‘Things were way tougher’: Warren Buffet’s right-hand man has a blunt message for whiners worried about ‘hardship.’ 3 stocks that keep Charlie Munger happy in tough times
Despite a strong start to early 2023 for stocks, inflation remains hot and recession fears linger.
But Warren Buffett’s right-hand man Charlie Munger suggests that we should be more content with our current situation.
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“People are less happy about the state of affairs than they were when things were way tougher,” Munger said earlier this year.
“It’s weird for somebody my age, because I was in the middle of the Great Depression when the hardship was unbelievable.”
Best known as Berkshire Hathaway’s vice chairman and Buffett’s long-time business partner, Munger also serves as the chairman of Daily Journal, a newspaper publisher with a sizable stock portfolio of its own.
So if you’re hoping some of Munger’s blunt realism will rub off on you this year, why not borrow some of his investing picks too? If these three stocks can keep the 99-year-old investing veteran happy, maybe they’ll work for you too.
Bank of America
Daily Journal held 2.3 million shares of Bank of America (NYSE: BAC) at the end of September 2022, worth approximately $69.46 million at the time. Occupying 42.49% of the portfolio, that makes the bank the largest publicly traded holding at Munger’s firm.
With economic turmoil forecast for this year, it’s a savvy holding for Munger. While many sectors fear rising interest rates, banks look forward to them. That’s because banks lend money at higher rates than they borrow, then pocket the difference.
When interest rates increase, the spread of a bank’s earnings widens.
And it just so happens that Bank of America has steadily been upping its payout to shareholders.
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Last summer, Bank of America boosted its quarterly dividend by 5% to 22 cents per share — and that’s after the company’s 17% dividend increase in July 2021.
At the current share price, the bank offers an annual yield of 2.5%.
Buffett likes the company, too, as Bank of…
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