Remembering Charlie Munger: Warren Buffett’s Tribute

Warren Buffett, in his first annual letter to shareholders since Charlie Munger’s passing, paid tribute to his longtime partner for his instrumental role in shaping Berkshire Hathaway into the powerhouse it is today.

Munger, who served as vice chairman at Berkshire since 1978, was more than just a colleague to Buffett. He was the guiding force behind many of the company’s most significant decisions, offering sage advice and pushing Buffett to think differently about the business.

One pivotal moment came in 1965 when Munger advised Buffett to focus on acquiring wonderful businesses at fair prices rather than settling for mediocre companies at bargain prices. This shift in strategy laid the foundation for Berkshire’s success and set it on a path to becoming one of the most valuable companies in the world.

Throughout their partnership, Munger played a crucial role in keeping Buffett grounded and focused on the long-term vision for Berkshire. He was not afraid to challenge Buffett’s ideas or steer him away from potential pitfalls, ultimately leading to extraordinary returns for both investors and shareholders.

One of Munger’s most notable contributions was his recommendation to invest in the Chinese automaker BYD, a decision that paid off handsomely for Berkshire. The initial $230 million investment in 2008 grew to a staggering $9.5 billion over 14 years, surpassing even Buffett’s wildest expectations.

But Munger was more than just a savvy investor. He was also known for his colorful language and candid opinions on various topics, including cryptocurrencies. Munger famously referred to Bitcoin as “rat poison” and advocated for a ban on the entire industry, likening it to a dangerous form of gambling.

Despite his many accomplishments, Munger remained humble and never sought recognition for his contributions to Berkshire. Buffett described him as the “architect” of the company, with Buffett himself serving as the “general contractor” to bring Munger’s vision to life. Their dynamic partnership was built on mutual respect and trust, with Munger always willing to let Buffett take the lead, even when he knew he was right.

Looking ahead, Buffett expressed concern about the lack of attractive acquisition targets for Berkshire, noting that the company’s cash hoard had reached a record $167.6 billion in the fourth quarter. While this presents a challenge for the company, Buffett remains confident in Berkshire’s ability to navigate the ever-changing business landscape and continue to deliver value for shareholders.

In conclusion, the legacy of Charlie Munger lives on in Berkshire Hathaway, a testament to his vision, wisdom, and unwavering commitment to excellence. As the company faces new challenges and opportunities in the years to come, Buffett and his team will undoubtedly draw inspiration from Munger’s lasting impact on the business world.

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