Episode 413: Buffett's Departure as Berkshire CEO May Be a Good Thing

On this week's Stansberry Investor Hour, Dan and Corey welcome Vitaliy Katsenelson back to the show. Vitaliy is the CEO and chief investment officer of Investment Management Associates. He's also an author, award-winning writer, and founder of "The Intellectual Investor" newsletter and podcast.

Vitaliy kicks off the show by discussing the difficulty in writing books and how he has evolved as an investor over the years. He explains that through continuous trial and error, he has learned not to dumpster-dive for bad stocks just because they're cheap. He emphasizes the value of good management, knowing your own strengths, and allowing yourself to say no to investments that aren't in your circle of competence. Vitaliy also gives his thoughts on Warren Buffett's retirement and Berkshire Hathaway's stock today...

I am not really enthusiastic about the stock. I mean, it's fully valued... I look at individual divisions. Like I look at Geico, and the last couple of years, it was kind of losing market share to Progressive. Then you look at Burlington Northern Santa Fe, and that railroad is not as nearly well run as other railroads. You can look at the efficiency ratios and you can see it's undermanaged.

Next, Vitaliy shares his experience running portfolios and how his strategy differs from Buffett's. This leads to a conversation about what could happen to Berkshire after Buffett passes and what made Vitaliy decide "I don't want to be like Buffett." He gives his nuanced take on learning from legendary businessmen and other historical figures without agreeing with them on everything. Similarly, the U.S. trading with countries it disagrees with (like Russia) is important. Vitaliy discusses his own experience growing up in the Soviet Union and being "brainwashed" to hate Americans. And he talks more about finding a good work-life balance, no matter your career...

I'm using investing as an example, but it applies to almost any profession. If you are obsessed about anything you're doing, then the rest of the world's going to get pushed out... You get sucked in and it occupies all the real estate in your mind... If you have an obsessive personality – if you really love what you do – then you have to put guardrails.

Then, Vitaliy dives into the psychology behind decision-making and willpower. He quotes one of his favorite sayings as a reminder to investors: "Knowing and not doing is not knowing." After that, Vitaliy shares why he believes Uber Technologies still has a lot of upside today. He notes that the stock isn't cheap, but it is undervalued. And he breaks down his reasoning for wanting to hold the stock long term, including its potential to incorporate Waymo or other self-driving cars on its app...

Waymo can put itself on Uber's platform... Like you know today you have Uber, UberX, Comfort, UberXL? There could be another one called Self-Driving. And Self-Driving is probably going to be cheaper... Let's say you go at 5 p.m. [when demand is high] and you see the Self-Driving wait is 40 minutes. You say, "You know what? I'll just get UberX." And at 2 p.m. [when demand is lower], you can get a Self-Driving in five minutes. "You know, I want Self-Driving." So Uber provides this platform where it's going to be hybrid for a long period of time.

Click here or on the image below to watch the video interview with Vitaliy right now. For the full audio episode, click here.

(Additional past episodes are located here.)

The transcript is coming soon.

This Week's Guest

Vitaliy Katsenelson – nicknamed "the new Benjamin Graham" by Forbes – has more than two decades of investment experience. He joined Investment Management Associates in 1997 as an analyst and later became portfolio manager. Today, he serves as the investment firm's CEO and chief investment officer.

Vitaliy has authored several books, including Soul in the Game: The Art of a Meaningful Life and The Little Book of Sideways Markets. He has written articles for Barron's, the Financial Times, and many other outlets. He has been a guest on CNBC, Fox Business, BNN, and Yahoo! Finance. And he has taught a graduate investment class at the University of Colorado Denver – his alma mater, where he earned his bachelor's and master's degrees in finance. Vitaliy is a CFA charterholder.