Charlie Munger renews Robinhood reviews, likens the app to track betting

He added: “It’s really just wild speculation, such as casino betting or racing betting. There’s a long history of destructive capitalism, these commercial orgies that trampled on the people who benefit from it.”

Munger, 97, is the vice president of Berkshire Hathaway Inc. and longtime business partner Warren Buffett. His comments on Thursday echoed the criticism he threw at Robinhood the day before.

Those initial beards of Mr. Munger’s provoked a strong retort from the corridor. Robinhood spokeswoman Jacqueline Ortiz Ramsay said Wednesday that Munger’s comment about people who had the mentality of track bettors was “disappointing and elitist.” Mr Munger made the comment after saying: “It’s very stupid to have a culture that encourages so much the game in action.”

“In a way a whole new generation of investors has been criticized and this comment overlooks the cultural change that is taking place in our nation today,” he said. “Robinhood was created to allow people who don’t have access to generational wealth or the resources that come with it to start investing in the U.S. stock market.”

After hearing Robinhood’s statement in full on Thursday, Munger said, “Everyone wants to protect their way of earning a living. That’s just human nature. That’s all I want to say about it.”

Robinhood has recently been at the center of the storm around GameStop Corp.

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the shares, which shot up, crashed and have risen again amid a frenzy on the part of individual investors. His CEO faced tough questions during a hearing in Congress this month.

The brokerage has also faced scrutiny from Massachusetts securities regulators, who in December criticized the trading platform for exposing clients to “unnecessary trading risks.” Customers have long been attracted to the app because of its free stock operations and its simple and attractive mobile platform. Massachusetts regulators, on the other hand, have said many of these same characteristics have “gamified” the investment experience.

Robinhood has answered the allegations and said earlier that it has made “significant improvements” to its options trading offering and added guarantees and improved educational materials. Last month, the broker responded to Massachusetts regulators, saying its complaint distorted “the Robinhood experience.”

The round trip with Mr. Munger began when the remarkably frank investor was at the Daily Journal’s annual meeting Corp.

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, of which he is president.

During Wednesday’s meeting, Mr. Munger, who has previously asserted the virtues of patience in investing, was asked about the recent Reddit-fueled frenzy around GameStop. In a broad response, Mr. Munger said he believes “you should try to make money in this world by selling other people things that are good for them.”

“If you’re selling them gambling services, where you make profits like many of these new brokers specialize in attracting players, I think it’s a dirty way to make money and I think we’re crazy about allowing them,” he continued. Mr. Munger.

Wednesday later, when asked where he saw an excess in the financial system, Mr Munger said it was very blatant “at the time of trading by novice investors attracted by new types of brokerage operations like Robinhood”.

“I think all this activity is unfortunate,” he said. “I think civilization would be better off without it.”

Write to Caitlin McCabe to [email protected] and Jason Zweig to [email protected]