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Mimicking the herd invites regression to the mean.

Charlie Munger

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Charlie Munger
Age: 100
Born: 1924
Born: January 1
Business Person
Financier
Investor
Lawyer
Omaha
Nebraska
Charlie Thomas Munger
Charles T. Munger
Charles Thomas Munger
Herd
Herds
Invites
Mean
Mimicking
Regression

More quotes by Charlie Munger

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A lot of our respected financial institutions are just casinos in drag.
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Accounting is a big subject and there are huge forces in play. The entire momentum of existing thinking and existing custom is in a direction that allows terrible follies to happen, and the terrible follies have terrible consequences.
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The first chance you have to avoid a loss from a foolish loan is by refusing to make it there is no second chance.
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How could economics not be behavioral? If it isn't behavioral, what the hell is it?
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Berkshireis not as good as it was in terms of percentage compounding [going forward], but it's still a hell of a business.
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If you have competence, you know the edge. It wouldnt be a competence if you didnt know where the boundaries lie. Asking whether youve passed the boundary is a question that almost answers itself.
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The safest way to get what you want is to deserve what you want.
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For many of our shareholders, our stock is all they own, and we're acutely aware of that. Our culture [of conservatism] runs pretty deep.
Charlie Munger
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Clever derivatives broke dozens of companies. It killed them. Bankrupt. We don't need these kinds of innovation in finance. It's OK to be boring in finance. What we want is innovation in widgets.
Charlie Munger
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Financial institutions make us nervous when they're trying to do well.
Charlie Munger
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A rough rule in life is that an organization foolish in one way in dealing with a complex system is all too likely to be foolish in another.
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How should the best parts of psychology and economics interrelate in an enlightened economist's mind?... I think that these behavioral economics...or economists are probably the ones that are bending them in the correct direction. I don't think it's going to be that hard to bend economics a little to accommodate what's right in psychology.
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It's not the bad ideas that do you in, but the good ones.
Charlie Munger
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Wesco had a market capitalization of $40 million when we bought it [in the early 1970s]. It's $2 billion now. It's been a long slog to a perfectly respectable outcome - not as good as Berkshire Hathaway or Microsoft, but there's always someone in life who's done better.
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We want very good leaders who have a lot of power.
Charlie Munger
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I believe in the discipline of mastering the best that other people have ever figured out. I don't believe in just sitting down and trying to dream it all up yourself. Nobody's that smart.
Charlie Munger
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It's a finite and very competitive world. All large aggregations of capital eventually find it hell on earth to grow and thus find a lower rate of return.
Charlie Munger
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I think the idea that the hedge fund manager gets lower taxes than the taxi driver or the physics professor is insane. The legislators who leave that policy in place are derelict in their duties to be rational and fair. There are plenty of them in both political parties. It's totally outrageous.
Charlie Munger
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I think corporate managers should learn to be better investors because it would make them better managers.
Charlie Munger
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A Lesson on Elementary, Worldly Wisdom As It Relates To Investment Management & Business
Charlie Munger