317- The Best Munger Quotes!
\u201cIt is remarkable how much long-term advantage people like us have gotten by trying to be consistently not stupid, instead of trying to be very intelligent.\u201d \u2014\xa0Charlie Munger\n\nMunger is the Vice Chairman of the world\u2019s greatest compound interest machine: Berkshire Hathaway, Inc. In the time of his and Warren Buffett\u2019s reign as the leaders of Berkshire, the company has returned roughly 2,000,000% on its initial value. We can learn a lot from Charlie Munger!\n\nCharlie Munger once said that \u201cCoca-Cola is the perfect business because it has this gigantic durable competitive advantage, or moat, which gives it predictable cash flow.\u201d This allows us to figure out what the future cash flow will be and value the company today, so we know whether we can buy it on sale or not.\n\nCharlie Munger also once stated that \u201cYou don\u2019t make money when you buy and you don\u2019t make money when you sell.\xa0You make money when you wait.\u201d That assertion is so powerful that it is easy to overlook how critical it is. The whole idea of Rule #1 Investing is buying a stock low, and selling it high. But, the key here is that you\u2019re doing nothing most of the time.\n\nWhen Charlie says, \u201cWait\u201d he means, \u201cWait for 5 years if necessary\u201d. If you\u2019ve been given serious money to invest, waiting five years in cash is not a plan; it is a recipe for disaster.\n\nCharlie believes there are only a small number of real opportunities to get very high returns with very low risk. Maybe 20 in a lifetime. He said that if you remove the 10 best deals Warren and he ever did, Berkshire would have average market level performance. The only way to get those kinds of returns is to wait and wait for the right opportunity to come along.\n\nIn today\u2019s podcast, Phil and Danielle explain some of their favorite Charlie Munger quotes, and cover how many of the Rule #1 Investing principles are based on his teachings.\n\nGet inspired to invest like the world's greatest investors like Charlie Munger and Warren Buffett with this free guide: https://bit.ly/3fr7VmB\nLearn more about your ad choices. Visit megaphone.fm/adchoices