Charlie Munger is a legendary investor who was most well-known to be Warren Buffett’s closest partner and Vice-Chairman of Berkshire Hathaway. In his numerous public appearances, Mr. Munger had many memorable quotes that inspired people. Here are three topics where his wisdom really stood out:
LEARN
“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.”
For Munger, the secret is in learning, or how effectively you can accumulate knowledge or skills. There are others who are smarter than we are, or work harder than we do. The key is not to get anxious compare where we are at vs others, but to focus on how to improve our own knowledge. So long as we keep learning every day, we’ll eventually go far like Munger!
Actionable Step:
Learning something is a great way to increase your skill set. If we want to do this every day, we’ll need to be disciplined about it: make it a point to write down things that we learned, so that it’s recorded, reflected, and processed. You may choose to have a learning journal, or a note file on your phone. For example, I read articles, book excerpts, or Blinkist review first thing in the morning and track my learnings on my phone. This way, even if I have a very busy day, I can have this learning session done early. Creating your own habits of learning will be a great investment in your personal development!
THINK
Munger has partnered with Warren Buffett for over 60 years. Over that time, he’s had a front-row seat on the investment universe. Munger noticed that investment success does not directly correlate with intelligence. In fact, he said: “A lot of people with high IQs are terrible investors because they’ve got terrible temperaments.” To Munger, the investor’s temperament, or the lack thereof, is what drives long-term success. He summarized the ideal investor profile as follows:
“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.”
Actionable Step:
Practice how to think calmly and deliberately, even after an emotionally charged event. You could for example create some room for your mind by taking a few deep and slow breaths, having a brisk walk, or taking a coffee break. All of these activities are shifting your brain’s focus away from “temperaments.” Once you notice your emotional state is calmer, you can then practice what Munger suggested: to go after the facts and figure out the value. You can also take a look around you: in your environment, how do the best leaders manage their emotions or practice thoughtful analysis?
DELIVER
“You want to deliver to the world what you would buy if you were on the other end.” This is the elegant way Munger described how we should deliver. In other words, the value that we create for the world must be so clear that we’d do the deal on the other side and still be happy with it: a true win-win situation! When Munger convinced Buffett to buy See’s Candy in 1972 — a quality company with significant brand value and loyal customer base — the owner family wanted to find a buyer after the patriarch passed away. Berkshire Hathaway provided the $25 million that solved the See’s Family’s needs, while See’s Candy provided over $2 billion in profits in the subsequent decades. Both sides walked away happy, with Munger’s long-term investment horizon unlocked significant value for Berkshire Hathaway. Find those win-win solutions, and you will go far in the world.
What Munger has inspired us to do is to learn every day, to think calmly, and to deliver win-win solutions.
Thank you, Mr. Munger, for sharing your wisdom and living by example. You did just as you said: “The best thing a human being can do is to help another human being know more.” And thanks to you, we now all know more today than we did yesterday.
