One of a Kind
“I think that a life properly lived is just learn, learn, learn all the time.” —Charlie Munger
“You have to keep learning if you want to become a great investor. When the world changes, you must change.” —Charlie Munger
Stock markets had another up week, as continued hopes that the Fed is done raising rates drove the 10-year Treasury yield down close to 4.2%. The major indices all rose for the fifth straight week and also closed out a blockbuster month during the week. For November, the S&P 500 was up 8.9% and the Nasdaq was up 10.7%.
Last week, on November 28th, the investing world also had some sad news. Charlie Munger, someone we’ve long-admired and learned so much from over the years, died at the age of 99.
Charlie was wise and witty. He often spoke the unfiltered truth, and at other times he, famously, had nothing to add. He was multidisciplinary and could speak on topics ranging from economics to psychology to the mating habits of naked mole-rats. He was one of a kind.
Sometimes, he taught lessons by being blunt. Other times, he used analogies and stories to illustrate the important things one should know about investing and the investing profession:
“I think the reason why we got into such idiocy in investment management is best illustrated by a story that I tell about the guy who sold fishing tackle. I asked him, ‘My God, they’re purple and green. Do fish really take these lures?’ And he said, ‘Mister, I don't sell to fish.’”
“Usually, I don’t use formal projections. I don’t let people do them for me because I don’t like throwing up on the desk. But I see them made in a very foolish way all the time, and many people believe in them, no matter how foolish they are. It’s an effective sales technique in America to put a foolish projection on a desk.”
“You have to strike the right balance between competency or knowledge on the one hand and gumption on the other. Too much competency and no gumption is no good. And if you don’t know your circle of competence, then too much gumption will get you killed. But the more you know the limits to your knowledge, the more valuable gumption is.”
And while reading Poor Charlie’s Almanack or watching old Berkshire Hathaway Annual Meeting videos is likely to make you a better investor, there is also so much advice given by Munger to make one a better human and help along the journey of one’s life and career:
“The safest way to try to get what you want is to try to deserve what you want. It’s such a simple idea. It’s the golden rule. You want to deliver to the world what you would buy if you were on the other end. There is no ethos in my opinion that is better for any lawyer or any other person to have. By and large, the people who’ve had this ethos win in life, and they don’t win just money and honors. They win the respect, the deserved trust of the people they deal with. And there is huge pleasure in life to be obtained from getting deserved trust.”
“You’ll do better if you have passion for something in which you have aptitude. If Warren [Buffett] had gone into ballet, no one would have heard of him.”
We will miss Charlie. We didn’t know him personally, but it felt that way, given the time we spent following his wisdom. And while there won’t be any new wisdom, we encourage anyone and everyone to follow his advice below and make friends with Charlie and the lessons he gave us for so long.
“That sounds funny, making friends among the eminent dead, but if you go through life making friends with the eminent dead who had the right ideas, I think it will work better in life and work better in education. It’s way better than just giving the basic concepts.” —Charlie Munger
Tweets of the Week
In Case You Missed it…
Squawk Pod Podcast: Charlie Munger: A Life of Wit and Wisdom Part 1
Squawk Pod Podcast: Charlie Munger: A Life of Wit and Wisdom Part 2
How Much Are You Hurting Your Returns? - by Ian Cassel
Frugal vs. Independent - by Morgan Housel
Mohnish Pabrai's Talk at the YPO Waterloo Austin on October 17, 2023 (video)
Cyber Monday thoughts, part 2: Is $ASO inevitable?
The Security Analysis Podcast: Maj Soueidan: 30 Years of Microcap Investing
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