#3: Blue Chip Stamps 1978-1982

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For the third episode of the podcast, I chose to cover the letters of Charlie Munger from Blue Chip Stamps, a holding company with several major subsidiaries, including See's Candies and Wesco Financial.

Blue Chip Stamps' legacy business model was simple: the company issued trading stamps to customers of various businesses, primarily supermarkets and service stations, as a sales promotion strategy.

Customers would collect these stamps and later redeem them for merchandise at Blue Chip Stamps' redemption stores.

However, the real value of the company lay in the "float" generated by the trading stamp business. Munger leveraged this float to invest in and acquire other businesses, which is why Berkshire Hathaway began investing in the company in 1970.

Munger was later named Chairman of the Board and wrote the shareholder letters from 1978 to 1982, until Blue Chip Stamps was merged into Berkshire Hathaway.

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