Warren Buffett

Mar 07, 2024

Sources

Arvid Interview

00:01, Arvid: Yeah, so a few things I want to cover before we get started. So just so I don't forget. So a few concepts. *Number one, the current event one is like, he, you know, they found that he's been insider trading on at least three occasions by looking at his tax, by looking at his IRS records, right? So that's like a kind of matter of fact thing. And that's the current event.
But then generally there's, it's just this never ending pattern with him where he. always gets involved with investing a ton of money into super sketchy companies and then like making them even sketchier.
So he gets involved with Moody's before the financial aid crisis, 2008 crisis, he gets involved with Wells Fargo before they're, he finds super sketchy companies, makes them get way more sketchy in terms of like making money through ways that they're really not allowed to be, or it's at the very least, ethically very questionable, but oftentimes legally questionable, like with Wells Fargo stuff and the Goldman Sachs stuff.
Moody's and then he never gets in trouble because he calls himself an investor, but he's much more than that You know, you know takes a very active role as a as the primary one of the primary shareholders of these companies and then And the company gets in trouble.
But he always makes it out in a really good situation and specifically like the Goldman Sachs one He gets a special deal where they pay him like I think they paid him like five hundred million dollars a year just to Be an investor outside of like the actual investment itself
1:27, Arvid: Because they know that if they if the his game plan is a sketchy company as a sketch company They want his reputation of a stellar, you know positive reputation. So that's his Arbitrage is like bringing his positive reputation to sketchy companies.
Another big thing is that he if you go back to the early history of him like he talks about like How he had to learn to become likeable and that he went through Dale Carnegie so that people would like him all his stuff because he realized like the whole game of of being an investor and having an investment fund is how trustworthy and likable you are, much more than your actual investments. That's very secondary to the situation.
Like the way that you, your whole game is getting money from other people, basically. They would only give you money if they see you as trustworthy and likable. So that's been his life's mission. And he says this publicly.
And then separate from that *fourth piece of information is, like he advocates for things that are traditionally seen as evil. Like he advocates for like, price gouging and like becoming monopoly, all the stuff that you would see as an evil capitalist, but because he puts on a vibe of a jolly Santa Claus, you don't see it as a bad thing.
So if you look at other people who employ his tactics, you can see it, you know, the same Martin Shkreli in his lecture, I think it was to Harvard, he was explaining the reason he did all this price gouging is because he learned from Warren Buffett that you should be doing that.
And so like, like that was his thing. Like a lot of these people who do sketchy stuff, they're just following Warren Buffett's advice, especially as portfolio companies that are just following his advice. And he's just like, Oh no, I didn't mean it, you know, in some evil way. I just, you know, just want to be like, so, so yeah.
So he always gets involved with super sketchy companies. And then if he's not involved with this financial industry, sketchy company, the food companies is involved with. They're also super sketchy. So obviously Coca-Cola, um, Their main focus is to make it so that the world drinks Coca-Cola instead of water as a remaining competitor.
They always like... The companies he pours money into, they're either sketchy in terms of they're scamming people or they're very sketchy in terms of getting people addicted to harmful products or something.
But at the end of the day, he is probably one of the most impressive fraudsters I've seen where he... Based on the ProPublica thing, he does the insider trading.
03:44, Arvid: and all this shit himself too, but he just impressively keeps getting away with it because he plays the role well. So that's kind of the whole summary before we get involved. This is all just my summary to the writer and so they can do the research on this.
04:29, Jake: All right, Arvid, so everyone, so Warren Buffett is like the most beloved person in all of finance. Like everyone looks up to him. They call him the oracle of Omaha. Is that warranted? What is he actually like?
04:58 Arvid: Yeah, I mean, I'm very impressed that he pulled it off, especially given like what his persona and his public image was when he first got started.
So, you know, anyone who sort of studies them and you know, loves them, they all kind of know that he went through Dale Carnegie training in order to like become a good public speaker and become likeable. And if you actually like follow what he says, he always talks about the requirement of becoming a lovable person like heis pretty open about the fact that he architected this public personality of becoming very likable and lovable really.
But no one really takes two seconds to think beyond what that actually means.
So if you look at the history of Warren Buffett in terms of just his actions and you separate that from this fake personality that he's created and you can even see there's plenty of people privately who sort of come out and saying that he's a ruthless type of person privately.
But if you put that aside and just look at his actions what you see is probably the most impressive fraudster I've ever seen in my life and the sketchiest guy I've ever seen.
So realistically, what he does is he gets involved in companies which are extremely sort of the worst of the worst companies you could imagine. So he got involved with Moody's before the 08 financial crisis. He gets involved with Goldman Sachs right after. And then he gets involved with Wells Fargo that gets into a big scandal. He gets involved with Coca-Cola and then they sort of poison the rest of the world.
He keeps doing this over and over again. where he finds companies that are already sketchy with what they do and somehow he makes them 10 times, and somehow he makes them 10 times sketchier. And it's no coincidence.
And the amazing thing that he's pulled off is calling himself a passive investor. Like he just sits there, you know, he's saying, oh, I just sit there and I read and I just read all day and I just find really great companies and I just pour a bunch of money into them. But you know, I'm just like everybody else. I'm just a reader. Do you love reading? And so it works super well with like,
06:48, Arvid: what moms want to tell their kids, like, why don't you read more? Then you could be successful.
And so Warren does this amazing job of presenting himself as this kid-friendly, family-friendly type of figure, when in reality what he's doing is he very actively recognizes that by creating this positive public persona, he's able to steal a lot more money from people in terms of getting more investors to trust him. And then more importantly, with that positive reputation, his arbitrage is finding the sketchiest companies with the worst reputations, and he goes to them and he says, hey, why don't I become an, and he goes to them and he says, why don't I become an investor into your company, and you give me a special deal oftentimes.
So if you look at the Goldman Sachs deal, he ended up getting a lot more money than any sort of passive investor would. And generally speaking, he gets involved with these companies, and very similar to the corporate raiders and the activist investors of the past, he just. gets involved in such a way where he figures out how to make the company make a lot more money, which oftentimes requires doing a lot of questionable things, both ethically and legally.
But unlike the corporate raiders of the 1980s, who all ended up going to jail, Warren Buffett kept this pristine, positive public reputation. And every time he gets investigated for something, magically, because of his vibe, more than anything else, he just doesn't get in trouble over and over again. He's been investigated many times for a lot of different things that he's done. But again, he just... plays this role and makes this testimony. Like, oh, I didn't know that Wells Fargo did this. I didn't know that Moody's did this. You know, who am I? I'm just some passive investor guy.
But in truth, every single time that Warren Buffett picks a primary investment of his, he's doing so because he's trying to make a sketchy company, he's trying to make a sketchy company much sketchier and have the shield of the Warren Buffett sort of reputation. to protect them as they're doing it. But then once they do get in trouble, he always stays away from jail, he's good to go.
And he's been able to do this over and over again until finally, he's in his 90s now. And it took Pro Republica looking at his IRS tax filings to actually see that at the very least, there's hard evidence that in at least three occasions, he did commit insider trading. So just to explain this to anyone who was curious, so basically,
09:05, Arvid: You know, when Berkshire Hathaway, being such a large institution, decides to make a major investment into a company, the employees of Berkshire Hathaway, especially, you know, the main guy being Warren Buffett, they're not allowed to be trading on those stocks beforehand, especially right before, because they know... Sorry, give me one second.
especially the main guy, they're not allowed to be trading on those exact same stocks beforehand, especially not right before. And so there's been at least three occasions that he's done that. And there's like hard evidence for this. And again, because he's Warren Buffett, you know, you don't see this in the headline news, you see this in, you know, one or two segments barely on CNBC. And they say it in such a way where they don't say Warren Buffett's been committing insider trading, that they're not going to say that because they love him.
Instead, they just say some, some sort of convoluted thing happened that he did. personal trades and there's corporate trades and this and that, like they make it confusing for the average viewer.
But at the end of the day, you know, he's probably the most impressive fraudster I've ever seen in my life. But even if you don't want to see him as a fraudster, he's the most really impressive, like Wall Street, sort of a greedy maniac that I've ever seen who's worked super, super hard to create this public image. And, you know, if you want to, we can talk about the Warren Shkreli thing. I think that's the one last thing.
10:24, Jake: Okay. Oh yeah, can you explain to people like, like Warren Buffett like pretty much, like he plays off the role of like a passive investor that sits back and does nothing, but you're saying he's super active, like does he actually like own these companies? Is he the majority shareholder?
10:47, Arvid: Well, very often times, you know, he is the at least through Berkshire Hathaway, he is, you know, the primary sort of top shareholder of the company or one of the top shareholders of the company.
But more importantly, you know, he has these principles. Let's say like he, he talks about, this is kind of the funny thing about him is his principles, he says publicly and inherently what the principles actually are, are sort of like, you know, you know, the most evil type of principles you could have, for example, with price gouging.
And so he always talks about pricing power. He's obsessed with pricing power for a company, like how do you keep increasing your prices more and more and more? And then, of course, his portfolio companies follow in his philosophy, and they very regularly do meet with him privately, and there's plenty of evidence for this. But even if they don't, at the very least, the second anyone actually employs what he requires in terms of his business philosophy, they very quickly end up doing something very illegal or something extremely unethical, at the very least.
So, Martin Shkreli, as he said, I think I think it was at Harvard University when he gave a lecture after he started to get into a lot of controversy. He started to say publicly like, hey, I'm just a Warren Buffett disciple.
He says to do this, and I literally just did what he said to do, which is to maximize how much you charge as much as you possibly can, and then you benefit from it. And of course, as soon as he does it, he ends up in jail. And as soon as other people start to do it and take him literally, they end up in jail or they at least end up in some sort of investigation.
But generally speaking, there's plenty of evidence that... He does play an active role in terms of regularly meeting with the top management of his portfolio companies and at the very least just by the law of fiduciary responsibility for these companies the second that you know, they're sort of main shareholders Bertha Hathaway They do need to you know act in the best interest of Bertha Hathaway, but more importantly he does generally speaking, you know play somewhat of an active role He does play an active role in meeting with the management of these different companies and making sure that they are implementing the Berkshire Hathaway principles, so to speak.
But more importantly beyond that, as you saw with the insider trading scandal, what he does behind the curtain, I don't know. I know enough people in that universe now to say that what he's doing behind the curtain is probably a million times worse than what anyone could imagine.
13:09, Arvid: But at the very least, what he's even doing publicly, we could see is very questionable. But privately, if enough information came out, I think people would probably be shocked. But again, we don't know that yet. And the pro-Republica article is at least the first step in the right direction of looking into the hard evidence of what he actually does behind the scenes.
13:27, Jake: So can you explain to people why the vibe is... Because most people grow up thinking like, you know, if you break the law, then you're going to go to jail. You're going to get found guilty. But are you saying that the law is like a lot more flexible based on like your vibe or something?
13:56, Arvid: It's absolutely nothing like that. You know, and people can understand this in their day-to-day life.
Let's say, like when you see a sketchy looking guy, you know, walking into a store, he obviously gets very scrutinized. And then if he does anything wrong, you know, they'll try to catch him because at the end of the day, you know, he's giving off a very sketchy vibe.
It's very straightforward versus if you see some very innocent looking, you know, individual who's just happy and is just going about their day and maybe they make a mistake, whatever, no one thinks twice about the situation.
And if you sort of take that. analogy into the sort of elite world of law enforcement and of sort of Corporate investigations all this stuff. It doesn't actually change
at the end of the day Us as human beings like to believe that we are personally really good people And we wouldn't want to go to jail ourselves because we think we're good people So if you find somebody else and we think that oh, that's also a good person Any action that they reasonably do as long as we can put ourselves into their shoes we think to ourselves like, okay, I don't wanna punish this person because they're just being a good, innocent person with good intentions and they're good to go.
The moment that we get to categorize somebody as an evil person, like, oh, this is a sketchy person or this person is inconsiderate or this person seems angry or whatever it might be, the moment we really categorize this person as a threat in any way, our immediate reaction is we need to separate them from the rest of society, you know, whether it's a jail or it's, you know, any other form of exile traditionally throughout history, nothing's really changed.
So... When you look at the law, the actual technical law, as any elite lawyer will say, barely matters at all. It really, really matters. Who is this person? What's their reputation? What's their vibe? What's the vibe of the lawyer that represents them? What's the relationship that the lawyer has with the judge? Or how good is the lawyer at communicating in the right way to the jury? All these random things. That actually is what matters.
And people saw this. If you look at the... with a Johnny Depp trial. People saw this especially with the Johnny Depp trial. That was very publicized. And most people were on Johnny Depp's side. The law absolutely was not on his side. There's no question about it. That trial shouldn't have happened. It's sort of a case closed, Amber Heard wins, if you understand anything about the law. But because the vibe is such that everyone wants to support Johnny Depp.
16:19, Arvid: And I'm neutral to this whole situation. I'm just sort of saying this as an outside party. But because everybody wants to support Johnny Depp, naturally you like to believe him. You like to be fond of his lawyers and his legal team. And you start to vilify Amber Heard's side and you see that her lawyers are incompetent and that you can clearly see that the judge is very much so on Johnny Depp's side the whole time. And so everybody's on one team. And that's pretty much how the law works across the board.
If you look at Elizabeth Holmes, for example, You know, she was actually acquitted of the main things that people tried to get her for. She didn't technically really break laws in the traditional sense. What she did get in trouble for was kind of hilarious. She said one wrong sentence to her, you know, multibillionaire investors who couldn't care less about that money. So what they got her for was a technicality. But at the end of the day, you know, people want to see her in jail.
And so same thing applies to pretty much anyone like Martin Shkreli. They just wanted to see him in jail. Whereas with Warren Buffett. people really don't wanna see that type of person in jail because what he stands for is very positive and very reflective of what is really wholesome and people wanna teach their kids, hey, you can be really successful with it like this guy, but you don't need to be spending money lavishly, you don't need to brag about it, you just need to be really smart and study and just read books all day and just keep reading and reading and reading and reading, and the more you read, the more you'll get rewarded. And that's sort of a picture perfect. a frame that everybody wants to agree with, and nobody wants to see that shattered really.
20:44, Arvid: I think one other key point that you say though, that I didn't say clearly enough that we can rerecord right now is like, when you ask the question of like, how involved is he with these companies? It's a good question. And the only real answer is like, he is publicly advising the executives of these companies. That's what we know for a fact, but at the same time, we have no idea what he's doing behind the scenes, which is what the pro-Republica thing proves. We don't know what he's really up to behind the scenes.
22:05, Jake: You wanna do it right now? Okay. Yeah, so these billionaire types, they always like to make themselves look like they're humble and modest, like Warren Buffett drives his old car and he eats McDonald's every day and he lives in his old house and he doesn't live like a lavish lifestyle. Is that actually the case in real life or like why do they do this?
22:31, Arvid: Yeah, so it's kind of a funny thing, but basically, you know, even with multi billionaires or with plenty of celebrities, their actual day to day life isn't particularly glamorous. So when you get past the cool novelty of a sports car and a mansion and all this stuff, it's not fun.
Basically, like even a big mansion, like it's just sort of cold, crappy place to live. Like people don't really like living in mansions realistically, because you actually have to have a lot of people. living with you just to be able to maintain it to clean it all the stuff It's you don't have any privacy It's not actually like a fun way to live same thing with a sports car like most people who have you know exotic cars They almost never practically drive it except to show off once in a while if they need to for some video But like realistically, it's not a comfortable car to drive
So when you get past that phase of that exciting novelty Eventually you get back to square one and you end up like realizing like oh, these are the foods that I like this is the actual home that I like and so Eventually, you naturally go into a space where you don't care about trying to impress people by saying that like, oh, I have this luxury shirt or pants or car or whatever. People already know you're rich, so no one really cares anymore.
It's only when you're kind of in the early stages of starting to make money, that's when people start to spend a lot of money on these sort of luxury purchases. But again, you kind of get past that phase.
What Warren Buffett did really well... is simply show that like, oh, I'm just a regular person. So the number one criticism that people have of billionaires really is just that they're jealous of them. Like at the heart of it, you know, people say that they're evil and this and that. And, you know, in fact, like a lot of things that they did are very sketchy, but most of where people are frustrated tends to be that they're upset about their own lives and they can't tolerate seeing somebody else, you know, living so lavishly.
And so Warren Buffett did a good job making his number one branding and marketing that he just lives a poor person's lifestyle. But realistically, there are a lot of multibillionaires that could show this.
And even, who is it? I'm remembering correctly. I think it was Snoop Dogg. What's the Snoop Dogg in MTV Cribs? He shows that he lives in his guest house because he has too many dogs in the house. There's some celebrity, right? So like, realistic, and a lot of celebrities I know, they just live at their girlfriend's house. They don't actually live in these luxurious, like.
24:57, Arvid: mansions and stuff. If you go to the nicest houses throughout Los Angeles, they're almost all empty. It's universally the case. Like if you go to the super, super mega mansions, they're almost always empty. They're just there for whatever reason that the person ended up having to buy it. But like at the end of the day, the actual lifestyle of most of these super wealthy people isn't luxurious at all.
So what Warren Buffett did, I think sort of as a good job is he tried to really shock people by showing like, oh, wow, look, I don't live. luxuriously at all. But in truth, you know, most people who are rich, they just don't either.
So the yeah, I would say that like the key thing, though, is like the reason he picked out about out of all things to show is mostly just to allow people to love him and he keeps saying this over and over again, you have to be lovable, you have to be lovable, like that's the whole key. And, and especially if you're trusting people with your money, you know, or people are putting their life savings into birch or Hathaway, whatever it might be. you want to give that money to someone that you really like and trust and respect as some genius.
That's the last key thing, is they need to show themselves as like a really, really intelligent person because otherwise, how can you justify to yourself? Like, why is it that I can't just invest this money? I need to respect the fact that this is some genius and I need to not be jealous of him or her. And so it's nice to see that they're not living lavishly and I need to see that they're super wealthy already. and they speak in a sophisticated way. There's enough things that I can finally go to sleep at night being proud of myself that I gave all my life savings to this random guy that I've never met before.
So the funny thing is most, I've never really seen that people who love Warren Buffett have actually spent time with him privately. So like, it's like a weird thing where, everyone who's obsessed with it, you guys don't even know who he is. You've never spent even one lunch with these people. And you've experienced this too, Jake, like the multi-billionaire people that we've. had dinner with, their public persona is almost exact opposite to their private persona. So that's universally the case, I would say.
26:58, Jake: Okay, that was a perfect explanation. So if you're in the investment finance space, your goal is to get people to invest with you, to get people to invest with you. Number one, they have to think you're a genius. But number two, if they think you're a genius, but you have a lavish lifestyle, then they're gonna get jealous, so they're not gonna wanna give you money. So the second part is you have to make yourself look normal and like modest. Okay. Yeah.
28:14, Arvid: I think this one could be like, like you could ask like, why am I doing this? Like, why am I publicly going against these people that, um, uh, like what's the point of me like saying this stuff? And then I can basically say it's because like, uh, now that I'm like, you know, uh, past the point of helping these types of people. Like I actually want, I've realized that most regular people are suffering because they believe all this BS that they're saying and that's why most people can't, you know, grow their income, that type of thing.
28:43, Jake: Okay, so you've advised really rich people, billionaires, but now you're like exposing them. You're going after like the number one person, Warren Buffett, that everyone loves. So why are you doing this?
29:03, Arvid: Yeah, I mean, the truth is that after spending so much time with all these different types of people, they're intolerable. Like, you know, I'm over this phase of my life.
And as I got a chance to really speak to people from all over the world, from all walks of life, the sad thing that I found is that the almost the only reason that people haven't been able to improve their own life in terms of their own income or whatever it might be is because they buy into all this nonsense that all these, you know, public billionaires say. It's all a lie.
You know, I've never seen you know, maybe there's one exception really, but almost 100% of the time, everything that they're saying is a complete lie.
And it's harming the everyday person or it's even harming the everyday entrepreneur who's simply trying to grow their business because they think they have to somehow become this genius person themselves. And then through their genius, they're now going to get rich, but real life doesn't reward you that way.
Real life only rewards you if you find a way to simply add more value to more people's lives.
So the first thing that most people should do actually is give away value for free. Let people experience your value. Let that be the easiest way to actually get customers. You don't need to have a complicated sales processor or any of this other nonsense.
Like actually help a lot of people, whether it's through your product or your service, give that value for free. Step two is you need to turn off your ego, turn off that part of your brain that thinks you have to be a genius and simply find a way to keep knocking on more doors and get more and more customers.
And so I put this all in a one hour training and a lot of people have gone through it and every single person I've spoken to one on one afterwards. their life has dramatically changed from it.
And it's not because I'm saying something that I think is such a genius thing to say. It's really just that I'm saying common sense things that I've never seen anyone else really say publicly before because everyone's so swamped with this nonsense that these billionaires keep saying and it kind of ruins everyone else's chances to actually simply multiply their own income by turning their job or turning their existing profession or their expertise. into a business for themselves.
So you don't need to learn a million random things and think that you need to read a million books. You just need to find a way to help more and more people. And that will be a direct reflection in your income. And that's my main mission and purpose with everything that I do moving forward. I don't really care or want to keep helping any of these people anymore. My only focus, I hope for the rest of my life, is just to help any individual who finds me through my YouTube channel primarily and...
31:23, Arvid: help them one-on-one through my phone calls and through guiding them sort of step by step into how they can get the outcomes that they're looking for based on their exact situation that they're in.

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