daily journal shareholder letter 2021

Charlie Munger: I dont know anything about Haven. He was very courageous and generous in helping everybody around him all his life. GE released its 2021 Annual Report today. However, could you be more specific? I said to Rick, were going to make Gerry the head of the Daily Journal. We would all say that. That recognized reality and worked way better than what other people were doing. Thats one you can easily arrange. I admire him that much. We expect many of our employees to always be at client court offices because we work with them very closely to make sure they get what they need. The Daily Journal shareholders will have to take whatever outcome comes from caring more about our customers than is at all common. Costco I do think has one thing that Amazon does not. The only opinion I have there is that I dont think anybody knows whats going to happen for sure. I kind of admire the way Bill takes on these very hard problems. Charlie Munger: I would go further. \h_^cBa\"BfuLj@`}Ze jZ*l!-;LUe=v3+adjh4Sz8h*`iQ5>dZ;c8sgu[9|7$t}HkN5xv.,GqwYp0Y,53Urn i*5"x~z0GYkgPU0gbivl:"[Z@"S5mdY = 14M.6X!8&[R-p;a)}P5Y^wE7>L>39ju oH*crZRYTf 0@N',.>BP%M72HY=eY\ |Lt[kC&15YsATr*z=%4;mSH4%ZJ[WI]da f1u#{z)`|Es5dH^,X"I3V4&F@N]6# 7V}cDCY$P(Xa:FVPfl\V!ZA~jtSBtrleZuV"Nr7cA_ u!LC36Mh]82(M+ RR)mnk d=#:v4P^^xEbt:x85!K-yQK Nu=?vL]'.vq|1b* pS67-K^sqj Source: FactSet, Indexes: Index quotes may be real-time or delayed as per exchange requirements; refer to time stamps for information on any delays. Warren Buffett is set to release his annual shareholder letter Saturday morning along with the conglomerates quarterly earnings. With that one exception, Ive stayed out of Sequoias business because theyre so much better at it than I would be and I dont know how to do it the way they do it. The first order of business is to reelect the four directors and the votes are as follows: Charles Munger, 679,481, Gerald Salzman, 660,287, Peter Kaufman, 593,336, Mary Conlon, 651,493. Question: Given all of your donations to physics, what is your favorite way of applying physics to societys problems and also to investing? We made the rich richer, not as a deliberate choice, but because it was an accidental byproduct of trying to save the whole civilization. <> Thats what weve been doing throughout my whole lifetime. Question: My question concerns China. Florida would have a really serious problem. He was just a very old-fashioned sound thinker. I think that the methods that Ive used including the checklists are the correct methods and Im grateful that I found them as early as I did and that the methods have worked as well as they have. In the past few years, equity prices have increased significantly and cash has arguably become riskier due to central banking policy. Given the developments over the past year, could you give us an update on your assessment of wretched excess in the system? And, of course, I think its vastly stupid for any state to be user-friendly to the rich people. By accepting all cookies, you agree to our use of cookies to deliver and maintain our services and site, improve the quality of Reddit, personalize Reddit content and advertising, and measure the effectiveness of advertising. Sources: CoinDesk (Bitcoin), Kraken (all other cryptocurrencies), Calendars and Economy: 'Actual' numbers are added to the table after economic reports are released. Its just not gonna work. The psychology professors dont know all that much about the rest of knowledge and they have no incentive to master it. WebDaily Journal Corp. balance sheet, income statement, cash flow, earnings & estimates, ratio and margins. I expect that and I welcome it. I dont think we have any great gift at making macroeconomic predictions. Nobody was trying to make the rich richer. And were gonna play that as hard as we can. And, of course, its going to create trouble as it did. One of my smartest friends in venture capital is constantly getting huge clumps of stocks at nosebleed prices. But they dont teach that in the psychology department because the academic system rewards little experiments that develop more insight into psychological tendencies instead of synthesizing whats already been discovered with the rest of knowledge. Question: It is estimated that the Gates Foundation has saved well over 100 million lives. Any tips on how to generate insight in these types of situations? Question: The highly configurable JTI product may help e-suites integrate deeply into new jurisdictions as agencies and citizens become familiar with the courthouse software. In fiscal 2021, we reached revenues of $50.5 billiona significant milestone that represents 11% growth in local currency and the addition of $6.2 See our Terms, Privacy Policy, and Disclaimer. At the age of 97, Charlie Munger wasnot surprisinglysharp as a tack. Absolute insanity. Charlie Munger: I think any rich nation ought to have a social safety net that expands a little with its wealth. %PDF-1.3 Question: Can you share some parting thoughts with the viewers who are watching all around the world? So I dont worry that the country is being ruined by a few people over getting ahead a little faster than the rest of us. Washington State is actually considering a wealth tax at the state level. And yet he made a lot of mistakes in the course of living his life. Charlie Munger: Well, generally speaking, I dont try and compete with Sequoia. Without the method of learning, youre like a one-legged man in an ass-kicking contest. Theres an old German proverb Ive always liked. I think you can count on the fact that if we really like the company and we like the managementand that is the way we feel about BYDwere likely to be a little too loyal. Has the quality of the publication suffered as the employment levels have decreased? Thats what the communists are doing. And, we hope to do well in it. I do think the present CEO is an extraordinarily able man and the directors made a very wise choice when they put him in charge. It doesnt happen anymore. h`DU6,]Z a]T&LPuwIXX>4cGy82 So he was just a perfect banker if you wanted never to have any trouble. We use cookies and browser capability checks to help us deliver our online services, including to learn if you enabled Flash for video or ad blocking. And his conclusion is that mankind should just step up to it and do it. He cared terribly about not making bad loans or incurring dumb expenses. Question: You have revised your famous talk on the standard causes of human misjudgment with considerable new material back in 2005. Data are provided 'as is' for informational purposes only and are not intended for trading purposes. Its just that the investment banking profession will sell shit as long as shit can be sold. No, I dont have any secrets. Im just trying to get a feel for what the long-term capital allocation is. I dont think that hydrocarbons are going. When you respond to software by the RFP process, its a very difficult, demanding business and its less profitable and less sure than what Microsoft does. Could you share the secret to living a long, healthy, and happy life? FactSet (a) does not make any express or implied warranties of any kind regarding the data, including, without limitation, any warranty of merchantability or fitness for a particular purpose or use; and (b) shall not be liable for any errors, incompleteness, interruption or delay, action taken in reliance on any data, or for any damages resulting therefrom. Thank you for all you do to educate us. Thats our system. But, I find that the old ways of doing things still work. At times in my life, I have put myself to a standard that I think has helped me: I think Im not really equipped to comment on this subject until I can state the arguments against my conclusion better than the people on the other side. In display advertising, for example, we now utilize a very friendly company that worked with us for 25 years and now they are helping us sell advertising. Gerry, dont you think were doing pretty well? But I do think politics is getting more full of hatred and irrationality than it used to be in America and I dont think thats good. Classified advertising is down significantly. I knew a man once, Henry Singleton, who was not a chess champion. Question: Your advice given on choosing a good spouse in Poor Charlies Almanac is terse. Of course, it really helped to know everybody in town. Daily Journal Corp : Submission of Matters to a Vote of Security Holders (form 8-K) AQ. I recommend that other people follow my practice. Dimon, the banks chairman and CEO, laid out all of this and more in his annual letter to shareholders, released early Wednesday. He was death on corruption which was a very good idea. My guess is we have suffered some editorial quality. Would you mind elaborating on how a professor or individual should go about building a curriculum around this approach? And some bankers yield to the temptations. Question: Why, almost two years ago, did you believe that Costco was the only U.S. stock worth buying? Question: Do you believe the market is going through a long-term value slump similar to 1999, or do you believe technology has caused a permanent change in how companies should be valued? That happened because Gerry and I bought these little newspapers all over the state just as a precaution to make sure we could serve public notice advertising wherever it arose in the state. If you dont have master the rest of the knowledge you cant synthesize it with psychology. But he could play chess blindfolded at just below the Grandmaster level. Generally, what people do is they have financial reserves so they have some options if trouble comes, and they adapt the way Gerry has to require downsizings or require upsizings. So, its a very interesting competitive field. What I see in China now just staggers me. I have a bust of Lee Kuan Yew in my house. Of course, that made him very leery of dumb loans. What else can you do? Also, fortunately before the pandemic, we got out of the conference-type events and we were not subjected to the problems of no conferences nobody to attend. Question: Youve said several times that the best way to learn about business is to study the multi-decade financial results of great companies. Everybody is. All except for the legal advertising system which we had to build because nobody else has the volume that we have. Charlie Munger: Well, I consider that very unlikely. <>>> Every value investor tries to get more value than he pays for. The content provided on the Junto Investments (Junto) website is for informational purposes only, and investors should not construe any such information or other content as legal, tax, investment, financial, or other advice. We cant promise what the outcome will be but we are trying pretty hard and we get some favorable impressions of progress. Is there anything that you wish you had added to your checklist sooner? I hope that that will continue in the future. And, I think that could happen, but, of course, thats not a sure thing. Occasionally, some damned fool will suggest something that violates the laws of physics and I always turn off my mind the minute I realize the poor bastard doesnt know any physics. He had a long and wonderful run. I came to law school having learned the method of learning and nothing has served me better in my long life than continuous learning. Ive been around for a long time and my policy has always been to just write them out. And, what about passive investing? They wouldnt be a lot happier if they were richer or a lot less happy if theyd been poor. So far the evidence would be that maybe the monetary modern monetary theory is right. For a quarter in which we made only a handful of portfolio changes and essentially broke even, lot They dont work that hard at figuring out what works and what doesnt. Im way more comfortable owning two or three stocks which I think I know something about and where I think I have an advantage. Of course, that history is useful to know. This helped drive average monthly order frequency higher in Q4 on both a Q/Q and Y/Y basis. But he previously worked for Rick Guerin and me in running a little mutual fund that we bought control of. Last year it quintupled. Question: Eugene Abegg seems like he was one of the best bankers of the last century, achieving both extremely low loan loss rates and earning around 2% on assets over a long time period. But theres no rule that life has to be easy on the mental side. 3 0 obj Put me down as skeptical. You are on record as a zealous fan of the Chinese work ethic and Confucian value system. So I think what China has done was probably right for China and that we shouldnt be so pompous as to be telling the Chinese they ought to behave like us because we like ourselves and our system. And by the way, I think its hard to teach. And its rather interesting. But I dont think thats going to end up with a mistake. 5. I dont even know how much more difficultor how much more dangerousit would be to deal with hydrogen than it is to deal with gasoline which is also a dangerous substance. So human greed and the aggression of the brokerage community create these bubbles from time to time. Question: Youve spent much of your life contributing your wisdom to schools and hospitals. Question: In your past speeches, you have mentioned the term functional equivalent of embezzlement to describe situations where bubbles can form because both parties involved in a bubble believe the asset to be worth more than it truly is. And why did you feel that Amazon had more to fear from Costco than Costco had to fear from Amazon? As for some of our technology, like eFiling for example, the courts are closed. Its like evolution in biology. Charlie Munger: Early 70s. s=QFO?TT ze(0$ $$JI6[t_j%Suf.`2QW So, I think for some folks, early-stage investing is best, and for other folks, what Ive done in my life is best. :qpt1cMt8\2&avSY9-;S6 |jw&.\ "P/cdx>5[_:Vt _;hgf1!||tx8Oz}Y=eHcu65gl-T >Tkbb,OxW]Y?W8p`? LimT;IZ}La`9tFG;hB*4bI*Kt,U7e~kEVzVTmT$k*(4>uBXrW0L-MYz g\uz:~F ],ZgKUVyaq5muCWc*uNSS1e/~;$wqNw;jJkyVG*"ns*~e15{f +%>\o-^^U]UpJW',/ WebDaily Journal. We have offices in all the major cities in California and also in Logan, Utah. How did Eugene achieve incredibly low loan losses over the long term while so many other bankers have failed miserably? And I think that were crazy to allow it. Gerald Salzman: Charlie refers to the courts, many times. % What happens is that every human being tends to believe way more than he should in what hes worked hard to find out or where hes announced publicly that he already believes. What I think is interesting about chess is, to some extent, you cant learn it unless you have a certain natural gift. And we cant go to many offices because theyre closed. And my advice would be if you have a fixable disadvantage, remove it. Its really kind of an artificial substitute for gold, and since I never buy any gold, I never buy any Bitcoin. Youll remember that when the first big bubble came, which was the South Sea bubble in England back in the 1700s, it created such havoc eventually when it blew up that England didnt allow hardly any public trading and securities of any companies for decades thereafter. We were together in that for a long, long time, and then Rick and I did the Daily Journal together on another occasion. The former majority owners of Bank of Blue Valley and Morill & Janes Bank, Bob Regnier and Kurt Saylor respectively, both signed the shareholder letter. The second proposal is to ratify the appointment of our certified public accountant: Baker Tilly US, LLP. They lose their money fast enough. Im not saying I wanted to live in China. I know Berkshire is a long-term owner and rarely sells securities of high-quality companies it owns in its portfolio simply because its overvalued. At this rate, Change value during the period between open outcry settle and the commencement of the next day's trading is calculated as the difference between the last trade and the prior day's settle. For more information, please see our When you look at whats happened in California [in terms of] the price of real estate and rentals, weve reduced the number of offices we have both for Journal Technology and for the Daily Journal. Nobody else has ever taken a big country out of poverty so fast and so on. Gerrys lived a long time too and I think we both have been lucky. Youve even said business schools that dont adopt this method are doing their students a disservice. I dont know the answer. I feel the same way about those choices. Charlie Munger: Well, it certainly does and thats the kind of thing that can happen when you get a whole lot of people who are using liquid stock markets to gamble the way they would betting on horses. KWOT].AfOJQ=3U'(Jn6c3fBvvv[#"vsjQog:}CcS?t*Zh|gB;k1xER6fxE5fI6UVFs7v=ViHmg"qTELgJD(2*Q. Theyre no longer using peasant girls to beat the brains out of our little shoe companies in America. When I look at the modern Singapore health system, it costs 20% of what the American system costs. Rick was part of the group which consisted of Warren Buffett, Rick Guerin, and Charlie Munger that bought control of Blue Chip Stamps when it was widely distributed in an anti-trust settlement. Charlie Munger: Well, Im constantly making mistakes where I can, in retrospect, realize that I should have decided differently. Question: What is the biggest lie currently being perpetuated by the investment complex? You can imagine its in a wonderful position and that excited the people in China which has its share of crazy speculators. For example, Coca-Cola in the past. Privacy Policy. Charlie Munger: Im a great admirer of Jeff Bezos whom I consider one of the smartest businessmen who ever lived. And the next time around the poor will get richer faster than the rich. And they dont just keep everlastingly at it the way he did. And if you believe Jeff Bezos is one of the best businessmen you have ever known, would you consider investing early in any of the new projects he will inevitably focus his attention on now that he will not have to be as concerned about the day to day responsibilities of Amazon? % Question: Do you think its best to invest in the common stocks of businesses early or while they are more nascent and the industry is smaller, or wait until they are the clear winner of a more mature industry? Question: Do you believe any psychological personality tests, such as the Myers-Briggs Type Indicator, to be of any good in choosing a compatible partner, given that choosing a spouse is probably the most important decision one can make in life. Part of the reason for that was cultural. If so, how do you think society should address it, especially because poor countries require much more cheap energy to reduce poverty? So, you can understand why Warren got disenchanted with Wells Fargo. As a matter of fact, what happens is to make a nation rich, you need a free market system. So, you have to be a little closer to the employees needs, desires, babysitting, and all those activities that were kind of taken for granted in the past. Charlie Munger spreads wisdom at the annual meeting for the Daily Journal. Charlie Munger: I dont think so. Question: I was wondering if you could share some thoughts on Haven, particularly why it was ultimately closed. Ill paraphrase here. I think the result would have been worse if either party had been in control all by itself for the whole period. News Corp is a global, diversified media and information services company focused on creating and distributing authoritative and engaging content and other products and services. That was not a startup, but it was so small and thinly traded that we were buying into a venture capital type investment but in the public market. What, for example, would you recommend as course materials? What little newspaper company has come through the crisis of this destroying of all the newspapers better than the little Daily Journal? Charlie Munger: I think Ill skip that one. And, I think Jack Ma was very arrogant to be telling the Chinese government how dumb they were, how stupid their policies were, and so forth. Charlie Munger: Were really old both of us. Its such a simple idea. I said it wont matter. Some people have a natural trend toward good judgment, and with other people, their life is just a series of mistakes over and over again. In other words, to some extent, its a self-correcting system. What were the lessons learned? Buffett recommended it. Web2021. Think of whats died in my lifetime. and our We paid two and a half million for it. Thats entirely due to the practical talent of Lee Kuan Yew. Sure, we all love the kind of civilization we have. Bitcoin at 50,000 or Teslas fully diluted enterprise value of 1 trillion. And another shareholder asked: Dear Mr. Munger, please share your thoughts on the recent /r/WallStreetBets GameStop short squeeze. Mutual Funds & ETFs: All of the mutual fund and ETF information contained in this display, with the exception of the current price and price history, was supplied by Lipper, A Refinitiv Company, subject to the following: Copyright Refinitiv. And, of course, thats a very dangerous way to invest. They just copied Adam Smith and left out the free speech and it worked fine for them. Charlie Munger: No, I would say that of course, theres some new material in misjudgment. Change value during other periods is calculated as the difference between the last trade and the most recent settle. And thats not a sure thing either. And they dont do that very wellIm talking about the business schools. One of the great advantages of the way Berkshire operates is that we associate with a lot of marvelous people. We admire the company and like its position. They really need the world to stay the way it is. And I dont know whether hes right or not. Interpretations of those facts will vary. You can hardly think of anything more important in life than being reliable for the people who trust you. Because even as a boy, I knew a lot about who was sound who wasnt sound in Ohama. How do you decide to hold on to a stock or sell some? Today, the majority of contractual revenue that can be identified is from implementations and licenses. Theres hardly anything he touched he didnt improve. At about the same time, we bought a newspaper in Phoenix and that worked out extremely well. If anybody can fix it, he can. The wealth management industry has a crisis on its hands. Charlie Munger: Ladies and gentlemen, wherever you are, via Yahoo finances website. Just time after time, he would choose the right system. But the Chinese have proved that you dont need free speech to have a wonderful economy. You can hardly think of a decision that matters more to human felicity than who you marry. God knows it was difficult but I dont think its a mistake. I tell a story on Rick that he took the Navys IQ test and got one of the highest scores ever recorded and left early. He loved to kid people. And like last year, you will in this note find a full transcript of the entire meeting. The stock appreciated probably way more than intrinsic value. Question: Do you believe global warming is an existential threat to humankind? 2021 Key Results Total net revenue grew 55% year-over-year (YoY) to $2.765 billion Platform revenue increased 80% YoY to $2.285 billion Gross profit was up 74% YoY to $1.409 billion Active Accounts reached 60.1 million, a net increase of 8.9 million active accounts from Q4 2020 Streaming Hours increased by 14.4 billion hours YoY to Everything you see is profit. And would the Daily Journal consider Bitcoin or any other cryptocurrency as an asset on the balance sheet similar to what Tesla recently did? On balance, we hold in certain of these position when, normally, we wouldnt buy a new position. Were all pretty forgiving of ourselves too which is probably a good thing. I think civilization would do better without it. Charlie Munger at the 2021 Daily Journal annual meeting spoke once again at great length. In other words, its your money. Question: What advice would you give to someone who is trying to stay within their circle of competence but finding that the pace of technical technological innovation is rapidly reducing that circle? Ive seen the whole bus system shift from gasoline or diesel to gas and so it obviously isnt impossible, but youd have to create a whole new system of supply for it. As a matter of fact, it will be here for a long, long time if we stop using many hydrocarbons in transportation. It was a background that helped everybody. Buffetts donations to the foundation have obviously helped to save many millions. By the way, the Harvard Business School, when it started out way early, they started out with a history of the business. They have created a strong culture of fanaticism about cost, quality, efficiency, and honor. WebIn 2021, for example, we paid$3.3 billion while the U.S. Treasury reported total corporate income-tax receipts of $402 billion.Additionally, Berkshire pays substantial state and foreign taxes. I would hate to compete with Sequoia in their field. I dont think Ive got any great insight about hydrogen. How do you reconcile the idea of paying 50 or 60 times revenue for a growing but unprofitable business with the more traditional value investing concept of a margin of safety? If you stop to think about it, business success long term is a lot like biology. The mantra he said over and over again is very simple. Question: If you had a chance to make an addition or revision to Poor Charlies Almanac, what would that be? stream Question: Many believe that inequality accelerated by this pandemic has reached alarming levels that demand drastic solutions such as a wealth tax. Gerald Salzman: Well, we dont think about mistakes. I do think banking run intelligently is a very good business. Generally speaking, people assume that were a normal software company like Microsoft or something. Charlie Munger: Well, the one charitable institution where I have had some influence for a very long time has a whole bunch of hotshot financiers in every branch of wealth management there is on the board. He was a very smart man and he had a lot of good ideas. Furthermore, hed gone through the Great Depression. I dont think we have made a lot of horrible mistakes. <>/ExtGState<>/XObject<>/ProcSet[/PDF/Text/ImageB/ImageC/ImageI] >>/Annots[ 18 0 R 19 0 R] /MediaBox[ 0 0 612 792] /Contents 4 0 R/Group<>/Tabs/S/StructParents 0>> Its a very dishonorable low-grade way to talk. I gave at the office is an unassailableassertion when made by February 11, 2022. DAILY JOURNAL CORPORATION : Company profile, business summary, shareholders, managers, financial ratings, industry, sector and market information | Bitcoin reminds me of what Oscar Wilde said about fox hunting. And there arent many people that can do that. But Henry was a genius. And weve had marvelous people here to help us do it through very difficult times and one of them is Gerry Salzman. In a shareholder letter, Barra said 2023 will be a "breakout year" for GM's Ultium-based EVs. In 2020 and 2021, enormous QE approximately $4.4 trillion, or 18%, of 2021 gross domestic product (GDP) and enormous fiscal stimulus (which A lot of people assume that since England led the Industrial Revolution and had free speech early that free speech is required to have a booming economy as prescribed by Adam Smith. But he knew how to learn what he didnt know. And it has saved Los Angeles a fortune because gas is so much cheaper than gasoline. Just think of the things that were once prosperous that are now in failure or gone. Today, it hovers around 9500. Its been amazing that one little company starting up not that many decades ago could become as big as Costco did as fast as Costco did. Its entirely possible that our system is right for us and their system is right for them. It just created the most unholy mess. We discuss the company Berkshire Hathaway and the economic context in which it operates. These actions have given some shareholders more visibility and comfort on their investment. Key Points. Do you agree with the premise and if so how would you address inequality? Im satisfied with the way things have worked out and Im not gnashing my teeth when other people are doing better. Charlie Munger: I cant think of a We paid high prices for some little companies in the course of trying to enter the court software business. Its just that some people look for values in strong companies and some look for values in weak companies.

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