Charlie Munger Quotes - Page 18

You'll find many markets where bottlers of Pepsi and Coke both make a lot of money and many others where they destroy most of the profitability of the two franchises. That must get down to the peculiarities of individual adjustment to market capitalism. I think you 'd have to know the people involved to fully understand what was happening.

In Gillette's case, they keep surfing along new technology which is fairly simple by the standards of microchips. But it's hard for competitors to do. So they've been able to stay constantly near the edge of improvements in shaving.

I think the main figure that matters to all of us, including people in the media, is: How does GDP per capita grow? And those figures have been very good. There is a huge flux both up and down, so it isn't like we're all static in status. What's important is that pie grows.

I think corporate managers should learn to be better investors because it would make them better managers.

There are always people who will be better at some thing than you are.

I have a name for people who went to the extreme efficient market theory-which is "bonkers". It was an intellectually consistent theory that enabled them to do pretty mathematics. So I understand its seductiveness to people with large mathematical gifts. It just had a difficulty in that the fundamental assumption did not tie properly to reality.

It would be nice if this [finding really cheap stocks] happened all the time. Unfortunately, it doesn't.

To say accounting for derivatives is Americais a sewer is an insult to sewage.

It's dangerous to short stocks.

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

We have a high moral responsibility to be rational

I think liberal art faculties at major universities have views that are not very sound, at least on public policy issues - they may know a lot of French however.

I feel that by getting rich in the way I did, I think my own example has hurt my own country.

This is an amazingly sound place. We are more disaster-resistant than most other places. We haven't pushed it as hard as other people would have pushed it. I don't want to go back to Go. I've been to Go. A lot of our shareholders have a majority of their net worth in Berkshire, and they don't want to go back to Go either.

I regard the amount of brainpower going into money management as a national scandal. When some idiot would get rich, they'd say, 'Well, old Charlie was out in the field playing the big brass tuba on the day it rained gold.' A lot of people have become rich lately who were playing the tuba on the day it rained gold.

Ben Franklin and Samuel Johnson, he credits their wisdom for his success. "They were both utterly brilliant men. And powerful communicators. Both have helped me all the way through life. Their lessons are easy to assimilate."

I have concluded that most PhD economists under appraise the power of the common-stock-based "wealth effect," under current extreme conditions... "Wealth effects" involve mathematical puzzles that are not nearly so well worked out as physics theories and never can be... What has happened in Japan over roughly the last ten years has shaken up academic economics, as it obviously should, creating strong worries about recession from "wealth effects" in reverse.

The reason we avoid the word 'synergy' is because people generally claim more synergistic benefits than will come. Yes, it exists, but there are so many false promises.Berkshire is full of synergies - we don't avoid synergies, just claims of synergies.

If you, like me, lived through 1973-74 or even the early 1990s... There was a waiting list to get OUT of the country club - that's when you know things are tough. If you live long enough, you'll see it.

It took us months of buying all the Coke stock we could to accumulate $1 billion worth - equal to 7% of the company. It's very hard to accumulate major positions.

Even if you assume that the whole economy would work better had we never had double taxation, having the envy and resentment of the richest paying low or no taxes screams of injustice. You have to have a fair system.

We've had the most massive creation of wealth for people a lot younger than those who formerly got wealth in the history of the world. The world is full of young people who really want to get rich, and when I left school nobody thought it was a reasonable possibility.

Understanding how to be a good investor makes you a better business manager and vice versa.

I've been associated with Warren ( Buffett) so long, I thought I'd be just a footnote.

There's more honor in investment management than in investment banking.