Charlie Munger Mindset

  • Name: Charles Munger
  • Date of Birth: 1 January 1924
  • Profession: Investor
Charlie Munger

Personality:

Charlie Munger is an investor, lawyer and additionally the lifelong business partner of Warren Buffet as Vice-Chairman of Berkshire Hathaway Corporation, one of the most successful diversified investment corporations in the world. He is also the Chairman of the Daily Journal Corporation (responsible for multiple publications) based in Los Angeles and a Director of Costco Wholesale Corporation. His total net worth is more than 1 Billion US Dollars and he is now widely known also for his philanthropy. For the most part, The Charlie Munger Mindset is to understand how not to act, and then focus on doing the opposite.

Munger’s Key Things to Avoid:

  • Sloth
  • Unreliability
  • Intense ideology (not considering the other side as carefully as your own)
  • Self-serving bias (only believing what’s good for yourself is good for all)
  • Perverse incentives (working for groups with bad intentions)
  • Perverse associations (being around other people with bad intentions)
  • Influences that will compromise your objectivity (try to keep your judgement based on facts rather than a hunch)

Discovery:

Though he is very interested in correcting the miscalculations that humans make, he doesn’t have a lot of interest in teaching young people how to get rich the same way that he did. However, this is not because he would rather not have the competition in his field, instead he would rather just teach people how to improve their decision making. He saw a pattern of irrationality cropping up frequently in his life which he felt was too extreme, but he had no way to deal with it. So, he started to create his own system of psychology, in part by casual reading (which he does often) and largely by learning accordingly from his own personal experiences.

Continual Learning:

Certainly, one of the major points which always seems to crop up in terms of the mindset of Charlie is his ability to keep on learning. He spends a vast amount of his time reading about a wide range of topics. He believes that generations younger than him have a tough time reading so much material, as they are not fully able to focusing solely on one task. Because of modern technology and the new ways in which we live our lives, multi-tasking is seen much more frequency, but he thinks this only serves as a distraction which stops people from learning properly.

Furthermore, Charlie has attributed his success not to his intelligence but his ability to focus intently on the material that he reads without distraction, therefore enabling him to fully absorb the subject matter. He believes the best format for reading will always be the book, or any other printed publication.

High Standards:

Munger’s personal philosophy is to have high ethical standards in everything that he does. Also, he has mentioned before with regards to his own investments that the best businesses are ethical ones. He feels that companies who rely on trickery and deceit may get ahead initially, but are doomed to failure in the long run. Therefore, it benefits him to understand which businesses hold high standards as he knows these are better for him to invest in.

Above all, Charlie has worked hard to get to the top and he has managed to maintained his high levels of success by being as transparent as possible with the people he needs to work alongside, such as Warren Buffett. Furthermore, Warren has mentioned before that Charlie can listen to a problem and always provide him with a solution within 30 seconds.

Charlie Munger MBTI (Probable):

The INTJ (Mastermind) personality is analytical, most comfortable working alone and tend to be less sociable than other types. They have a low tolerance for excuses or excessive emotions from other people. INTJ’s are not usually susceptible to small-talk and do not appreciate authority based on tradition, age, title etc. Furthermore, they possess an innate desire to express themselves by showcasing their complicated intellectual designs. What’s more, they have a natural talent for analysing and formulating complex theories.

Charlie Munger Mindset – Quotes:

“In my whole life, I have known no wise people (over a broad subject matter area) who didn’t read all the time — none, zero. You’d be amazed at how much Warren reads–and at how much I read. My children laugh at me. They think I’m a book with a couple of legs sticking out.”

“To get what you want, you have to deserve what you want. The world is not yet a crazy enough place to reward a whole bunch of undeserving people.”

“You have to have a temperament to grab ideas and do sensible things. Most people don’t grab the right ideas or don’t know what to do with them.”

“The iron rule of nature is: you get what you reward for. If you want ants to come, you put sugar on the floor.” 

“Acquire worldly wisdom and adjust your behaviour accordingly. If your new behaviour gives you a little temporary unpopularity with your peer group…then to hell with them.” 

“Develop into a lifelong self-learner through voracious reading; cultivate curiosity and strive to become a little wiser every day.”

“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.” 

“There is no better teacher than history in determining the future… There are answers worth billions of dollars in a $30 history book.” 

Munger’s Keys to Success:

  • Read often – Dedicate a good amount of time to reading from a wide-range of different sources, fiction, non-fiction, newspapers etc. By taking in information from a variety of bases, you can ensure that your understanding of different ideas will be broadened significantly over time.
  • Understand the past – By understanding the events of the past, you can have a better insight into how to affect your future. Cycles are a natural part of the world we live in, so we can look at how various results occurred previously and analyse how these were caused. If you want to achieve things that were achieved before or better, you will need to create a similar or improved environment that was present for it to happen for you.
  • Develop every day – If you can go to bed each evening and understand that you have learned something new, no matter how small, you will be growing intellectually as a person.  Even by dedicating a trivial amount of time daily to a new pursuit, you will be able to continue your growth.

Charlie Munger Essential Reading & Products:

Charlie Munger – Facts:

  • Charlie Munger drinks but only in moderation. He attributed the death of two of his childhood friends to alcohol in addition to another friend who became an alcoholic.
  • His personal hero is Benjamin Franklin. He recommends reading anything possible about the individual.
  • Munger was born in Omaha, Nebraska.
  • His other interests include card games, architecture and law.

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I am an experienced SEO and Digital Marketer with a keen interest in Sports, Music and Psychology. The idea for Success Mentality came about naturally through the combination of my interests as it enabled me to research and blog about the individuals that have achieved the most success in fields that I like to follow.
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