Following Berkshire Hathaway’s annual shareholder meeting, Warren Buffett and Charlie Munger (later joined by Bill Gates) have a tradition of doing more than a few interviews. Here’s a snippet from their 07-May-2018 interview (video, transcript) with CNBC’s Becky Quick on “Squawk Box,”

When we buy a business we look at what the business earns and decide how we feel about it in terms of what we paid. But we are buying something that at the end of the period we not only have what we bought in the first place but we have something that the asset produced. And when you buy non-productive assets—all you’re counting on is whether the next person is going to pay you more because they’re even more excited about another next person coming along. But the asset itself is creating nothing.

It’s better if they don’t understand it. That’s the other thing about non-productive—if you don’t understand it you get much more excited than if you understand it. I mean, if you buy a bond that says it’s gonna pay you 4% a year you’re not gonna get any pleasant surprises. It only pay you 4% a year. But if—you can have anything you wanna imagine if you just look at something and say, “That’s magic.” You can do it with sharks teeth or seashells or anything. I mean, people—they like to speculate. They like to gamble.

There’s people who do trade on very crazy things over time. You know, imagine people selling their homes to buy a tulip in Amsterdam.

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