Charlie Munger of Berkshire Hathaway says what he really thinks about Bitcoin
The billionaire investor Charlie Munger , the vice president of Berkshire Hathaway The 97-year-old shared his latest ideas about Bitcoin on Wednesday (February 24) while speaking at the Daily Journal Corporation’s Annual Shareholders’ Meeting.
A recap of Munger’s previous comments on cryptography
In recent years, Munger has been a severe critic of Bitcoin.
For example, as the first CNBC reported in December 2017, in November 30, 2017, on a event conducted by the Ross School of Business at the University of Michigan, where Munger was a guest, when asked about his views on cryptocurrencies, he called Bitcoin “Total insanity”:
“I think it’s perfectly stupid to even stop to think about them… They are bad people, crazy bubble, bad idea, attracting people to the concept of easy wealth without much perception or work. This is the last thing on Earth that you should think about … There are a lot of things that are not going to work for you. Find out what they are and avoid them like the plague. And one of them is bitcoin. … It is total madness. “
So in January 10, 2018, in a telephone interview with CNBC’s “Squawk Box” , he referred to Bitcoin and other cryptocurrencies as “bubbles”.
Almost one month later, on Valentine’s Day, in a question and answer session at the Daily Journal’s 2018 annual shareholders’ meeting, again, Munger did not like Bitcoin, calling it “Harmful poison”.
In April 28, 2018, Munger was again attacking Bitcoin and other cryptocurrencies, saying – during an interview with Yahoo Finance – that those who bought them were speculating rather than investing:
“If you buy something like a farm, an apartment building or a stake in a business… You can do it on your own… And it is a perfectly satisfactory investment. You analyze the investment itself to generate a return. Now, if you buy something like bitcoin or some cryptocurrency, you really don’t have anything that produced anything. You just expect the next one to pay more. “
On Saturday, May 5, 2018, at 2018 annual Berskhire Hathaway shareholders meeting , the place where your boss called Bitcoin “Squared rat poison”, this is what Munger said about the cryptocurrency trade:
“It’s just dementia… And I think that people who are professional traders who trade cryptocurrencies, are just disgusting. It is as if someone else is changing shit and you decide: ‘I can’t be left out. ‘”
At the following day, during an interview with Yahoo Finance, Munger said the following about Bitcoin:
“The computer science behind Bitcoin is a great triumph for the human mind, it’s what captivated all these people. They created a product that was difficult to create more, but not impossible … This is very peculiar, but they managed to do it. Therefore, many people in computer science love this simply because it is an extreme achievement of computer science. I, of course, have no interest in that because it is not my subject. And I see an artificial speculative medium, where people are buying only because they think they can sell to someone else at a higher price, although that has no intrinsic value. And so I consider the whole business as antisocial, stupid, immoral. “
Munger’s most recent thoughts on Bitcoin
During the 2021 annual meeting of the Daily Journal, Yahoo Finance correspondent Julia La Roche put questions from the Daily Journal shareholders to Munger, and some of them were about Bitcoin.
The first question was:
“What is the biggest competitive threat to American banks, like Bank of America and the US Bank, both long-term stakes in the Daily Journal Corporation? Are digital wallets like PayPal, Square or Apple Pay? Is it Bitcoin? Decentralized finance or something else? “
“Well, I think I don’t know exactly what the future is for banks and I don’t think I know how the payment system will evolve. I really think that a properly managed bank is a big contributor to civilization and that the central banks of the world like to control their own banking system and their own stock of money.
” Then, I don’t think the Bitcoin will end up being the medium of exchange for the world. It is very volatile to serve well as a medium of exchange. AND it’s really kind of an artificial substitute for gold and, as I never buy gold, I never buy any Bitcoin and I recommend that other people follow my practice.
“Bitcoin reminds me of what Oscar Wilde said about fox hunting. He said it was the search for the intractable for the unspeakable. “
Another question was:
“Your opinion on cryptocurrencies has remained the same and would the Daily Journal consider Bitcoin or any other cryptocurrency as an asset on the balance sheet similar to what Tesla did recently?”
“We will not follow Tesla and Bitcoin.”