The Wizard of Omaha & King Munger - Business & Life Lessons
All of the information you need to succeed in what you want to do is out there, it's just a matter of being resourceful and taking action.
Did you know that for the low entry pass price of $5 and a plane ticket to Omaha, Nebraska, you can hear directly from the former most wealthy person in the world, Warren Buffett (92), and his partner, Charlie Munger (99), who run Berkshire Hathaway and are considered two of the best investors of all time?
For me, a finance major and ex-wall street investment banker, the 6 hour trek from Jacksonville, Florida to the Berkshire Hathaway Annual Shareholder Meeting was well worth the investment to hear these two share their wisdom about the economy, life, family, relationships, and politics.
Yes, you can watch these two old farts giggle and make jokes online, here, as the event is recorded online, but there is really something special about being in-person to really feel what they're saying.
Instead of watching the 6 hours of Q&A sessions, if you'd like to read the lessons I'm taking away from the event, keep following.
Before we hop into the lessons, what is so surprising to me is how accessible this very valuable knowledge is to the entire world. These two are leaving it all on the table. And that makes me think: all the information out there is available for you to succeed in what you want to do, it is a matter of being resourceful and taking action. What is missing is people taking action on the knowledge that is gained and shared.
As Munger says, human nature is still human nature (even with the advent of A.I. technologies), which is part of the reason Buffett and Munger downplay the doomsday scenarios from the advancement in A.I. Even with more information and better information, humans are still going to do stupid things, and there will be good inviestment opportunities.
"People are still going to do stupid things even if they have more information" - Munger
So here we go!
Lessons from Buffett & Munger:
More people do dumb things and that's where opportunities will come from.
"Deworsification" - it is insane to teach that one has to diversify when investing in common stocks. Investors should know themselves and their strengths.
Write your obituary and live up to it.
If you can judge where someone's self interest is, you can see where their behavior is going to go.
Your best example for your kids is yourself.
Spend less than you earn, avoid toxic people and activities, and continually learn, and delay your gratification. If you do these things, you will succeed. If you don't do these things, you'll need a lot of luck to succeed.
Toxic people will lie to you, not meet their commitments, and not do the work, get them the hell out of your life and do it fast.
The most difficult thing in your life is people.
Everyone has a sign on their head: "make me feel important"
Say no to almost everything, the default answer is no.
Understand your income and don't do foolish spending, even when you have the money.
A brand is a promise.
You have to decide first what kind of business you DON'T want.
We have no master plan. Our plan is to respond to the market. We fire anyone who tries to make a master plan.
You do not have to attend every argument you are invited to.
Interest rates are to asset prices like gravity is to the earth.
If you don't learn elementary probability you go through life like a one legged man in an ass kicking contest.
Most people systematically undervalue their time.
Differentiation is survival.
You have to have a competitive advantage (unfair advantage).
Invest in better businesses that don't have big capital requirements and strong cash flow. Forget buying fair businesses at wonderful prices, instead buy wonderful businesses at fair prices.
Diversification is for people who don't know what they're doing. Look at how fortunes are built.
My idea of shooting fish in a barrel is to drain the barrel first.
For a mediocre business, time can be a curse. For a great business, time does most of the work. Time carries most of the weight. Don't mess up a good business, just let time do its work.
The problem isn't getting rich, it's staying sane.
Mimicking the herd invites regression to the mean. Don't care about what other people are doing or thinking.
We aren't about predicting accurately, just get into a wonderful business and stay there.
Run toward a financial crisis by investing in businesses while everyone else is running.
Stop multitasking.
I did not succeed because of intelligent, I succeeded because I have a long attention span.
Smart people are not exempt from professional disasters.
Get into great businesses with great people.
Low quality people just have one problem after another. They can drown in a cup of water.
Move only when you have the advantage. Bet when the odds are in your favor. Only play games that you have an edge.
Wise people step on problems early.
It's better to be not stupid than to be intelligent.
You have to be ready when opportunity shows up, in this world opportunity doesn't last long.
Don't plan your career, pursue opportunities. They tend to present themselves when you're not expecting them. They come and go quickly.
Are you surprised if you lose to someone like that?
Always go with better business with durable competitive advantage.
If you cannot handle a 50% loss from market fluctuation, you should not be an investor.
Tough times don't last, but tough people do.
If the dominant player is big enough, size and market domination can create a durable competitive advantage.
Knowledge, like money, can compound, and make you more aware of the world.
Don't sell anything you wouldn't buy yourself, don't work for anyone you don't respect and admire, work only with people you enjoy.
Only those who are asleep make no mistakes
You perform better when you rub your nose in your mistakes and admit them.
Wisdom is prevention.
If you are not interested in something, you won't succeed at it. Have passion for what you choose to do.
Most people are rat poison and you should avoid them. There are a lot of them.
There are no cookie cutter solutions.
Take a serious idea and take it seriously.
Great businesses don't have endless problems.
The best armor for old age is a well spent life preceding it.
It's not greed that drives the world, but envy. Cure yourself of this. Self pity has no utility, and envy doesn't either.
I've never met a wise person who doesn't read all the time.
Become a learning machine and stop multitasking.
The #1 reason for success: focus.
Reliable people who trust each other. If you can't trust someone, don't do business with them, no matter the contract.
Every opportunity in life is to learn something.
Studying from history is a form of leverage.
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Jon Brooks / jon@movewithmomentum.com
