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Quote by Charlie Munger

“Understanding both the power of compound interest and the difficulty of getting it is the heart and soul of understanding a lot of things.”

Quote by Charlie Munger

Author

Charlie Munger, born on January 1, 1924, is a distinguished business person known for his investment philosophy and partnership with Warren Buffett at Berkshire Hathaway. He has been a significant influence in the field of finance and investing, contributing to the success of the company over the years. more

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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 only way to win is to work, work, work, work, and hope to have a few insights”

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“I’d say that Berkshire Hathaway’s system is adapting to the nature of the investment problem as it really is. We’ve really made the money out of high quality businesses. In some cases, we bought the whole business. And in some cases, we just bought a big block of stock. But when you analyze what happened, the big money’s been made in the high quality businesses. And most of the other people who’ve made a lot of money have done so in high quality businesses.”

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“Personally, I’ve gotten so that I now use a kind of two-track analysis. First, what are the factors that really govern the interests involved, rationally considered? And second, what are the subconscious influences where the brain at a subconscious level is automatically conclusions in various ways — which, by and large, are useful — but which often malfunction? One approach is rationality… And the other is to evaluate the psychological factors that cause subconscious conclusions — many of which are wrong.”

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“Practically everybody (1) overweighs the stuff that can be numbered, because it yields to the statistical techniques they’re taught in academia, and (2) doesn’t mix in the hard-to-measure stuff that may be more important. That is a mistake I’ve tried all my life to avoid, and I have no regrets for having done that.”

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“We’re partial to putting out large amounts of money where we won’t have to make another decision.”

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“There’s no way that you can live an adequate life without many mistakes. In fact, one trick in life is to get so you can handle mistakes. Failure to handle psychological denial is a common way for people to go broke.”

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“Organized common (or uncommon) sense -- very basic knowledge -- is an enormously powerful tool. There are huge dangers with computers. People calculate too much and think too little.”

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“Obviously if you want to get good at something which is competitive, you have to think about it and practice a lot. You have to keep learning because world keeps changing and competitors keep learning. You have to go to bed wiser than you got up. As you try to master what you are trying to do – people who do that almost never fail utterly. Very few have ever failed with that approach. You may rise slowly, but you are sure to rise.”

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“A business model that relies on trickery is doomed to fail.”

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