Charlie Munger: Blood brother of evil

“The history of much of which we don’t like in modern corporate capitalism comes from an unreasonable expectation, communicated from headquarters, that [corporate] earnings have to go up with no volatility and great regularity. That kind of an expectation from headquarters is not just the kissing cousin of evil. It’s the blood brother of evil. And we just don’t need that blood brother in our headquarters.” –Charlie Munger.

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Charlie Munger: Easy lending on houses

“It’s obvious that the easy lending on houses causes more houses to be built and causes housing prices to be higher, probably, in the new field. Eventually, of course, if you construct enough of new anything, you can have a countervailing effect. If you build way too many houses, you’d eventually cause a price decline.” —Charlie Munger.

Charlie Munger: Blowing opportunities

“At least we are constantly thinking about the past occasions when we blew opportunities. Since those don’t hit financial reports, the opportunities you had but didn’t accept, most people don’t bother thinking about them very much. At least that is a mistake we don’t make. We rub our own noses in our mistakes in blowing opportunities.”

—Charlie Munger. 

Charlie Munger: Reading alone won’t do it

“I don’t know anybody who is wise who doesn’t read a lot. On the other hand, that alone won’t do it. You have to have a temperament, really, which grabs the correct ideas and does something with those ideas. And I think most people who read a lot don’t have the necessary temperament, and they grab the ideas or they’re simply confused by the mass of material. And, of course, that won’t work.” –Charlie Munger. 

Charlie Munger: Considerable defense

“Most people are going to get a very small real return from investment after considering inflation and taxes. I think that’s an iron law of the world and if, for a brief period, some of us do better than that, we ought to be very thankful. One of the great defenses to being worried about inflation is not having a lot of silly needs in your life. In other words, if you haven’t created a lot of artificial demand to drown in consumer goods, why, you have a considerable defense against the vicissitudes of life.”

—Charlie Munger.