2001: Promotion, not performance, is Wall Street’s biggest money maker.

WARREN BUFFETT: Yeah, most smart people, unfortunately, in Wall Street figure that they can make a lot more money a lot easier just by, one way or another, you know, getting an override on other people’s money or delivering services in some way that people —

And the monetization of hope and greed, you know, is a way to make a huge amount of money. And right now, it’s very — just take hedge funds.

I mean, it’s — I’ve had calls from a couple of friends in the last month that don’t know anything about investing money. They’ve been unsuccessful and everything else. And, you know, one of them called me the other day and said, “Well, I’m forming a small hedge fund.” A hundred and twenty-five million he was talking about.

Like, the thought that since it was only 125 million, maybe we ought to put in 10 million or something of the sort.

I mean, if you looked at this fellow’s Schedule D on his 1040 for the last 20 years, you know, you’d think he ought to be mowing lawns. (Laughter)

But he may get his 125 million. I mean, you know, it’s just astounding to me how willing people are, during a bull market, just to toss money around, because, you know, they think it’s easy.

And of course, that’s what they felt about internet stocks a few years ago. They’ll think it about something else next year, too.

But the biggest money made, you know, in Wall Street in recent years, has not been made by great performance, but it’s been made by great promotion, basically.

Charlie, do you have anything?

CHARLIE MUNGER: Well, I would state it even more strongly. I think the current scene is obscene. I think there’s too much mania. There’s too much chasing after easy money. There’s too much misleading sales material about investments. There’s too much on the television emphasizing speculation in stocks.