Charlie Munger has been around a long time and he has seen what speculative investing can do to people.
This week he compared investing in meme stocks to gambling and gambling to heroin while warning of the pitfalls of high-risk investing.
DON'T MISS: Charlie Munger Reveals What Stock He's Addicted To
“They [people] love gambling, and the trouble is, it’s like taking heroin,” the nonagenarian said in an interview with Berkshire Hathaway investment officer Todd Combs, according to Fortune.
“A certain percentage of people when they start just overdo it. It’s that addictive. It’s absolutely crazy, it’s gone berserk. Civilization would have been a lot better without it.”
The stock market attracts two types of investors, according to Munger: long-term investors and those who are looking "to do casino gambling."
“Now, what earthly good is it for our country to make the casino part of capitalism more and more efficient, and more and more attractive, and more and more seductive? It’s an insane public policy,” Munger said, adding that it causes harm to the country. “On the other hand, I think the chances of changing it are practically zero.”
As for Munger, he has a stock that he is addicted to.
"I love everything about Costco. I'm a total addict, and I'm never going to sell a share," Munger said at the Daily Journal's annual shareholder meeting.
While Berkshire Hathaway, the investment conglomerate of which Munger is the vice chairman, exited its stake in Costco (COST) in 2020 by selling 4.3 million shares, Munger has held onto his personal stake in the company.
