Charlie Munger

Charlie Munger on Patience, Wisdom, and the Power of Changing Your Mind

An announcement before I begin today’s post.

I have opened admission to the August 2024 cohort of my Online Value Investing Workshop, which has already been taken by 1800+ students ever since I launched it two years ago. Here is what you get when you sign up for this workshop –

30+ hours of pre-recorded lectures and Q&A videos
60+ questions answered in the Q&A
Live Q&A session of 3 hours on Sunday, 25th August 2024 (7 PM IST Onwards)
One-year unrestricted access to the entire content
7 readymade screens to filter high quality stocks (and avoid the bad ones)
Bonus 1: Stock analysis spreadsheet (otherwise priced at ₹1999)
Bonus 2: Rethinking Financial Freedom Masterclass + The Art of Investing Masterclass (otherwise priced at ₹1998)

I am accepting 100 students for this cohort, and the first 30 can claim a special early bird discount on the registration fee. Click here to read the details of the workshop and sign up.

Welcome to the latest issue of ‘The Journal of Investing Wisdom’, where I delve into the thoughts, reflections, and readings that have recently captured my attention. This journal serves as a window into my contemplations and the resources that inspire and inform my journey as an investor. I hope you like what you read below. If you are new here, and wish to get insights and ideas like these straight into your inbox, please click here to become a member.

What I’m Reading

Wit and Wisdom of Charlie Munger

I am a loner and have worked alone for almost the whole of my time at Safal Niveshak, which is for the past 13 years, but I understand the importance of having the right partner. For me, that partner is my wife. 🙂

But if you are looking to find a good partner for work, you may want to look into the 60-year long partnership of Warren Buffett and Charlie Munger, which sadly ended late last year with the passing away of Charlie.

[Read more…]

An Underrated Secret of Success in Life and Investing

The Sketchbook of Wisdom: Get Your Copy Now

Buy your copy of the book Morgan Housel calls “a masterpiece.” It contains 50 timeless ideas – from Lord Krishna to Charlie Munger, Socrates to Warren Buffett, and Steve Jobs to Naval Ravikant – as they apply to our lives today. Click here to buy now.

The Art of Value Investing: Chicago and New York

I am organising a couple of sessions on Value Investing in the US –

Chicago: Sunday, 28th April 2024
New York/New Jersey: Sunday, 12th May 2024

If you are in or around these cities and wish to attend, kindly register here.

In its obituary, The New York Times wrote this about Charlie Munger in December 2023 –

Although overshadowed by Mr. Buffett, who relished the spotlight, Mr. Munger, a billionaire in his own right had far more influence at Berkshire than his title of vice chairman suggested.

Mr. Buffett has described him as the originator of Berkshire Hathaway’s investing approach. “The blueprint he gave me was simple: Forget what you know about buying fair businesses at wonderful prices; instead, buy wonderful businesses at fair prices,” Mr. Buffett once wrote in an annual report.

That investing strategy was a revelation for Mr. Buffett, who had made his name in the 1950s buying troubled companies at deep discounts. (He called them “cigar butts,” because investing in them, he said, was like “picking up a discarded cigar butt that had one puff remaining in it.”)

Mr. Munger counseled Mr. Buffett that if he wanted to build a large, sustainable company that would outperform other investors, he should buy solid brand-name companies. “He was the architect and I was the general contractor,” Mr. Buffett said of their relationship.

[Read more…]

[New Book] The Worldly Wisdom of Charlie Munger

As the first dawn of 2024 breaks, we stand at a poignant milestone.

Today, Charlie Munger would have completed 100 revolutions around the sun. A century that was almost reached, yet remained just beyond grasp, as he left us on November 28, 2023.

[Read more…]

The Charlie Munger Investing Manifesto

Close on the heels of The Charlie Munger Manifesto, which contains his most important rules for living a good life, and avoiding bad outcomes, here comes The Charlie Munger ‘Investing’ Manifesto, which lays down some of his most profound ideas on becoming a wiser investor.

Click here to download the manifesto in high resolution.

Click here to download the manifesto in high resolution.

Read it. Print it. Frame it. Face it. Remember it. Do it.

And if you find value in it, please share it.

* * *

You can never get enough of Charlie. And so, in his memory, and as part of The Inner Game podcast, I am launching a new series titled “The Munger Method” on his unforgettable speech titled “The Psychology of Human Misjudgment.”

In The Munger Method, I am going to try and dissect Charlie’s timeless wisdom from that speech and break it down into bite-sized, easy-to-understand podcasts.

Click here to watch the introduction episode.

You can also find this series and all past episodes of The Inner Game podcast on Apple Podcasts, Spotify, Google Podcasts, and Amazon.

Hope you like them and find some value. Please let me know your feedback and/or suggestions for improvement. Thank you.

The Charlie Munger Manifesto

“We have a passion for keeping things simple,” Charlie Munger would often say.

And taking a leaf out of that, I have created The Charlie Munger Manifesto, which contains his most important rules for living a good life, and avoiding bad outcomes.

These rules are something you can reflect back on, like I have done, if you ever feel stuck in your life.

And if you believe in them, follow them, and stand for them, your life will be good.

Click here to download the manifesto in high resolution.

Click here to download the manifesto in high resolution.

Read it. Print it. Frame it. Face it. Remember it. Do it.

And if you find value in it, please share it.

Thank you.

Charlie Munger Lives on as All Great Philosophers Do

“The best armour of old age is a well spent life preceding it.” – Charlie Munger

It’s a natural human tendency to seek comfort in the belief that certain scenarios are beyond the realm of possibility. Whether it’s a health issue, or a personal tragedy, we often tell ourselves, “That could never happen.” We build mental fortresses around these notions, finding solace in the illusion of invincibility.

But life has a way of humbling us, showing us that no one is exempt from its capriciousness.

Today is one such day.

Charlie Munger, whom I have considered a hero in my life, has passed away at the age of 99, just 34 days from turning 100.

And Charlie is not just a hero for me on paper. He has been, and always will be a guiding force in my life, shaping my values, decisions, and aspirations. His wisdom has been my compass, and his principles are sort of my North Star.

As I mourn his passing, I also celebrate the incredible legacy he leaves behind. The impact he had on my life and the lives of countless others is a testament to his extraordinary character and the enduring power of his words.

This is a moment of grief for me, and it may take some time for acceptance to set it. And so, I will stop writing right away, and just leave you with these beautiful quotes from Charlie on how to be happy in life and survive a long time to tell the tale.

Over to Charlie.

If all you succeed in doing in life is getting rich by buying little pieces of paper, it’s a failed life. Life is more than being shrewd in wealth accumulation.

Remember that reputation and integrity are your most valuable assets – and can be lost in a heartbeat.

A lot of success in life and business comes from knowing what you want to avoid: early death, a bad marriage etc.

Envy is a really stupid sin because it’s the only one you could never possibly have any fun at. There’s a lot of pain and no fun. Why would you want to get on that trolley?

Confucius said that real knowledge is knowing the extent of one’s ignorance. Aristotle and Socrates said the same thing. Is it a skill that can be taught or learned? It probably can, if you have enough of a stake riding on the outcome.

Some people are extraordinarily good at knowing the limits of their knowledge, because they have to be. Think of somebody who’s been a professional tightrope walker for 20 years – and has survived. He couldn’t survive as a tightrope walker for 20 years unless he knows exactly what he knows and what he doesn’t know. He’s worked so hard at it, because he knows if he gets it wrong he won’t survive. The survivors know.

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

Finally, as Charlie would have said, “I have nothing to add.”

Will miss you, Charlie! 🙁

Want to Learn Charlie Munger’s Way of Thinking?

According to Colby, men will confess to treason, murder, arson, false teeth, or a wig, but not to a lack of humour.

This, I believe also happens with creative thinking.

So people, in general, like to think that they are creative thinkers, don’t even consider otherwise and, you know what, they may be right!

Most of us can become creative thinkers. It’s just that we need a catalyst to bring forth our innate thinking powers.

Roger von Oech's Creative Whack Pack One such amazing catalyst I found out two years back, through a recommendation from Prof. Sanjay Bakshi, is Roger von Oech’s Creative Whack Pack.

This is a great tool to practice thinking like Charlie Munger does – combining various ideas from different spheres of life and joining them to create a process of thinking creatively – the latticework of mental models, as he calls it.

The pack consists of a deck of 64 cards divided in four suits. Each card gives a bite-sized story or situation and a strategy that may be adapted to the problem or concept the user is working on.

The idea is that drawing cards singly or in combination and considering the strategy can shift the user’s mind to previously unexplored, creative directions.

While this entire pack of cards has helped my thought process immensely over these past two years, here are four cards that have helped me as far as my investment thinking is concerned.

The text in quotes below is from the respective card.

Charlie Munger’s Six Secrets to Winning Big in Investing

Charlie Munger, business partner of Warren Buffett and vice chairman of Berkshire Hathaway, recently did an interview with Jason Zweig published by the Wall Street Journal. You can read Zweig’s notes from the interview here.

Here are the six simple but big-big ideas I’ve pulled out from WSJ’s interview of Charlie Munger – these are all you need to become a smarter investor, if you can ingrain these in your investment philosophy and practice them while making your decisions.

Over to Charlie!

How to Be Happy and Get Rich

I have been re-reading Poor Charlie’s Almanack over the past few days in preparation of my upcoming Mastermind course.

This is my fifth reading of this wonderful book, and it seems I am going through it for the very first time.

Unlike what many people think, this book is not a ready reckoner on how to become a successful investor. In fact, it’s much more than that.

It’s a book on how to live a happy, sensible and rich life and in the process become a better thinker and investor.

As you read through the book, some of Munger’s ideas will inspire you, and some will make you uncomfortable. But all will challenge you to think outside the box.

The third chapter of Poor Charlie’s Almanack captures “Mungerisms”, where Munger dispels hundreds of ideas on subjects ranging from life, investing, academia, financial engineering, accounting, money management business, and managements.

Wit, Wisdom, Charlie: Elementary Worldly Wisdom from Charlie Munger (Issue #9)

This post is authored by Puneet Khurana, a Safal Niveshak tribesman.

Imagine the following scenario. You are sitting at your work desk sipping your coffee when your boss comes and offers you the following deal.

He offers you a fixed bonus of Rs 1 crore for the year. Besides this, he offers you a variable bonus. For the variable bonus, he asks you to either take another fixed Rs 50 lac or flip a coin. If it’s heads, you get Rs 1 crore and if its tails, you get zero.

Which of the options will you chose?

Now consider this.

This time he offers you a fixed bonus of Rs 2 crore for the year. From this Rs 2 crore, you can either give him Rs 50 lac back, no questions asked, or you can flip a coin.

Charlie Munger

Become a wiser investor in just 5 minutes

What I’m Reading