Poor Charlie’s Almanack: The Essential Wit and Wisdom of Charles T. Munger

by Charles T. Munger

One other aspect of Berkshire’s equity investment practice deserves comparative mention. So far, there has been almost no direct foreign investment at Berkshire and much foreign investment at foundations. Regarding this divergent history, I wish to say that I agree with Peter Drucker66 that the culture and legal systems of the United States are especially favorable to shareholder interests compared to other interests and compared to most other countries. Indeed, there are many other countries where any good going to public shareholders has a very low priority and almost every other constituency stands higher in line. This factor, I think, is under-weighed at many investment institutions, probably because it does not easily lead to quantitative thinking using modern financial technique. But some important factor doesn’t lose share of force just because some “expert” can better measure other types of force. Generally, I tend to prefer over direct foreign investment Berkshire’s practice of participating in foreign economies through the likes of Coca-Cola and Gillette.