Warren Buffett & Charlie Munger: Negative Shareholders' Equity

Подписаться 66 тыс.

Просмотров 34 тыс.

50% 1

Warren Buffett and Charlie Munger discuss negative shareholders' equity at the 1995 Berkshire Hathaway annual meeting.
Top ten investment books;
The Intelligent Investor by Ben Graham: amzn.to/2XP3Hvo
The Big Short by Michael Lewis: amzn.to/3ak7Wr0
The Dhandho Investor by Mohnish Pabrai: amzn.to/2PqQDgk
One Up On Wall Street by Peter Lynch: amzn.to/39JM2Kk
Ben Graham's Security Analysis: Sixth Edition, Foreword by Warren Buffett: amzn.to/2XNYtAh
The Little Book of Common Sense Investing by Jack Bogle: amzn.to/2UsGk8T
Common Sense on Mutual Funds by Jack Bogle: amzn.to/2Uxu2wl
Common Stocks and Uncommon Profits by Phil Fisher: amzn.to/2XOCU2v
Poor Charlie's Almanack: The Wit and Wisdom of Charles T. Munger by Peter Kaufman: amzn.to/2oBddW4
The Essays of Warren Buffett: Lessons for Corporate America: amzn.to/3EwbNxx
(The above are affiliate links.)

Опубликовано:

6 сен 2024

Ссылка:

Скачать:

Готовим ссылку...

Добавить в:

Мой плейлист

Посмотреть позже

Комментарии : 43

@robbybee70 3 года назад

must be a close friendship, Munger took a cookie right off of Buffets plate....

@thomasm6445 5 лет назад

This Q&A is eluding to an important point - the accounting treatment for certain operations (and the corresponding financial statements) can be confusing and counter intuitive. What is actually happening with the business itself is not necessarily what the numbers written on a page at the end of the year says is happening. Good businesses make owners wealthier; accounting standards dictate how that wealth increase is written down. They are not the same thing, and being able to distinguish between the two puts you well ahead of those that don't understand the question that was asked in the video, Warren's response, or why either are even important.

@kumudjain6001 3 года назад

Please someone explain me everything about this video , its accounting effects and actual reality change. I am so confused after watching this

@robbybee70 3 года назад

another aspect, a company can cook it's books to make things look better, but they can't fake how many people you see in their parking lot when you drive by

@honeyjain6655 2 года назад

@@kumudjain6001 Negative SH equity is when the business owes more in debt than it can recover from its assets, for ex you have 15 in debt -5 in equity and 10 in assets. It does not matter if the company has stable and quality cash flows. You see coca cola has stable cash flows, they can pay their debt easily with those earnings. But GM, as charlie said in last, its a bad for them to have a negative Sh eq. Coj their cash flows arent stable, they have no deep moats, the fundamental economics is poor. and that hinder their capability to have more debt than it can recover by selling its assets.

@diseasefire 3 года назад

Basically Charlie predicted General motors bankruptcy :)

@elitehunterz 2 месяца назад

Wait what do you mean?

@ahome3406 3 года назад

They actually said somewhat opposing opinions about shareholders equity. Buffett was saying negative shareholders equity isn't bad, while Munger was saying having a positive shareholders equity is a good thing. Neither of their answers is helpful for investors trying to gauge the usefulness of this number.

@diseasefire 2 года назад

basically if a business is sound and keeps earning money regularly there`s nothing wrong in going into negative equity for a while (for example after a huge stock buyback) but you would need to make sure that the interest coverage ratio is appropriate and also liquidity or you could end up in trouble. Real estate businesses for example can get in serious trouble because they are illiquid (look at evergrande now)

@neddiego2570 2 года назад

Buffett said it is not bad based on businesses like KO.

@SuperLari1234 Год назад

@@diseasefireevergrande just declared bankruptcy

@odesyy 3 месяца назад

Thanks a lot! This is exactly the same question that i was looking for

@urinater 3 года назад

Charlie Hunger

@dodid0 4 года назад

Starbucks has negative sharesholder equity currently.

@hectormiguel05 4 года назад

So does McDonalds. From my understanding, it's not always a bad thing.

@sergiveramartinez2685 4 года назад

In my opinion it depends on the business. For a company having a lot of assets (financial or real estate) is terrible having a negative shareholders' equity, but for companies having more intangible assets than tangible ones (technology or pharmaceuticals) it's possible to have negativa shareholders' equity, specially if they have debt.

@SH-yk4ft 3 года назад

When a company makes a lot of money it buys back its shares which lowers equity and also pays dividends which lowers cash which in turn lowers equity. Low equity is typically a bad thing but not always with a highly profitable business.

@kingtigercrownestate9102 3 месяца назад

Randolph and Mortimer Duke!

@Octovisuals 3 года назад

MCD, ABBV...

@veritasimmigration 5 лет назад

Another awesome video! Thanks!

@The_Financial_Review 5 лет назад

Thank you!

@ashishmantri3684 Год назад

Lowes also has negative shareholders equity is it sonething to worry about

@Ammar23217 11 месяцев назад

same question here

@kumudjain6001 3 года назад

What does negative shareholder’s equity means?!

@rhythmandacoustics 2 года назад

Too much liabilities

@neddiego2570 2 года назад

@@rhythmandacoustics wrong

@neddiego2570 2 года назад

Company has more liabilities than assets. Assets = Liabilities + Equity $ 10 = $15 + ($5)

@rhythmandacoustics 2 года назад

@@neddiego2570 that is what i meant by too much liabilities. Douchebag.

@ROHIT12399 4 месяца назад

❤thnks@@neddiego2570

@alphamusicalphamusicbarina2991 4 года назад

Magic

@VikasYadav-gt4pg 5 лет назад

Charlie always eat something

@onderbetaald8677 5 лет назад

More like Charlie Muncher

@lakshmimondal3808 5 лет назад

@@onderbetaald8677 😂😂😂

@nobobonobo 3 года назад

@@onderbetaald8677 lmao

@TylersRapPromo 4 дня назад

😂@@onderbetaald8677

@arjungoud3450 2 года назад

I guess , one should analyse this statement, as his words crucial he may not sound 100% truthfull

@loremipsum3625 2 года назад

How come?

@stardust0075 Год назад

Warren Buffett doesn't answer questions directly. Now that's a sign of liar. I've seen him many times, buying time by talking and using "uh, oh" inbetween. He does that because he thinking how to lie.