Tuesday, June 4, 2019

Charlie Munger: 2019 Daily Journal Meeting

Some things Charlie Munger had to say at the Daily Journal (DJCO) meeting earlier this year:

Now...we've done better than average. And now there's a question, why has that happened? Why has that happened? And the answer is pretty simple. We tried to do less. We never had the illusion we could just hire a bunch of bright young people and they would know more than anybody about canned soup and aerospace and utilities and so on and so on and so on. We never had that dream. We never thought we could get really useful information on all subjects like Jim Cramer pretends to have. (laughter) We always realized that if we worked very hard we can find a few things where we were right. And that a few things were enough.

and

...take the modern world where people are trying to teach you how to come in and trade actively in stocks. Well I regard that as roughly equivalent to trying to induce a bunch of young people to start off on heroin. It is really stupid...And then there are people on the TV, another wonderful place, and they say, "I have this book that will teach you how to make 300 percent a year. All you have to do is pay for shipping and I will mail it to you!" (laughter) How likely is it that a person who suddenly found a way to make 300 percent a year would be trying to sell books on the internet to you! (laughter) It's ridiculous.

Yet, somehow, apparently enough individuals will continue to behave as if they can get an edge by buying into what's being promoted -- whether in the form of a book, website, tv show or otherwise. If so, they're taking the promoter(s) advice -- someone who usually benefits one way or another by getting as many folks as possible to pay attention to that advice -- over that of Charlie Munger who's sound opinion is offered with no gain in mind.

Oh, and we're talking about Charlie Munger here.

The word wisdom shouldn't be thrown around carelessly though, in his case, it's the first word that comes to mind.

And that wisdom applies far beyond the relatively narrow world of investing.

More than a few capable investors exist in the world but, with Charlie Munger, we're not simply talking about a capable investor.

In other words, the much deserved praise and admiration that's come his way over the years still, to me, understates his broader significance.

Investing time to understand why may not be such a terrible idea.

The bonus possibly being a few less hours spent on social media.

Adam

No position in DJCO

This site does not provide investing recommendations as that comes down to individual circumstances. Instead, it is for generalized informational, educational, and entertainment purposes. Visitors should always do their own research and consult, as needed, with a financial adviser that's familiar with the individual circumstances before making any investment decisions. Bottom line: The opinions found here should never be considered specific individualized investment advice and never a recommendation to buy or sell anything.