Charlie Munger, longtime vice chairman of Berkshire Hathaway, said it’s “weird” that voting power at U.S. corporations increasingly lies with operators of index funds.

Munger, whose Berkshire Hathaway Inc. and Daily Journal Corp. are shareholders in Wells Fargo & Co., also isn’t a fan of the work arrangement set up by the bank’s new chief executive officer.

“That’s outrageous,” Munger, 96, said Wednesday in an interview when asked about Charlie Scharf’s choice to live in New York while running the San Francisco-based lender. “Anybody should move for a big job like that.”

The bank named Scharf as CEO in September after a six-month search and agreed to let him remain back east. In addition to running one of the biggest U.S. lenders, Scharf is pushing to help the firm emerge from three years of scandals and regulatory punishments.

Scharf, the former CEO of Bank of New York Mellon Corp. and Visa Inc., defended his work location in September, saying that he’s accustomed to spending “very little time” in the office while doing his job. “I don’t think anyone would ever say in the places I’ve worked that I’ve not been present,” he said. “It’s just the opposite.” A Wells Fargo spokesman declined to comment on Wednesday.

Scharf won the Wells Fargo job after two previous CEOs were felled by consumer scandals that have dogged the bank since late 2016. The company has paid billions of dollars in fines and legal costs and is under a Federal Reserve order limiting its growth.

Munger, chairman of publisher Daily Journal, said he was dismayed that previous Wells Fargo CEO (WFC) Tim Sloan was forced to step down amid criticism last year.

“He was not responsible for the mistakes that were made,” Munger said following Daily Journal’s annual meeting in Los Angeles.

Munger, a California resident, is a vice chairman at Omaha, Nebraska-based Berkshire. The conglomerate run by Warren Buffett is the largest shareholder in Wells Fargo, with a stake valued at about $18 billion. Daily Journal also owns shares in the lender.

Here’s some other key takeaways from the interview Wednesday:

On Index Funds

As Munger ran through the business items for the Daily Journal’s annual meeting, he said it’s “weird” that voting power at U.S. corporations increasingly lies with operators of index funds.

“God knows what the consequences will be,” he said.

He said that Larry Fink, who runs BlackRock Inc., and proxy advisory firm Institutional Shareholder Services Inc. have enormous power. JPMorgan Chase & Co. CEO Jamie Dimon is among critics of the current system, saying some shareholders blindly follow recommendations from proxy advisory firms.

“The voting power of the index funds is a sleeping giant,” Munger said. “If the giant wakes up, we don’t know what’s going to happen.”

On Politics

Munger, a longtime Republican, said both Pete Buttigieg and Senator Amy Klobuchar are interesting presidential candidates. Buttigieg, who gained momentum with the Democratic caucus in Iowa and his second-place ranking in New Hampshire, is “very articulate” and is making a stir, Munger said.

Senator Bernie Sanders, who claimed a victory in New Hampshire’s primary, is a powerhouse, according to Munger. His take on student loan forgiveness and health care has drawn supporters, Munger noted.

“It’s a powerful message,” Munger said. “‘Everybody’s the victim’ and ‘everyone’s being unfair to you’ is a popular refrain.” He declined to name which, if any, candidate he’d back for the presidential election.

Michael Bloomberg is also seeking the Democratic presidential nomination. He is the founder and majority owner of Bloomberg LP, the parent company of Bloomberg News.

On Dealmaking

Berkshire, where Munger is a vice chairman, has been finding it harder to deploy its record $128 billion in cash. For years, Buffett and Munger had sought to avoid stock buybacks, preferring to use cash to strike deals to build out the sprawling conglomerate. That’s become tougher as prices for good businesses skyrocket.

Berkshire’s board loosened its buyback policy in 2018, widening a pathway to deploy capital. The company spent $2.8 billion repurchasing shares in the first nine months of the year.

“We were more optimistic about being able to intelligently use our money elsewhere,” Munger said. “We’re gradually getting more pessimistic.”