버크셔 해배웨이 2025 연차총회 핵심 해설과 버핏 Q&A 비법

(00:00) Buffett mentioned how important it is to develop a reputation for having just a solid currency over time.

 And I think this means having a currency that has just a very low likelihood of being overly depreciated over time.

 And this is among many reasons that Warren has, I think, just tended to stick to the US where the currency has historically been one of the strongest in the entire world.

(00:21) But, you know, for other investors out there looking at emerging markets, I think you just have to factor this into your investments.

 If you were to get say a 10x on an investment in a foreign currency, but the currency devalues just at a very very high rate, there's a chance that you're investment just isn't producing any value or it can even go down.

(00:45) Before we dive into the video, if you've been enjoying the show, be sure to click the subscribe button below so you never miss an episode.

 It's a free and easy way to support us, and we'd really appreciate it.

 Thank you so much.

 Welcome to the Investors Podcast.

 I'm your host, Clayfink.

 And today, Kyle and I, we just got back from the Berkshire Hathaway annual shareholders meeting in Omaha.

 (01:06) And we'll be sharing our reflections from the meeting, as well as a few of our favorite segments from the Q&A session with Warren Buffett, Greg Ael, and Ajit Jane.

 And amazingly, I heard at the start of this meeting that this was Warren Buffett's 60th annual shareholder meeting.

 So that sat alone is just like mind-blowing and it's uh no surprise how popular the event was this year.

 (01:30) And this was actually by far one of my favorite weekends of the year.

 You know, I get to be surrounded by kindered spirits and like-minded people and um in the podcasting world just so much of our our life is uh sort of spent in isolation reading and whatnot.

 And I'm sure many in the audience can resonate with that.

(01:46) So this was my sixth meeting that I've attended and I'd say it was probably my favorite one yet.

 you know, is quite memorable and even a bit emotional.

 So, the whole arena was packed until the end of the Q&A.

 I believe was at 1:00 and I think in most years you'd see a number of empty seats just a couple of hours in by 9 10:00 a.

m.

(02:08) But for whatever reason, this definitely was not the case.

 So, the best place to start here is actually at the end.

 So at the end of the session, Buffett announced that, you know, he was hitting the 5-minute mark and everyone in the audience didn't realize that they were about to witness history and the end of a legacy.

(02:26) So there was an arena full of attendees and Buffett would announce that he would be stepping down as the CEO of Bergkshire Hathaway at the end of the year and Greg Ael would become the new CEO of the company.

 So Buffett of course is going to remain the chairman of the company and continue to oversee what's happening at the company.

(02:44) So after sharing that he had no intention of selling any of his personal shares in Bergkshire, he received just a roaring standing ovation in an arena full of followers of Bergkshire.

 It was just a really cool experience and really unique moment in the history of Berkshire in Buffett's 60th meeting.

 And uh to the best of my knowledge, Buffett has never sold a share of Bergkshire and never will, which is just just mind-blowing.

(03:09) Like the long-term thinking that this guy has and you know, living off money that he made like a lot of times just off his personal account or what he's doing outside Bergkshire, which likely isn't that much really.

 He then had a quote that I'll share here.

 The decision to keep every share is an economic decision because I think the prospects of Bergkshire will be better under Greg's management than mine.

 (03:30) And we'll be getting to this later on just how Buffett time and time again he just continually praises others.

 And um I think uh that is a trait that I just see in so many people here in the value investing community.

 And you know I was happy to see Buffett make this announcement at the age of 94 to help ensure that you know there's going to be a smooth transition to Greg as the new CEO.

(03:53) And in hindsight it's just amazing that he waited this long to make that transition.

 Yeah, you're totally right about this being just a historic annual general meeting, Clay.

 So, you know, I was just ecstatic to be here for this one.

 It was obviously Warren Buffett, someone I hold in very, very high esteem.

 And only I've only been to two events, but uh this one was definitely my favorite for the obvious reason that um it was so monumental, but also, you know, I also just thought the meeting just went really, really well the way it went.

(04:18) I mean, last year, just like you pointed out, and probably as you might know, other years, it just seemed like the audience just kind of fizzled out, and this time it was very vibrant.

 I was really surprised at the very end.

 I just looked around and I was like, "Oh my god, there's so many people here.

" It felt like, you know, I don't know how many people left last year, like hours beforehand.

 (04:37) So, yeah, it was it was a really cool and special moment.

 But, you know, I think even before Buffett officially passed the baton to Greg, it was clear that he was still just doing other things behind the scenes.

 And I think that he was really trying to just give Greg more airtime.

 And obviously I think he knew beforehand that was the reason he wanted to do that.

 (04:53) But it's really clear to see after the fact.

 And I just think that, you know, that just struck me as a really classy move and just a subtle signal that Buffett is just really confident in Greg as a future leader of Berkshire.

 So there are three other themes that I found pretty fascinating.

(05:09) So the first was just some of the comments around Japan and the strength of those partnerships that I found really really interesting for some reasons that we'll go into later.

 And then second, you know, I thought the conversation around the importance of a strong currency was just really really relevant today.

 I think most of the time, you know, probably doesn't matter that much, but just what's going on in the world today, I thought it was something that he kind of spoke about quite a lot compared to other years.

(05:31) And then lastly, you know, I just love Warren's broader reflections on how to live a meaningful life and position yourself for long-term success.

 We're going to dig in a lot more into that throughout this episode.

 Now, before I hand it back to you, Clay, I just wanted to say I wasn't really surprised to be honest that he did this.

(05:48) I mean, I was surprised, but I actually got a chance to speak to a friend on Thursday and we were talking about Bergkshire and just the cash position and what they were trying to do with it.

 And the conversation actually got steered towards, okay, well, maybe they're having this big cash position specifically to give Greg a war chest to manage once he takes over.

(06:06) And maybe that's this weekend.

 Who knows? So, we actually brought that up before the fact.

 So, you know, I I I I just feel like um Warren probably exited at the right time.

 I think um doing it on your own accord rather than having to be forced to do it at a later time is just the way to go.

 And you know so using a sports analogy I think he really you know I felt he stepped down kind of like right after winning the championship what pick a sport doesn't really matter which one cuz I think every sport has this problem.

 So, you know, you you have(06:37) these other players, unfortunately, they might win a championship and then their career continues to extend and you just see these players, they get tossed around to different teams.

 Their game obviously is just nowhere where it used to be.

 And then unfortunately, they're just forced to retire because no one really wants them because they're just their talents just aren't there anymore.

 (06:56) And I think Warren just left at the top of his game and I think he just did it with a lot of grace.

 Yeah.

 Yeah.

 Well, I would add that uh you know, retiring at 94 isn't cutting himself short by any means like uh some athletes would do.

 So, he's just performed exceptionally well in managing Bergkshire since 1965, just the entire way when you give him a long enough time horizon and runway.

(07:16) And he also made a funny comment at the meeting that he isn't doing anything to try and make Greg look good, whether it be trimming down the Apple position or or whatever else.

 He's doing what he believes is in the best interest of the partners at Bergkshire.

 And during the meeting, I did feel that the baton was gradually being handed to Abel as he answered many of the questions not just on the energy business, but also on business strategy, philosophy, the future of Bergkshire.

(07:44) And it was back in 2018 that Abel was promoted to the vice chairman of the board and named to oversee all non- insurance operations.

 I'm not sure what year it sort of became clear that he would be the successor whenever they decided to to make that transition.

 And Abel, he joined Berkshire in 2000 when Berkshire acquired Mid-American Energy.

(08:06) And you know, he's just played a critical critical role in Bergkshire's success ever since.

 And uh while the fundamentals of Berkshire's strategy largely remains unchanged, one area where Abel could potentially shake some things up is just his involvement in the operations of the subsidiary.

 So I think uh during the meeting they discussed how you know Buffett might know some of these businesses really well and Abel might not as much just cuz you know he's been here just over two decades.

 (08:33) So, you know, he'd get in touch with management, learn more about their businesses, and maybe take more of an engaged role than what Buffett would do.

 So, um, you know, Buffett has this hands-off approach, and it does seem that Abel does like to be more engaged and potentially look for ways where maybe certain subsidiaries could collaborate or just share ideas or uh, yeah, just kind of take that more active, engaged role.

(08:58) And Buffett kind of joked that uh Abel just works harder than Buffett, but he Abel did also emphasize just his commitment to continue to ensure that managers do have full autonomy and making decisions that are best for the organization.

 So it's definitely still in line with Bergkshire's culture, right? And Greg, I think, is just an interesting guy because while he's clearly a very talented manager, I mean, let's be honest, I just don't think he's going to ever live up to the standards that Warren Buffett provided for Berkshire(09:25) Hathaway shareholders for all these years.

 But even then, I still think Warren made the right choice.

 You know, it's really clear that to me at least that Warren and Greg are probably two different people just in terms of their, you know, the general temperament.

 So, for instance, Warren's got that unique charm.

(09:41) You know, he likes to poke fun of himself.

 likes to tell interesting stories and then somehow he just always tends to loop it back to the main point in some incredibly insightful way.

 And then, you know, when you looked at some of Greg's answers to some of the questions, you know, it was a huge contrast.

 He's just a lot more straightforward and to the point.

(09:56) It's not necessarily that his answers are bad or anything.

 That's just in his nature.

 So, you know, maybe you could say he's a little bit more corporate in the way he delivers things compared to Warren.

 But I wanted to double down on your point there, Clay, about Buffett's points that he thought Greg would do an even better job than Warren would at managing Bergkshire.

(10:13) So I think, you know, just given the scale that Bergkshire is at today, Greg just doesn't have as steep of a hill to climb, I think as Buffett did in those early days.

 Buffett had to, you know, run the investment portfolio and he had to run the subsidiaries for just multiple decades.

 And I think he just did it better than literally anybody else on planet Earth could have done.

(10:32) So, you know, to ask someone to try to replicate that version of Buffett is just it's impossible.

 But I think now that Bergkshire is a larger business, it's not going to be growing anywhere near historical growth rates.

 I mean, it's already been declining now for quite a while.

 I just think there's a little bit less pressure.

 (10:47) I think Greg is just really well set up to hopefully put some of those management skills that obviously Warren talked at length about to good use and I think that you already outlined.

 So, you know, I think if just thinking going back in time, creating an alternate universe, maybe if we went back 30 years ago and Bergkshire needed a CEO that could balance things with capital allocation, things with private and public businesses, then maybe this would be seen as like a huge negative.

 (11:11) But I feel like now given that Bergkshire is the size that it is, I think this is probably going to be, you know, it's probably going to be smooth sailing just in a in a slightly different way.

 So now you got Greg and he's going to be there and he's going to be focusing on management more on the private side of Bergkshire and I think he'll be, you know, leaving the public side more and more to Todd and Ted.

(11:31) Yeah.

 I mean, when you look at the early days of Bergkshire, it's it's uh requires someone like Buffett to be, you know, scrappy and creative to transform, you know, this terrible business into this gigantic conglomerate.

 I'm reminded of just the Apple transition from Steve Jobs to Tim Cook.

 you know, they obviously benefited from having someone that's more buttoned up, a little bit more corporate, and just, you know, knows the best practices of running an organization, whereas Buffett might be someone that's much better just starting(12:00) from scratch and building something from the ground up, which two different skill sets that are both incredibly incredibly valuable.

 And one thing about Omaha, or one word I should say that I think of when it comes to just Omaha and getting together at these certain types of events is serendipity.

 (12:18) when I just look back at my journey in value investing and it's just a long random journey of one moment of serendipity after another.

 So it started for me at age 18 when I ordered the snowball by Alice Schroeder.

 It covers the entire life of Buffett.

 Then in college in 2016 I happened to go on the search for the best investing podcast which brought me to be a listener of tip.

(12:42) Then in 2021, I received an email from my good friend Robert Leonard announcing that TIP was hiring a host and here we are today.

 So I got into investing in general because uh I was just interested in learning how to make my money work harder for me and like many others I came to stay in the space for the relationships that are built and the serendipitous ways in which you know the value investing community can help me live a better life.

(13:08) And while I do enjoy going to the meeting, really my favorite part of going to Omaha is meeting with old and new friends that I typically only get to see once or twice a year.

 And uh I spent much of my weekend with our tip mastermind community.

 We had around 40 of our members in Omaha.

 We hosted a bus tour and a couple of dinners and socials.

(13:27) And it was just a wonderful experience for me especially.

 There were also a number of other things happening.

 I attended a Monish Pabrise talk on Friday morning which I think the video should be made public soon.

 I also attended the Markel brunch on Sunday which is just a wonderful networking event to see people I just don't get to see throughout much of the year.

(13:46) And there's just so many other events I have named here on Friday.

 Guys Value X and especially Friday there's a lot of stuff going on every single year in our community.

 Yeah, I'm also reminded I do as a host of the show I do connect with investors quite often.

 For the community, for example, we do Zoom calls every week, but just nothing beats that in-person connection that you build with people.

 (14:11) You just can't get that same experience through a call or a Zoom meeting or whatnot.

 And I noticed that I'm just able to build much deeper connections with people when I do meet them in person.

 So, for whatever reason, this the conversation just seems to be more organic and natural.

 The connection feels more real, and it just tends to lead down a path that otherwise wouldn't go down.

(14:35) And it's just one of those feelings that you know it when you experience it.

 And um I feel like every year I get more of those moments when I go to Omaha.

 Yeah.

 I mean, I think my journey definitely shares that serendipitous feel, but I was thinking more about just Buffett's life and how much serendipity I think he had in his life.

 (14:51) You know, I think born inside of him is this person who's deeply curious and maybe that's not a a thing of serendipity, but I think what happened a lot in his early days after that is so, you know, you think about he wanted to learn at this young age.

 He started buying stocks.

 I think his first one he bought at was 11 years old.

(15:07) I mean, and then he even had capital from his sister obviously was a very small amount that they split on.

 And then from there, you know, he had a father who was somewhat involved as a I think he was a broker for a couple of years.

 So, he had kind of that angle as well.

 And then, you know, he got Benjamin Graham as a teacher.

 I mean, how lucky would you have to be to get to that point? And then, you know, he even wanted to get a job with Benjamin Graham, but he said no just because of other extenduating circumstances.

(15:29) And then eventually he got in there with him for just a few years, learned a ton.

 And then, you know, after Benjamin Graham shut down his fund and Buffett left, he was just going to retire basically.

 He was already probably, I think, pretty close to being independently wealthy.

 Obviously, nowhere close to where he was now.

 (15:46) And then just through talking about what he wanted to do with his own money, he found a group of other people that were very close to him that wanted him to manage their money and he said, "Okay.

" So, you know, it's just all sorts of little things that happened that especially in those early days that I think got him to to where he is today.

 And I think it's just an interesting to think about cuz you know, I think the same way as you, you know, I had all sorts of events that happened.

(16:05) I mean, even joining tip, that was just basically from Clay.

 I think I had a couple names that Clay also admired and um he just reached out to me and we also obviously would speak a lot about things like Constellation Software which you know we both like and then Clay just invited me to go to the mastermind community that we both uh I help him manage now and that was back in May 2023 and then Stig listened to it and I got offered a job and here I am.

(16:30) So it's just really cool to think about all the things that just happen in your life and where it can take you.

 But I think, you know, one of the biggest surprises of being part of tip has just been what Clay was just talking about, which was these communities.

 Coming into TIP, I had no idea just how much value and enjoyment I would get from being part of the TIP mastermind community along with with Clay and Stig.

 (16:53) It really has been my favorite part of the job.

 And I saw many of our members in Omaha and just had such a great time on the bus tour and dinner.

 I got a whole bunch of new ideas to spend some time on.

 I wrote some notes on.

 Um, I got people I can talk to about them if I want to dig deeper.

 I shared some great Uber trips and laughs with our members and I got to know many of the members just more deeply.

(17:13) I mean, Clay just mentioned there how we do these calls and yeah, we do we do a call a week.

 It's actually even more than a call a week at this point.

 And we have the opportunity to interact with people online and on Zoom, but like it's it's just different.

 I don't I don't know how to how to put it.

 You just have to kind of live to see it.

(17:29) I mean, there's people in our community who I've spoken to, probably even one-on-one on Zoom calls, and I just feel like, you know, the first 5 minutes that we spent on the bus or walking through Nebraska Furniture Mart, we just deepen that connection so much more than even spending, you know, more hours together on a Zoom call.

(17:47) It's just such a wonderful experience to just deepen these relationships because I really like all of our members and, you know, obviously you resonate more so with others, but all of them are just provide so much value.

 I mean, there's one member, a newer member, and um he owns 10, I'll call them quick service restaurant franchises.

(18:07) You can guess what that might be.

 And uh I'd been asking him just a load of questions about the industry cuz I'm just trying to learn about another another business up in Canada.

 And uh he basically would typed out a whole bunch for me.

 And then he realized we were going to both be at this event.

 (18:22) and he basically talked for me about for like half an hour about how QSR restaurants work, the economics and it was just incredible and it was so nice to learn that and and uh just I met him, I met his wife.

 So it was just such a wonderful experience and I'm really excited to you know keep doing these things.

(18:39) So on top of that I also manage the richer wiser happier masterclass which is a group of about 20 people who are very avid people who want to learn from William Green and each other regarding some of the central principles from Williams book which is Richard Wiser happier of course.

 So you know we did a couple events we watched the Berkshire Hathaway annual meeting together.

 I got there at uh 4:00 a.

m.

 (18:58) to save us some seats.

 We had a couple fantastic meals.

 We had an incredibly insightful Jeffersonian style dinner on the Saturday evening with some excellent guests that William has interviewed on the podcast and it was just mind-blowing.

 It's Clay and I were speaking before this episode that both of our minds are just kind of in overload cuz it's not just the going to the AGM and then just doing nothing.

(19:20) I mean, we're literally doing things every second every day.

 Like, but it's awesome.

 I loved it.

 That's just that's kind of what you come to expect.

 And so, just a a couple other events that I found interesting.

 And I along with Clay as well went to that Monish event.

 I got to go to Value X which was really cool.

 (19:35) Lots of incredible guests, lots of really interesting people in attendance.

 So, you know, if you can get to those events, I highly recommend going to them into the future.

 So, yeah.

 Um, it was just it's a fantastic weekend all around and I think I walked away just learning a ton and feeling even more connected to some of the incredible people that are part of the TIP network.

(19:54) Yeah, so much to take in there.

 To your point on serendipity, I'm also reminded of Geico.

 Buffett went back to whatever year it was the was it 50s or 60s.

 He knocked on the door at Geico and the janitor opened it and let him in and talk to one of the executives in his just some kid in his early 20s.

 He assumed that, you know, why not chat with them for a little bit? He won't be back.

(20:18) And then they sit down and chat for hours.

 He's he's just surprised by how much Buffett was curious to learn about insurance and and what he already knew at that age.

 and you know he found Geico through Ben Graham and then now today we're talking about Geico for many of the questions at every single meeting.

 And just for the record for those curious, everyone's asking what's going to happen, you know, to the Bergkshire meeting in the future.

(20:38) As far as we know, TIP will be in Omaha in 2026.

 I know I will.

 I'm based in Nebraska.

 I'm sure Kyle will as well.

 We don't know whether Buffett's going to be on stage or not.

 That's yet to be determined.

 But we don't have any reason to believe that, you know, next year's meeting won't be just as exciting as many of meetings in the past.

(20:56) And there's very likely going to be a ton of events around the weekend and many wonderful people making the trip.

 So, it's still well worth going in my opinion.

 Before we get to the Q&A segment here, at the end of the first session and the meeting that went um a couple hours long, they chatted briefly just about the financial results for the most recent quarter.

(21:17) At the end of the quarter, Bergkshire reported a $328 billion cash position that's up 10 billion over the quarter.

 Bergkshire didn't buy any shares back in 2025, which is no surprise given how much shares are up over the past 12 to 18 months.

 And since 2019, on average, they've bought around 2.

4% of shares outstanding per year.

(21:38) So, they showed the share count since 2019.

 And Buffett highlighted that at the end of 2022, there was an excise tax that was implemented on share buybacks.

 It's a 1% tax.

 So there's this additional frictional cost whenever any companies making share repurchases.

 So this not only impacts Berkshire, but it also impacts, you know, the businesses they own as well.

(21:59) So he pointed out how Apple's doing a hundred billion in share repurchases a year, meaning that they're paying an additional $1 billion in taxes on those repurchases.

 And um leave it to Buffett to just mention some of these small tiny little costs.

 They'll I guess 1% if we can call that tiny in the scheme of billions.

 Leave it to Buffett to uh be sure to mention that.

(22:20) And finally, I wanted to highlight just a few of my favorite quotes from Buffett during the meeting.

 He's just like one of the most quotable people on the planet.

 A couple of these quotes are tied into the clips, but you know, these are so good, they're probably worth mentioning at least twice here.

 So, I have four quotes here I'm going to share.

(22:36) Then I'll let Kyle share some reflections and then uh we'll move on to get to the first clip here.

 So the first quote I have is uh the world is not going to adapt to you.

 You're going to have to adapt to the world on concentration.

 He stated Charlie thought we did too many things and that we were never concentrated enough.

 (22:52) Of course Buffett mentioned Charlie several times during the meeting which is you know again sort of one of those emotional moments for us uh Bergkshire followers.

 on temperament.

 He stated, "People have emotions, but you have to check them at the door when you invest.

" And for Buffett to just sort of pull these quotes in terms of, you know, he has no idea what questions are going to be asked.

(23:16) It's quite remarkable to me just to at the age of 94 to be have a mind that sharp is just quite remarkable to me.

 And finally, he stated uh you get a few breaks in life in terms of people you meet who just change your life dramatically.

 If you have a handful of those, you treasure them.

 Yeah, great quotes.

 You picked some good ones there.

 So, I really resonated a lot with a few of these.

 (23:39) So, I wanted to just share some of my points here.

 So, I really like the comment on Charlie.

 I thought it was great because I think it just reminds us all that there's just an opportunity cost to pretty much everything that we do.

 When I think of opportunity cost, my mind tends to think about it purely from a financial standpoint.

 (23:54) For investing, for instance, if I buy stock XYZ, it means I'm not buying stock ABC.

 So when XYZ does nothing while ABC catapults upwards, it really stings.

 But I think, you know, Buffett was probably speaking a little more broadly here.

 Given Bergkshire's size, their investable universe is actually quite limited.

 Even though Bergkshire could technically buy nearly any business out there, it's hamstrung by its size.

(24:18) If a good deal is available, but there's just no chance of it actually moving the needle for Berkshire, which is most investments, they just don't bother with it.

 And then the other quote you listed there about treasuring the few people who have changed your life that just really hit home for me.

 Warren, you know, has spent so much time thinking about all the people in his life and how they've affected him in a positive light.

(24:37) So I just think his words here are really just full of wisdom.

 So to me, the biggest takeaway is that when you meet someone who just elevates you, whether that's personally, professionally, whatever it may be, you got to just double down on those types of relationships because those are the ones that I think are probably going to bring you the most amount of joy, the most amount of meaning, and you know, maybe even some success over the long run.

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 Yeah, I mean uh of course the person that Buffett treasured probably more than anyone as Charlie Munger.

(27:06) He those two met in 1959 and you know they were essentially best friends for uh many many years ever since then.

 It's a good example of treasuring those that are that are closest to you.

 So let's transition here to play a few clips from the Q&A session with Warren Buffett, Greg Ael, and A Jane.

 There were a number of pretty good or pretty decent questions covered every year.

(27:27) Each year you you sort of get some some yo-yo questions like we had one on Portillos which was bought by a a firm named Bergkshire but not Bergkshire Hathway.

 So there's a bit of a mixup but we won't have a chance to get to all of our favorites here.

 But if you're interested in checking out the the full Q&A you can find it on CNBC's YouTube channel.

(27:45) Buffett had a response here that I thought would be a good one to include at the top given that, you know, we touched on the topic of surrounding yourself with people that help lift you up, you know, and that's really what a lot of this community is for me.

 It's that sense of community and that sense of camaraderie and going to Omaha and seeing all these these people I get to see once or twice a year.

 (28:08) And I think the greatest things in life come from compounding.

 And the people you surround yourself with either help reinforce those positive things in your life or they're doing the opposite.

 So here we'll go ahead and play the first clip.

 Hi, my name is Marie.

 I'm from Melrose, Massachusetts.

 Thank you for the time today.

(28:32) As a young person interested in investing like myself, I would love to hear your insights, Mr.

 Buffett.

 What were some pivotal lessons you learned early in your career and what advice do you have young for young investors who are looking to develop their investment philosophy? Thank you.

 Well, those are good questions.

 I wish I thought of them myself earlier in my life.

(28:57) uh the you know who you associate with is just enormously important and don't expect that you'll make every decision right on that.

 I mean but you you are going to go into you're going to have your life progress in the general direction of the people that you that you work with that you admire that become your friends.

 (29:25) Uh I mentioned a few fellows that that have died in the last couple years.

 Well, all of those people were people that that that that uh you know, if we were working together on something 1 10,000th the size of Birchard.

 I mean, they'd be the kind of people you choose.

 You just they're they're people that make you want to be better than you are.

 (29:52) And you want to hang out with people that are better than you are and that you feel are better than you are because you're going to go in the direction of the people that you you associate with.

 And uh and that's that's something you learn and of course you learn it late in life and that uh you you uh it's hard to really appreciate how important some of those factors are until you get much older.

(30:22) But when you've got people around you like Tom Murphy and and like like well like just name him Sandy Goddisman that uh Walter Scott that uh you're just going to live a better life than than uh you do if you just go out and look at somebody that's making a lot of money and decide you're going to try and copy him or something of the sort.

(30:51) Uh uh so I would I would I would try to I tried to be associated with smart people too where I could learn a lot from them and I would try to look for something that I would do if I didn't need the money.

 I mean what you're really looking for life is something where you've got a job that you'd hold if you didn't need the money.

 (31:10) And I've had that.

 Charlie had it for a very very long time.

 In fact, all the fellows I named uh had it and uh and they also every one of those ones I named, they always did more than their share and they thought they never sought more than their share of the credit.

 They just behaved as the way you you'd like anybody you you work with.

 (31:36) And when you find them, you treasure them and and when you don't find them, you still keep doing whatever causes you to eat.

 uh or enables you to eat.

 But uh but you don't you don't give up on on looking around and you will find you'll find people do wonderful things for you.

 I mentioned I mentioned uh uh earlier the you know going down to Geico and knocking on the door when the door was locked.

(32:06) I mean who knows what was behind that door.

 went in.

 But but no, in 10 minutes I found that I had a man that uh was going to be just wonderfully helpful to me.

 And of course, if somebody's going to be helpful to you, you want to try to figure out ways to be helpful to them.

 So, you get a compounding of of good intentions and good behavior.

(32:31) And unfortunately, you can get the reverse of that in life, too.

 And uh and you know with a lot of I I was lucky in having a a good environment for uh living that kind of a life and other people you know have a whole different environmental situation have to overcome it but don't be don't feel guilty about your good luck if you've got if if you know if you've got uh well if you live in the United States you you know you you you've you've uh there are 8 billion people in the world and there's 330 million United States, you've already won the game uh(33:15) to a great degree and then just keep making the most of it.

 But you you don't want to you don't want to associate with people or enterprises that ask you to do something that or tell you to do something that you shouldn't be doing.

 And uh that's one of the problems.

 I mean the different professions select for different types of people and uh uh there's it's interesting to me that in the investment business uh uh so many people get out of it after they've made a pile of money that that uh uh it it you really want something that(34:11) you'll stick around for.

 you know whether you need the money.

 Greg doesn't need the money.

 A G doesn't need the money uh remotely and they but they enjoy what they do and they're so damn good at it.

 It's it it's uh you know it just well I've had the advantage of seeing how that works over time.

 the best manager I ever knew and there's a lot of contention for who that would be but actually was Tom Murphy senior that uh who lived the the almost 98 and uh I've never seen anybody that could get the potential out of other people (34:57) uh more than than uh Murf.

 I mean, if if if you wanted to if you wanted to become a better person, you went to work for for Tom Murphy.

 And uh uh there are all kinds of successful people that really don't have that sort of don't bring that to the party.

 And and I'm not saying that's the only way to succeed, but I think it's I think it's the most pleasant way to succeed for sure.

 (35:36) And uh uh and I think that you know the the Bergkshire experience is pretty dramatic.

 I mean to to operate with Sandy Goddisman from 1963 until he died a couple years ago.

 And um Walter Scott for 30 years and Clayton operated with him for 25 years or so, whatever it was.

 30.

 Yeah.

 And and uh you know, you really can't miss it.

 Uh and you know, you you'll learn all the time, but you'll you'll not only learn how to be successful at business, you'll learn how to be successful at life.

(36:23) And uh uh so that's that's that's uh my recommendation and u and uh and for some reason I apparently you live longer too because pretty amazing.

 I mean, these people I'm talking about, including myself, I mean I mean, you know, you can I like to attribute it to this and a few other things, but I I I think a happy person lives longer than somebody that that that's uh doing some things that they don't really admire that much in life.

(37:05) Okay, so this was just a great clip and I think the part of it that I find most inspiring was just how much Warren just really really emphasized surrounding yourself with the right people.

 You often hear the saying that you're the average of the five people that you surround yourself with.

 And I think Warren says he surrounded himself with just the best of the best.

(37:26) And you know when you hear all the names of people that he associates with whether you know Bill Gates, Charlie Mer, it's just people that are amazing people.

 And I think that is also part of the reason why Warren Buffett is so amazing.

 Yeah.

 And I'll jump in here and mention that uh you know I just noticed throughout the meeting that he would just continually praise others, right? I think that's just another reason why there's such a strong sense of community in this space.

(37:53) So people are just pretty quick to to lift up others up and praise others.

 And you know when you know even in this space when I reach out to someone and ask for help or ask for hey if someone will give a presentation to our group or come on our show or whatever it is very often I'm getting a very positive response and I think it's just super powerful and humbling to surround yourself with these types of people that are just givers and givers and they just help lift you up.

 Yeah.

(38:20) So another takeaway I think here is in relation to just finding a job that you love.

 I have to say that I think I personally am just incredibly fortunate to have a job that I truly love.

 So, a funny story regarding this is when I first started with tip.

 So, there were a couple times I'd have events in my calendar that needed my attention.

(38:38) And unfortunately, there were multiple times where I was just so focused and so in the zone that time just literally just disappeared to me.

 I just didn't pay attention to it cuz I was so engrossed in what I was doing.

 I was basically in the flow state.

 And I think I would be in this flow state and it would just be hard for me to get out of it unless I force myself with an alarm which I now do.

 (38:57) So anytime I have like an important event, I basically put an alarm on because if I get to, you know, reading or researching a company or, you know, writing or about one of the scripts or re researching one of our guests, sometimes the hours can go by and it literally feels like minutes.

 But, you know, in some of the other jobs I've had, that was never the state because I would usually be looking at the clock as much as possible, just hoping that it would be time to go home rather than continue working.

(39:23) So, I think if you can find a job that is just so enjoyable that you just become immersed in that work that you love and where the line between, you know, work and fun is just so blurry that it pretty much doesn't exist, you've found a job that you just genuinely love and that's what you should do for the rest of your life.

 (39:40) So, I think Warren embodies this just better than anybody.

 you know, over the last 40 years, he took a salary of $100,000 per year to run Berkshire Hathaway.

 Total that up and that's $4 million.

 Again, not adjusting for inflation here, but you know, just think about $4 million and look at pretty much any CEO in who manages this S&P 500 company and they probably make that in a year.

(40:01) So, just to put that into perspective, it's just it's pretty inspiring and it's pretty impressive that he just, you know, it was very clear that money just wasn't the only thing that he put an importance on.

 And I think, you know, if you have any investor or shareholders who own Bergkshire, if there was a a scenario where you just said, you know, would you have paid Warren Buffett 10 times, 20 times what he made over all those years to run the company? I don't think you're going to find one person who's going to say no.

 So, you know, I think just for(40:28) Warren, Birkshire wasn't just about the money.

 He got so much joy and intellectual stimulation and friendship just from going to work and connecting with people that could help him and raise him up like we've been talking to.

 So, you know, wealth was uh was just a byproduct of doing what he truly loved.

 Yeah.

(40:47) And I'm actually pretty lucky that I just happened to tune in to Buffett's advice early on in life because he was actually a key reason why I decided to join tip related to his advice of just doing work you enjoy, doing work that, you know, doesn't necessarily feel like work a lot of the time.

 And I was pretty sure that I would enjoy this line of work much more than my my previous job.

 (41:07) And it just it helps one tremendously in just so many ways, not just in terms of what you're doing, but the people you surround yourself with.

 And um there's so much more to money when it comes to a job.

 And it's kind of funny that the richest person in the world is telling you not to go to work for money.

(41:22) Siga just released an episode with Monish and they sort of touched on this topic as well.

 Monish mentioned that if he could make more money, but the quality of his life declined in any way, then he just wouldn't pursue that opportunity.

 So, for example, he mentioned the possibility of owning a second home.

 And it for him, it's just like a no-brainer that it would be detrimental to his happiness because it just brings on this whole new set of headaches.

(41:46) And it's just hard for me to disagree with them.

 Sometimes one home can feel like a lot to keep track of.

 But we'll go ahead here and uh jump to the next clip discussing the role of patience for investors.

 I really liked this question.

 He touches on this idea of patience being dynamic.

 Sometimes it can be super valuable and other times you need to act with a sense of urgency.

(42:08) Buffett and Greg Ael touch on this further here.

 So, we'll go ahead and play the second clip.

 Hi, Mr.

 Buffett.

 My name is Daniel and I'm from Tennifly, New Jersey.

 First of all, I just want to say how grateful I am for getting the opportunity to ask you a question.

 When it comes to your principles of investing, you often talk about how important it is to be patient.

(42:28) Has there ever been a situation in your investing career where breaking that principle and acting fast has benefited you? Thank you.

 Well, that's a good question and uh there are times when you have to act fast.

 In fact, uh we made a great deal of money because we're willing to act faster than anybody around.

(42:54) Uh Jessica Tombs is a I think she's the stepdaughter of of um or stepg granddaughter of Ben Rosner, a manager of ours.

 And in 1966, I got a call from a fellow named Bel Steiner in New York, and he said, "I I represent uh Mrs.

 Annenburgg.

" Uh, and there were there were actually nine Annenburgg sisters, I believe, before War Anenberg came along as the son.

(43:33) But he said, "We have a business we'd like to sell you.

" So, I called Charlie up and uh I got a few details and it sounded very interesting and uh uh Charlie and I went back to the office of Will Felsteiner in New York, which is a marvelous guy.

 Never met him since, but uh he was handling things for Mrs.

 Uh well, ace a a Simon B.

 (44:04) But she her name was Ann and her husband had been the partner of of Ben Rodner, but he had died and uh and Ben got kind of tense about working with her.

 Uh and so he u offered us this business at a bargain price.

 He offers us a business for $6 million.

 It had $2 million of cash.

 It had a $2 million piece of property in a 900 block of of u what's the key street in Philadelphia down there, Market Street.

(44:43) And uh and it was making 2 million a year pre-tax and the price was 6 million.

 and Charlie and I went back to this place and uh Ben Rosner was there and he really he just was upset about doing business with his his partner's widow.

 He was she was extremely wealthy and uh and he just didn't he wasn't enjoying it.

 He was very nervous about selling it.

(45:14) And he he said to me and Charlie, he said uh um he said, "I'll run this business for you until December 31st and then I'm out of here.

" And I got Charlie and we went out in the hallway.

 And I said, "If this guy quits at the end of the year, you can throw away every book on psychology I've ever read.

 (45:38) " I mean, and so that began a wonderful we bought the company and had a great relationship.

 And did I know that morning when I got a phone call uh from Will Felsteiner that was background about uh uh I' I've had a couple of times and that was one of them where people in the East felt that they had a a stereotype in their mind of what people from the Midwest were like and uh Ben had been married, his first marriage was to a woman from Iowa and he just figured that anybody from the Midwest was okay.

(46:27) And uh the trick when you do when you get in business with somebody or get in a room with somebody like that and they want to sell you something for $6 million that's got 2 million of cash and couple million of real estate and it's maybe two million a year.

 Uh you don't You don't want to be patient then.

 You want to be patient and waiting to get the occasional call.

(46:49) My phone will ring sometime, you know, with something that, you know, wakes me up.

 I may be sleeping in there or something, but it it you just never know when it'll happen.

 And that's what makes it what makes it fun.

 I mean it it uh uh so patience it it's a combination of of of patience and a willingness to do something that afternoon if it comes to you.

(47:23) You don't want to be you don't want to be patient about about acting on deals that make sense and you don't want to be very patient with people as they're talking to you about things that will never happen.

 So, uh, it's it's not a it's not a constant asset.

 It's not a constant liability.

 So, be patient.

 Greg, you well, Warren, I was going to add, uh, as you're being patient, I I happen to know, and I think that goes for our uh, Ajit also and all our managers.

(47:53) Uh, we're very patient when we're looking at opportunities.

 And as you touched on, we want to act quickly, but while we're being patient, um never underestimate the amount of reading and work that's being done to be prepared uh to act quickly because we we do know be it equities, but I would include a variety of of private companies that when the opportunity presents itself, we're ready to act.

 (48:19) And and that's a large part of uh being patient is is using it to be prepared.

 Yeah.

 And and of course it it doesn't come in anything like an even flow.

 I mean the most uneven sort of activity you could get into.

 And uh uh the main thing you have to do is you have to be willing to hang up after 5 seconds and you have to be willing to say yes after 5 seconds.

 Absolutely.

 (48:52) And and uh uh you can't you can't be filled with self-doubt in the business.

 You just forget it isn't going to work.

 That uh uh go into some other activity.

 uh uh but you also I mean one of the great pleasures it is the great pleasure actually in this business is having people trust you and that's that's really the why why work at 90 when you've got more money than anybody could count you know if they started today and had the machines they're helping them and everything else and it it that it means nothing in terms of of uh how you're going to live or how (49:39) your children are going to live or anything else.

 Uh, and uh, but it it it but both Charlie and I, we just enjoyed the fact that people trusted us and they trusted us 60 years ago or 70 years ago and and and partnerships we had and uh, we never sought out professional investors to join our partnerships.

(50:09) Among all my partners, I never had a single institution.

 I never I've never wanted an institution.

 I wanted people and I I didn't want people that were sitting around and having people present to them every three months and and tell them what they wanted to hear and all that sort of thing.

 So, and and that's what we got and that's why we've got this group here today.

(50:31) So, it it's all worked out.

 But that uh it it it's you don't want to be patient when things are going your way when when the time comes to act it uh you you want to get it done that day.

 Now Buffett is probably one of the best when it comes to acting opportunistically.

 And while I I wouldn't personally advise anyone to try and time the market by holding a lot of cash in their portfolio, Buffett actually believes that this is much of Bergkshire's competitive advantage and where a lot of their opportunity lies is in having this large pile of cash and(51:10) being ready to act big when the right opportunity presents itself.

 So, for example, if we go back to the great financial crisis, just after the collapse of Lehman Brothers, Berkshire put up $5 billion in a Goldman Sachs deal to receive 5 billion in preferred shares with a 10% annual dividend in addition to a bunch of warrants to buy more shares in Goldman that was exercisable over 5 years.

 (51:33) So this deal was hugely profitable for Berkshire and it came because Goldman was just desperate for a capital infusion and they just really needed that confidence from the market that they were going to be well financed and weather through the crisis because confidence and trust is so critical when it comes to banks.

(51:50) And a similar deal was made with Bank of America in 2011 during the European debt crisis.

 shares of Bank of America were tanking and Bergkshire was again able to deploy billions of dollars into preferred shares and warrants.

 And as a result, Bank of America today is one of Bergkshire's top three positions according to their most recent 13F filing.

(52:12) And in a world where so many firms are just highly leveraged or have what we can call an optimal amount of leverage, Berkshire prepares for these what we can call just outlier scenarios where a highly leveraged institution gets into trouble.

 They find themselves needing capital when it's most difficult to get capital and Bergkshire comes in and gets a heck of a deal.

(52:33) I'm reminded of another uh Buffett quote here.

 He said, "Cash is to a business as oxygen is to an individual.

 never thought about when it's present, the only thing in mind when it's absent.

 And on the contrary to being impatient at times, I also recall a quote from Monish.

 He shared in his talk uh back on Friday.

 He told this elaborate story of someone giving the advice fast is slow.

(52:57) And the way I interpret that is that when it comes to investing is that by going too fast can actually lead to inferior results.

 So if you're chasing a hot stock or you're rushing to make a decision, it can lead to potentially poor performance.

 Or even if you look at a business, say if you're scaling up a business for example, if you're scaling up too fast, you might have a team that's burnt out.

(53:21) You might have a fragile revenue base or uh just other downstream consequences that end up hurting you in the long run.

 So sometimes it's just the case that fast is slow.

 Yeah, I really like the fast is slow framework that Monich discussed in this talk.

 I think it basically honestly just works perfectly well with with the story that Buffett just gave.

(53:40) And I think the story is just great because it's just a very vivid description that illustrates that, you know, obviously Warren is known for being incredibly patient, but in this case where he had this deal that was just a home run, you got to act very, very fast.

 Otherwise, you know, you run the chance of that deal just going to the next person.

(53:59) So what he said here oddly kind of reminds me of a quote from Lenin which is there are decades where nothing happens and then there are weeks when decades happen.

 Now I know it's kind of in different context but you know the point being that a lot of things in terms of investing can happen in a very short period of time.

 (54:16) You mentioned Lehman Brothers and Bank of America where you know they need this instant capital injection as fast as possible.

 They're scrambling to get these deals done and if they can't get it done theoretically the company just is done.

 And so, you know, if on the other hand, Buffett is just standing on his hands and saying, "Okay, well, let me think about this for a month, well, chances are in a month that company's gone or they're going to find someone else to give that deal to.

(54:38) " So, I just think that Buffett and Greg Ael explained it really well here.

 You know, speaking about specific deals, even outside of those deals, I mean, a lot of the time Buffett is not doing anything, but we all know he reads five or six hours a day.

 And so, that's prep time.

 That's time reading and researching things, industry, specific people, history, chatting with other people, and that all of that culminates to just help him and hopefully Greg as well, just better understand these deals that are going to be coming to them on a(55:08) pretty regular basis.

 But on the other hand, if you're just unprepared, you know, you're not doing reading, learning, you're just kind of stuck doing what you always do, well then when a deal comes onto your desk, you're just not going to be prepared.

 And unfortunately, a good deal can become no longer good if you take too long.

 (55:26) So, I got a couple of just scenarios here.

 So, let's say a deal comes to you and maybe you're just not prepared.

 So, there's kind of three possibilities.

 The first one is that you just completely miss the great opportunity as it goes to someone else.

 And you just say, "Okay, this is out of my circle competence.

 I just don't understand it.

 (55:40) " As Buffett would do, he just put in a two card pile.

 Wouldn't feel bad about it, but that is a scenario.

 And I'm sure that's probably the one that happens to him most often.

 The second scenario is that maybe you do like the deal, but you actually want to try to understand it a little bit better.

 So in that case, well, understanding things takes time, right? And with a lot of these deals, you don't have time.

(55:59) So if if you were to do that, you might run the risk of just that deal becoming less attractive.

 And then on top of that, kind of just as a correlary, you know, there's also the chance where yes, okay, maybe you will have some time to do your due diligence, but also what happens sometimes if a company is looking for cash or looking to be acquired, it might not be that they're only wanting to sell to you.

 (56:19) They might want to sell to someone else.

 I know with in Warren's case, sometimes he's the only buyer out there, which is a huge advantage for him, but that's not an advantage that everyone has.

 So, you know, if one deal is being shopped, let's say to Clay and I, Clay's prepared and I'm completely unprepared.

(56:33) Clay knows, "Wow, this is an amazing deal.

" I'm like, "I need three weeks to think about it.

" Well, then Clay's probably gonna pick it up and I'm gonna be twiddling my fingers and hating myself for not getting in on a good deal.

 So, you know, I think even though it can sometimes appear to the untrained eye that maybe there's a deal that's being executed too quickly, I think there's probably certain people that might be in the know who just know that this deal has been building up for a long period of time.

 So, you know, many outsiders,(56:59) for instance, might look at Bergkshire and Apple and say, "Okay, well, Bergkshire just did really good on Apple.

 They got lucky.

" But I just don't think that's the case.

 I mean, if you just observe all the lessons that Warren talked about, if you go way further back in time before he even thought about buying Apple decades before that, he was talking about what he learned from Seas Candy, from Coca-Cola, and you can pretty easily connect the dots that the Apple acquisition was truly a buy that was decades in the making.

 So I'm (57:25) reminded here of just a great quote by one of my favorite philosophers I want to end this part off with which is by Senica and that is luck is what happens when preparation meets opportunity.

 Yeah.

 I also think there's the the patience in you know doing the research and doing the due diligence and waiting for that right opportunity.

 (57:43) But there's also the skill of having the patience to let a business compound once it's in your portfolio.

 They've of course trimmed down the Apple position in recent years, but you know, they've let it run many times when people would say it was overvalued and the stock would double in in a couple years.

 And I think that that's that active decision to hold an exceptional business can be harder than many people would probably be led to believe because there's 250 trading days in a year and um I think holding it is an active decision.

 And I also think (58:13) back to my conversation with Francover Sean.

 He recently purchased Booking Holdings, which we'll be discussing in next week's episode.

 And yeah, he was studying that industry for 20 plus years before he even initiated a position.

 You know, imagine how well someone knows a business and an industry after 20 years of reading the reports, following the competitors and whatnot.

(58:34) I think that there's a lot of value in having that patience, and making sure you're ready to act when the time is right.

 Next here, we're going to turn to a question on Berkshire's investment in Japan.

 The interesting part about this answer is less about you know his sentiment in Japan to me at least and more about how he goes about finding new opportunities.

(58:53) So rather than just waiting for the phone to ring and it's Goldman Sachs needing cash, he's continuously sifting through opportunities and always looking for the next gem that he might not know about or just always looking for that that next potential investment.

 at uh Monish's talk on Friday, he talked about how he was sitting across from Buffett and he noticed the Japanese company handbook on his desk and you know Buffett was clearly using this book as a source of potential opportunities and Moish picked it up and dogeared some of(59:22) his favorite businesses for Buffett to take a look at.

 So it's a breath of fresh air to have the greatest investor of all time using a Moody's manual or using the Japan handbook instead of AI or some fancy tool to to invest billions of dollars.

 you know, it's essentially exactly what he's done for, you know, since the beginning.

 (59:40) So, anyways, here's the clip on Japan.

 Uh, Mr.

 Buffett, uh, Mr.

 Ael, and Mr.

 Jing, good morning.

 Uh, I'm St.

 J.

 I'm from Hong Kong.

 Mr.

 Buffett and Mr.

 Monger did a very good and successful investment in Japan in the past five or six years.

 The recent CPI in Japan is currently above 3%.

 Not far away from its 2% targets.

(1:00:19) Bank of Japan seems very determined in raising rates while Fed ECB and other central banks are considering to cut them.

 Do you think BOJ, Bank of Japan makes sense to proceed the rate hike? Will is planned rate hike deter you from further investing Japanese stock market or even considering to realize your current profits.

 (1:00:52) Thank you very much for arranging this greatest event every year.

 Finally, I wish you healthy always and keep holding this shareholding.

 Thank you.

 Well, I'm going to extend the same goodwill to Japan that you've just extended to me.

 I I I I I will let the people of Japan determine their best course of action in terms of economics.

(1:01:28) It's an incredible story.

 Uh and uh uh I it's been about 6 years now as you pointed out.

 I was just going through a little handbook uh that probably had two or three thousand Japanese companies in it.

 Um, one problem I have is that I can't read that handbook anymore.

 The the print's too small.

 (1:01:55) But, uh, the uh, and here were these five trading companies.

 They have a special name for them in Japan, but they were selling at ridiculously low prices.

 And uh, so I spent about a year acquiring them.

 And then we got to know the people better.

 and everything that Greg and I saw we like better as we went along.

 So we got fairly close to the 10% limit that we we told the company we would never exceed without their permission.

(1:02:29) And uh so we did ask them reasonably whether that limit could be relaxed and it's in the process of being relaxed somewhat.

 Uh we we I I would I would say that I'll speak for Greg beyond me that I in the next 50 years.

 Uh and I hope he's running things then.

 Uh we we won't give a thought to to selling those.

 (1:03:01) I mean they had uh uh and uh Japan's record has been extraordinary actually in terms of that uh uh my guess is that Tim would tell you Tim Cook would tell you that iPhone sales there are about as great as any country outside the United States.

 American Express would tell you that they sell their product very very well in Japan.

(1:03:29) Coca-Cola that we do business with another big investment of ours, they do extraordinarily well in Japan.

 They have a number of habits in uh in a civilization that operates differently than ours.

 Uh Japan is by far the biggest uh they this is the container they've always preferred.

 Uh there's soft drinks and and they have uh have a whole different sort of distribution system there.

 (1:04:01) But we have been treated extremely well by the five companies.

 They they they talked with Greg primarily.

 Uh, I went over there year or two ago.

 Uh, Greg Greg's Greg's more cosmopolitan than I am.

 So, he he's which isn't saying much actually, but uh, very little.

 And but he is I How many times do you think you've met with representatives of one company the other? Yeah, when you think of the five, there's definitely a couple meetings a year, Warren.

 (1:04:42) And I think the thing we're building with the five five companies is one, it's it's been a very good investment, but we are really, as Warren touched on, we we envision holding the investment for 50 years or or forever.

 But I think we also are building relationships to do incremental things with each of those companies.

 And we really do hope to do big things with them uh globally.

(1:05:06) They bring different perspectives and different opportunities and we see and that's the uh that's why we're building that long-term relationship with them.

 It's super long-term and and and they have a much they have different customs.

 They have different uh approaches to business.

 That's that's true around the world.

 And uh and uh we're we we don't have any intention in any way of trying to change what they've done because do because they they do it very successfully and uh and our our our main activity is just to is just to cheer and clap and uh and that I can (1:05:52) still do it 94.

 Uh so uh we will own those you know we we will uh we we will not be selling any stock.

 I mean that is just it's that that will not happen uh in in decades if then.

 Uh and I my guess is that they will find things cuz they cover the world pretty much.

 Uh the five trading companies, we will find things occasionally that may be very large for any individual company there.

(1:06:39) Uh they may in some way be assisted by some some help we bring to the situation.

 Uh but but that will be an expanding relationship.

 Uh it's too bad that Bergkshire has gotten as big as it is because we love that position and I'd like it to be a lot larger than than it is.

 But even with the five companies being they're very large companies and they're large companies in Japan uh and we've got at market that you know in the in the range of $20 billion invested but I'd rather I'd rather have a hundred billion than 20 billion and that's the(1:07:27) way I feel about several other investments we have but uh size is an enemy uh a performance at Bergkshire and uh I don't know any good way to solve that problem.

 But but uh Charlie always told me that having a few problems was good for me.

 I never quite understood that, but he if you listen to him moralize, you would understand.

 (1:08:00) And uh and and it's not an impossible problem at all.

 that uh and the Japan the Japan investment has has just been right up our alley.

 You want to add anything on that? No, I think uh you've touched it, but um as you said, it's right up our alley and I I absolutely agree, Warren.

 I I do believe we'll see some very large opportunities long term and that and that's just been a great plus of that that relationship.

 Yeah.

(1:08:31) Yeah.

 I would say they they they want to they would like to present us with opportunities.

 We would like to receive them.

 We've got the money.

 We both get along well very well with each other.

 And they have different they have some different customs than than we have.

 Uh they drink the number one Coca-Cola product.

 They drink over there something called Georgia coffee.

(1:08:58) Uh, so, uh, I'm I'm I haven't converted them to Cherry Coke and they're not going to convert me to West Georgia coffee.

 But it's, um, it's a perfect relationship.

 I just wish we had could get more like it.

 Uh, uh, and I never dreamt of that when I picked up that little wasn't so little.

 was about that thick and but sometimes two companies to a page and and a couple thousand pages I believe.

 (1:09:28) But it's amazing what you can find when you just turn turn the page.

 We showed a movie last year that uh about turn every page and I would say that turning every page uh is one important ingredient to bring to the investment field.

 it uh and that very few people do turn every page and the ones that turn every page aren't going to tell you what they're finding.

(1:10:02) So you you got to do a little of it yourself.

 Okay.

 Yeah.

 So Clay, I just I really liked what you said there about, you know, just going down to the absolute basics.

 I mean, you and I, we're a lot younger.

 We both like using tech.

 I know I like it.

 I lean on it a lot.

 It helps me save a lot of time.

 But, you know, it just goes to show you that even in today's day, because I think Buffett's had these now for I think fiveish years, you can just go and flip through a book and find amazing ideas with that.

 No technology in needed (1:10:31) or necessary.

 I mean, it's interesting because also to Charlie's point there about doing five things instead of 50.

 Maybe they felt that some levels of technology added just unneeded complexity and so that's why they kind of skipped it.

 But there are a few nuggets from this clip that I really found interesting.

(1:10:49) So the first one is that Buffett said that they're talking with some of these companies specifically to see if they can actually get the 10% limit relaxed.

 So they own about 10ish% of that company and they've talked with management and said that they don't want to get more.

 Usually that's just because they want to make sure that management doesn't get angry that you know they want to come in there and be an activist and uh mess around with the business.

(1:11:08) So I think this really indicates that maybe they're willing to increase their position size if allowed.

 And this is also interesting to me because from what I've heard the positions almost doubled I believe since they initially bought them.

 So that would mark a pretty large increase in I guess what they think the intrinsic value has gone up by.

(1:11:26) And then secondly I thought that Greg mentioned a few things that were really relevant.

 So he said that they've been in contact with these businesses pretty regularly and are discussing some potential future partnerships.

 And then he also mentioned just global opportunities.

 So I think for Bergkshire partnering with other businesses that they obviously know and trust and have researched a lot makes a lot of sense.

 (1:11:48) They also have that high degree of trust that they can lean on.

 And it just makes sense as well because obviously if these companies, they're still big companies, but they're obviously a lot smaller than Bergkshire.

 And if they have an interesting deal that they feel is in Bergkshire's wheelhouse, well having that connection and trust based already means that maybe they can find some interesting opportunities.

(1:12:07) And then just kind of piggybacking on that to the whole patience point, Greg mentioned that he felt similar to Warren that there's going to be some vast opportunities over the long term.

 And I think that this just further emphasizes the points made earlier about, you know, being patient versus moving fast.

 Obviously, Greg, he specifically said that he does a lot of things in the background that you don't see or probably give credit for, but he's doing these things to understand and improve his understanding of industries or businesses that he's(1:12:34) looking at.

 So, you know, I think Greg really understands just like Buffett that he's doing all this work and sometime in the future, who knows if that's one year, 5 years, 10 years, 20 years, there's going to be a huge opportunity for them to hopefully deploy some of this cash, which is going to continue to balloon up.

(1:12:50) Um, and he'll be able to take advantage of it once that happens.

 Yeah, the 10% limit's interesting.

 It'll be interesting to see if how far they'll be able to push it because Berkshire is obviously a very friendly partner when it comes to being, you know, a pretty non-active shareholder.

 And the bet on Japan is just pretty interesting.

(1:13:08) Obviously, valuation is one side of the equation, but you know, they're talking about the perspective returns even going forward being very good.

 And especially Japan, a lot of people talk about, you know, the Bank of Japan, you know, intervening with the currency constantly.

 there's the population decline and the deflation in the economy.

(1:13:27) So to hear, you know, Greg Ael and Buffett speak so positively of these companies, I think is super interesting.

 And what also stood out to me about this clip was Greg mentioning that they want to own these businesses forever.

 And Buffett agreed with them.

 And you know, Buffett's 94 years old and here he is thinking 50 years out, which is quite an admirable trait to have as an investor.

 (1:13:46) and you just have to be operating on a whole different spectrum for most investors to be flipping through the Japanese handbook to look through the next stock you want to own for the next 50 years.

 So, I'll leave it at that for the Japanese segment.

 We'll jump here to a clip that Kyle picked out on Buffett's advice for emerging countries wanting to attract institutional investors.

(1:14:12) Uh good morning Warren and Greg Ajit.

 Thank you so much for hosting this event.

 Good to be here.

 My name is Dash Boyinder and I'm from great country of Mongolia.

 A little bit background about my country.

 Mongolia is an emerging market and landlocked country sandwiched between Russia and China.

 But we are rich in history and minerals and have full democracy and growing economy.

(1:14:46) Last week we hosted our second annual Mongolia investor conference in New York to attract investors like yourself.

 I know you meet and give advice informally to government leaders such as South Korea, China and India.

 What advice would you give to government business leaders of emerging markets like Mongolia to attract institutional investors like yourself? It'd be great if you have long-term plans for exposure to emerging markets as a hedge or an opportunistic investment.

 (1:15:29) Lastly, I welcome all of you to Mongolia and my country folks would be very happy if you can make it to our economic forum this July.

 Oh, thank you.

 Yeah, I I have trouble planning a trip to Council Bluffs, which is just a few miles from here, but thanks an optimist.

 Uh actually I met a fellow here at the annual meeting um oh probably 20 years ago or more who did a lot in Mongolia and uh uh it he's he did very well in Mongolia and uh actually moved there for quite a while.

 (1:16:20) Uh I would say that if if you're looking for advice to give the government over there, it's to develop a reputation for for having a solid currency over time.

 I mean that we we we don't really want to go into any country where we think that there's a a chance with I mean a significant probability of runaway inflation.

(1:16:51) It just it's it's too hard to figure.

 People the other people have figured out ways to make money in in hyperinflationary situations but uh that's not our game.

 and I I I don't think I'd play it well.

 So, uh we wouldn't be that that would be that would be a factor with us.

 The chances are and we won't find anything in Mongolia that fits our size requirements aside from that.

(1:17:25) But but like I say, I it uh I think my friend that I met here 20 years ago has done very well in in uh Mongolia.

 And if if the country develops a reputation for being businessfriendly and currency conscious conscious uh and I think that that bodess very well for the the residents the residents of that country particularly if it has some other natural assets that uh it can build around.

 (1:17:59) Uh, I don't know that much about the minerals there or anything of the sort, but but uh uh I mean who would have been on the United States in 1790? But uh um we we we didn't we didn't have to have perfection.

 We just had to be better than the other guys for quite a while.

 And we started out with nothing and we ended up with close to 25% of the world's GDP and faster growth rates and generally sounder currencies and all kinds of things that uh so uh I wish you well.

 Yeah.

 (1:18:41) So, I really like this clip, not because I have any interest in investing in Mongolia, but I just thought that there were a couple powerful messages that we should consider, especially in today's just volatile currency environment.

 So, you know, Buffett mentioned how important it is to develop a reputation for having just a solid currency over time.

 (1:18:59) And I think this means having a currency that has just a very low likelihood of being overly depreciated over time.

 And this is among many reasons that Warren has, I think, just tended to stick to the US where the currency has historically been one of the strongest in the entire world.

 But, you know, for other investors out there looking at emerging markets, I think you just have to factor this into your investments.

(1:19:19) If you were to get say a 10x on an investment in a foreign currency, but the currency devalues just at a very high rate, there's a chance that your investment just isn't producing any value or it can even go down.

 So the second point here was that you want to be invested in countries that have policies that are friendly to foreign businesses.

(1:19:40) I think this is how most great countries have attracted outside wealth.

 You know, China did it, the US did it and continues to do so.

 And I think there's many other countries that are attempting similar strategies.

 And there's just numerous reasons why this is such an advantage.

 The first one being that you attract capital to your country, which helps create jobs and more tax dollars.

(1:20:00) And then as a added benefit to that, if there's foreign investors who are having a lot of success investing in your country, they're going to look for more and more opportunities, they're going to attract other investors, and you just get this prosperous flywheel effect.

 If, on the other hand, investors all have just abysmal experiences, it can be really hard to attract capital back in.

(1:20:19) And I think this is kind of what has happened to China.

 And while China definitely has some really good companies, I think it's probably going to be kind of hard for them to attract foreign capital in large amounts again in the future.

 Um, and they probably will, but I think it's going to be pretty slowgoing here.

 (1:20:34) Yeah.

 So, if you're a US investor investing internationally, you're looking at international stocks, I think uh the currency risk is something certainly you should pay close attention to.

 Just because a stock goes up 20% and your benchmarks 15% doesn't necessarily mean you achieve that 15% return.

 In recent years, there's been a US dollar headwind in terms of investing in these international countries.

(1:20:57) So, uh that's something definitely you should be factoring in.

 And it's interesting you included this segment considering our previous segment on Japan.

 In terms of its population, Japan is number 11 in the world in terms of the number of people living in their country.

 But they have the fifth largest economy in the world after just recently being surpassed by India.

(1:21:17) Their GDP is growing quite rapidly.

 I think it's like a 6% rate in recent years.

 And uh Japan, they have significant exports in different sectors including automobiles, electronics, and this helps strengthen their economy, strengthen the value of the currency.

 And then the yen, this leads to it being playing a pretty key role in global trade.

(1:21:38) And that just provides stability to the currency relative to a smaller emerging market since many of these international players are going to be holding again in their reserves to help facilitate trade.

 And that's sort of what Buffett's looking for here is that stability and trust in that currency.

 There was also another question where Buffett was asked if they would hedge the risk of the devaluation of the US dollar.

(1:22:01) There's plenty of talk throughout the day on fiscal deficits and uh where the US is going to be heading and it's a valid question considering that Bergkshire owns a massive trunch of US dollars and US treasuries both of which would not be protected by the devaluation of the currency.

 But you know he did discuss his concerns related to whether the US you know will get their deficits in check to prevent runaway inflation.

 (1:22:27) And I guess on the flip side, you know, the businesses that he owns are going to be protected to a large extent to runaway inflation, but you know, it's something that top managers at Bergkshire are certainly aware of and keeping their eye on.

 And maybe that's potentially why they're looking to to diversify a little bit outside the US in some ways, even though throughout the day he did also express his optimism and bullishness on the US more broadly.

 (1:22:53) So yeah, it's an interesting dynamic to see him get into some of these other countries in recent years, but um yeah, I expect him to largely be pretty well allocated to the US as well.

 So we wanted to play one more question here on Berkshire's recent activity and his take on today's market.

 This is another shorter one, but I thought it's a interesting one uh that we'll cap off the episode with.

(1:23:17) Um the first quarter ended March 31st and it did show that Bergkshire's cash pile expanded from the end of the last year, but the greatest market turmoil came in April.

 Martin Divine, a shareholder from Scotland who is attending the meeting today, wants to know, has the recent market volatility presented Bergkshire with opportunities? And Martin just wrote in an addendum in the last 40 minutes or so pointing out that you mentioned Bergkshire almost invested $10 billion recently and wanting to know if you could talk more(1:23:48) about that.

 Well, the I can give you a good answer to the second part of which is no the but 10 billion wouldn't have done that much.

 You know that's the other side another side of it.

 Uh what has happened in the last uh 30 30 45 days, 100 days, whatever whatever you want to pick up whatever this uh this uh period has been is is it's really nothing.

(1:24:28) There's been three times since we acquired Bergkshire that Bergkshire has gone down 50%.

 Uh in a fairly short period of time, three different times.

 Nothing was fundamentally wrong with the company at any time.

 But but this is not a huge move.

 Uh the Dow Jones average at 381 in September of 1929.

 they got down to 42.

 (1:25:00) So that's by going from 100 uh to 11.

 Uh this is not this has not been a dramatic uh bare market or anything of the sort.

 I mean it uh it it you know like it uh pointed out if I've I've had 200 and 50 trading days a day, you know, for however many years I've been old enough to trade stocks that got 17 or 18,000 days.

(1:25:34) There's been plenty of periods that that uh uh just are dramatically different than this.

 I mean, when the day I was born, the Dow Jones was a 240 and my first that was August 30th, 1930.

 And between that and the low, it went from 240 to 41.

 I mean, so if people think that it made a really major change, it it didn't if it if it gone up 15% instead of down 15%, people think they take that with remarkable grace.

 (1:26:15) But uh but uh if it makes a difference to you whether your stocks are down 15% or not, you you're you're you need to get a somewhat different investment philosophy because the world is not going to adapt to you.

 You're going to have to adapt to the world.

 And you will see a period in the next certainly in the next 20 years, you'll see a period that that that we'll be in.

 (1:26:41) But somebody in the market described one time as a hair curler compared to anything you've seen before.

 I mean that just it just happens periodically.

 The world makes big big big mistakes and surprises happen in dramatic ways.

 And the more sophisticated the system gets, the more the surprises can be out of right field.

(1:27:05) That's that that's just that's part of the stock market and that's what makes it a good place to to focus your efforts if you got the proper temperament for it and a terrible place to get involved if if you get frightened by markets that decline and and get excited when stock markets go up.

 I don't mean to sound particularly critical.

(1:27:27) I mean, I know and and people have emotions, but you got to check them at the door when you invest.

 So, this is a great clip to end in light of the recent volatility related to the US tariff announcements.

 You know, occasionally, you know, declines in the stock market are just to be expected.

 And Buffett highlighted that shares of Bergkshire have had declines of 50% in a short period of time on multiple occasions.

 (1:27:55) and you know, the underlying business of Bergkshire just wasn't materially impacted.

 So, if anyone's interested in backing up the truck after a 15% decline in the S&P 500, as Buffett alluded to, you're likely in for a rude awakening at some point over the next 10, 20 years.

 Yeah, I think this is just a really good reminder to just zoom out and look at your portfolio from a thousand-y view.

(1:28:17) You know, there's just events like what we're living through now that happen pretty regularly through history.

 you know, might not be the exact same event, but you know, a lot of these events are a lot more painful as well than what was just happened to us.

 So, if you were to look out say 10, 20 years from now, do you think that this will be an event that has fundamentally changed the market? I think maybe the average person obviously the market did go down so the average person might say yes but I think as the pain subsides and we get more and more normaly back into (1:28:44) the market and time goes by there's just a really good chance that this is just a temporary blip in an ongoing growth story onwards and upwards so you know the world has events that cause certainty and I think when you take a closer look at Buffett he's just profited from this uncertainty specifically by being greedy when others are fearful and so I looked at data when I looked at Q4 which was the most recent quarter where they show his activity and it showed that he added a couple companies.

 He added Dominoes, Poolc(1:29:13) Core, Sirius XM Holdings, Verasign, Accidental Petroleum and Constellation Brands.

 Now I looked at each of those businesses and just wanted to see what their stock prices did since then.

 And so from Q4 a couple of them, Pool, Sirius XM, Oxy, and Constellation Brands have all decreased in price.

 So looking at the world from Warren Buffett's view, there's probably a good chance whenever the Q1 numbers come out that maybe he's added to some of those names.

(1:29:38) Yeah, he also made the point that I'll reiterate here that, you know, if the recent events have shaken you emotionally, then perhaps you should consider changing your investment philosophy.

 And I thought those were just powerful words.

 So that wraps up today's discussion.

 If you're interested in joining some really high quality tip events later this year in the fall, we're hosting our summit in the mountains of Big Sky, Montana at the end of September.

(1:30:03) And our TIP mastermind community is getting together in New York City in October.

 You can reach out to Kyle or I if you're interested in learning more about either of those.

 And then we have information on our website as well for both.

 So with that, I think we'll close it out there.

 For those we met in Omaha, it was great to see you and we hope to see you again next year.

(1:30:19) And if you haven't been to Omaha yet, you're certainly invited to hang out with us next year and come say hi and uh connect with other like-minded value investors.

 So, thanks a lot for tuning in and we hope to see you again next week.

 In 2023, they generated 37 billion in operating earnings.

 The stat that sort of just blew my mind at the meeting is they put that in terms of daily earnings they're getting.

 (1:30:41) They're getting $100 million per day that they have to figure out how to allocate it.

 So capital is just constantly flowing in faster than they're able to deploy