Saying Goodbye to Charlie Munger: A Legend in Business and Finance
Financing titan Charlie Munger, a prominent critic of Bitcoin, has reportedly passed away at the age of 99.
The financial realm bid farewell to Charlie Munger, longtime right-hand man of Warren Buffett, Bitcoin critic, and vice chairman of Berkshire Hathaway, who passed away at 99 in a Californian hospital. Born January 1st, he would have turned 100 this New Year's Day.
Berkshire Hathaway, initially a struggling textile company, transformed into an investment juggernaut under Buffett's guidance, boasting a staggering $785 billion stock market valuation. Munger, at Berkshire since 1978, amassed a net worth of $2.6 billion, earning constant praise for his sensible approach to stock-picking and investing.
As we bid adieu to Munger, the world of finance will never be the same. Countless investors admired and revered both Munger and Buffett, with many flocking to Omaha, Nebraska, for Berkshire's annual shareholder weekends to hear their hard-earned wisdom on life and business. Despite Omaha's close ties with Buffett and Berkshire, the city is gaining traction in another financial domain - Nebraska sports betting, as regulation and adoption progress across the state.
Known for his success in the financial markets but vocal in his disdain for Bitcoin and other cryptocurrencies, Munger once famously called Bitcoin "rat poison" back in 2013. Looking back in 2018, when the price soared to $9,000 per coin, he deemed it as "more costly rat poison." His skepticism stemmed from the volatility of Bitcoin and the lack of regulatory structures. He feared the possible use of Bitcoin for illegal activities such as kidnapping and terror funding.
Although cryptocurrencies weren't Munger's preference, investors could still draw valuable insights from his six-decade investment experience.
Tributes poured in for Munger, with Buffett stating, "Berkshire Hathaway could not have been built to its present status without Charlie's inspiration, wisdom, and participation." Former Twitter, Apple CEO Tim Cook referred to Munger as "a titan of business and keen observer of the world around him," who helped build an American institution. Bank of America CEO Brian Moynihan proclaimed Munger a "legendary figure in the investment community."
Despite his colorful and often provocative quotes, including those laced with foul language, shareholders appreciated Munger's candid remarks, a trait they will miss when the annual meeting resumes in May.
Featured image from Redfin, Getty Images
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Charlie Munger, known for his successful investment career as the vice chairman of Berkshire Hathaway, has consistently held skeptical and often critical views of Bitcoin and cryptocurrencies throughout his career. Here are key points highlighting his stance:
- Criticism of Cryptocurrencies: Munger has described cryptocurrencies as "worthless," "crazy," and "massively stupid." He praised China's decision to ban cryptocurrencies, contrasting it with the U.S. approach[3][4]. In an interview with the Australian Financial Review in July 2022, he referred to investing in cryptocurrencies as buying a piece of nothing[4].
- Comparison to Artificial Gold: Munger once referred to Bitcoin as "worthless artificial gold." This shows his skepticism about its inherent value or use as a store of wealth like gold[5].
- Investment Philosophy: Despite his disdain for cryptocurrencies, Munger's investment philosophy, which emphasizes patience and discipline, can be applied to Bitcoin. Some investors have found success by holding onto Bitcoin through market fluctuations, much like Munger held onto significant positions in financial companies[1].
- General Investment Approach: Munger's philosophy focuses on identifying strong, well-managed businesses with a competitive edge. He has historically avoided investing in assets he doesn't understand or that lack tangible value, which aligns with his stance on cryptocurrencies[1][3].
- In echoes of past sentiments, Charlie Munger, the late business titan, referred to Bitcoin as "rat poison" and "worthless artificial gold," reflecting his sustained skepticism and criticism of cryptocurrencies.
- Contrasting Munger's investment philosophy, which emphasizes patience, discipline, and avoidance of assets without tangible value, some investors have found success in holding onto Bitcoin during market fluctuations.
- Despite China's decision to ban cryptocurrencies, Munger remained critical, viewing such digital assets as lacking merit, contrasting them with his investment approach in well-managed businesses with a competitive edge.
- In interviews, Munger continued to lambast the volatile nature of cryptocurrencies, fearing their potential use in illicit activities such as kidnapping and terror funding due to the absence of proper regulatory structures.
- While Munger's opinions on cryptocurrencies were often polarizing, investors could still draw valuable insights from his six-decade-long investment experience in the realm of finance and technology, beyond his stance on cryptocurrencies.
