Money and Finance
- Charlie Munger On Efficient Markets And Bureaucracy
Via Whitney Tilson’s notes from the 2007 Wesco Annual Meeting:If markets were efficient, this tent wouldn’t be so full. Some business schools are teaching properly, but the world grew up amidst a different fashion, encouraged by academics of the era....
- Stretching For The Right People...
Comment from Charlie Munger about Iscar, via Whitney Tilson’s notes from the 2007 Wesco Annual Meeting:It’s not a Ben Graham stock – in fact, it would be the ultimate non-Ben Graham stock. It’s located a few miles from the Lebanese border in Israel....
- Charlie Munger On Capital And Credit In 2005...
Via Whitney Tilson’s notes from the 2005 Wesco Annual Meeting:It is weird the way that capital occurs. We have monetized houses in this country in a way that’s never occurred before. Ask Joe how he bought a new Cadillac [and he’ll say] from borrowing...
- Charlie Munger On Leucadia And Telecom...
Via Whitney Tilson’s notes from the 2005 Wesco Annual Meeting:We regard the Leucadia people as very smart. Is it conceivable that the Leucadia people could have one outcome that didn’t work very well? Sure, it’s possible. I look at telecom...
- Charlie Munger On Berkshire's 15 Best Deals...
Via Whitney Tilson’s notes from the 2005 Wesco Annual Meeting:The reason I keep talking about the record without the 15 best deals is that it shows how few deals you need in a lifetime. The people who need a deal every month, by and large, they all...
Money and Finance
Charlie Munger on having the right compensation system...
Via Whitney Tilson’s notes from the 2005 Wesco Annual Meeting:
It isn’t enough to buy the right business. You’ve also have to have a compensation system that’s satisfactory to the people running them. At Berkshire Hathaway, we have no [single] system; we have different systems. They’re very simple and we don’t tend to revisit them very often. It’s amazing how well it’s worked. We wrote a one-page deal with Chuck Huggins when we bought See’s and it’s never been touched. We have never hired a compensation consultant.
And an example of it gone wrong:
The recent historical experience of mobile homes – actually, it’s “manufactured”; they’re not manufactured to move – is that you had a bunch of no-good nut cases and a balloon of unfortunate, commission-sales-driven activity. Any time you let people on sales commission set the credit standards for people using margin [e.g., debt to buy the home], you create a disaster. It’s like mixing oxygen and hydrogen and lighting a match.
- Charlie Munger On Efficient Markets And Bureaucracy
Via Whitney Tilson’s notes from the 2007 Wesco Annual Meeting:If markets were efficient, this tent wouldn’t be so full. Some business schools are teaching properly, but the world grew up amidst a different fashion, encouraged by academics of the era....
- Stretching For The Right People...
Comment from Charlie Munger about Iscar, via Whitney Tilson’s notes from the 2007 Wesco Annual Meeting:It’s not a Ben Graham stock – in fact, it would be the ultimate non-Ben Graham stock. It’s located a few miles from the Lebanese border in Israel....
- Charlie Munger On Capital And Credit In 2005...
Via Whitney Tilson’s notes from the 2005 Wesco Annual Meeting:It is weird the way that capital occurs. We have monetized houses in this country in a way that’s never occurred before. Ask Joe how he bought a new Cadillac [and he’ll say] from borrowing...
- Charlie Munger On Leucadia And Telecom...
Via Whitney Tilson’s notes from the 2005 Wesco Annual Meeting:We regard the Leucadia people as very smart. Is it conceivable that the Leucadia people could have one outcome that didn’t work very well? Sure, it’s possible. I look at telecom...
- Charlie Munger On Berkshire's 15 Best Deals...
Via Whitney Tilson’s notes from the 2005 Wesco Annual Meeting:The reason I keep talking about the record without the 15 best deals is that it shows how few deals you need in a lifetime. The people who need a deal every month, by and large, they all...