Imagine being the actual wisest person in the whole world. That’s the title given to Charlie Munger by several other people. Born in 1924, he is one of the oldest value investors and has been touted for his wisdom. Warren Buffett, Warren’s children, Bill Gates, Mohnish Pabrai, amongst many others, have labelled him the wisest person they have ever met. Vice chairman of the Berkshire Hathaway, he is a former lawyer turned value investor who has made many mistakes and many successes. Every person that writes about meeting with Charlie comes out wiser wishing they had the opportunity to do so sooner. Below I’ve added my favorite takeaways from Charlie over the last 10 years. I hope you find something interesting.

 

-you have to do things that make you happy. That is the secret to long life

-you can’t be with people who you have to go to extreme measures to get them to behave well

-do not try to succeed in things you aren’t good at

-people who are attracted to positions of power are not nature’s noblemen to begin with

-avoid people of questionable character

-many of our subconscious decisions or conclusions can often be wrong

-the world rewards morality tempered with wit

-once you know someone is toxic, get them out of your life fast

-a great life consists of great people and great businesses

-go for great

-human nature does not change. The same behaviours repeat forever. Look at things through the lens of history

-don’t go for good, go for great

-problems occur from time to time. This is to be expected

-wise people do not whine about their problems, they prevent them

-great businesses and great people are rare. Build relationships with great people. Find good businesses to work for and invest in. Doing those two things will prevent the majority of problems under your control

-knowing what you don’t know is more useful than being brilliant

-it is a rare company whose future will not be worse than its present

-if you haven’t destroyed at least one good idea a year; you have a broken learning process

-Study the history of business and capitalism first

-some people’s lives contain good judgment, others make mistakes over and over again their whole life

-the more you say things, the more it gets pounded in to your own head. So, watch your thoughts, words, actions, behaviour

-acknowledging what you don’t know is the dawning of wisdom

-as long as I have a book in my hand, I don’t feel like I’m wasting time

-we must be strict and demanding of ourselves

-success is not accidental. Timing and opportunities are important, but the inherent character of a person is even more important

-have wisdom in finding the right spouse. They are the key to your happiness and life

-wisdom is avoiding being tricked by deceitful fraud

-the first rule to a happy life is low expectations

-it is hard for ordinary people to become great investors

-use lots of shortcuts to filter people out. Associate with marvellous people

-many of the people ruined by money would have been ruined without money

-I see little reason to complain about the unwisdom of the world. Instead, have humour

-it’s not necessary to hope to persevere; Ferdinand the Great

-a career that’s very tough, you’re not going to do well in. If you go into a field where you have the advantage and like what you do, you will do well

-concentration of thought upon one subject, however interesting, tethers a man’s mind in a narrow field

-there is no better teacher than history

-take a simple idea and take it seriously

-to the man with a hammer, every problem looks like a nail

-you have to figure out what your own aptitudes are. If you play games where other people have the aptitude and you don’t, you’re going to lose

-enjoy the process and the proceeds, because the process is where you live

-it is better to remember the obvious than grasp the esoteric

-have patience; resist the natural human tendency to act

-the only way to win is to work, work and work and hope to have a few insights

-Emulating the crowd encourages a return to the average

-once you have a certain amount of money, making more for the sake of making more when you don’t enjoy it is insane

-enormously talented people go into fraud

-it’s hard to be smart if you’re crazy leftist

-smart people think they are smarter than they are and thus do worse than dumb people

-you can’t live a successful life without doing difficult things that go wrong; otherwise, you wouldn’t be sufficiently courageous

-keep swimming regardless of the current

-know the edge of your competence, don’t trick yourself thinking you are smarter than you are

-avoid people and situations that are just too hard to figure out, regardless of the context

-good investing requires a fine balance between patience and aggression

-If a business generates an 18% return on capital over 20 or 30 years, even if you pay a seemingly high price, you’ll ultimately achieve a favorable outcome. Even if you pay a discount for a 6% business, over a long time it makes 6%. So, look for good businesses and pay for those ones.

-“would you rather be the worlds worst lover while everyone thinks you are the best, or be the best lover but everyone think you are the worst?”

-people leave track records in life. If you want to figure someone out, find out their track record. That is why resumes exist

-deferred gratification does better in the long run than instant gratification, and the long run comes quite soon. So those who invest earlier succeed quicker

-power definitely corrupts

-happiness comes from reducing expectations, not meeting them

-patience, seize opportunity, act rationally for the long term

-invert, always invert. Think first about what you don’t want, which will help you figure out what you want

-be rational if you can’t rely on being a sex object

-accept things as they come

-bitcoin is antisocial

-countries are managing their own currencies according to their own interests, they could care less what happens to the rest of the world

-don’t be a victim, be a survivor. Be responsible, rather than looking for fault

-there are lots of troubles coming, due to wretched excess

-Chinese love to gamble in stocks (very stupid)

-people want fewer and better managers

-fish where the fish are, where the fishing is easier

-with initial screener and checklist, find the right hunting ground to invest in. Chinese companies are the best, good management and growing the fastest so the stock returns will eventually be realized with the business return

-the words you say and think have an effect on you

-young people who protest nonsense is no good, they shout out nonsense

-it’s a big mistake to attend to anything because you become what you pretend to be

-bashes politicians

-learn from the best so you get more out of life than you deserve, particularly those who are similar to you

-there are now a lot of professions and people who make money from misleading people. More difficult than before to find out who is who

-take the high road, it’s less crowded

-high compliments for Costco

-honest success is the best success, not cheated success

-Sequoia capital is one of the best venture capital firms, due to keeping things small

-these fee driven hedge funds are no good, ever ending demand for fees only

-wretched excess in software, venture capitalist companies who are interested in those companies

-media companies are quasi government related, collect from government. Daily journal does not collect until they complete a project, as opposed to hourly collecting. Does not take bad contracts, and does not try to overcharge

-attempts to digitalize is slow to occur over years; very difficult, very transparent about these difficulties

-daily journal; we’ve succeeded not because we are smart, but because other people are so stupid

-I don’t play in a game where other people are wise and I’m stupid. I look for a place where I’m wise and they are stupid. God bless our stupid competitors — Charlie Munger

-Benjamin Franklin: “Keep your eyes fully open before marriage and partially closed afterward”

-no fan of politics

-anger and hatred are foolish

-overconfidence to believe one can tell what someone is like from one interview

-you can’t teach the new dogs old tricks. Or old tricks to new dogs. Old dog survivors are better than new arrogant ones

-did law until enough money from side investment in housing and stocks to quit and do it full time

-sometimes you have to be a capitalist and sometimes a careerist. Buy good businesses

-make theories, and if correct, stick with them, as mental models of checklists. If wrong, immediately switch to what is right

-you don’t have to repeat the success or mistakes of our predecessors. Find your own way and stick to it. Floating paths and moving around doesn’t work.

-Mozart at 10 started writing symphonies, while not asking other people how to do it or if he should do it, just started doing it.

-capitalist operator rather than a cog of a bureaucracy. It’s unlikely for me to succeed in these areas too.

-I don’t have a preference for whether the cat is black or white; what’s important is that it catches mice

-politics is vicissitudes

-bureaucracy is terrible as it doesn’t get things done. Moving things around inboxes and meetings don’t do anything

-keeping it simple investing

-Buffett and Munger have never made a decision based on a macro economic indicator, only on the business

-if you have to follow the business too closely, you shouldn’t own it

-common sense is actually uncommon sense. Standard human condition is mis cognition

-“Improving as a person is likely to enhance your skills as an investor, and growing in wisdom is likely to make you a more adept investor.”

Disclaimer

This is not Financial Advice. This article is meant only for educational and perhaps entertainment purposes.