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<ul><li>Archegos' use of financial derivatives helped it increase its leverage that triggered a $20 billion liquidation and rattled financial <keyword id="31671" type="CITY" weightage="100" keywordseo="markets">markets</keyword> last week.</li><li>In 2002, <keyword id="6358963" type="DEFINITION" weightage="60" keywordseo="Warren-Buffett">Warren Buffett</keyword> described derivatives as "financial weapons of mass destruction."</li><li>Buffett said that derivatives were expanding "unchecked" and that governments had no way to control or monitor the extreme risks posed by them.</li><li><a href="https://newsletter.businessinsider.com/join/4np/10-things-opening-bell?utm_source=markets&amp;utm_medium=ingest?utm_source=markets&amp;utm_medium=ingest?utm_source=markets&amp;utm_medium=ingest?utm_source=markets&amp;utm_medium=ingest?utm_source=markets&amp;utm_medium=ingest?utm_source=markets&amp;utm_medium=ingest?utm_source=markets&amp;utm_medium=ingestarkets&amp;utm_medium=ingest">Sign up here for our daily newsletter, 10 Things Before the Opening Bell</a>.</li></ul>The derivatives instruments that triggered the <keyword id="11012106" type="UNKNOWN" weightage="60" keywordseo="archegos-capital">Archegos Capital</keyword> Management implosion have for years been scrutinized by regulators and some of Wall Street's biggest investors, including Warren Buffett.In <a href="https://www.berkshirehathaway.com/2002ar/2002ar.pdf">Berkshire Hathaway's 2002 annual report</a>, Buffett called derivatives "financial weapons of mass destruction, carrying dangers that, while now latent, are potentially lethal."Archegos' investments were partially concentrated in derivatives called total-return swaps. The highly leveraged trading strategy also had a role in the fallout of <keyword id="954594" type="COMPANY" weightage="60" keywordseo="Long-Term-Capital-Management">Long-Term Capital Management</keyword>, a hedge fund that failed in 1998 and ultimately required a bailout from a consortium of Wall Street banks to prevent a financial-market collapse.In the letter, Buffett described how LTCM used total-return swaps and how the instruments are contracts that can facilitate 100% leverage in various markets, including stocks.In a total-return swap, one party, usually a bank, puts up all the money for the purchase of a stock, and another party, without putting up any capital, agrees that at a future date it will receive any gain or pay any loss that the bank realizes, Buffett explained."Total-return swaps of this type make a joke of margin requirements. Beyond that, other types of derivatives severely curtail the ability of regulators to curb leverage and generally get their arms around the risk profiles of banks, insurers and other financial institutions," the investor said.He said highly experienced investors and analysts could encounter major problems analyzing the financial conditions of firms that are heavily involved with derivatives contracts, including total-return swaps. He said that when he and Berkshire Vice Chairman Charlie Munger read through the footnotes detailing the derivatives activities of major banks, the only thing they understood was that they didn't understand how much risk the institution was running."The derivatives genie is now well out of the bottle, and these instruments will almost certainly multiply in variety and number until some event makes their toxicity clear," Buffett said.He said that the derivatives businesses were expanding "unchecked" and that central banks and governments had found no effective way to control or even monitor the risks posed by these contracts.Almost 20 years later, Bill Hwang's use of derivatives like total-return swaps helped enable him to increase his leverage and ultimately triggered a $20 billion liquidation of his family office. <a href="https://markets.businessinsider.com/news/stocks/archegos-capital-margin-call-20-billion-liquidation-8-stocks-plummeted-2021-3-1030254795?utm_source=markets&amp;utm_medium=ingestgest">The trades rattled stocks last Friday</a>, as ViacomCBS and Discovery faced their largest daily declines on record. And while some banks like Goldman Sachs and Wells Fargo <a href="https://markets.businessinsider.com/news/stocks/wells-fargo-stock-price-no-losses-archegos-capital-margin-call-2021-3-1030260227?utm_source=markets&amp;utm_medium=ingestgest">managed to escape losses</a> by quickly liquidating their exposure to Archegos,<a href="https://markets.businessinsider.com/news/stocks/nomura-takes-2-billion-loss-after-last-weeks-sell-off-2021-3-1030252569?utm_source=markets&amp;utm_medium=ingestgest"> others like Nomura</a> and <a href="https://markets.businessinsider.com/news/stocks/credit-suisse-market-capitalization-archegos-hwang-margin-call-stock-sales-2021-3-1030253684?utm_source=markets&amp;utm_medium=ingestgest">Credit Suisse could face billions in losses from the trades</a>.Archegos was trading on leverage using total-return swaps, and, <a href="https://www.forbes.com/sites/antoinegara/2021/03/29/the-firm-behind-the-30-billion-yardsale-shaking-financial-markets-disclosed-almost-nothing/?sh=51b4dc8b3567">according to Forbes</a>, the family office did not disclose its position and subsequent transactions because Securities and Exchange Commission law exempts family offices from disclosing these trades.The SEC has opened an investigation into Archegos, <a href="https://markets.businessinsider.com/news/stocks/sec-opens-investigation-archegos-capital-trades-sparked-margin-call-2021-3-1030265726">but it might not lead to any allegations of wrongdoing</a>.

Warren Buffett warned 18 years ago about the financial instruments that triggered the Archegos implosion

<ul class="summary-list"><li><keyword id="6358963" type="DEFINITION" weightage="60" keywordseo="Warren-Buffett">Warren Buffett</keyword> and <keyword id="293271" type="PERSON" weightage="60" keywordseo="Charlie-Munger">Charlie Munger</keyword> blasted <keyword id="1268253" type="PERSON" weightage="60" keywordseo="Robinhood">Robinhood</keyword> and Archegos' lenders in a recent interview.</li><li>The business partners also reflected on their six decades of friendship and biggest influences.</li><li>Buffett and Munger discussed remote working and the pandemic's impact on <keyword id="6362665" type="ORGANIZATION" weightage="60" keywordseo="berkshire-hathaway">Berkshire Hathaway</keyword> as well.</li></ul>Warren Buffett and Charlie Munger blasted Robinhood, slammed the banks that enabled the <keyword id="11012106" type="UNKNOWN" weightage="60" keywordseo="archegos-capital">Archegos Capital</keyword> meltdown, and reflected on their friendship of six decades in a <a href="https://www.cnbc.com/2021/06/29/cnbc-transcript-billionaire-investors-warren-buffett-charlie-munger-sit-down-with-cnbcs-becky-quick-for-cnbcs-buffett-munger-a-wealth-of-wisdom-.html">CNBC interview</a> that aired on Tuesday night.The Berkshire Hathaway chairman and vice-chairman also <a href="https://markets.businessinsider.com/news/stocks/warren-buffett-charlie-munger-berkshire-hathaway-stocks-markets-cnbc-interview-2021-6-1030564941">shared their key lessons</a> from the pandemic, discussed its impacts on their company, and clashed on the subject of Zoom meetings versus telephone calls.<h2>Here are the 15 best quotes from "Buffett &amp; Munger: A Wealth of Wisdom," lightly edited and condensed for clarity:</h2>Warren Buffett: "I knew when I met Charlie, after a few minutes in the restaurant, that this guy was gonna be in my life forever. We were gonna have fun together. We were gonna make money together. We were gonna get ideas from each other. We were gonna both behave better than if we didn't know each other."Charlie Munger: "What I like about Warren is the irreverence. We don't have automatic reverence for the pompous heads of all civilization."WB: "It goes well beyond buying a stock and selling it higher. He's designed dormitories and helped build them. He's worked at hospitals to understand how they can be made better, serve more people, and do it at less cost. Charlie's worked on big problems, and he doesn't need to. And Charlie has never shaded anything he's told me since we met, in terms of presenting it to me in a different way than reality. He's never done anything I've seen that's self-serving. He makes me better than I would otherwise be. I don't wanna disappoint him." - describing what he admires about Munger.WB: "I never heard my dad say to me in my life, 'Be sure you pay all your debts.' But I just watched how he lived, and you wanna have certain people in life that you don't want to disappoint. You wanna have people that make you a better person than you otherwise would be. Charlie does that for me now, but my dad did it for me early on."WB: "What really is great is if you can do what you want to do in life, and associate with the people you want to associate with in life. We've had that luxury now for 60 years or close to it. That beats 25-room houses and six cars."CM: "If it's clear that something is a mistake, fix it quickly. It doesn't get better while you wait."CM: "Think of how massively stupid that was. It was the lure of the really easy money that the idiot was paying you, being the prime broker for the jerk. They were all foolish. But Credit Suisse has managed to be the biggest fool of all." - commenting on the <a href="https://www.businessinsider.com/archegos-liquidation-cost-global-banks-10-billion-jpmorgan-bill-hwang-2021-4">Archegos fiasco</a> earlier this year.CM: "Robinhood is beneath contempt. It's a gambling parlor masquerading as a respectable business. It's basically a sleazy, disreputable operation." - on the popular trading platform.CM: "The regulators need to change laws now. But if you're running a gambling parlor, you want the big players to gamble more furiously. We don't wanna suck people into gambling for way more than they can afford." - criticizing lax rules in the securities business.CM: "Our wonderful, free-enterprise economy is letting all these crazy people go to this gross excess. The communist Chinese are avoiding it. They step in preemptively to stop speculation. I don't want all of the Chinese system, but I certainly would like to have the financial part of it in my own country."WB: "If you get enough people believing something won't be there next week in banking, it won't be there next week, absent the Federal Reserve." - recalling companies' mad rush to tap their credit lines when the pandemic struck.WB: "The biggest thing you learn is that the pandemic was bound to occur, and this isn't the worst one that's imaginable at all. Society has a terrible time preparing for things that are remote but are possible, and will occur sooner or later."WB: "The economic impact has been extremely uneven. Millions of small businesses have been hurt in a terrible way, but most of the big companies have overwhelmingly done fine, unless they happen to be in cruise lines or hotels or something." - Buffett added that the pandemic surprised his team in many ways, and cautioned there's a lot they still don't know about the fallout.WB: "I don't see any plus to it particularly. I'd rather have my feet on the desk, and I find the telephone a very satisfactory instrument." - responding to Munger saying he's "fallen in love with Zoom" and uses it three times a day.WB: "I wouldn't have wanted to work there. I'd resign or be fired. I'd rather be in a jail cell with a few people who are interesting, and plenty of reading material." - commenting on how he would react to a centralized management system at Berkshire.

Warren Buffett and Charlie Munger slam Robinhood, blast Archegos' lenders, and reflect on their iconic friendship in a new interview. Here are the 15 best quotes

<ul class="summary-list"><li><keyword id="6358963" type="DEFINITION" weightage="60" keywordseo="Warren-Buffett">Warren Buffett</keyword> and <keyword id="293271" type="PERSON" weightage="60" keywordseo="Charlie-Munger">Charlie Munger</keyword> took part in a CNBC interview that aired on Tuesday night.</li><li>The billionaire investors criticized Robinhood and Archegos, and reflected on their friendship.</li><li>Buffett and Munger also discussed remote working and the lessons they took from the <keyword id="43587" type="ORGANIZATION" weightage="60" keywordseo="pandemic">pandemic</keyword>.</li></ul>Warren Buffett and Charlie Munger discussed their iconic friendship, how they approach business, and how they built <keyword id="6362665" type="ORGANIZATION" weightage="60" keywordseo="berkshire-hathaway">Berkshire Hathaway</keyword> in <a href="https://www.cnbc.com/pro/">"Buffett &amp; Munger: A Wealth of Wisdom,"</a> a CNBC program filmed shortly after the Berkshire annual meeting in May and aired on Tuesday night.The Berkshire Hathaway chairman and vice-chairman also criticized Robinhood, called for tighter regulations after the Archegos Capital fiasco, discussed the remote-working trend, and shared what they learned from the pandemic.Buffett, 90, and Munger, 97, met more than 60 years ago. The pair went on to build one of America's biggest conglomerates, which owns companies such as Geico, See's Candies, and the BNSF Railway, and holds multibillion-dollar stakes in Apple, American Express, Bank of America, Coca-Cola, Kraft Heinz, and other public companies.<h2>Here are the highlights from the interview:</h2><h2>Archegos</h2>The first clip from Buffett and Munger's interview focused on the collapse of Archegos Capital earlier this year, and the loose lending standards among banks that allowed it to happen. Munger singled out Credit Suisse as "the biggest fool of all," and bemoaned that it took the financial crisis to spur regulators to tighten the rules and clamp down on risky practices last time around."Think of how massively stupid that was," Munger said about Archegos taking on tens of billions of dollars in leverage and blowing itself up. "It was the lure of the really easy money that the idiot was paying you - being the prime broker for a jerk."Munger added that the banks should have known better than to lend to Bill Hwang, given the fund manager had <a href="https://markets.businessinsider.com/news/stocks/who-is-bill-hwang-archegos-tiger-cub-christian-insider-trading-2021-3-1030255723">pleaded guilty to insider trading</a> in the past. "You can't make a good deal with a bad person, just forget it," Buffett said."The regulators need to change the laws," Munger said. "But of course if you're running a gambling parlor, you want the big players to gamble more furiously.""We don't want to suck people into gambling more than they can afford," he added.Buffett chimed in that regulators have a very tough job, as cracking down on the biggest problems involves attacking the financial center of enormous institutions.<h2>Robinhood</h2>The pair also touched on Robinhood, the trading platform that they both slammed at <a href="https://markets.businessinsider.com/news/stocks/warren-buffet-new-investors-tech-stocks-acquisitions-berkshire-hathaway-meeting-2021-5-1030391285">Berkshire's annual shareholder meeting in May</a>.Robinhood is a "gambling parlor masquerading as a respectable business," Munger said. "It's beneath contempt."Buffett added that Robinhood doesn't push its users to invest in long-term, low-cost index funds. Instead, it encourages them to trade options and take leveraged positions."It's basically a sleazy, disreputable operation," Munger added.<h2>Friendship</h2>Buffett and Munger recalled meeting one another at a dinner in 1959. Buffett enjoyed the fact that Munger was "rolling on the floor, laughing at his own jokes" like him, while Munger said he loved Buffett's irreverence and the fact he doesn't automatically suck up to the "pompous heads of all civilization."They also discussed the start of their partnership. "We had fun in the early days because it was like hunting expeditions," Munger said.<h2>Berkshire</h2>The next part of Buffett and Munger's interview focused on how they built Berkshire. They reflected on the conglomerate's earliest holdings, which included Blue Chip Stamps and Berkshire's original textile mills, and how those businesses ultimately failed as society moved on.Buffett said that Diversified Retailing, its department-store business, was eventually sold and the proceeds were plowed back into Berkshire. The investor estimated that decision generated about $25 billion in value, based on the increase in Berkshire's stock price since then.Buffett also commented on the mishmash of businesses that made up Berkshire in its early days. "It looked like a plate of spaghetti at one time, which was not good," he said.Munger said that a key lesson he learned from Berkshire's early failures: "If it's clear that something is a mistake, fix it quickly. It doesn't get better while you wait."<h2>Role models</h2>Next, the pair discussed their relationships with their fathers. "I never heard my dad say in my life, 'Be sure you pay all your debts,' but I just watched how he lived," Buffett said."You want to have certain people in life that you don't want to disappoint," he continued. "You want to have people that make you a better person.""I was surrounded by high-grade people," Munger said, highlighting his father, who was a lawyer like him. "I was just forced to imitate the right people."Buffett recalled how as a young boy, he often dropped in on four or five housewives on his way home from Sunday mass, as he always enjoyed speaking to people older than him.The investor emphasized the power of being able to choose the people in his life. "We've had that luxury now for 60 years or close to it," he said. "That beats 25-room houses, and six cars. What really is great is if you can do what you want to do in life, and associate with the people you want to associate with in life."Buffett also reflected on his first impression of Munger. "I knew when I met Charlie, after a few minutes in the restaurant, that this guy was gonna be in my life forever.""We were gonna have fun together, we were gonna make money together, we were gonna get ideas from each other, we were both gonna both behave better than if we didn't know each other," he added.<h2><keyword id="1591611" type="PERSON" weightage="60" keywordseo="remote-work">Remote work</keyword></h2>Buffett and Munger also discussed how they adapted to the pandemic. "I've fallen in love with Zoom," Munger said, adding that he uses the video-communication tool at least three times daily. "It just adds so much convenience."Meanwhile, Buffett said he's "not a Zoom guy" and doesn't see much value in using it. "I find the telephone a very satisfactory instrument," he said.Munger also discussed some of the pandemic's fallout. "A lot of business travel will never come back," he said, adding that companies will decide to have a couple of in-person meetings a year and use Zoom to conduct the rest of them. Highlighting the slump in office demand, he added that lots of aspects of work could change for good.<h2>The pandemic</h2>Buffett added that a lot remains unknown about the pandemic, and highlighted how uneven and unpredictable the economic impacts have been with smaller businesses struggling and many large corporations thriving.The Berkshire chief also disclosed that some of his company's car dealerships wanted to apply for government aid, but Buffett stopped them because they had a "rich parent." He also underscored the immense danger when droves of people take out loans in a crisis because they're worried they won't have access to credit in a week's time."You get enough people believing something won't be there next week in banking, it won't be there next week, absent the Federal Reserve," Buffett said.The investor added that his most important lesson from the pandemic was that it was bound to occur eventually, and that it wasn't "the worst one that's imaginable at all," he said.<h2>Decentralization</h2>Buffett and Munger emphasized how much they enjoy Berkshire's decentralized structure, which allows them to delegate responsibility to the managers of its scores of subsidiaries. Munger predicted that the strategy would catch on more widely."Just as we found we can eliminate some business travel, we're gonna find we can get rid of some dumb bureaucracy in American corporations," he said.Buffett also balked at the idea of helming a centralized company. "I'd resign or would have been fired," he said. "I'd rather be in a jail cell with a few people who are interesting, and plenty of reading material."<h2>Partners for life</h2>The Berkshire chief reserved some heartfelt praise for his partner of six decades."It goes well beyond buying a stock and selling it higher," Buffett said about Munger's contributions to society. "He's designed dormitories and helped build them. He's worked at hospitals to understand how they can be made better and serve more people and do it at less cost.""Charlie's worked on big problems, and he doesn't need to," the investor continued. "Charlie has never shaded anything he's told me since we met, in terms of presenting it to me in a different way than reality, and he's never done anything I've seen that's self-serving.""He makes me better than I would otherwise be," Buffett added. "I don't wanna disappoint him."

Warren Buffett and Charlie Munger knocked Robinhood, discussed the Archegos fiasco, and reflected on their friendship in a new interview. Here are the highlights

Hello everyone! Welcome to this weekly roundup of <keyword id="35175" type="ORGANIZATION" weightage="60" keywordseo="investing">Investing</keyword> stories from deputy editor Joe Ciolli. Please <a href="http://newsletter.businessinsider.com/join/4np/insider-investing" target="_blank" rel="noopener">subscribe here</a> to get this newsletter in your inbox every week.Hello and welcome to Insider Investing. I'm Joe Ciolli, and I'm here to guide you through what's been happening in <keyword id="31671" type="CITY" weightage="100" keywordseo="markets">markets</keyword>. Here's what's on the docket:<ul><li>Experts have been busy finding strategies designed to capitalize on President Biden's $2 trillion infrastructure plan. An analyst for the top-performing US infrastructure ETF this year shares <a href="https://www.businessinsider.com/biden-infrastructure-stocks-to-buy-now-biden-package-top-etf-2021-3" target="_blank" rel="noopener">5 stock picks</a>, while UBS unveils <a href="https://www.businessinsider.com/investing-commodity-trades-capitalize-biden-infrastructure-plan-reopening-ubs-strategy-2021-4" target="_blank" rel="noopener">8 high-return commodity trades</a>.</li><li>Now that the infamous hedge-fund explosion of Archegos is in the rear view, we've nailed down a <a href="https://www.businessinsider.com/archegos-implosion-options-expert-explains-derivatives-role-warren-buffett-trade-2021-3" target="_blank" rel="noopener">"Warren Buffett trade"</a> investors can use to take advantage, as well as <a href="https://www.businessinsider.com/archegos-capital-management-experts-share-how-traders-can-exploit-blowup-2021-3" target="_blank" rel="noopener">strategies designed to profit from mispricings</a>.</li><li>Ryan Jacob's internet-focused mutual fund is up 201% over the past year. He shared with us <a href="https://www.businessinsider.com/stocks-to-buy-best-internet-significant-upside-faang-ryan-jacob-2021-3" target="_blank" rel="noopener">5 stocks he thinks will crush Wall Street estimates</a> going forward.</li></ul><a href="http://newsletter.businessinsider.com/join/4np/insider-investing" target="_blank" rel="noopener">If you aren't yet a subscriber to Insider Investing, you can sign up here.</a>Have thoughts on the newsletter? Just want to talk markets? Feel free to drop me a line at <a href="mailto:ddefrancesco@businessinsider.com" target="_blank" rel="noopener">jciolli@insider.com</a> or on Twitter <a href="https://twitter.com/JoeCiolli" target="_blank" rel="noopener">@JoeCiolli</a>.<h2><a href="https://www.businessinsider.com/biden-infrastructure-stocks-to-buy-now-biden-package-top-etf-2021-3" target="_blank" rel="noopener">How to trade the infrastructure bill</a></h2><a href="https://www.businessinsider.com/biden-infrastructure-stocks-to-buy-now-biden-package-top-etf-2021-3" target="_blank" rel="noopener"></a>President Joe Biden recently announced a $2 trillion plan to rebuild American infrastructure. We spoke to Global X infrastructure analyst Andrew Little about <a href="https://www.businessinsider.com/biden-infrastructure-stocks-to-buy-now-biden-package-top-etf-2021-3" target="_blank" rel="noopener">5 stocks he thinks stand to benefit</a>.UBS is also looking for opportunities specifically in the commodity space. The firm recently revealed <a href="https://www.businessinsider.com/investing-commodity-trades-capitalize-biden-infrastructure-plan-reopening-ubs-strategy-2021-4" target="_blank" rel="noopener">8 such trades it says can each lead to 10%-plus returns</a> as raw-material prices surge.Read the full stories here:<h3><a href="https://www.businessinsider.com/biden-infrastructure-stocks-to-buy-now-biden-package-top-etf-2021-3" target="_blank" rel="noopener">An analyst for the top-performing infrastructure ETF in the US this year shares 5 stocks set to benefit for years from Biden and Congress' expected multitrillion-dollar package</a></h3><h3><a href="https://www.businessinsider.com/investing-commodity-trades-capitalize-biden-infrastructure-plan-reopening-ubs-strategy-2021-4" target="_blank" rel="noopener">UBS says these 8 commodity trades could make you a return of at least 10% as the reopening and Biden's $2 trillion infrastructure plan send prices surging</a></h3><h2><a href="https://www.businessinsider.com/archegos-implosion-options-expert-explains-derivatives-role-warren-buffett-trade-2021-3" target="_blank" rel="noopener">Strategies for Archegos fallout</a></h2><a href="https://www.businessinsider.com/archegos-implosion-options-expert-explains-derivatives-role-warren-buffett-trade-2021-3" target="_blank" rel="noopener"><div type="image" title="Bill Hwang" height="640" width="1280" msid="82022014" hostid="261"></div></a>For investors that were spared serious fallout from the implosion of Archegos, the whole ordeal is a good opportunity to reevaluate certain approaches, and perhaps even capitalize on the chaos.From a <a href="https://www.businessinsider.com/archegos-implosion-options-expert-explains-derivatives-role-warren-buffett-trade-2021-3" target="_blank" rel="noopener">"Warren Buffett trade"</a> investors can use to take advantage, to <a href="https://www.businessinsider.com/archegos-capital-management-experts-share-how-traders-can-exploit-blowup-2021-3" target="_blank" rel="noopener">strategies designed to profit from mispricings</a>, we've been busy compiling recommendations.Read the full stories here:<h3><a href="https://www.businessinsider.com/archegos-implosion-options-expert-explains-derivatives-role-warren-buffett-trade-2021-3" target="_blank" rel="noopener">An options expert breaks down how the secretive derivatives instruments at the center of the Archegos implosion work - and shares a 'Warren Buffett trade' that investors can execute to take advantage of stocks impacted by the $30 billion selling spree</a></h3><h3><a href="https://www.businessinsider.com/archegos-capital-management-experts-share-how-traders-can-exploit-blowup-2021-3" target="_blank" rel="noopener">2 experts in the risky product that triggered Archegos' $20 billion margin call break down the market implications of the blowup - and share how traders can take advantage of the heightened volatility</a></h3><h3><a href="https://www.businessinsider.com/ex-baupost-pm-replicate-hedge-fund-performance-with-less-risk-2021-4" target="_blank" rel="noopener">An investor who used to work for Baupost's Seth Klarman explains why he thinks the Archegos implosion is the 'Frankenstein version of GameStop' - and shares how to replicate hedge fund performance without taking on huge risks</a></h3><h2><a href="https://www.businessinsider.com/stocks-to-buy-best-internet-significant-upside-faang-ryan-jacob-2021-3" target="_blank" rel="noopener">99th-percentile internet investing</a></h2><a href="https://www.businessinsider.com/stocks-to-buy-best-internet-significant-upside-faang-ryan-jacob-2021-3" target="_blank" rel="noopener"><div type="image" title="Ryan Jacob" height="1500" width="3000" msid="82022016" hostid="261"></div></a>Ryan Jacob's mutual fund - the Jacob Internet Fund (<a href="https://markets.businessinsider.com/funds/jacob-internet-investor-class-us4697856049">JAMFX</a>) - is up 201% over the last year. He shared with us <a href="https://www.businessinsider.com/stocks-to-buy-best-internet-significant-upside-faang-ryan-jacob-2021-3" target="_blank" rel="noopener">5 stocks he thinks will crush Wall Street estimates</a> going forward. And while he tends to stay away from large-cap firms, he shared <a href="https://www.businessinsider.com/stocks-to-buy-best-internet-significant-upside-faang-ryan-jacob-2021-3" target="_blank" rel="noopener">which two FAANMG stocks he likes most</a>.Read the full story here:<h3><a href="https://www.businessinsider.com/stocks-to-buy-best-internet-significant-upside-faang-ryan-jacob-2021-3" target="_blank" rel="noopener">Ryan Jacob's internet fund tripled in value over the last year and beat 99% of its peers over the past 3. He shared 5 stocks he's betting on for their 'very significant' upside - and the 2 FAANMG firms he thinks will grow 20-30% per year.</a></h3><h2>Stock pick central</h2>Seeking experts who are willing to name names? Look no further:<ul><li><a href="https://www.businessinsider.com/goldman-sachs-stock-picks-for-higher-eps-earnings-growth-consensus-2021-4" target="_blank" rel="noopener">Goldman Sachs handpicks 40 stocks that will enjoy bigger earnings growth than Wall Street expects in 2021</a></li><li><a href="https://www.businessinsider.com/stock-picks-to-buy-30-top-global-ideas-q2-rbc-2021-4" target="_blank" rel="noopener">RBC says to buy these 30 high-conviction stocks that represent its analysts' top global ideas for 2021 amid an economic reopening and rising inflation expectations</a></li><li><a href="https://www.businessinsider.com/stocks-picks-to-buy-china-electric-vehicle-ev-dominate-jefferies-2021-4" target="_blank" rel="noopener">Jefferies unveils 15 stocks to buy as China's electric-vehicle sector is about to accelerate on favorable regulatory policies, consumer adoption, and tech partnerships</a></li><li><a href="https://www.businessinsider.com/stock-picks-to-buy-best-reliable-all-weather-morgan-stanley-2021-4" target="_blank" rel="noopener">MORGAN STANLEY: Buy these 25 highly reliable stocks set to perform well in any market environment as rising prices threaten to crush profit margins</a></li><li><a href="https://www.businessinsider.com/stock-picks-to-buy-pandemic-seismic-shifts-financials-btig-emanuel-2021-3" target="_blank" rel="noopener">Buy these 30 stocks that are best-placed to benefit from the pandemic's 'seismic shifts' and continue surging in its aftermath, BTIG says</a></li><li><a href="https://www.businessinsider.com/stocks-to-buy-biden-infrastructure-plan-trillion-build-back-semiconductor-bofa-2021-4" target="_blank" rel="noopener">BANK OF AMERICA: Buy these 14 semiconductor stocks poised to benefit from Biden's multitrillion-dollar infrastructure plan - including 1 set to surge 39%</a></li><li><a href="https://www.businessinsider.com/stock-picks-to-buy-with-best-profitability-growth-estimates-gs-2021-4" target="_blank" rel="noopener">Goldman Sachs says buy these 33 stocks now as profits rebound for companies that suffered the most during the pandemic</a></li><li><a href="https://www.businessinsider.com/stocks-to-buy-30-cheapened-stocks-with-high-incomes-barclays-2021-3" target="_blank" rel="noopener">BARCLAYS: Buy these 30 'cheapened' stocks with high incomes that can beat macro headwinds or rising rates</a></li><li><a href="https://www.businessinsider.com/tech-stocks-etfs-to-buy-for-consistent-dividend-payments-cfra-2021-4" target="_blank" rel="noopener">Buy these 3 tech stocks and 2 ETFs that will continue boosting dividend payments to shareholders as the economy recovers, CFRA says</a></li></ul>

Trading the infrastructure bill, plus strategies for Archegos fallout

<ul class="summary-list"><li>Three Chinese tech firms will buyback $1.55 billion in shares after their stocks fell due to the <keyword id="11012164" type="UNKNOWN" weightage="60" keywordseo="archegos">Archegos</keyword>' blow-up.</li><li>Hedge fund Archegos Capital Management was forced to liquidate its positions due to margin calls from banks.</li><li><keyword id="4897273" type="COMPANY" weightage="60" keywordseo="vipshop">Vipshop</keyword>, <keyword id="6050734" type="UNKNOWN" weightage="60" keywordseo="Tencent-Music">Tencent Music</keyword>, and <keyword id="9805348" type="UNKNOWN" weightage="60" keywordseo="gsx-techedu">GSX Techedu</keyword> all announced share buybacks in the past week.</li></ul>The Chinese tech firms <a href="https://markets.businessinsider.com/stocks/vips-stock">Vipshop</a>, <a href="https://markets.businessinsider.com/stocks/tme-stock">Tencent Music Entertainment</a>, and <a href="https://markets.businessinsider.com/stocks/gsx-stock">GSX Techedu</a> all announced share buybacks after getting hammered by the hedge fund Archegos' blow-up at the end of last week.Tencent Music Entertainment's board <a href="https://www.prnewswire.com/news-releases/tencent-music-entertainment-group-announces-1-billion-share-repurchase-program-301257167.html">approved</a> a $1 billion buyback program of its class A shares over the next 12 months on Sunday. Vipshop followed suit this week <a href="https://www.prnewswire.com/news-releases/vipshop-announces-us500-million-share-repurchase-program-301258302.html">authorizing</a> a $500 million share buyback program over the next 24 months on Tuesday. Both companies plan on using their existing cash balances for the repurchases.Larry Xiangdong Chen, the founder, chairman and CEO of GSX Techedu, said he would use personal funds to <a href="https://www.prnewswire.com/news-releases/gsx-announces-mr-larry-xiangdong-chens-share-purchase-plan-of-up-to-us50-million-shares-301258296.html">buy back $50 million worth</a> of his education technology company over the next 12 months in a Tuesday press release as well.The three Chinese firms were hurt by the <a href="https://www.businessinsider.com/archegos-hedge-fund-liquidation-wall-street-credit-suisse-nomura-goldman-2021-3">forced liquidation of Archegos' Capital Management</a>, a hedge fund that failed to meet <a href="https://www.businessinsider.com/what-is-a-margin-call">margin calls</a> from big banks including Goldman Sachs, Morgan Stanley, Credit Suisse, Nomura, UBS, and Deutsche Bank.Archegos' had placed leveraged bets on the Chinese tech firms, among others. When it was forced to rapidly liquidate its positions to pay back banks, shares of its holdings plummeted.In the past week alone, as of Monday's closing price, Vipshop fell over 37% while Tencent Music Entertainment and GSX Techedu fell 36% and 56%, respectively.The Archegos blow-up didn't just hurt the hedge fund's holdings either. Banks like Credit Suisse and Nomura have said they are facing <a href="https://www.businessinsider.com/credit-suisse-price-nomura-losses-banks-archegos-stock-firesale-2021-3">significant losses</a> stemming from the event.Archegos' was run by <keyword id="11012210" type="UNKNOWN" weightage="60" keywordseo="bill-hwang">Bill Hwang</keyword>, a former protégé of the hedge-fund titan Julian Robertson, who founded Tiger Capital Management.Hwang used "total return swaps" to borrow huge sums from banks in relative anonymity without having to put down as much collateral. "Total return swaps" allow users to take on the profits and losses of a portfolio in exchange for a fee.The tactic has been widely criticized by economists and investors including Warren Buffett. The "oracle of Omaha" said in a <a href="https://www.berkshirehathaway.com/letters/2002pdf.pdf">2002 letter to investors</a> that these types of "derivatives are financial weapons of mass destruction, carrying dangers that, while now latent, are potentially lethal."

Chinese tech firms hammered by the Archegos blow-up announce share buybacks

<ul class="summary-list"><li>Credit Suisse stock tanked on Monday, as concerns grew that it would default on its debts.</li><li>The Swiss Bank is working to assuage widespread worries about its financial health.</li></ul>Credit Suisse is fending off concerns about its financial health, with some investors going as far as suggesting the Swiss bank is at risk of suffering a Lehman Brothers-style collapse that could upend the global financial system. Here's a closer look at what's going on.<h2>Markets are on edge</h2>Rampant inflation, soaring interest rates, early signs of a global economic downturn, and tumbling asset prices have spooked investors in recent months, and made them worry about what's coming next.The new UK government also roiled markets last week by announcing a slew of unfunded tax cuts and spending programs, which fueled fears of worse inflation and more rate hikes. The news <a href="https://markets.businessinsider.com/news/currencies/pound-dollar-tax-cuts-inflation-recession-stagflation-interest-rates-hikes-2022-9">sent the British pound to a record low</a> against the US dollar, spiked the UK government's borrowing costs, and prompted a <a href="https://markets.businessinsider.com/news/bonds/bank-of-england-bond-buying-pound-yields-qe-markets-economy-2022-9">rare Bank of England intervention</a>. The backlash spurred Prime Minister Liz Truss and her team on Monday to <a href="https://markets.businessinsider.com/news/currencies/pound-jumps-uk-kwarteng-government-abandon-tax-cuts-rich-kwarteng-2022-10">scrap their planned removal</a> of the top rate of income tax.With all that kindling, it should be no surprise that a spark would cause a massive blaze. In this case, Credit Suisse CEO Ulrich Koerner told staff in a Friday memo that it was a "critical moment" for the bank ahead of the unveiling of its restructuring plan on October 27, and they should expect more market volatility.Instead of calming anyone, the memo set Twitter and Reddit alight with wild predictions of the bank imploding and triggering the collapse of the global financial system. A large Credit Suisse investor <a href="https://mobile.twitter.com/CGasparino/status/1576233963294949376">told a Fox reporter</a> the bank's investment arm is a "disaster," and the lender's credit-default swaps were trading as if a "Lehman moment was about to hit."Senior bank executives rushed to reassure large clients, counterparties, and investors about their liquidity and capital position over the weekend, the <a href="https://www.ft.com/content/c62bea1f-2929-4473-838d-665dc6c45f83">Financial Times reported</a>. The BoE also liaised with Swiss authorities after the Credit Suisse memo added fuel to the firesale in markets, <a href="https://www.telegraph.co.uk/business/2022/10/02/bank-england-monitors-credit-suisse-amid-market-turbulence/">The Telegraph reported</a>.<h2>Bad news for Credit Suisse</h2>Credit Suisse shares <a href="https://markets.businessinsider.com/news/stocks/stock-market-news-credit-suisse-stock-price-lehman-brothers-moment-2022-10">fell as much as 12%</a> on Monday morning, extending their decline this year to 60%. Moreover, the spread on five-year credit-default swaps (CDS), which investors often buy as insurance against a company defaulting, climbed as high as 350 basis points, up from about 55 basis points at the start of this year, the <a href="https://www.ft.com/content/51480b88-9e08-477d-8a31-f973e4b337a1">FT reported</a>. The larger spread suggests investors now see a far higher chance of the bank defaulting on its debts.If Credit Suisse decides to issue shares to fund its restructuring plans, the plunge in its stock price this year will make a capital raise much more dilutive for existing shareholders. The wider CDS spread will likely translate into higher borrowing costs too, as it reflects greater concerns about the bank's creditworthiness.The bank updated its talking points for staff over the weekend to note it has a $100 billion capital buffer, and still expects to maintain a 13% to 14% ratio for its safest equity capital through the end of this year, The Journal reported.Credit Suisse, which manages about $1.1 trillion of assets, has been hit by several fiascos in recent years. For example, it was <a href="https://www.businessinsider.com/greensill-capital-bankruptcy-bluestone-resources-lawsuit-fraud-loan-fintech-finance-2021-3">embroiled</a> in the Greensill Capital scandal, and <a href="https://www.businessinsider.com/credit-suisse-archegos-greensill-viacom-thomas-gottstein-brian-chin-bill-hwang">suffered</a> a $5 billion blow from the collapse of Archegos Capital Management last year.There's no reason yet to believe Credit Suisse is at risk of imploding and causing a repeat of the 2008 financial crisis. However, it's clear that already rattled investors are deeply worried about the bank's short-term outlook, and the company hasn't succeeded in alleviating their concerns.Credit Suisse didn't immediately respond to a request for comment from Insider.Read more: <a href="https://www.businessinsider.com/david-rubenstein-book-warren-buffett-carlyle-berkshire-key-investing-skills-2022-10">David Rubenstein sees Warren Buffett as the ultimate investor. The private equity billionaire lays out the 12 traits and habits that are key to Buffett's success.</a>

Credit Suisse is fending off concerns about its financial health, fanning fears of another Lehman Brothers moment that could roil the global financial system. Here's what's happening, and what it means.

<ul><li><keyword id="831606" type="PERSON" weightage="60" keywordseo="Leon-Cooperman">Leon Cooperman</keyword> criticized the federal government for pumping up the US economy.</li><li>The billionaire investor said low interest rates and <keyword id="45304" type="COMPANY" weightage="60" keywordseo="Stimulus">stimulus</keyword> are pushing investors to take risks.</li><li>The <keyword id="2732126" type="POSITION" weightage="60" keywordseo="Omega-Advisors">Omega Advisors</keyword> boss warned of a brutal market crash once conditions worsen.</li><li><a href="https://www.businessinsider.com/?hprecirc-bullet">See more stories on Insider's business page</a>.</li></ul>Leon Cooperman blasted the federal government for juicing a booming economy, predicted rising inflation will prompt an interest-rate hike next year, and warned <keyword id="31671" type="CITY" weightage="100" keywordseo="markets">markets</keyword> will nosedive once sentiment shifts during a <a href="https://www.bloomberg.com/news/videos/2021-05-05/leon-cooperman-on-fed-economy-and-current-state-of-markets-video">Bloomberg Surveillance interview</a> this week.The billionaire investor and Omega Advisors chief also blamed the <keyword id="6355253" type="UNKNOWN" weightage="60" keywordseo="federal-reserve">Federal Reserve</keyword> for investors taking greater risks, highlighted a bubble in the bond market, and questioned the need for greater regulation of family offices.<h2>Here are Cooperman's 11 best quotes from the interview, lightly edited and condensed for clarity:</h2>1. "It's the advance of greed basically. The fact that the industry would get into the same predicament again is kinda surprising. The more things change, the more they remain the same." - comparing the <a href="https://www.businessinsider.com/archegos-hwang-hedge-fund-meltdown-post-crisis-bank-rules-work-2021-4">recent collapse of Archegos Capital</a>, which sparked over $10 billion of losses for the banks that lent it money, to Long-Term Capital Management blowing up in the late 1990s.2. "I'm a retired money manager living on investment income. I run my own money. Why they have the right to regulate me is beyond my wildest dreams." - questioning the SEC's plans to increase oversight of family offices.3. "I describe myself as a fully invested bear." - Cooperman explained he doesn't currently see the factors that cause bear markets such as accelerating inflation, a hostile Federal Reserve, and recession fears, but he expects the backdrop to change.4. "The biggest plus out there is the Fed has created an environment where there's an absence of alternatives." - arguing that near-zero interest rates have pushed investors into riskier assets such as high-yield bonds, <keyword id="6354298" type="DEFINITION" weightage="60" keywordseo="Stocks">stocks</keyword>, and cryptocurrencies.5. "We are borrowing from the future. Interest rates shouldn't be where they are, and we should not be injecting so much fiscal stimulus when the economy is growing off the charts."6. "The market's gonna be surprised because the Fed will raise rates sometime in 2022. They'll be forced to by inflation."7. "Everything I look at would suggest caution, intermediate to long term, would be the rule of the day."8. "On NFTs, bitcoin, stuff like that - I'm too old. I don't understand that stuff, it's crazy to me, it makes no sense. I'm a meat-and-potatoes guy, a stocks guy."9. "The bubble is not so much the stock market, the bubble is the bond market."10. "They're not cheap stocks, but they're not expensive stocks. Nothing is expensive if interest rates stay here." - commenting on "big tech" stocks and <a href="https://markets.businessinsider.com/news/stocks/warren-buffet-new-investors-tech-stocks-acquisitions-berkshire-hathaway-meeting-2021-5-1030391285">echoing Warren Buffett</a>.11. "When this market has a reason to go down, it's gonna go down so fast your head's gonna spin."

Billionaire investor Leon Cooperman blasted stimulus efforts, flagged a bond bubble, and warned of a brutal market crash in an interview this week. Here are the 11 best quotes.

You Searched For "warren buffett archegos" and got 7 results

Warren Buffett warned 18 years ago about the financial instruments that triggered the Archegos implosion

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Warren Buffett and Charlie Munger slam Robinhood, blast Archegos' lenders, and reflect on their iconic friendship in a new interview. Here are the 15 best quotes

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Warren Buffett and Charlie Munger knocked Robinhood, discussed the Archegos fiasco, and reflected on their friendship in a new interview. Here are the highlights

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Trading the infrastructure bill, plus strategies for Archegos fallout

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Chinese tech firms hammered by the Archegos blow-up announce share buybacks

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Credit Suisse is fending off concerns about its financial health, fanning fears of another Lehman Brothers moment that could roil the global financial system. Here's what's happening, and what it means.

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Billionaire investor Leon Cooperman blasted stimulus efforts, flagged a bond bubble, and warned of a brutal market crash in an interview this week. Here are the 11 best quotes.

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