I just came into contact with poor Charlie’s Almanack, and thought that the author Peter Kaufman’s book was just trying to “cheat” the readers because of people’s enthusiasm of Charlie Munger. Because the cover of the book is printed with the portrait of Buffett’s partner and great enlightener - Charlie Munger, it’s curious to take it up and read it. Unexpectedly, this book records a lot of wisdom proverbs of Charlie Munger, who is talking to people like a kind wise man. So I couldn’t help but read the book many times at a time.
The so-called wisdom maxim of Charlie Munger has no gorgeous rhetoric, no profound reason, and no popular empty talk and formula; some are just the unique insights of an investor who has achieved success completely by virtue of wisdom; some are just the insights of an intelligent, honest and patient elder on investment and life; some are just the outstanding examples made by a practitioner to the world 。
Munger has been practicing all his life that “buying a great enterprise with fair valuation is better than buying an ordinary enterprise with super low stock price”. This extraordinary wisdom helps Buffett get rid of Benjamin Graham style investment. It is impossible for ordinary investors to master Munger’s investment skills easily, because the unique insight is formed by a diligent person who is different from ordinary people and has studied business investment logic, human psychological behavior mode and a large number of subject knowledge all his life. Therefore, he thinks that the degree of mistakes in higher education is surprising. It is fatal that all disciplines are isolated and lack of connections. The views of Humanities and Social Sciences professors in all universities cannot stand scrutiny. He even thinks that the Black Scholes pricing model commonly used by investment banks and capital markets is “a system without knowledge”, especially “if the option is longer than 90 days, then it’s a little nerve to use this model”. As Charlie Munger put it, “if you take an interdisciplinary approach, you’ll never want to go back. It’s like cutting off your hand.
“Mobile bookcase with long legs” Charlie Munger enjoys reading all his life, has encyclopedic knowledge, has mastered all the “important theories of important disciplines”, has formed more than 100 unique (according to his own estimation) multiple thinking models for business analysis and evaluation, and can see all the complex business and investment problems. Charlie Munger has never fully listed or introduced more than 100 kinds of multiple thinking models, perhaps because he thinks these are just moves, just like the best martial arts has always been “no move wins with move”. In thinking and decision-making, I am familiar with the thinking of various disciplines, instinctively used to analyze and reveal the mutual influence and connection of investment related factors, and see clearly the essence of investment problems.
Poor Charlie’s book is not only a book about investment, but also a book about successful work and rational life style. For Munger, success in investment is just a by-product of a rational life, patience and integrity. “I just want to know where I will die in the future, so I will never go there.” therefore, he always thinks backwards, likes to study how life becomes painful, likes to study how enterprises decline, continues to collect famous cases of failure of various celebrities and famous enterprises, and analyzes the reasons. It is the important reason why Berkshire, which he and Buffett have been at the helm of for 50 years, has never made major mistakes and achieved brilliant achievements for 60 years to constantly sum up all kinds of failure lessons in all walks of life. Munger highly sums up the basic principles of successful work with the word “rationality”.
Different from all kinds of “gods” in our current society, Munger comes from ordinary people step by step. Munger’s golden rule is “To get what you want, you have to deserve what you want.” He trains his intelligence, discipline, patience and concentration with hard work and thinking. He believes that major opportunities “usually fall on the people who are constantly looking for and waiting, full of curiosity and keen to analyze various possibilities”. Therefore, regardless of the surrounding environment and mood fluctuations, he always insists on taking precautions and being patient.
Munger not only never looks for the gray edge to seek all kinds of interests, but also has the values of love and hate. He feels that it is because he insists on doing the right thing that he makes more money. He criticized the lack of morality on Wall Street, his aversion to accounting fraud and radical accounting treatment, and his warning to financial institutions and derivatives all reflected his integrity. At the same time, he also insisted on avoiding dealing with people with moral quality problems.
It can be said that he and Buffett have achieved unprecedented investment performance together, which is just a manifestation of their enjoyment of the hard work process. If they are not engaged in investment, they stick to the right belief in other fields and work hard for life, and they have a great chance to achieve great success. At the same time, I also believe that even if they don’t achieve such great achievements, they will always adhere to their correct beliefs and enjoy the process of their efforts.
This is similar to the practice of Buddhism. Practice is to correct one’s behavior and heart according to the correct values, ways of thinking and attitude towards things, so as to have a correct response to things. Munger and Buffett, just embody their cultivation in the field of investment, enjoy the peace of soul every day, and not disturb their hearts by the fluctuation of wealth, the highest temptation in the world. Maybe their supreme cultivation is also an important reason for their longevity.
We ordinary people, adhere to their own beliefs and ideals, persevere in learning and adhere to the right action, can we also get peace of mind and full of sense of achievement in their work? Yes, I think it is.
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