Quotes From Charlie Munger, Warren Buffett's Right-Hand Man
Don't drift into self-pity because it doesn't solve any problems.
"Generally speaking, envy, resentment, revenge and self-pity are disastrous modes of thoughts. Self-pity gets fairly close to paranoia, and paranoia is one of the very hardest things to reverse. You do not want to drift into self-pity. ... Self-pity will not improve the situation."
Source: Charlie Munger USC Law Commencement Speech, May 2007
Those who keep learning, will keep rising in life.
Source: Charlie Munger USC Law Commencement Speech, May 2007
At a certain point, you have to suck it up and cope.
“There’s danger in just shoveling out money to people who
say, ‘My life is a little harder than it used to be. At a certain place
you’ve got to say to the people, ‘Suck it in and cope, buddy. Suck it in
and cope.’”
Life has terrible and unfair blows. Utilize them in a constructive fashion.
"Another thing, of course, is that life will have terrible blows in it, horrible blows, unfair blows. It doesn't matter. And some people recover and others don’t. And there I think the attitude of Epictetus is the best. He thought that every missed chance in life was an opportunity to behave well, every missed chance in life was an opportunity to learn something, and that your duty was not to be submerged in self-pity, but to utilize the terrible blow in constructive fashion. That is a very good idea."
Source: Charlie Munger USC Law Commencement Speech, May 2007
Real knowledge is knowing that you don't know anything.
"Confucius said that real knowledge is knowing the extent of one’s ignorance. Aristotle and Socrates said the same thing. Is it a skill that can be taught or learned? It probably can, if you have enough of a stake riding on the outcome. Some people are extraordinarily good at knowing the limits of their knowledge, because they have to be. Think of somebody who’s been a professional tightrope walker for 20 years – and has survived. He couldn’t survive as a tightrope walker for 20 years unless he knows exactly what he knows and what he doesn’t know. He’s worked so hard at it, because he knows if he gets it wrong he won’t survive. The survivors know. ... Knowing what you don’t know is more useful than being brilliant."
Source: The Wall Street Journal
If you're lazy and unreliable, it doesn't matter what you're good at.
"What do you want to avoid? Such an easy answer: sloth and unreliability. If you’re unreliable it doesn’t matter what your virtues are. You're going to crater immediately. Doing what you have faithfully engaged to do should be an automatic part of your conduct. You want to avoid sloth and unreliability."
Source: Charlie Munger USC Law Commencement Speech, May 2007
There's a lot of stupidity on the part of major philanthropic groups.
"I’ve seen so much folly and stupidity on the part of our major philanthropic groups, including the World Bank. I really have more confidence in building up the more capitalistic ventures like Costco."
Don't overspend. Even Mozart couldn't get away with doing that.
"Another thing that does one in, of course, is the self-serving bias to which we’re all subject. You think the 'True Little Me' is entitled to do what it wants to do. And, for instance, why shouldn’t the True Little Me overspend my income. There once was a man who became the most famous composer in the world but was utterly miserable most of the time, and one of the reasons was because he always overspent his income. That was Mozart. If Mozart can’t get by with this kind of asinine conduct, I don’t think you should try."
Source: Charlie Munger USC Law Commencement Speech, May 2007
Avoid extremely intense ideology because it ruins your mind.
Source: Charlie Munger USC Law Commencement Speech, May 2007
Keep it simple.
Source: Wesco Financial annual meeting, 2008 (quoted in Stanford Business School paper)
Optimistic accounting leads to 99% of problems.
"Ninety-nice percent of the troubles that threaten our
civilization come from too optimistic accounting. And yet these damn
accountants with their desire for mathematical purity want to devote
exactly as much attention to accounting that is too pessimistic as they
do to accounting that is too optimistic — which is crazy. Ninety-nie
percent of the problems come from being too optimistic. Therefore, we
should have a system where the accounting is way more conservative."
Assets require more scrutiny than the liabilities.
"The liabilities are always 100 percent good. It’s the assets you have to worry about."
Source: Wesco Financial annual meeting, 2008 (quoted in Stanford Business School paper)
People who rise high enough in business have a moral duty to be underpaid.
Source: Wesco Financial annual meeting, 2008 (quoted in Stanford Business School paper)
Only those who are willing to leave at any point should hold high level corporate jobs.
"'No man is fit to hold office who isn't perfectly willing to leave it at any time,'... I think that ought to be more the test in corporate directorships. Is a man really fit to make tough calls who isn't willing to leave the office at any time? My answer is no."
Source: Berkshire Hathaway 1995 Annual Meeting (quoted in Stanford Business School paper)
"One solution fits all" doesn't work.
Source: Stanford University Director's College, June 26, 2006. (quoted in Stanford Business School paper)
Many successful organizations have fewer (rather than more) controls.
Source: Wesco Financial annual meeting, 2007 (quoted in Stanford Business School paper)
Deserved trust is the most important thing.
Source: Wesco Financial annual meeting, 2008 (quoted in Stanford Business School paper)
Great investing requires a lot of delayed gratification.
"It's waiting that helps you as an investor, and a lot of
people just can't stand to wait. If you didn't get the
deferred-gratification gene, you've got to work very hard to overcome
that.”
Source: The Wall Street Journal
He wanted to be rich in order to be independent.
Source: Buffett: The Making of an American Capitalist
Wisdom acquisition is a moral duty.
"Wisdom acquisition is a moral duty. It’s not something you do just to advance in life. Wisdom acquisition is a moral duty. As a corollary to that proposition which is very important, it means that you are hooked for lifetime learning. And without lifetime learning, you people are not going to do very well. You are not going to get very far in life based on what you already know. You’re going to advance in life by what you learn after you leave here."
Source: Charlie Munger USC Law Commencement Speech, May 2007
School is not a prerequisite.
“To this day, I have never taken a course anywhere, in chemistry, economics, psychology, or business.”
Source: Forbes
He learned by reading, not schooling.
"I met the towering intellectuals in books, not in the classroom, which is natural. I can't remember when I first read Ben Franklin. I had Thomas Jefferson over my bed at seven or eight. My family was into all that stuff, getting ahead through discipline, knowledge, and self-control."
Source: Damn Right!: Behind the Scenes with Berkshire Hathaway Billionaire Charlie Munger
CEOs should be "empowered" to make decisions without extensive review by the board of directors.
Source: Stanford University Director's College. (quoted in Stanford Business School paper)
Even Ben Graham had a lot to learn as an investor.
"I don’t love Ben Graham and his ideas the way Warren
does. You have to understand, to Warren — who discovered him at such a
young age and then went to work for him — Ben Graham’s insights changed
his whole life, and he spent much of his early years worshiping the
master at close range. But I have to say, Ben Graham had a lot to learn
as an investor. His ideas of how to value companies were all shaped by
how the Great Crash and the Depression almost destroyed him, and he was
always a little afraid of what the market can do. It left him with an
aftermath of fear for the rest of his life, and all his methods were
designed to keep that at bay."
Source: The Wall Street Journal
The bailouts should've been ever bigger.
"Hit the economy with enough misery and enough disruption,
destroy the currency, and God knows what happens. So I think when you
have troubles like that you shouldn’t be bitching about a little
bailout. You should have been thinking it should have been bigger.”
The fortunate should give back.
"Those of us who have been very fortunate have a duty to give back. Whether one gives a lot as one goes along as I do, or a little and then a lot (when one dies) as Warren does, is a matter of personal preference."
Source: Poor Charlie's Almanack: The Wit and Wisdom of Charlie T. Munger
Regarding quick trading of derivatives and stocks.
Source: The Wall Street Journal
And his closing advice is...
"In the end I’m like an Old Valiant for Truth in The Pilgrim’s Progress: 'My sword I leave to him who can wear it.'"
Source: Charlie Munger USC Law Commencement Speech, May 2007
BONUS: Some additional Munger zingers.
Regarding Buffett's cancer diagnosis: "I regarded it as a total non-event. I would bet a lot of money that I have more than he does, I don't event allow them to check for it. … So when my doctor puts down PSA test I just cross it out.”
On Donald Trump (according to Andrew Ross Sorkin): "Obviously I think he's a jerk."
On buying gold: "I think gold is a great thing to sew in to your garments if you're a Jewish family in Vienna in 1939 but I think civilized people don't buy gold."
On Bitcoin: "I think it's rat poison."
On bankers: "I do not think you can trust bankers to control themselves. They are like heroin addicts."
And on investment banking in general: "There's more honor in investment management than in investment banking."
And how he will be remembered: I may be remembered as a wise ass.
BONUS: Warren Buffett wants to be remembered as a teacher, not a businessman.
Source: CNBC interview
Source: Charlie Munger USC Law Commencement Speech, May 2007
Source: http://www.businessinsider.com/charlie-mungers-best-quotes-2014-9?op=1/#nt-drift-into-self-pity-because-it-doesnt-solve-any-problems-1
No comments:
Post a Comment