Charles Thomas Munger, co-founder of Berkshire Hathaway with Warren Buffett, has built his own following among investors. The late billionaire left behind a wealth of tried and tested investment advice over the years. Even Buffett, 95, nicknamed the ‘Omaha Believer’ for his numerous flawless investment decisions over the years, credits Munger with teaching him the couple.
After Munger’s death in November 2023, Bloomberg noted in an obituary his importance as a “straight man and scoundrel of corporate excess” who provided a reality check and balance against Buffett’s fame and fortune.
Quote of the day by Charlie Munger
“I believe in the discipline of mastering the best that other people have come up with. I don’t believe in just sitting down and trying to dream it all up yourself. Nobody’s that smart.”
What does Charlie Munger’s quote mean?
Munger was a staunch advocate of multidisciplinary knowledge, where one gathers information on broad subjects and draws on the genius of those around them to develop one’s own intelligence.
Speaking to Harvard graduates in 1998, Munger emphasized, among other things, the need to read books across subjects that have nothing to do with your majors or jobs. He gave the students the example of Buffett, who he said “spends half of all his time sitting and reading. And much of the rest of his time is spent talking face-to-face, either on the phone or in person, with highly talented people he trusts and who trust him.”
He added that he also practices it. “This multidisciplinary approach. Well, I can tell you what it’s done for me – it’s made life more fun, it’s made me more constructive, it’s made me more useful to others, it’s made me immensely rich. You name it. This approach really helps.”
Munger’s words are an overarching call to rely on those around you, especially those with expertise. You are more likely to benefit from the experience and advice of those you surround yourself with, and the sum of all your wisdom is better than trying to do things on your own. Broadening your information base only has the benefit of limiting yourself to only sectors or spaces that suit you as it broadens your mind and helps you think outside the box.
Master Joke: Who is Charlie Munger?
Munger, known for his sharp wit, brutal honesty and no-nonsense thinking, was one of the architects of Berkshire Hathaway Inc.’s success alongside Buffett’s best friend and business partner. For nearly 60 years, the duo transformed the company from a failing textile manufacturer to an empire worth billions.
A lawyer by training, Munger helped Buffett, who was seven years his junior, develop a philosophy of investing in companies for the long term. Buffett credited him with shaping Berkshire Hathaway’s investment style and shifting the “Oracle of Omaha” from cheap butt stocks to high-quality businesses at fair prices.
Under their leadership, Berkshire averaged 20% annual returns from 1965 to 2022, roughly double the pace of the S&P 500. Decades of compounding returns have made the pair of billionaires and folk heroes idolized by investors.
Munger was vice president of Berkshire from 1978 until the day he died in 2023 at the age of 99. He was also among the company’s largest shareholders, with shares worth about $2.2 billion. His total net worth was about $2.6 billion, according to Forbes.
