Charlie Munger Quotes

In engineering, people have a big margin of safety. But in the financial world, people don't give a damn about safety. They let it balloon and balloon and balloon. It's aided by false accounting.

Almost all good businesses engage in 'pain today, gain tomorrow' activities.

How could economics not be behavioral? If it isn't behavioral, what the hell is it?

No CEO examining books today understands what the hell is going on.

Being rational is a moral Imperative. You should never be stupider than you need to be.

To some extent, stocks are like Rembrandts. They sell based on what they've sold in the past. Bonds are much more rational. No-one thinks a bond's value will soar to the moon.

Everybody engaged in complex work needs colleagues. Just the discipline of having to put your thoughts in order with somebody else is a very useful thing.”

If (investing) weren't a little difficult, everybody would be rich.

Using volatility as a measure of risk is nuts. Risk to us is 1) the risk of permanent loss of capital, or 2) the risk of inadequate return.

If you always tell people why, they'll understand it better, they'll consider it more important, and they'll be more likely to comply.

It's not a competency if you don't know the edge of it.

To me, it's obvious that the winner has to bet very selectively. It's been obvious to me since very early in life. I don't know why it's not obvious to very many other people.

It's a rare business that doesn't have a way worse future than it has a past.

Warren spends 70 hours a week thinking about investing .

You don't have to be brilliant, only a little bit wiser than the other guys, on average, for a long, long, time.

It's human nature to extrapolate the recent past into the future, but it's terrible that managements go along with this.

You don't have to have perfect wisdom to get very rich - just a bit better than average over a long period of time.

The world of derivatives is full of holes that very few people are really aware of. It's like hydrogen and oxygen sitting on the corner waiting for a little flame.

Recognize reality even when you don't like it-especially when you don't like it.

The tradition of always looking for the answer in the most fundamental way available - that is a great tradition, and it saves a lot of time in this world.

For years I have read the morning paper and harrumphed. There's a lot to harrumph about now.

The total amount paid out in dividends is roughly equal to the amount lost in trading and investment advice, so net dividends to shareholders are zero. This is a very peculiar way to run a republic.

What good is envy? It’s the one sin you can’t have any fun at.

At Berkshire Hathaway we do not like to compete against Chinese manufacturers.

A board member should be perfectly willing to leave at any time and willing to make the tough calls.

Understanding how to be a good investor makes you a better business manager and vice versa.

... some important factor doesn't lose its "share of force" just because some "expert" can better measure other types of force.

I'm used to people with very high IQs knowing how to recognize reality, but there's a huge human tendency where it may be instructive to think that whatever you're doing to succeed is all right.

Knowing what you don't know is more useful than being brilliant.

To the man with only a hammer, every problem looks like a nail.

When you borrow a man's car, always return it with a tank of gas.

It's stupid the way people extrapolate the past -- and not slightly stupid, but massively stupid.

The game of life is the game of everlasting learning. At least it is if you want to win.

Proper accounting is like engineering. You need a margin of safety. Thank God we don't design bridges and airplanes the way we do accounting.

The harder you work, the more confidence you get. But you may be working hard on something that is false.

The ethos of not fooling yourself is one of the best you could possibly have. It's powerful because it's so rare.

You've got to have models in your head and you've got to array you experience - both vicarious and direct - onto this latticework of mental models.

Capitalism is a pretty brutal place.

There's no way that you can live an adequate life without making many mistakes.

Fixable but unfixed bad performance is bad character and tends to create more of itself, causing more damage to the excuse giver with each tolerated instance.

It's very useful to have a good grasp of all the big ideas in hard and soft science. A, it gives perspective. B, it gives a way for you to organize and file away experience in your head, so to speak.

The general systems of money management [today] require people to pretend to do something they can't do and like something they don't. It's a terrible way to spend your life, but it's very well paid.

You must value the business in order to value the stock.

We have to have a special insight, or we'll put it in the 'too tough' basket. All of you have to look for a special area of competency and focus on that.

Don't do cocaine. Don't race trains. And avoid AIDS situations.

Spend each day trying to be a little wiser than you were when you woke up. Day by day, and at the end of the day-if you live long enough-like most people, you will get out of life what you deserve.

We don't train executives, we find them. If a mountain stands up like Everest, you don't have to be a genius to figure out that it's a high mountain.

Wells Fargo behaves better than the average big bank. But nobody's perfect.

People always underestimate the ability of earth to increase its carrying capacity.

I think corporate managers should learn to be better investors because it would make them better managers.