751 Quotes by Charlie Munger

There are two kinds of businesses: The first earns 12%, and you can take it out at the end of the year. The second earns 12%, but all the excess cash must be reinvested - there's never any cash. It reminds me of the guy who looks at all of his equipment and says, 'There's all of my profit.' We hate that kind of business.

The ethos of not fooling yourself is one of the best you could possibly have. It's powerful because it's so rare.

You can hire your advisor and then just apply a windage factor, like I used to do when I was a rifle shooter. I'd just adjust for so many miles an hour wind. Or you can learn the basic elements of your advisor's trade. You don't have to learn very much, by the way, because if you learn just a little then you can make him explain why he's right.

Finding a single investment that will return 20% per year for 40 years tends to happen only in dreamland. In the real world, you uncover an opportunity, and then you compare other opportunities with that. And you only invest in the most attractive opportunities. That's your opportunity cost. That's what you learn in freshman economics. The game hasn't changed at all. That's why Modern Portfolio Theory is so asinine.

There's danger in just shoveling out money to people who say, 'My life is a little harder than it used to be.' At a certain place you've got to say to the people, 'Suck it in and cope, buddy. Suck it in and cope.'

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 inJapan ... has shaken up academic economics, as it obviously should, creating strong worries about recession from "wealth effects" in reverse.

If you don't keep learning, other people will pass you by. Temperament alone won't do it - you need a lot of curiosity for a long, long time.

...being an effective teacher is a high calling.

Learn how to ignore the examples from others when they are wrong, because few skills are more worth having.