The Charlie Munger Reading List (45 Books Recommended)

The Charlie Munger Reading List (45 Books Recommended)

Buffett’s partner Munger said: If you rely on existing knowledge, you can’t go far in life. Munger discovered early on that one needs to learn interdisciplinary knowledge in order not to do stupid things.

He is also a fan of biography books, he said, reading a biography is to make friends with the “dead great men”, but if you do become friends with the dead great men in your life, then you will live a better life and get better This is much better than just talking about some great principles.

Warren Buffett, an investment guru known as the “stock god”, said that he has met countless people in his life and has never met someone like Charlie Munger. “I am grateful for him beyond words.” As Buffett’s golden partner and behind-the-scenes think tank, Munger and Buffett have created the best investment record ever. Since Berkshire Hathaway was founded in 1956, its stock has grown by leaps and bounds at an average annual growth rate of 24%. The current market value is close to US$280 billion. The company ranks third in the global market value list of listed companies.

At the annual Berkshire Hathaway and Sico International Shareholders’ Meetings, Munger recommends some books, covering a wide range of fields. Kaufman concluded that Munger “extremely mastered each It is a different discipline, so it can take into account many factors that ordinary people would not consider when investing.” If you want to get a glimpse of the business logic of this investment genius, you might as well look for the answer in the book.

Munger said: “If you have not done a solid reading in this field of investment, I don’t think you can become a really good investor, and I don’t think there is a book that can do this for you.” In reading, establish your own “thinking pattern grid”, which requires a lot of reading mathematics, biology, physics, sociology, psychology, philosophy, literature and other subjects and important works of famous scientists in related subjects, understand Familiar with the core concepts introduced in the book, connect and integrate the thinking modes of different disciplines. At the same time, apply these theories to investment, carry out correct thinking and independent thinking, and then invest smartly to obtain the best return on investment.

Munger said: “I don’t think I’m a model of a good education. I learned to get the information I want by reading. I often do this in my life. I often prefer an outstanding mentor who has passed away and does not like it. A living teacher.”

If you want to get wisdom, you need to sit down and read a book quietly. This is the source of wisdom.

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Table Of Contents

  • 2. Munger’s Quotations and Thinking
  • > Charlie Munger’s Books: Recommended Reading List
  • > 45 Books Recommended By Charlie Munger

1. Who is Munger

The 96-year-old old man, In the past 46 years, He and Buffett teamed up to create the best investment record ever-the book value of Berkshire’s stock has created an investment myth with an average annual compound rate of return of 20.3%, The stock price per share rose from $19 to $84,487.

2. Munger’s Quotations and Thinking

2.1 Reverse thinking

2.2 Find the circle of competence

Just be prepared, Seize a few opportunities in life, Take appropriate action quickly, Do simple and logical things, Wealth in this life will be greatly increased.

The opportunities mentioned above are rare, They usually fall on constantly looking and waiting, People who are full of curiosity and keen to analyze various possibilities.”

2.3 Interdisciplinary model + multiple thinking

From the perspective of the person holding the hammer in his hand, The world is like a nail.”This is a dumb way to deal with problems. Encountered different companies, You need to check different factors, Apply different mental models.

Soft science should strengthen the basic scholarly spirit and methods imitating hard science. Here the hard sciences, Is exponential, physics, Four disciplines of chemistry and engineering. Munger spent a lot of energy, Master the basic academic spirit and methods of hard science, He used this method to learn various soft sciences, Increase interdisciplinary universal wisdom.

If you switch from engineering to business, you will find that probabilistic thinking conflicts with mechanical determinism thinking, If professors who study these two disciplines meet, Probably pinch. But the moment when I feel the conflict, You will find that your thinking system begins to change from point thinking to line thinking.

If I were a two-dimensional creature, I don’t understand how three-dimensional creatures see the world, One more subject will give you another measure. “Three-body”. It talked about looking at 3D from 4D, It’s like a divided piece of paper is mapped in a mirror of infinite reflection.

The most important examples of these models include the redundant backup model of engineering, the Mathematical compound interest model, The tipping point of physics and chemistry, the Overturning moment, the Autocatalysis model, Modern Darwinian Comprehensive Model of Biology, And the cognitive misjudgment model of psychology. If you haven’t made the basic but somewhat less natural mathematical probability methods a part of your life, Then in the long life, You will be like a one-legged man in a kicking competition.

However, these disciplines — — Especially psychology — — Constitutes the foundation on which his system rests.

Munger made a special mention in chapter four of this book, Human misjudgment psychology, I especially like this part, Because I saw a lot of people, including professionals who have inevitable results due to misjudgment or cognitive bias. Even if I understand the underlying reason, It’s hard to overcome, Because of human nature.

Recommend Nobel Prize Winners in Economics, Daniel Kahneman “Thinking, Fast and slow”, Reading this book will help understand Munger’s interdisciplinary foundation, It’s delicious to read the two books together.

“Let me explain why education is so bad now. Part of the reason is the status quo of old age and death between different disciplines. E.g, Psychology is most useful only when combined with the principles of other disciplines. But if your professor doesn’t understand the principles of other subjects, Then he cannot complete this necessary integration.”

2.4 Curiosity

Must have a keen interest to figure out the reasons behind what is happening. If you can maintain this mentality for a long time, Your ability to pay attention to reality will gradually improve. If you don’t have this mentality, So even if you have a high IQ, Also doomed to fail.

2.5 Patience

Many people like to do short-term, I know I don’t have that IQ, If you do a lot of short-term results, you can only pay tuition fees and pay commission fees. But human nature is deeply attracted by greed and stimulation, Whether it’s a stock or a fund, Research a good product and hold it for a long time, Let him go, I don’t move, Hope to hold on.

2.6 Crazy derivatives

Catch the cat’s tail, The man who lifted the cat upside down, Will learn lessons he can’t learn elsewhere. — — mark·Twain.

2.7 The efficient market hypothesis

I gave a name to those who believe in the extreme efficient market theory — — Called “Neuropathy”.

That is a logically self-consistent theory So that they can make beautiful math problems. So I think this kind of theory is very attractive to those with high mathematical talents. But its basic assumptions are not in line with real life. So the answer is: The market is both partially efficient, Is also partially inefficient.

2.8 Munger’s checklist

a. Double track analysis

b. Investment and decision checklist

c. Super simple common concept

  • Use mathematical skills.
  • Reverse Thinking(Consider the problem in turn).
  • Apply basic interdisciplinary wisdom, Never completely rely on others.
  • Pay attention to the combined effect of multiple factors — — The lollapalooza effect.

d. Based on psychology

2.9 Revisiting economics

So, Economics should imitate the basic methods of physics, But you should never pursue a theory as accurate as a physics formula.

The economics community puts too much emphasis on macroeconomics, And insufficient attention to microeconomics. I think this is wrong. It’s like not knowing anatomy and chemistry But want to master medicine. Besides, Microeconomics is fun. It can help you understand macroeconomics correctly, It’s as fun as playing acrobatics. On the opposite, I don’t think people can get so much fun in studying macroeconomics. The most important reason is, They often make mistakes Because the system they want to understand is too complicated.”

2.10 Importance of reading

I am a fan of biographical books myself. I think if you want people to know useful and great concepts, It is best to connect these concepts with the lives and personalities of the great men who proposed them. I think if you can and Adam·Smith makes friends, Then you can definitely learn economics better. with “Deadman” make friends, It sounds fun, But if you do become friends with the great dead in your life, Then I think you will live a better life, Get a better education. This method is much better than simply giving some basic concepts.”

In the annual Berkshire Hathaway and Wesco shareholder meetings and speeches, Munger recommends some books. The relevant books and sources are now organized as follows:

Below is a list of 45 books recommended by Munger and four books about Charlie Munger. Poor Charlie’s Almanack: The Wit and Wisdom of Charles T. Munger is by far the best book on Munger.

> Charlie Munger’s Books: Recommended Reading List

Charlie Munger: Books

  • Poor Charlie’s Almanack: The Wit and Wisdom of Charles T. Munger by Peter D. Kaufman (2008)
  • Damn Right: Behind the Scenes with Berkshire Hathaway Billionaire Charlie Munger by Januaret Lowe (2003)
  • Of Permanent Value by Andrew Kilpatrick

> 45 Books Recommended By Charlie Munger

  • Common Stocks and Uncommon Profits by Philip A. Fisher
  • Paths to Wealth Through Common Stocks by Philip A. Fisher

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