Charlie Munger is a rich guy who runs Berkshire Hathaway along with the more famous Warren Buffet. He got some bad press recently due to an interview excerpt in which he seemed like the stereotypical rich guy defending the bank bailouts while telling the ordinary folk to suck it up. Having read him over the years, it was unfortunate to see him so unfairly tarnished even if he kinda did it to himself (*). In my opinion, he’s the one rich old curmudgeon you should know.
Anyway, Munger isn’t worth reading because he’s rich, but because he takes an eclectic view on things, assembling frameworks and perspectives that reflect his practical and straightforward nature while incorporating his insights as a voracious mufti-disciplinary autodidact who shuns dogma and simplistic thinking.
With that, an excerpt from Poor Charlie’s Almanack (recommended):
“You must know the big ideas in the big disciplines and use them routinely – all of them, not just a few. Most people are trained in one model – economics, for example – and try to solve all problems in one way. You know the old saying: To the man with a hammer, the world looks like a nail. This is a dumb way of handling problems
…I can never make it easy by saying, ‘Here are three things.’ You have to derive it yourself to ingrain it in your head for the rest of your life.
…You have to learn the models so that they become part of your ever-used repertoire.
…The happier mental realm I recommend is one from which no one willingly returns. A return would be like cutting off one’s hands.”
In his text he refers to the “one hundred big ideas”. A tall order.
Anyway, I think one’s hidden models – the ones used without recognition – can be the most powerful because their influence is unconstrained. It might be better to say we’re subject to those hidden models.
* Note: When you’re in your 80s and have accumulated thousands upon thousands of hours of recorded interviews, tell me about how you never said something that lacked tact, nothing that could make you look bad.