American investor, philanthropist, and businessman Charlie Munger, served as vice chairman of Berkshire Hathaway, the company that Warren Buffett owned; Buffett called Munger his right-hand man and closest confidant.
Charlie Thomas Munger died on Tuesday 28th November at the age of 99.
Who is Charlie Munger?
Charlie Munger, often described as Warren Buffett’s right-hand man, is a multifaceted individual with an impressive array of accomplishments. Born on January 1, 1924, Munger is not just an investor; he’s a lawyer, philanthropist, and a renowned thinker. His influence extends beyond the financial world, making him a fascinating figure for anyone seeking to understand the keys to success in various aspects of life.
From 1984 to 2011, Munger presided over Wesco Financial Corporation as chairman. In addition, he served as a director of Costco Wholesale Corporation and chairman of the Los Angeles, California-based Daily Journal Corporation.
Charlie Munger–A Multifaceted Legacy
Born on January 1, 1924, Charlie Munger isn’t just a renowned investor; he’s a multifaceted individual whose philosophy transcends industries. This past year, we’ve delved into the depths of Munger’s teachings, discovering a rich tapestry of insights that go beyond the numbers.
Childhood and schooling
The son of attorney Alfred Case Munger and Florence “Toody” (Russell), Munger was born in Omaha, Nebraska. He worked at Buffett & Son, the grocery store owned by Ernest P. Buffett, Warren Buffett’s grandfather, when he was a teenager. Thomas Charles Munger, a state representative and judge on the US District Court, was his grandfather.
He studied mathematics at the University of Michigan. He became a member of the fraternity Sigma Phi Society while attending college. He left college early in 1943, a few days after turning 19, to enlist in the US Army Air Corps, rising to the rank of second lieutenant. He was told to study meteorology after earning a high score on the Army General Classification Test.
Character, Ethics, and Lifelong Learning
Munger’s influence extends beyond the boardroom, emphasizing the importance of character, ethics, and continuous learning. In a world fixated on immediate gains, we’ve embraced Munger’s perspective, recognizing that enduring success requires qualities that go beyond mere numbers.
Beyond Investing: A Holistic Perspective
Munger’s philosophy revolves around the idea of acquiring worldly wisdom, urging individuals to broaden their knowledge base across disciplines. We’ve embraced this interdisciplinary approach, integrating mental models from various fields to gain a more comprehensive understanding of the world around us.
Charlie Munger final interview with CNBC:
— Thomas Chua (@SteadyCompound) November 29, 2023
Is there anything left on your bucket list?
Well… I am so old and weak compared to when I was 96 I no longer want to catch a 200 lbs tuna…
…I would have paid any amount to catch a 200 lbs tuna pic.twitter.com/u2fcW85AMk
Investing profession
Munger joined the legal practice Wright & Garrett (later Musick, Peeler & Garrett) after relocating to California with his family. In 1962, Munger started , Tolles & Olson LLP and practiced real estate law there. After quitting his legal practice to focus on investment management, he later entered into a real estate development partnership with Otis Booth. He first spoke with Buffett about investments during a lunch meeting at the Omaha Club, and they never stopped. Subsequently, he and Jack Wheeler collaborated to establish Wheeler, Munger and Company, an investment firm that holds a seat on the PATCOR. After suffering losses of 32% in 1973 and 31% in 1974, he closed Wheeler, Munger, and Co. in 1976.
RIP Charlie Munger
— Brian Feroldi (@BrianFeroldi) November 28, 2023
I'll always remember him for this talk he gave on the Psychology of Human Misjudgement.
If you have an hour, it's well worth the time: pic.twitter.com/yCQVlciSQ5
FAQ
What was Charlie Munger’s source of income?
Munger received an invitation to collaborate with Otis Booth, an old friend, in 1961 on a real estate development project. The deal was finalized in 1967, and Munger profited 400% from the development’s sale. Munger continued in the industry for a few more years before earning his first $1 million earnings.
Why does Warren have more wealth than Charlie Munger?
Warren Buffett was far wealthier than Charlie Munger.
Why is Munger’s gap in wealth so significant? primarily because Munger has sold or donated more than 75% of his Berkshire stock over the years, but also largely because Buffett always owned a much larger Berkshire stake.
Charlie Munger and Warren Buffett, who is wealthier?
While Buffett, who has occasionally held the title of world’s richest person, has amassed a fortune of approximately $117 billion, Munger’s net worth was estimated by Forbes in June at $2.5 billion. Opinion: With Charlie Munger gone, who will refuse Warren Buffett?
Focus on the Big Picture: Embracing Mental Models and Thinking Frameworks
According to the wise words of Charlie Munger, “I paid attention in law school when someone humorously remarked, ‘A legal mind is a mind that, when two things are all twisted up together and interacting, it’s feasible to think responsibly about one thing and not the other.’ Well, I quickly realized from that single sentence that it was utterly ridiculous.
This realization steered me further into my natural inclination, which was to delve into understanding all the big ideas across various disciplines. I was determined not to be a fool fixating on one aspect of something that couldn’t be separated from the totality of the situation in a constructive manner. Recognizing that the really big ideas carry 95% of the weight, it wasn’t challenging for me to absorb all the major concepts in different fields and incorporate them into my regular thought processes.
In essence, Munger encourages us to focus on the broader perspective. By integrating big ideas from various disciplines into our mental routines, we not only make thinking more responsible but also enhance our ability to navigate complex situations constructively. The key is not just to acquire these ideas but to continually practice and apply them in our daily lives. Munger’s approach isn’t just a recipe for personal success; it’s a mindset that adds enjoyment, constructive thinking, and richness to our journey. So, let’s embrace the big picture, adopt a multi-disciplinary mindset, and make our lives more fulfilling and impactful.
Famous Line of Charlie Munger
An example of financial wisdom and longevity that has inspired generations
It’s simple.
Spend less than what you earn.
Invest wisely.
Avoid toxic people and toxic activities.
And often giving up all immediate gratifications.
If you do all these things, you are almost assured of success. If you don’t do this, you will need a lot of fortune.
And neither serve nor have so much fortune.
Try entering a game when it is very likely that you will win without the need for any particular type of luck.
#charliemunger #warrenbuffett