Been diving into how does warren buffett short stocks and honestly, the answer is pretty straightforward - he basically doesn't. And after reading through his decades of commentary on it, I get why.

Buffett's been pretty vocal about short-selling ever since the internet bubble days. Back in 2001, when everyone was asking if he'd short obviously terrible companies, his response was telling: "Everything we've ever thought about shorting worked out eventually. But it's very painful. It's a whole lot easier to make money on the long side."

Here's the thing that stuck with me - he pointed out that does warren buffett short stocks because the asymmetric risk just doesn't make sense. "You can't make big money shorting because the risk of big losses means you can't make big bets," he said. And then the kicker: "It's ruined a lot of people. You can go broke doing it."

Charlie Munger, his right-hand man at Berkshire Hathaway, put it even more bluntly - being short and watching a promoter pump a stock is "very irritating. It's not worth it to have that much irritation in your life." Fair point.

Buffett even shared a personal horror story from 1954 when he shorted a stock. He said he wouldn't have been wrong over 10 years, but after just 10 weeks his net worth was "evaporating." That's the problem with shorting - timing matters everything, and you can get destroyed before you're proven right.

What's interesting is Buffett doesn't think shorting is evil or wrong in principle. He's actually pretty cool about it. He's said he'd happily lend stock to short-sellers at Berkshire - in fact, he'd charge them for it and pocket the income. He even joked about holding a special meeting for anyone wanting to naked-short Berkshire. That's peak Buffett confidence right there.

But here's his core point on why does warren buffett short stocks remain a hard no: "If you buy something at $20, you can lose $20. If you short at $20, your loss can be infinite." Think about GameStop jumping from $20 to over $400. Anyone caught on the wrong side of that got absolutely wrecked.

Munger summed it up perfectly: "Why would you want to go within hailing distance of that?" After decades in markets, both Berkshire leaders just don't see the risk-reward working out. And honestly, when you look at the math, it's hard to argue with them. Short-selling isn't a compelling way to build wealth - it's just a very tough way to make a living.