Nati Harnik/Associated Press
Charlie Munger, the 99-year old vice chairman of Berkshire Hathaway, sat down with The Wall Street Journal for an interview several weeks ago.
Munger, who has an estimated net worth of nearly $3 billion, riffed on everything from bitcoin to the woes of stock picking, and revealed the simple habit behind his billionaire status.
Munger is an investor worth listening to given his storied career work alongside Warren Buffett, and the incredible success of Berkshire Hathaway. Like Buffett, Munger often offers sharp opinions with clear thinking to back it up.
Here are the best quotes from Munger's interview.
"The only way to get from hunter-gathering to civilization that we know of that's ever worked is to have a strong currency. It can be seashells, it can be corn kernels, it can be a lot of things. It can be gold coins, it can be promises in banking systems like we have in the United States and England and so on. When you start creating an artificial currency... you're throwing your stink ball into a recipe that's been around for a long time, that's worked very well for a lot of people."
"It's at least 50/50. Venture capital has made it so difficult for everybody. They keep bidding the prices up and up and up, and of course that makes the results go down, down and down."
"I think that the modern investor, to get ahead, almost has to get in a few stocks that are way above average…. They try and have a few Apples or Googles or so on, just to keep up, because they know that a significant percentage of all the gains that come to all the common stockholders combined is going to come from a few of these super competitors."
"I think fewer and fewer people are really needed in stock picking. Mostly it's charlatanism to charge 3 percentage points per year or something like that to manage somebody else's money."
"Most people probably shouldn't do anything other than have index funds…. That is a perfectly rational thing to do for somebody who just doesn't want to think much about it and has no reason to think he has any advantage as a stock picker. Why should he try and pick his own stocks? He doesn't design his own electric motors and his egg beater."
"I'm not the guy that's using his money to buy a big yacht, who flies his own jet airplane so he can be in the Mediterranean in the season, and so on and so on. I'm not being a big excessive spender. And I prefer my less-expensive way of life…. Who in the hell with my wealth lives in the same house he built 70 years ago?"
"I would not break them up. I don't consider it all that significant. They've got their little niches. Microsoft maybe has a nice niche, but it doesn't own the earth. I like these high-tech companies. I think capitalism should expect to get a few big winners by accident."
"I think that one of the reasons I was as economically successful as I was in life is because I read so damn much all my life, starting when I was about six years old. I don't know how to get smart without reading a lot."
This story was original published on November 3, 2023
