11 Apr, 2021

Charlie Munger Prefers Alibaba Stock to Treasury Bills. Here’s Why.

Charlie Munger Prefers Alibaba Stock to Treasury Bills. Here’s Why.

Daily Journal Chairman Charlie Munger says a new investment in Chinese internet giant Alibaba is part of a move into stocks because returns on Treasury bills are so low.


Houston Cofield/Bloomberg

Warren Buffett’s
longtime partner
Charlie Munger
recently disclosed a new investment in the Chinese internet giant

Alibaba Group Holding.


Daily Journal

(ticker: DJCO)—Munger has served as chairman since 1977, and provides the firm with investing expertise—disclosed last week in a Securities and Exchange Commission filing that it owned 165,320 Alibaba (BABA) American depositary receipts as of March 31. Daily Journal hadn’t owned any at the end of 2020.

In response to a request for comment on the investment, Munger, who is also the vice chairman of

Berkshire Hathaway

(BRKb), provided a statement to Barron’s:

“Daily Journal Corporation has and needs securities held as cash equivalents. These cash equivalents would normally be U.S. Treasury Bills. But, with returns on Treasury Bills now so low, the Company instead, invests in common stock. And, unless its long term prospects seem good, a common stock is not considered to be a good cash equivalent.

“A minor part of Daily Journal Corporation’s cash equivalents now consists of a tiny amount of Alibaba common stock.”

That “tiny amount” was valued at $37.5 million as of March 31. Daily Journal could have bought the Alibaba ADRs at any point in the first quarter. So far this year, the ADRs are down 4%, while the

S&P 500

index is up about 9.9%.

Alibaba ADRs underperformed the market last year, only gaining 9.7% while the index rose 16.3%. The ADRs tumbled in December when an affiliate was forced by Chinese regulators to scuttle an initial public offering. Barron’s has written about a variety of risks of investing in China.

Daily Journal owns other stocks, as well, and its U.S.-traded investments totaled about $200 million as of March 31. Positions in other investments were unchanged, and the largest investments by dollar value remained

Bank of America

(BAC) stock at 2.3 million shares, and

Wells Fargo

(WFC) at 1.6 million shares; Daily Journal’s positions in those two bank stocks are unchanged since at least the end of 2013. The company was required to begin disclosing investment positions at that point because its U.S.-traded portfolio topped the threshold of $100 million.

Interestingly,
Warren Buffett
has recently overseen trades in both banks through Berkshire Hathaway’s portfolio. Berkshire Hathaway is Bank of America’s largest investor, with more than 1 billion shares after Buffett went on a buying spree last year. Berkshire Hathaway has also been slashing its investment in Wells Fargo. We estimated that cutting the Wells Fargo position, and that of other bank stocks, cost Berkshire Hathaway about $10 billion as the sector later rallied.

Also, Berkshire Hathaway doesn’t own any Alibaba ADRs.

Inside Scoop is a regular Barron’s feature covering stock transactions by corporate executives and board members—so-called insiders—as well as large shareholders, politicians, and other prominent figures. Due to their insider status, these investors are required to disclose stock trades with the Securities and Exchange Commission or other regulatory groups.

Write to Ed Lin at edward.lin@barrons.com and follow @BarronsEdLin.

Published at Sun, 11 Apr 2021 11:00:00 +0000

Space Jam 2: A New Legacy Official Trailer (NEW 2021) LeBron James, Tune Squad, Tunes vs. Goons HD

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Watch the official trailer for Space Jam 2: A New Legacy, an animation adventure movie starring LeBron James, Sonequa Martin-Green & Don Cheadle. In theaters July 16, 2021.

Welcome to the Jam! NBA champion and global icon LeBron James goes on an epic adventure alongside timeless Tune Bugs Bunny with the animated/live-action event “Space Jam: A New Legacy,” from director Malcolm D. Lee and an innovative filmmaking team including Ryan Coogler and Maverick Carter. This transformational journey is a manic mashup of two worlds that reveals just how far some parents will go to connect with their kids. When LeBron and his young son Dom are trapped in a digital space by a rogue A.I., LeBron must get them home safe by leading Bugs, Lola Bunny and the whole gang of notoriously undisciplined Looney Tunes to victory over the A.I.’s digitized champions on the court: a powered-up roster of professional basketball stars as you’ve never seen them before. It’s Tunes versus Goons in the highest-stakes challenge of his life, that will redefine LeBron’s bond with his son and shine a light on the power of being yourself. The ready-for-action Tunes destroy convention, supercharge their unique talents and surprise even “King” James by playing the game their own way.
James stars alongside Oscar nominee Don Cheadle (the “Avengers” films, “Hotel Rwanda”), Khris Davis (“Judas and the Black Messiah,” TV’s “Atlanta”), Sonequa Martin-Green (TV’s “The Walking Dead,” “Star Trek: Discovery”), newcomer Cedric Joe, Jeff Bergman (“Looney Tunes Cartoons”) and Eric Bauza (“Looney Tunes Cartoons”).
Lee (“Girls Trip,” “Night School”) directs from a screenplay by Juel Taylor & Tony Rettenmaier & Keenan Coogler & Terence Nance. The film’s producers are Ryan Coogler, LeBron James, Maverick Carter and Duncan Henderson, and the executive producers are Sev Ohanian, Zinzi Coogler, Allison Abbate, Jesse Ehrman, Jamal Henderson, Spencer Beighley, Justin Lin, Terence Nance and Ivan Reitman.
The director’s behind-the-scenes creative team includes director of photography Salvatore Totino (“Spider-Man: Homecoming”), animation producer Troy Nethercott (“Wonder Park”), production designers Kevin Ishioka (“The Mule”), Akin McKenzie (Netflix’s “When They See Us”) and Clint Wallace (upcoming “Eternals”), editor Bob Ducsay (“Godzilla: King of the Monsters,” “Star Wars Episode VIII – The Last Jedi”) and costume designer Melissa Bruning (“Rampage,” “War for the Planet of the Apes”). The music is by Kris Bowers (“Greenbook,” Netflix’s “Bridgerton”).
Warner Bros. Pictures Presents a Proximity/The SpringHill Company Production, a Malcolm D. Lee Film, “Space Jam: A New Legacy.” The film will be distributed worldwide by Warner Bros. Pictures. It will be released in theaters nationwide on July 16, 2021 and will be available in the U.S. on HBO Max for 31 days from theatrical release.

© 2021 Warner Bros. Entertainment Inc. | All Rights Reserved.

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