Warren Buffett: Why we don't invest in TSMC stock 📈 Charlie Munger: We will never buy into Taiwan 🤷
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- Опубликовано: 7 фев 2025
- WARREN BUFFETT: Taiwan Semiconductor’s one of the best managed companies and important companies in the world. And I think you’ll be able to say the same thing five, or ten, or 20 years from now.
I don’t like its location. And I’ve reevaluated that. I mean, I don’t think it should be any place but Taiwan, although they will be, obviously, opening up chip capacity in this country.
And actually, one of our subsidiaries that we got in Alleghany is participating in their Arizona construction activities.
But it’s a question of we would rather have the same kind of company. And there’s nobody in the chip industry that’s in their league, at least in my view.
And the man that is a 91-year-old or so connected with it, that I think I played bridge with in Albuquerque, and they’re marvelous people, marvelous company. But I’d rather find marvelous people - and I won’t find it in the chip industry.
But marvelous people and marvelous competitive position and everything, I’d rather find it in the United States.
I feel better about the capital that we’ve got deployed in Japan than Taiwan. I wish it weren’t so, but I think that’s the reality. And I’ve reevaluated that in the light of certain things that were going on. Charlie?
CHARLIE MUNGER: Well, tell them the story of the Japanese investment. That should be told again. That’s a nice story.
WARREN BUFFETT: Well, it was pretty simple. I mean, back when I started other people were going through Playboy and I was going through Moody’s, I mean, basically. And there’s a movie out called “Turn Every Page,” which I saw again for the second time a couple of days ago, Lizzie Gottlieb.
And I recommend everybody in this world watch that, because I turned every page in the past. And I did it for thousands and thousands of pages at Moody’s, and I did it at the Department of Public Utilities in Boston. I did it in the insurance department. I just kept turning pages. Well, that goes on for a while. But now we need big ideas in order to find things. And what was your question, Charlie?
CHARLIE MUNGER: Tell them about the Japanese.
WARREN BUFFETT: Well, the Japanese thing was simple. I mean, Ben and I liked looking at companies. I mean, I like looking at figures about companies. And here were five very, very substantial companies, understandable companies. Most of them, maybe all of them we’d done business with in a dozen different ways.
If you go a couple miles from where this place is, our last coal generating plant was built by one of the companies. So here they were. They were sitting as a group where they were earning, we’ll say 14% on what we were going to pay to buy them.
They were paying decent dividends. They were going to repurchase shares in some cases. They owned a whole bunch of businesses that we could understand as a group, although it didn’t mean we had deep understanding on any. But we’d seen them operate and everything.
There wasn’t anything to it. And at the same time, we could take out the currency risk by financing in the end. And that was going to cost a half of 1%. Well, if you get 14% on one side and a half a percent on the other side, and you’ve got money forever, and they’re doing intelligent things, and they’re sizable, so we just started buying them.
I didn’t even probably tell Greg until maybe six months after we’d gotten going. And then when we hit 5% in all of them, we announced on my birthday, 90th, that we owned over 5%. And recently went over for the first time to visit with them. And we were more than pleasantly surprised, delighted, with what we find there. And now we own 7.4% of them. We won’t go over 9.9% without their agreeing, and we sold another $164, whatever it is billion by the end.
CHARLIE MUNGER: They would’ve done it for us if we only had $5 billion or something. And it made $10 billion simply in that way. We would look like heroes. Now $10 billion just sort of disappears as if it’s a little dot in Berkshire’s reports.
WARREN BUFFETT: But it’s fun.
CHARLIE MUNGER: It is fun, and it is $10 billion.
WARREN BUFFETT: And Charlie says it keeps (Laughter) me out of bars when I talk to him about it. And I probably talked to Charlie about those the year after I started. But who knows? I mean, I knew he’d like it, I mean, obviously.
CHARLIE MUNGER: We tried to do every dollar. We would do - we could only do about $10 billion.
WARREN BUFFETT: And an issue that we intended to be 56 billion of yen that we were issuing and selling turned out to be 164.4 or something like that. And everything’s worked so well. And as Charlie says, you know, it doesn’t move $500 billion of net worth that much.
But this one, you know, will keep adding over the years to Berkshire’s value with this very widespread, probably $4 or $500 million a year. And, you know, we’ll just keep looking for more opportunities. And Japan, Berkshire is the largest borrower, outside of corporate borrowers, outside of Japan that exists.
Neither of them said anything remotely close to what’s in the stupid-ass title
Yes, he did. Clearly. Hesaid he is afraid the China will attach Taiwan and he doesn't want to invest when he is afraid.
There is 100 times as much chance of a war between Japan and China than Taiwan and China. So, he ain't all that brillient.
Only wasted 3 seconds thank u
@@bertwesler1181 Exactly ... TSMC stock hit an all-time record high today.
He bought it based on fundamentals but was intimidated by the escalation of rhetoric on Taiwan. So he sold out. It turns out that the worst did not happen. Those who bought at that time have a very handsome return.
This is one of the most important companies in the world along with ASML.
ASML is sesame compre to Warren and Charlie…. Dude don’t get too cocky on ur tech day trading, it will b time for u to remember this
I believe TSMC's expansion into Arizona mitigates much of the geopolitical problems with TSMC being exclusively in Taiwan. Additionally, it mitigates any problems the U.S encountered during COVID when chips were difficult to obtain. I'm buying and will keep buying
Of course it's political. Don't expect Buffet to ever admit to that, but he knows what he's doing. He's not gotten where he is by being driven by ideology instead of pragmatism.
He knows what he is doing 😂 well he missed out on billions of profit is what he was doing. But it’s ok, even Buffett couldn’t be always right, or he would be even far richer than he is now.
i don't understand, apple is the biggest customer of tsmc and he has over 40% of apple stocks in his portfolio. Is this not an indirect exposure to TSMC? Something is wrong herem maybe some political issues?
you have a good point
Apple would be screwed if China invaded Taiwan but so would nearly all tech and tech reliant companies. Apple however could rebound by moving to other suppliers. It would take probably 3-4 years but it would take far longer for TSMC to rebound.
yes.
No, the only reason tsmc is winning because they have a manufacturing technology advantage right now , while apple has a brand and ecosystem also if someone beats tsmc apple can just switch to them, so tsmc has a very weak moat
@@Archer-hg9rw TSMC manufactures for almost everyone. Even if they lost 100% of Apple’s business, they’d be fine.
Apple on the other hand only has a weakening brand and a weakening lock-in on existing customers.
Their service offerings are trash, their hardware offerings get more lackluster every year.
The one device they launched that was actually something new, their headset, has been a complete flop.
They’re going to continue to have their walled garden forced open, taking a big loss there.
There’s nothing left to do with their phones to make anyone really care, at a time when consumer spending on non-essentials is plummeting.
TSMC is better diversified than Apple.
He sold too early. I think his decision came down to China's threat against Taiwan and his shallow understanding of Taiwan chip supply chain.
They had political pressure from china
I doubt Buffet had a shallow understanding.
@@JoeShenaniganswell, he definitely sold far too early, so who knows, Buffett could be wrong you know, maybe he really didn’t understand fully.
@@JoeShenanigans😂
He's selling off all his china related investments, just sold all the byd as well. Selling tons apple too. As a US-based company, just too many risks out of Buffett's control with the worsening relationship between US and China. Possible he is thinking about wanting to leave berkshire as stable as possible when he goes.
selling is big mistake
No, selling the wrong -bought like paramont and TSMC is golden beyond u mortal can comprehend
Clearly, Berkshire missed a great opportunity on TSMC. Berkshire is sitting on a huge pile of cash and waiting for another financial disaster to cash in. I am not sure the opportunity will knock again before Warren passing the torch.
They are investing into tsm. Its called appl
@@tegridyfarms6851 Warren trimmed his Apple holding significantly, although for a different reason.
@@alalfred3474 that doesn't change the fact that he's a hypocrite. And the holdings are still significant. Can't say one thing and do another and trust people to still support you.
I don't agree with his assessment. If TSMC goes down with a Chinese invasion, nearly the whole world economy would collapse. Given the overall size of BH, $5-10B investment to TSMC would be a relative small concern.
The nice thing about investing is that more risk means more reward.
Yet Western investors were into Russia despite all the red flags and China is not much better. Taiwan's only problem is a potential China invasion but that's remote. I just don't understand why some big investors do what they do.
Once it skyrockets like Nvidia he would wish he didn't sell it
Other countries are making chips. There’s going to be a point where a chip size will be good enough. The question is when
@@AlbertTorres yeah that was intel's position 7 years ago. in fact people have been predicting the end of progress for 20 yers!!!
Warren was simply not comfortable with Taiwan Semidonductor after purchase.
巴菲特應該是誤聽與誤看媒體消息，以致於誤判地緣政治風險，過早賣出
Whats the Japanese company he is talking about
They bought 5 trading companies in japan in 2020 you can search buffet Japanese investment and you see the names
Itochu, Sumitomo, Mitsubishi, Mitsui and Marubeni.
TSMC is up over 150% since he sold. Bad trade period.
It's a tough call.
Can't say I don't wish Taiwan could switch places with say, Singapore or Indonesia on the world map, but it is what it is.
"I would rather find it in the United States"? just by this statement you know he's too old to comprehend the reality of the current market. Any industries would have greater chance of being sabotaged if they were in the US, the high labor costs, gov't tax, permits restrictions, gov't union labors and NO HIGH END ENGINEERS etc would only sink the business down.
Lol
Two worldly sages.... So sad Charlie's gone
hm... so by selling early, it is like $1.6B less...
TSMC stock high all-time record high today... Buffett missed out.
They don't like tmsc cause is bet against China, clearly they are pro China (and USA, obviously), tmsc is gray for them....but it also depends on the audience they are talking to ....is it possible who they are talking to? Or what is the audience or country where they are speaking from?
why pro china? US wont let china conquer taiwan, because it would make china almost monopolist in micro conductor area
China is making chips too. Once they reach a certain size and don’t need Taiwan, politics will come into play
The Dutch guys at asml said the physics is the same
China happens to have the largest stem graduates by population in the world
And the best part is that most or quite a few of them are working in the top tech companies
If the USA keeps pushing the "national security threat"
These talents are going to work somewhere else 😂
@@AlbertTorresChina has utterly failed to make chips on par with TSMC or the West and are shut out of using ASML equipment which is required for this. Even their semiconductor base component quality is poor. Fine for simple uses like home appliances but they’re considered 3rd tier at best, after the Japanese, Americans/Germans/Taiwanese, and this is a distant 3rd.
@@Cheesecake99YearsAgoNo real talent is moving to China to work there and any real talent in China is looking to escape. Number of graduates doesn’t equal accomplishment. Their education system is inferior and their sociopolitical climate, which is critical to innovation, is abysmal. China is circling the drain quickly.
I like companies substantial company’s where are we again
What he is really saying is: dont upset china and vice versa. So he wont invest in taiwan till the tension is over out of respect for china, and instead will invest in TSMC indirectly within the united states.
“True to our word” oh boy
"tension between the 2 companies" - quite a Freudian slip!
What crap is he blabbering??
Very nice video ,Tons of wisdom Thank You
Intel told everyone Taiwan was a dangerous place and didn't buy from TSMC as Intel would soon catch up.
Its already hard for Chinese language speaker to fully understand the Straits of Taiwan politics let alone a non Chinese speaker. Hence its fair that he was intimidated by BS propaganda from the CCP.
Yeah, they are right.
TSMC is 90% higher own by foreign, that is a very strange statement.
He’s the guy who has no sense about geopolitics. That’s why he bought Alibaba (pro China) and lost lots of money. He has no idea how resilient Taiwanese can be.
Kids love watching this cuz hey learn “playboy” is a good read
When Buffett went to school, they had no history
Steph curry misses most of his 3s. Buffett just messed up.
Man, they are really delusional about China. Not sure when this was recorded but it did not age well at all
Asian Silicon Valley. How i makes my money worth it. Hehe.
😮so you mean you are investing or working in Tsmc, dont you?
This guy did not understand clearly about Taiwan or you could day it is a bias
So much wisdom here.
Well you wont find one in the usa unfortunately
Those guys are eating peanuts. Stop buyings stock and invest all your money in Nut ( Peanut Birttle ) is the way to go.
it's simple, Buffett got insider tips from the pentagon.
Dont tell the truth we Berkshire class a holders all knew
Always praises, however, his actions are contrary.
TSMC 🇹🇼
Damn, the way he is swallowing and pausing a bit. Warren Buffet is getting old.
Yeah he’s in his 90’s..brilliant analysis by you
@WeBeatMedicare6969 Thanks. I thought it was a brilliant analysis also. Glad I was able to point that out to you.
Not every decision is a wise decision. TSMC is one of the best companies in the world. Buffett is too old to understand the tech sector and the meaning for the Future.
We encouraged China to join the WTO and helped them grow to what they are today. 30 years later we're regretting this but still not too late.
What's the regret ?
A 200+ year old country ordering a 5000+ year old civilisation around ?
he supports ccp byd cars. this guy just loves money, that's it.
He is a top tier capitalist
Obviously he can see through lies by the three letter agencies 😂
But some people just take in information at face value 😅
He is a top tier capitalist
Obviously he can see through lies by the three letter agencies 😂
But some people just take in information at face value 😅
He made a mistake, period.
There is a good chance of it going up for a long time, but also a small chance of China invading it and it would be catastrophic. You could see his thoughts in avoiding the catastrophic outcome, though unlikely but possible.
WHO CARES BUFFETT IS A FOSSIL