Charlie Munger
Charlie Munger
Charles Thomas Mungeris an American businessman, lawyer, investor, and philanthropist. He is vice chairman of Berkshire Hathaway, the conglomerate controlled by Warren Buffett; in this capacity, Buffett describes Charlie Munger as “my partner." Munger served as chairman of Wesco Financial Corporation from 1984 through 2011. He is also the chairman of the Daily Journal Corporation, based in Los Angeles, California, and a director of Costco Wholesale Corporation...
NationalityAmerican
ProfessionEntrepreneur
Date of Birth1 January 1924
CountryUnited States of America
Good businesses can survive a little bad management.
You have to realize the truth of biologist Julian Huxley's idea that 'Life is just one damn relatedness after another' "So you must have the models, and you must see the relatedness and the effects from the relatedness.
They [Mc Donalds] take people and give them a first job, which enables them to get a second job. They do a very good job of educating troubled young people to be good citizens and they're probably more successful than charter schools.
The interesting thing about it to me is the mindset. With all these "helpers" running around, they talk about doing deals. We talk about welcoming partners. The guy doing deals, he wants to do a deal and then unwind it in the near future. It's totally opposite for us. We like to build lasting relationships. I think our system will work better in the long term than flipping deals. I think there are so many of them [helpers] that they'll get in ea h other's way. I don't think they'll make enough money to meet their expectations, by flipping, flipping, flipping.
The hedge fund known as "Long Term Capital Management" collapsed last fall through overconfidence in its highly leveraged methods, despite I.Q.'s of its principals that must have averaged 160. Smart people aren't exempt from professional disasters from overconfidence. Often, they just run aground in the more difficult voyages they choose, relying on their self-appraisals that they have superior talents and methods.
A foreign correspondent, after talking to me for a while, once said: "You don't seem smart enough to be so good at what you're doing. Do you have an explanation?"
Although I am very interested in the subject of human misjudgment - and lord knows I've created a good bit of it - I don't think I've created my full statistical share, and I think that one of the reasons was I tried to do something about this terrible ignorance I left the Harvard Law School with.
If you took our top fifteen decisions out, we'd have a pretty average record. It wasn't hyperactivity, but a hell of a lot of patience. You stuck to your principles and when opportunities came along, you pounced on them with vigor.
Almost all good businesses engage in 'pain today, gain tomorrow' activities.
The harder you work, the more confidence you get. But you may be working hard on something that is false.
In my whole life, I have known no wise people (over a broad subject matter area) who didn't read all the time - none, zero. You'd be amazed at how much Warren reads - at how much I read. My children laugh at me. They think I'm a book with a couple of legs sticking out.
Assume life will be really tough, and then ask if you can handle it. If the answer is yes, you've won.
I think that one should recognize reality even when one doesn't like it; indeed, especially when one doesn't like it.
The number one idea is to view a stock as an ownership of the business and to judge the staying quality of the business in terms of its competitive advantage. Look for more value in terms of discounted future cash-flow than you are paying for. Move only when you have an advantage.