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In investment management today, everybody wants not only to win, but to have a yearly outcome path that never diverges very much from a standard path except on the upside. Well, that is a very artificial, crazy construct. That's the equivalent in investment management to the custom of binding the feet of Chinese women

Charlie Munger

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Charlie Munger
Age: 100
Born: 1924
Born: January 1
Business Person
Financier
Investor
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Omaha
Nebraska
Charlie Thomas Munger
Charles T. Munger
Charles Thomas Munger
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More quotes by Charlie Munger

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Creative accounting is an absolute curse to a civilization. One could argue that double-entry bookkeeping was one of history's great advances. Using accounting for fraud and folly is a disgrace. In a democracy, it often takes a scandal to trigger reform. Enron was the most obvious example of a business culture gone wrong in a long, long time.
Charlie Munger
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Most people are too fretful, they worry to much. Success means being very patient, but aggressive when it's time.
Charlie Munger
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I see almost no change in the price of the composite product that flows through Costco I don't feel sorry for the people who pay $27 million for an 8,000-square-foot condo in Manhattan. So inflation comes in places.
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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A lot of opportunities in life tend to last a short while, due to some temporary inefficiency... For each of us, really good investment opportunities aren't going to come along too often and won't last too long, so you've got to be ready to act and have a prepared mind.
Charlie Munger
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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.
Charlie Munger
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Beta and modern portfolio theory and the like - none of it makes any sense to me.
Charlie Munger
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there are all kinds of wonderful new inventions that give you nothing as owners except the opportunity to spend a lot more money in a business that's still going to be lousy. The money still won't come to you. All of the advantages from great improvements are going to flow through to the customers.
Charlie Munger
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You have to learn to be a follower before you become a leader.
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 it is undeniably true that the human brain must work in models. The trick is to have your brain work better than the other person's brain because it understands the most fundamental models- ones that will do most work per unit.
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.
Charlie Munger
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I bet Richard Fuld doesn't have an ounce of contrition. It's just megalomania. When it's like that, you need rules to prevent catastrophe. When banks are borrowing the government's credit rating, you need rules to prevent stupid things.
Charlie Munger
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It's been my experience in life if you just keep thinking and reading, you don't have to work.
Charlie Munger
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We’re partial to putting out large amounts of money where we won’t have to make another decision.
Charlie Munger
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Understanding how to be a good investor makes you a better business manager and vice versa.
Charlie Munger
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We have found in a long life that one competitor is frequently enough to ruin a business.
Charlie Munger
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The more hard lessons you can learn vicariously rather than through your own hard experience, the better.
Charlie Munger
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Failure to handle psychological denial is a common way for people to go broke: you have made an enormous commitment to something. You have poured effort and money in. And the more you put in, the more that the whole consistency principle makes you think, Now it has to work. If I put in just a little more, then it will work.
Charlie Munger
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There are two kinds of businesses: The first earns 12%, and you can take it out at the end of the year. The second earns 12%, but all the excess cash must be reinvested - there's never any cash. It reminds me of the guy who looks at all of his equipment and says, 'There's all of my profit.' We hate that kind of business.
Charlie Munger