My friend Doug Kass was able to put several questions to Warren and Charlie yesterday as the “credentialed bear” at Berkshire Hathaway’s annual shareholders meeting.
One of his questions had to do with short-selling, which Berkshire Hathaway does not do.
The exchange below, via Michael De La Merced’s excellent liveblog coverage at DealBook:
It’s Mr. Kass’ turn, and he comes up with a query that he concedes is part pitch. While Mr. Buffett is no fan of short-selling, or actively betting against stocks in the hopes that they will sink in price, the practice has proved useful.
In fact, Mr. Kass contends, it has proved so successful that even Mr. Combs had done well as an investor. To which Mr. Munger responded, “He had so much success that he stopped doing it,” getting big laughs from the audience.
Undeterred, the Berkshire bear persisted: Would Mr. Buffett then consider investing $100 million in a managed account at Mr. Kass’ firm, with the earned proceeds going toward charity?
Mr. Munger curtly says “No,” before Mr. Buffett elaborates than in Berkshire’s early days, the company tried its hand at short-selling.
The end of the discussion showed the two Berkshire buddies of same mind:
Mr. Munger: We don’t like trading agony for money
Mr. Buffett: But we wish you well!