Berkshire Hathaway (BRK.A) vice chairman Charlie Munger's remarks at the Daily Journal annual shareholder meeting are always popular with investors.
Munger, who also serves as chairman of the Daily Journal Corporation (DJCO), spoke about one of his biggest investment regrets at the meeting Feb. 15.
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He names the Chinese e-commerce and technology company Alibaba (BABAF) as an investment blunder.
"I regard Alibaba as one of the biggest mistakes I ever made," Munger said. "In thinking about Alibaba, I got charmed by their position in the Chinese internet and didn’t stop to realize, 'they’re still a gawd-damned retailer.'"
Munger also addressed the speech that Alibaba co-founder and former executive chairman Jack Ma gave in October 2020 that he said triggered a long, steep drop in its share value.
Shares dropped from a high of $309.92 on Oct. 23, 2020 to a low of $63.74 on Oct. 28, 2022.
"Pretty stupid," Munger said. "It's like poking a bear in the nose with a sharp stick. It's not smart. And Jack Ma got way out of line by popping off the way he did to the Chinese government. And of course it hurt Alibaba."
The speech Munger referred to took place at the annual People's Bank of China financial markets forum. In it, Ma criticized China's regulators and banks. China retaliated by launching an antitrust investigation into Alibaba in December 2020 that severely hurt its business.
"China's financial sector, like other developing countries that have just grown up, is a young industry that does not have a mature ecosystem and is not fully moving," Ma said in the speech, according to Interconnected. "China has many big banks. They are more like big rivers or arteries in our body’s circulatory system, but today we need more lakes, ponds, streams and tributaries, all kinds of swamps."
"Without these parts of the ecosystem, we will die when we are flooded, and die when we are in a drought," he continued. "So, today we are a country that bears the risk of lacking a healthy financial system, and we need to build a healthy financial system, not worry about financial systemic risks."
