Charlie Munger, the vice-chair of Berkshire Hathaway, died at the age of 99 on Tuesday 28 November. Warren Buffett, Berkshire’s chief executive, said in a short statement that the company “could not have been built to its present status without Charlie’s inspiration, wisdom and participation”.
Buffett described Munger as the originator of Berkshire Hathaway’s investing approach. “The blueprint he gave me was simple: Forget what you know about buying fair businesses at wonderful prices; instead, buy wonderful businesses at fair prices.” Below, we list a few quotes from Charlie Munger, a man who exemplified sensible, long-term, value investing and who has inspired us with his wisdom over many years.
Source: Financial Times
“The great investors are always very careful. They think things through. They take their time. They’re calm. They’re not in a hurry. They don’t get excited. They just go after the facts, and they figure out the value. And that’s what we try to do.”
“If you want to be a good investor, you have to have a long-term perspective. You have to be willing to be very patient and wait for the right pitch. And when you get the right pitch, you have to be ready to swing hard. You can’t just take a little teeny tiny swing. You have to swing with all your might.”
“I always laugh when people talk about how they’re going to learn how to invest. It’s not a subject you learn in a few weeks. It takes a lifetime to learn how to invest properly.”
“The big money is not in the buying and the selling, but in the waiting.”
“I don’t have to be an expert on every company or even many. I only have to be able to evaluate industries and the leaders within them.”
“You’re not learning anything if you’re not making mistakes.”
“I believe in the discipline of mastering the best that other people have ever figured out. I don’t believe in just sitting down and trying to dream it all up yourself. Nobody’s that smart.”
“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 – and at how much I read. My children laugh at me. They think I’m a book with a couple of legs sticking out.”
“Acquire worldly wisdom and adjust your behaviour accordingly. If your new behaviour gives you a little temporary unpopularity with your peer group…then to hell with them.”
“It takes character to sit with all that cash and to do nothing. I didn’t get to where I am by going after mediocre opportunities.”
“We all are learning, modifying, or destroying ideas all the time. Rapid destruction of your ideas when the time is right is one of the most valuable qualities you can acquire. You must force yourself to consider arguments on the other side.”
“I constantly see people rise in life who are not the smartest, sometimes not even the most diligent, but they are learning machines. They go to bed every night a little wiser than they were when they got up and boy does that help, particularly when you have a long run ahead of you.”
“The iron rule of nature is: you get what you reward for. If you want ants to come, you put sugar on the floor.”
“If something is too hard, we move on to something else. What could be simpler than that?”
“A lot of people with high IQs are terrible investors because they’ve got terrible temperaments. And that is why we say that having a certain kind of temperament is more important than brains. You need to keep raw irrational emotions under control. You need patience and discipline and an ability to take losses and adversity without going crazy. You need an ability to not be driven crazy by extreme success.”
“Mimicking the herd invites regression to the mean (merely average performance).”
“Man’s imperfect, limited-capacity brain easily drifts into working with what’s easily available to it. And the brain can’t use what it can’t remember or when it’s blocked from recognizing because it’s heavily influenced by one or more psychological tendencies bearing strongly on it…the deep structure of the human mind requires that the way to full scope competency of virtually any kind is to learn it all to fluency—like it or not.”
“Remember that reputation and integrity are your most valuable assets—and can be lost in a heartbeat.”
RIP Charlie Munger
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