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It’s always a good day when warren buffett sits down for a one-hour interview only a few times a year he does a full interview and today he did one on cnbc i watched the entire thing and i’m gonna share with you guys the 15 main points from that interview that were brought up he talked about apple stock he talked about crypto currencies he talked about the markets
In general they had charlie munger the vice chairman of berkshire hathaway out for a bit so it was a fun interview always a pleasure to watch there’s only a couple times a year they get to do it by the way buffett’s still run that company 87 years old now guys 87 years old who ever thought they would come when one of the biggest companies in the world is run by
An 80 87 year old like it’s crazy guys so the first thing i was talking about is he put in two vice-chairman okay why this is a big deal to vice-chairman is it kind of sets up the succession plan okay this kind of sets up a succession plan for whenever he steps down from berkshire hathaway there’s and they’re in a better position now that he has to vice-chairman
Before they only had one vice chairman charlie munger charlie munger is 94 years old so that doesn’t really set you up in a succession plan at all but in this situation now with too much younger ones i think ones in their late 50s and ones around 64 66 years old they’re in a much much better position for succession now at this point having those two vice-chairman the
Second thing was he said he’s in a remarkably good health which is lily i mean he still just as wise as he always was as far as you know talking and kind of being there and then you know you know when like people get in their 80s a lot of times you can like tell they’re like declining mentally and like their their speech is starting to slow and they’re kind of losing
Their train of thought and things like that like he’s still just as sharp as when i got into the markets in 2008-2009 and i’d watch warren buffett interview is he still just as sharp as them as far as being with it and being able to stay on topic and all those type of things the third thing is today they asked him like how long he plans on still being ceo berkshire
He said 10 years would be a long time because somebody the the woman becky quick who was interviewing him asked him you know like 10 years is that something he’s like that would be a long time but he sounds like five years is more realistic which would put him still being a ceo of five years from now he’s still ceo that being he’d be a 92 year old ceo which is way
Up there we shall see so that kind of covers like the succession plans and whatnot they’re in kind of how long he plans up being there the thing they talk about is he did not say the markets are overvalued he did not say they’re undervalued but if i kind of like read between the lines i’ve watched so many warren buffett’s the interviews over the past decade it’s
Ridiculous if i was kind of reading between the lines his his tone of voice sounded more like we’re more toward overvalued than undervalued that just put that way because i’ve watched you interviews where you know you can tell he’s like oh you know i’m buying everything right now it’s so undervalued there’s been times where you know i just feel like he’s in a fair
Market value right now i just kind of feel like he’s kind of like i’m more toward over value than undervalued that just put that way but he did not say we’re overvalued in the markets at the same time he didn’t say we’re undervalued it just sounds like we’re somewhere in the middle just toward the higher end of the range fifth thing they kind of talked about is he
Said that tax reform is a big deal for berkshire hathaway you know is so basically what kind of is an example he was giving was you know let’s say berkshire hathaway buys you know a company okay they only get 60 they only got sixty five percent of the profits before in that company where now they’re getting seventy nine percent of the profits so he says that’s a
Massive deal when not just for berkshire hathaway but for all big companies and all owners of big companies out there which if you’re a stockholder you’re basically an owner of the company right since that’s a really big deal when you go from owning you know sixty five percent of profits and now with tax reform only to twenty one percent corporate tax rate to now
Owning you know seventy nine percent of profits that’s a massive change there so that was a fifth thing he talked about the sixth thing they talked about is it asked him kinda you know are you a net i or he said yes i am an empire i’ve been a buyer of stocks under fifteen of the forty five presidents which was crazy fifteen of the forty five presidents he’s been
Buying stocks under now he says he’s just as big of a buyer as now as always as far as being a net buyer in stocks seven thing they talked about is it sounds like he’s still trying to sell that massive ibm stake and still trying to solve shares off he didn’t give a specific as yes we’re selling right now or or whatnot or we stopped selling or holding for now but it
Sounded it sounded more like he is trying to still get out of that ibm stake and trying to eggs at that position and when you have a position as big as they have you know in some of these huge companies like they built up with ibm it’s really hard to get out of those positions in a quick amount of time unless you’re just want to crash the stock or something like
That completely you have to kind of you know no no a few hundred thousand or a few million shares a day you know each trading day or whatnot to kind of get out of that stock in in a way that doesn’t completely devastate the stock so that’s what they’re trying to do there it sounds like number eight he says with uh he says bitcoin talked about bitcoin and talked
About crypto currencies in general his position kind of sounds like mine but he says with almost certainty with almost certainty they’re gonna have a very very bad ending that was kind of his words with almost certainty they’re gonna have a very very bad ending he says if he could buy five year puts on every single crypto currency in the world he would five year
Put meaning basically you’re betting against the stock that’d go down to a certain price within a five year span now five year puts obviously aren’t are something you need to generally buy out there like the longest put options and call options you can generally buy or just over two years sometimes so you can’t really do that so but he says he would absolutely do
It in every single cryptocurrency he’s convinced that’s gonna end very very badly number ten he said that like he would not short crypto currencies if he could because of they could keep rising in the short term they could keep going up massively and you could get absolutely destroyed by shorting them like that something that’s a high volatility type asset right
You short it and it just keeps going up it goes up another few hundred percent or let’s say in a thousand percent or whatever you can get absolutely destroyed which is why you’d want to buy a put because in a put option scenario which by the way i have an options course down there if you want to learn about options but when you buy options right you’re limiting
Yourself to a hundred percent loss you could lose a hundred percent of your money if you buy a call or put option any you know doesn’t do what you needed to do you lose a hundred percent when you short a position your loss is unlimited if that thing just keeps going up he keeps going up your loss is unlimited and on top of that obviously you have to pay interest
On that money so you get massively screwed which is why if i’m ever negative on a company if i’m never negative i never short shares i never short shares what i do is i buy put options on that particular company generally a year to two years out on that particular company so when options course link down there if you want to learn about that number eleven was he
Says a hurt he he didn’t say he actually showed it even though he owns a mad amount of of apple stock he’s actually a samsung fanboy he still has a samsung flip phone can you believe this i didn’t even know people still had flip phones at this day and age he actually showed it off and what not a samsung flip phone from like who knows how many years ago he still
Actually has one of those guys that’s freaking crazy he says tim cook sends him a christmas card every single christmas you know tries to convince him to buy an iphone but he still isn’t done yet number 12 he said that ge talked about ge stock they talked about that one for a bit he said it does have value at some point but it doesn’t sound like he’s buying the
Stock right now and he’s basically kind of has a position on not as similar to me as far as stocks go like even if you see something that’s maybe a decent deal maybe something else out there is way better deal so you can only put your money towards so many things out there so he said it has value at some point he says but it doesn’t sound like he’s buying it let’s
Just put it that way number 13 he doesn’t have any big acquisition set up but he would like to it because i think he has something like 80 billion dollars sitting around just for acquisitions and you know becky quick asked him if he’s got anything he said no but he says he would like to so doesn’t sound like they’ll be buying anything huge in any short amount time
Here number 14 when they had charlie munger on he said they kinda they asked him if he sees any bubbles out there and he’s by the way he’s like warren buffett’s right-hand man right so he says he sees kind of two bubbles out there and as far as right now he says one is in the private equity market which i would actually agree with this there are a lot of bubbles in
The private equity market basically meaning you know let’s say i got a massive fund of money that i’ve grouped from investors and whatnot i could go well you know to a private company like an uber or somebody like that or you know an air b&b or whatever right and i can say hey we’re gonna give you an extra amount of money we want more ownership in that company
That pushes up the valuation even higher and higher so what he says there’s a lot of bubbles in private equity i would agree with that he says he agrees with warren buffett as far as like a cryptocurrency is a huge bubble going on right now that’s not going to end well for anybody number 15 he says munger says professional economists basically don’t know what the
Hell they’re talking about and weird buffett pretty much agrees you know they kind of talked about you know we if you listen to professional economists right well it’s i’ll tell you this or that or this is that and many times you’re never gonna make money taking their advice and he says they don’t know what the hell they’re talking about most of time and buffett
Agreed with that so anyways that pretty much covers the whole entire interview i try to look for it on youtube i can’t see it on youtube yet as far as the full interviews there’s a few like highlights of the interviews and whatnot if you go to cnbc app you can actually watch the whole thing if you want to watch it in depth but basically those are the 15 biggest
Points everything else was just kind of a lot of like bs talking i like to call it or kind of talking about those points more and depth and things like that so anyways hope you guys enjoyed hit the thumbs up if you did and thank you for watching guys and have a great day you
Transcribed from video
Warren Buffett CNBC Interview Analysis By Financial Education
