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Derivative trading with mark-to-market accounting degenerates into mark-to-model. Two firms make a big derivative trade and the accountants on both sides show a large profit from the same trade.
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
Large
Accounting
Trade
Trading
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Firm
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Model
Derivative
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Firms
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Derivatives
Two
Models
Accountants
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Mark
Degenerates
More quotes by Charlie Munger
We have the same problem as everyone else: It's very hard to predict the future.
Charlie Munger
Knowing what you don't know is more useful than being brilliant.
Charlie Munger
You have to realize the truth of biologist Julian Huxley's idea that 'Life is just one damn relatedness after another' So you must have the models, and you must see the relatedness and the effects from the relatedness.
Charlie Munger
Move only when you have an advantage. It's very basic. You have to understand the odds and have the discipline to bet only when the odds are in your favor.
Charlie Munger
See's candy company was the first high-quality business we ever bought.
Charlie Munger
I always like it when someone attractive to me agrees with me, so I have fond memories of Phil Fisher. The idea that it was hard to find good investments, so concentrate in a few, seems to me to be an obviously good idea. But 98% of the investment world doesn't think this way.
Charlie Munger
They [Mc Donalds] take people and give them a first job, which enables them to get a second job. They do a very good job of educating troubled young people to be good citizens and they're probably more successful than charter schools.
Charlie Munger
If you skillfully follow the multidisciplinary path, you will never wish to come back. It would be like cutting off your hands.
Charlie Munger
One of the first big bubbles, of course, was the huge and horrible South Sea Bubble in England. And the aftermath was interesting. Many of you probably don't remember what happened after the South Sea Bubble, which caused an enormous financial contraction, and a lot of pain. They banned publicly traded stock in England for decades.
Charlie Munger
One of the smartest things a person can do is dampen investment expectations, especially with Berkshire. That would be mature and responsible. I like our model and we should do nicely
Charlie Munger
Avoid working directly under somebody you don't admire and don't want to be like.
Charlie Munger
Over many decades, our usual practice is that if something we like goes down, we buy more and more. Sometimes something happens, you realize you’re wrong, and you get out. But if you develop correct confidence in your judgment, buy more and take advantage of stock prices.
Charlie Munger
[Lawyers who file class-action securities suits] is not a group you would want to marry into your family. That said, more than half the time the people being sued by the Lerach firm are guilty of outrageous conduct. The problem is, they don't mind (suing) the other half. They are an equal opportunity litigator.
Charlie Munger
Most people are too fretful, they worry to much. Success means being very patient, but aggressive when it's time.
Charlie Munger
We're the tortoise that has outrun the hare because it chose the easy predictions.
Charlie Munger
I never allow myself to have an opinion on anything that I don't know the other side's argument better than they do.
Charlie Munger
It's a good habit to trumpet your failures and be quiet about your successes.
Charlie Munger
Just avoid things like racing trains to the crossing, doing cocaine, etc. Develop good mental habits.
Charlie Munger
I'm not entitled to have an opinion unless I can state the arguments against my position better than the people who are in opposition. I think that I am qualified to speak only when I've reached that state.
Charlie Munger
I think it would be a great improvement if there were no D&O insurance . The counter-argument is that no-one with any money would serve on a board. But I think net net you'd be better off.
Charlie Munger
