage for extended periods can’t be avoided – on Bertie or any of the individuals who have trusted us with their savings.

Berkshire is built to last.

I aspire to this “fortress” level of financial security for my personal finances. That’s why I’m also okay with holding a decent chunk of cash (Treasury bonds) even though most of the time it’s a performance drag. At the same time, this is also why I’d rather just own a Total US stock market index fund rather than BRK. I think BRK will be fine once Buffett is gone, but I’m not 100% certain.

As for the rest of their fully-owned and partially-owned businesses, nothing really stuck out to me. Buffett is still adding to his life’s work, his “masterpiece”. I just like to watch, not second-guess. He’s still buying OXY and some mystery financial company. Overall, operating earnings are going up, with some parts doing quite well (notably insurance underwriting and income) and some struggling (notably Berkshire Hathaway Energy and BNSF Railroad).

As for BRK shares themselves, these days there is an easy “buy” signal beamed directly by Buffett himself. If BRK is repurchasing a lot of shares, then it’s probably at a fair price to buy (with a tiny portion of my self-directed investments). If they stop repurchasing shares, then so will I.

Past shareholder letter notes.

• 1977-2023 are free on the Berkshire Hathaway website (PDF). 1965-2023 are $3.99 at Amazon (Kindle). Four bucks seems pretty reasonable for a permanent digital copy with the ability to search text and maintain highlights.
• 2022 Letter notes
• 2021 Letter notes
• 2020 Letter notes
• 2019 Letter discussed why BRK will continue to do fine without Warren Buffett around.
• 2018 Letter discussed using debt very sparingly and the importance of holding productive assets over a long time.
• 2017 Letter discussed patience, risk, and why they have so much cash.
• 2016 Letter touched on the rarity of skilled-stock pickers and some insight on his own stock-picking practices.
• 2015 Letter discussed his optimism in America and his “Big 4” stock holdings.
• 2014 Letter discussed the power of owning shares of productive businesses (and not just bonds).
• 2013 Letter included Buffett’s Simple Investment Advice to Wife After His Death.

The 2024 annual shareholder meeting will be in Omaha on Saturday, May 4th. CNBC will most likely livestream it again.

Charlie Munger held his last in-depth interview with CNBC’s Becky Quick in mid-November 2023. The interview was meant for a 1-hour special celebrating Munger’s 100th birthday, but was re-edited to become “Charlie Munger: A Life of Wit and Wisdom”. I don’t have cable TV anymore, but CNBC has thankfully released a full text transcript and will upload the full, uncut video the CNBC Buffett Archives site shortly (update: here is the extended version).

I highlighted a few Munger quotes below along with brief commentary. If you aren’t familiar with the “greatest hits” of Munger wisdom, definitely check out the full transcript or video. I will definitely miss mining through these interviews for the “new to me” gold.

Playing the hand you are dealt.

…I just played the hand I was dealt in order to get as much advantage as I could. And that’s what everybody else does too. They play the hand that was dealt to get as much advantage as they possibly can.

Think about the country/environment you were born, your parents, and your genetically-influenced gifts and challenges. Those are three huge things, and none of us had any choice in any of them. In fact, I’m certain many of you readers have overcome more obstacles than I can imagine. I hope to teach my children about appreciating their blessings, accepting their challenges, and to keep striving while giving grace to others. Heck, I hope to teach myself that too. Work in progress…

Stay in your circle of competence. I definitely believe that you need to enjoy what you’re doing to do it well, but I am also a firm believer in practical considerations.

And so I decided to stay the hell out of businesses where I would compete with people like Eddie Davis, Jr. and Eddie Davis, Sr. in their strong suit.

BECKY QUICK: Knowing your competencies.

CHARLIE MUNGER: Knowing your circle of competency. Right. And that kept me away from those businesses totally.

Maintain a margin of safety.

But really, it’s knowing you can have a very bad day. Do not live your life in such a fashion that a bad day can kill you.

But also be ready to take risks when the odds are in your favor.

But Grandfather Ingham just talked endlessly about the early days and how he’d surmounted all these hardships. And he says that it looks pretty easy, “looking back at it with retrospect, but it was damn hard, I want you to know.” And he said, “And in reviewing my life, what your grandchildren have to realize, it was his version of Robinson Crusoe, he told every grandchild, “Is when they give you a real opportunity, the world’s not gonna do it very often. And you’re only gonna get three or four of these invitations to the pie counter. And when you get your invitation, for God sakes, don’t take a small helping.” He basically said, “Lever up when you’re sure you’re right.” And of course that’s good advice. But be sure you’re right is what makes it hard. How can you be sure you’re right? Well, but you can’t. That’s the point. You can’t do it very often.

“Everyone struggles.”

BECKY QUICK: I mean, Charlie, people probably look at you and think you’re incredibly wealthy, you’ve had all these great opportunities and things that have happened in your life. But you’ve struggled too.

CHARLIE MUNGER: Of course. Everybody struggles. The iron rule of life is everybody struggles.

BECKY QUICK: I try and think back of what the toughest moments might’ve been and how you got through some of those. And, I mean–

CHARLIE MUNGER: Well, we all know how to get through them. The great philosophers of realism are also the great philosophers of what I call soldiering through. If you soldier through, you can get through almost anything. And it’s your only option. You can’t bring back the dead, you can’t cure the dying child. You can’t do all kinds of things. You have to soldier through it. You just somehow you soldier through. If you have to walk through the streets, crying for a few hours a day as part of the soldiering, go ahead and cry away. But you have to – you can’t quit. You can cry all right, but you can’t quit.

BECKY QUICK: You’ve had time in your life when you’ve done that?

CHARLIE MUNGER: Sure. I cried all the time when my first child died. But I knew I couldn’t change the fate. In those days, the fatality with childhood leukemia was 100%.

One of the things you’ll notice is that none of these quotes offer easy advice. It’s all annoyingly difficult stuff like keep plowing ahead, take smart risks, maintain reasonable expectations.

For some reason, I am always reminded of an old beer commercial (wish I could find the clip) where a man talks about raising his kids and finally sending them off to college. He basically says it was a long and hard journey and the other guy in the bar says something like “Well, you should be proud.” And the first guy realizes “Yeah, I should.” Nobody else knows all of your struggles. You don’t have to become a billionaire to be proud of your accomplishments.

Berkshire Hathaway (BRK) released its 2022 Letter to Shareholders, which is how Warren Buffett updates his fellow shareholders annually on the status of the business. Direct ownership of Berkshire Hathaway shares was one of my first “self-directed” investments (above index fund holdings) for both educational and profit purposes. The reason that people like me always mention Warren Buffett is not because he is smart, but because he is an excellent teacher that cuts through the fog of complex subjects. He writes this letter with his sister in mind. This year’s letter is only 9 pages long, so I recommend reading it for yourself.

This year, the letter covered a lot of familiar ground. That’s the thing about investing and personal finance though, most of it is just sticking with a few simple yet critical ideas for years and years. Build the habit to act honorably and rationally every day, and keep avoiding risks where you can lose everything. Here are my personal highlights.

Berkshire shareholders are different.

We believe Berkshire’s individual holders largely to be of the once-a-saver, always-a-saver variety. Though these people live well, they eventually dispense most of their funds to philanthropic organizations. These, in turn, redistribute the funds by expenditures intended to improve the lives of a great many people who are unrelated to the original benefactor. Sometimes, the results have been spectacular.

Berkshire owns both businesses in their entirety and pieces through publicly-traded stock shares. They take the long-term view with both:

Our goal in both forms of ownership is to make meaningful investments in businesses with both long-lasting favorable economic characteristics and trustworthy managers. Please note particularly that we own publicly-traded stocks based on our expectations about their long-term business performance, not because we view them as vehicles for adroit purchases and sales. That point is crucial: Charlie and I are not stock-pickers; we are business-pickers.

As investors, don’t cut the flowers and water the weeds. Hold onto those flowers. This applies to index fund investing as well. If you buy the entire haystack, you are guaranteed to own the needles (flowers).

The lesson for investors: The weeds wither away in significance as the flowers bloom. Over time, it takes just a few winners to work wonders. And, yes, it helps to start early and live into your 90s as well.

The pillars: continuous saving, the power of compounding, avoiding catastrophic failures, and the American Tailwind.

Thus began our journey to 2023, a bumpy road involving a combination of continuous savings by our owners (that is, by their retaining earnings), the power of compounding, our avoidance of major mistakes and – most important of all – the American Tailwind. America would have done fine without Berkshire. The reverse is not true.

More on the importance of risk management and having skin in the game. What do you do? “I own a boatload of cash and a wide array of businesses.” Sounds perfect. 😁

As for the future, Berkshire will always hold a boatload of cash and U.S. Treasury bills along with a wide array of businesses. We will also avoid behavior that could result in any uncomfortable cash needs at inconvenient times, including financial panics and unprecedented insurance losses. Our CEO will always be the Chief Risk Officer – a task it is irresponsible to delegate. Additionally, our future CEOs will have a significant part of their net worth in Berkshire shares, bought with their own money.

Don’t count on Berkshire being broken apart or starting to distribute dividends anytime soon:

And yes, our shareholders will continue to save and prosper by retaining earnings.

At Berkshire, there will be no finish line.

The letter ends with a bunch of wise quotes from Charlie Munger. Here’s just one.

There is no such thing as a 100% sure thing when investing. Thus, the use of leverage is dangerous. A string of wonderful numbers times zero will always equal zero. Don’t count on getting rich twice.

Past shareholder letter notes.

• 1977-2022 are free on the Berkshire Hathaway website (PDF). 1965-2021 are $2.99 at Amazon (Kindle). Three bucks seems pretty reasonable for a permanent digital copy with the ability to search text and maintain highlights.
• 2022 Letter notes
• 2020 Letter notes
• 2019 Letter discussed why BRK will continue to do fine without Warren Buffett around.
• 2018 Letter discussed using debt very sparingly and the importance of holding productive assets over a long time.
• 2017 Letter discussed patience, risk, and why they have so much cash.
• 2016 Letter touched on the rarity of skilled-stock pickers and some insight on his own stock-picking practices.
• 2015 Letter discussed his optimism in America and his “Big 4” stock holdings.
• 2014 Letter discussed the power of owning shares of productive businesses (and not just bonds).
• 2013 Letter included Buffett’s Simple Investment Advice to Wife After His Death.

The 2024 annual shareholder meeting will be in Omaha on Saturday, May 4th. CNBC will most likely livestream it again.

Charlie Munger is now 99 years old and still answering blind questions on the fly at the 2023 Daily Journal Annual Shareholder Meeting. CNBC has posted the full 2+ hour interview with Becky Quick on YouTube. You’ll miss out on his snarky tone, but you may prefer to read the transcript, kindly provided at Steady Compounding (looks to be computer-generated… psst – the name is Rick Guerin!).

Munger remains refreshing in that he doesn’t filter everything into bland nothingness. He’s not afraid to offend with his opinions. I’ve included a few of my personal highlights below.

Only 5% of money managers have the skill required to consistently beat the index averages after costs.

And if you want an example of how denial is affecting things, take the world of investment management. How many managers are going to beat the indexes? All costs considered, I would say maybe 5% could consistently meet the averages.

Everybody else is living in the state of extreme denial. They’re used to charging big fees and so forth for stuff that isn’t doing their clients any good. It’s a deep moral depravity. If some widow comes to you with $500,000 and you charge her 1 point a year for, and you could put her in the indexes, but you need the 1 point. And so people just charge somewhat a considerable fee for worthless advice. And the whole profession is full of that kind of denial. It’s everywhere.

Crypto is (still) crap.

…when you’re dealing with something as awful as crypto sh*t, it’s just unspeakable. It’s an absolute horror. And I’m ashamed of my country that so many people believe in this kind of crap and the government allows it to exist is totally, absolutely crazy, stupid gambling with enormous house odds for the people on the other side.

And they cheat — in addition to cheating and like betting, it’s just crazy. So that is something. There’s only one correct answer for intelligent people there, just totally avoid it and avoid all the people that are promoting it.

Charles Munger is a billionaire, but rarely ever gambles in a casino or at a sports book. In terms of percent of net worth, Munger has bet the equivalent of the average person betting less than 5 bucks in their entire life.

Q: How do you feel about the gambling that took place at the Super Bowl and surrounding that and the legalized gambling taking place in this country at this point?

A: Well, it’s not as bad as crypto s***. I don’t think there’s much harm in betting a modest amount you can afford on a Super Bowl game. That strikes me as a pretty — thing if you do it with a friend and not with a bookie. So I don’t have the same feeling — I obviously don’t think you should have a gambling impulse around betting against odds. If you take all the money that I have bet against odds in my whole life, I don’t think it’s more than a few thousand dollars.

I’m all in favor betting with the odds.

Big picture thoughts on the future long-term performance of Berkshire and stocks in general:

Everybody that bought Berkshire and held it for 20 years has done well. I think that will be true for those who buy at the current price. I don’t think it will be as good in the future as it was in the past, but it will be okay considering how poorly everything else is going to do. Because the valuations start higher now and because government is so hostile to business.

I would say it will fluctuate naturally between administrations and so on. But I think basically, the culture of the world will become more and more anti-business in the big democracies. And I think taxes will go up, not down. So I think the investment world is going to get harder for everybody. And — but it’s been almost too easy in the past for the investment class. It’s natural that it would have a period of getting harder. I don’t worry about it much because I’m going to be dead.

The Daily Journal’s employee 401(k) plan has only one investment option: index funds.

…look at the Daily Journal Corporation. We just put in a 401(k) plan. What are the investment options for the people at work? Zero. It’s all index funds.

What percentage of American 401(k)s have our plan, index funds required? About zero. Am I right or am I wrong? Of course, I’m right. It’s a logical thing to do.

If you can afford to self-insure, you should do so. Insurance protects you against catastrophe, but there many extra costs built into the premiums (fraud, commissions, etc). Medical insurance is an exception because the insurance-negotiated cost is often much lower than the direct-consumer-pay cost.

In my own life, I’m a big self-insured and so is Warren. It’s ridiculous for me to carry fire insurance on my house because I could easily rebuild a house if burned down. So why would I want to bother fooling around with the claims process and all kinds of things.

So if insurance — you should insure against things you can’t afford to pay for yourself. But if you can afford to take the bumps, so unusual expense coming along doesn’t really hurt you that much. Why would you want to fool around with some insurance company. If your house burned down, I would just write a check and rebuild it. And all intelligent people do that way. I don’t say all, but — maybe I should say, all intelligent people should do it my way.

There should be way more self-insurance in life. There’s a lot of waste. You’re paying when you buy insurance for the other fellows frauds, and there’s a lot of fraud in life. And you can afford to take the risk yourself and not fool around with claims and this and that and commissions and time. Of course, you self insure, it’s simpler and so forth.

Think of what I’ve saved in my life. I narrowed it. I don’t care. I never carried — never. I think once — but with one exception, I never carried collision insurance on a car. And once I got rich, I stopped carrying fire insurance on houses. I just self insure.

Past years:

• 2022 Daily Journal Shareholder meeting notes
• 2021 Daily Journal Shareholder meeting notes
• 2020 Daily Journal Shareholder meeting notes
• 2019 Daily Journal Shareholder meeting notes