Warren Buffett criticizes Robinhood at annual meeting

Billionaire Warren Buffett advised people not to think investing is an easy way to make a fortune. He said stock trading platforms such as Robinhood are only encouraging gambling, as they allow people to buy and sell stocks for free.

The CEO of Berkshire Hathaway was speaking virtually at the company's annual meeting, which was held online for the second time due to the coronavirus pandemic. He answered several questions along with vice chairmen Charlie Munger, Greg Abel and Ajit Jain.

Trading apps and cryptocurrencies

Buffett said apps such as Robinhood, which are popular among millennials, encourage a "gambling impulse" among Americans and create a casino-like atmosphere. "There is nothing illegal to it, there's nothing immoral, but I don't think you build a society around people doing it," he added.

Munger shared his views, and said it was "just god-awful that something like that would draw investment from civilized man and decent citizens. It's deeply wrong." 

Buffett advised investors to make safe bets, and criticized the GameStop trading phenomenon that happened earlier this year. Robinhood faces many lawsuits over its decision in January to curb trading in GameStop and other stocks. 

"There's a lot more to picking stocks than figuring out what will be an incredible industry in the future. I just want to tell you that it's not as easy as it sounds," said the legendary investor. 

Charlie Munger also questioned the value of cryptocurrencies. "I don't welcome a currency that is so useful to kidnappers and extortionists and so forth. Nor do I like shoveling out a few extra billions and billions and billions of dollars to somebody who just invented a new financial product out of thin air. I think I should say modestly that I think the whole damn development is disgusting and contrary to the interests of civilization," he said. 

Optimism about economy

The 90-year-old said Berkshire Hathaway is being lifted by the US economy, which is performing far better than predicted after the pandemic. He praised the monetary stimulus by the US Federal Reserve, and the fiscal stimulus provided by the US Congress. 

"It did the job. This economy, right now, 85% of it is running in super high gear," said Buffett.

He retained optimisim for the future of his company. "We've seen some strange things happen in the world in the last year, 15 months. It has reinforced our desire to figure out everything possible to make sure that Berkshire is, 50 or 100 years from now, every bit the organization and then some that it is now," said Buffett. 

tg/aw (AP, Reuters)