It's stupid the way people extrapolate the past -- and not slightly stupid, but massively stupid. Charlie Munger More Quotes by Charlie Munger More Quotes From Charlie Munger We have a higher percentage of the intelligentsia engaged in buying and selling pieces of paper and promoting trading activity than in any past era. A lot of what I see now reminds me of Sodomand Gomorrah. You get activity feeding on itself, envy and imitation. It has happened in the past that there came bad consequences. Charlie Munger envypiecespast It's not a competency if you don't know the edge of it. Charlie Munger edgesifsknows We're guessing at our future opportunity cost. Warrenis guessing that he'll have the opportunity to put capital out at high rates of return, so he's not willing to put it out at less than 10% now. But if we knew interest rates would stay at 1%, we'd change. Our hurdles reflect our estimate of future opportunity costs. Charlie Munger guessingcostopportunity In the LBO field there is a buried "covariance" with marketable equities, toward disaster in generally bad business conditions, and competition is now extremely intense. Charlie Munger intensecompetitionfields I have what I call an iron prescription that helps me keep sane when I naturally drift toward preferring one ideology over another and that is: I say that I'm not entitled to have an opinion on this subject unless I can state the arguments against my position better than the people who support it. I think only when I've reached that state am I qualified to speak. This business of not drifting into extreme ideology is a very, very important thing in life Charlie Munger ironthings-in-lifethinking Failure to handle psychological denial is a common way for people to go broke: you have made an enormous commitment to something. You have poured effort and money in. And the more you put in, the more that the whole consistency principle makes you think, "Now it has to work. If I put in just a little more, then it will work." Charlie Munger peoplecommitmentthinking The reason we avoid the word 'synergy' is because people generally claim more synergistic benefits than will come. Yes, it exists, but there are so many false promises.Berkshire is full of synergies - we don't avoid synergies, just claims of synergies. Charlie Munger benefitspeoplepromise The stupid and dishonest accountants allowed the genie of totally inappropriate accounting to descend on derivatives books. And once this has happened - people get status, etc. - it's impossible to get it back into the bottle. Charlie Munger stupidbookpeople Strategic plans cause more dumb decisions than anything else in America. Charlie Munger dumbdecisionamerica Every business tries to turn this year's success into next year's greater success. It's hard for me to see why Microsoft is sinful to do this. If it's a sin, then I hope all of Berkshire Hathaway's subsidiaries are sinners. Someone whose salary is paid by U.S.taxpayers is happy to dramatically weaken the one place where we're winning big?! Charlie Munger winningtryingyears I see almost no change in the price of the composite product that flows through Costco I don't feel sorry for the people who pay $27 million for an 8,000-square-foot condo in Manhattan. So inflation comes in places. Charlie Munger squaressorryfeet We've had the most massive creation of wealth for people a lot younger than those who formerly got wealth in the history of the world. The world is full of young people who really want to get rich, and when I left school nobody thought it was a reasonable possibility. Charlie Munger peopleworldschool We have never had the will to enforce the immigration laws. What you see is what you'll continue to get. Charlie Munger immigration-lawsimmigrationlaw Early Charlie Munger is a horrible career model for the young, because not enough was delivered to civilization in return for what was wrested from capitalism. And other similar career models are even worse. Charlie Munger returncareerscivilization Avoid working directly under somebody you don't admire and don't want to be like. Charlie Munger admirewant The only intelligence investing is value investing...to acquire more than one is paying for. Charlie Munger acquireinvestingvalues It would be one of the most irritating experiences in the world to do a lot of work to uncover a fraud and then at have it go from X to 3X and at h the crooks happily partying with your money while you're meeting margin calls. Why would you want to go within hailing distance of that? Charlie Munger crooksdistanceparty The definition of hell in the legal system is: endless due process and no justice; (in the corporate world) it would be: endless due diligence and no horse sense. Charlie Munger horsewould-bejustice If people tell you what you really don't want to hear what's unpleasant-there's an almost automatic reaction of antipathy. You have to train yourself out of it. Charlie Munger reactionswantpeople I think the foundation at Berkshire [Buffett's stake in Berkshirewill pass to the Buffett Foundation upon his death] will be a plus because there will be a continuation of the culture. We'd still take in fine businesses run by people who love them. Charlie Munger runningpeoplethinking
