The chairman and vice chairman of Berkshire Hathaway, Warren Buffett and Charlie Munger, are legendary business partners.
And to hear Buffett tell it, the two didn’t have to learn to like each other.
“We had dinner together in 1959,” says Buffett, speaking to CNBC’s “Squawk Box” on Monday, recalling how the two first bonded.
“We went to dinner and in five minutes, Charlie was rolling on the floor laughing at his own jokes — and I do the same thing,” says Buffett.
“We knew we were sort of made for each other,” adds the Oracle of Omaha.
Though the men both grew up in Omaha, Nebraska, and both worked at Buffett’s grandfather’s grocery store, they didn’t know each other until Munger was 35 and Buffett was 29, according to Buffett.
Today, Munger is 94 and Buffett is 87. Munger is worth almost $2 billion and Buffett is worth $89 billion, according to Forbes.
The wife of a prominent Omaha doctor, who had invested with Buffett and also knew Charlie Munger, first brought the two men together for lunch at the Omaha Club, according to a 2015 piece about the two men in the “Omaha World-Herald.” Munger was a lawyer in California, but his father, Alfred, had died and Munger had to return to Omaha to take care of his father’s legal practice.
Soon after, Buffett and Munger were both invited to dinner at a local businessman’s house. Later the two went for dinner together at Johnny’s Dinner. That’s the meal where Munger fell on the floor laughing, the “Omaha World-Herald” says, citing Buffett biographer Alice Schroeder.
The two investors were on the precipice of a nearly six-decade long friendship.
Munger started his own investment practice in 1962, Wheeler Munger & Co., according to the “Omaha World-Herald.” It wasn’t until 1978 that Munger became the vice chairman of Berkshire Hathaway, according to CNN.
“We’ve never had an argument in this whole time. We are strong minded. We did disagree on a few things. We agree on most things, and we have a great time together,” Buffett tells CNBC on Monday.
Not only do the investors get along, but they respect each other, says Buffett.
And they share the same fundamental beliefs about a big “don’t” when it comes to investing.
“My partner Charlie says there is only three ways a smart person can go broke: liquor, ladies and leverage,” Buffett explains, with “leverage” referring to the practice of borrowing money to buy stocks. “Now the truth is — the first two he just added because they started with ‘L’ — it’s leverage,” says Buffett.
“There is simply no telling how far stocks can fall in a short period,” Buffett wrote in his annual letter, published Saturday. “Even if your borrowings are small and your positions aren’t immediately threatened by the plunging market, your mind may well become rattled by scary headlines and breathless commentary. And an unsettled mind will not make good decisions.”