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“BE a Continuous LEARNING Machine!” | Charlie Munger | Top 10 Rules


my whole life I’ve never succeeded much
in something I wasn’t interested in so I
don’t think you’re gonna succeed if what
you’re doing all day doesn’t interest
you and without lifetime learning you
people are not gonna do very well you
are not going to get ready for our life
based on what you already know you’ll
actually start a law firm I had no
alternative and then you had an army of
children almost immediately I patted
myself in quite a corner need motivation
what’s this top ten with the elimination
believe Asia
what’s that believe nation it seven my
one word is believe and I believe in you
I believe you have Michael Jordan level
talent at something and I want you to
find it embrace it and use it to make a
difference so let’s get your motivation
to attend and get you believing in you
grab a snack and chewing today’s lessons
from a man who went from studying
meteorology dropping out of college to
join the u.s. army to then becoming the
billionaire business partner of Warren
Buffett he’s Charlie Munger and here’s
my take on his top ten roses excess
volume two
okay let’s kick it off with rule number
one pursue your interests in terms of
thinking what to do I want to report to
all of you in my whole life I’ve never
succeeded much in something I wasn’t
interested in so I don’t think you’re
gonna succeed if we’re doing all day
doesn’t interest you and you’ve got to
find something you’re interested in
because it’s just too much to expect a
human nature that you’re gonna be very
good at something you deeply dislike
doing and and so that’s that’s one big
issue and of course you have to play in
a game where you’ve got some unusual
talents you don’t know how to play if
you’re five foot one you don’t want to
play basketball against the guy that’s 8
v 3 it’s just too hard and so you’ve got
to figure out a game where you you have
advantage it has to be something you’re
deeply interested in rule number 2 be a
continuous learning machine wisdom
acquisition was a moral duty it’s not
something you do just to advance in life
wisdom acquisition is a moral duty and
and as a corollary to that proposition
which is very important it means that
you’re hooked for life time learning and
without lifetime learning you people are
not gonna do very well you are not going
to get very far in life based on what
you already know you’re going to advance
in life by what you’re going to learn
after you leave here if you take
Berkshire Hathaway which is certainly
one of the best regarded corporations in
the world and may have the best invest
long-term investment record in the
entire history of civilization the skill
that got Berkshire through one decade
would not have sufficed to get it
through the next decade with the
achievements made
without Warren Buffett being a learning
machine continuous learning machine the
record would have been absolutely
impossible the same is true at lower
walks of life I constantly see people
rise in life who were not the smartest
sometimes not even the most diligent but
they are learning machines they go to
bed every night a little wiser than they
were when they got up and boy does that
habit help particularly when you have a
long run ahead of you
rule number three find your true path
you actually start a law firm and then
practice law for some period of time I
had no alternative and then you had an
banded myself in quite a corner yeah so
zero choice is pretty powerful yeah for
sure of course
so you practice law and then you leave
law in the firm that you helped found
and move over to investments well but
that’s Ashland – sounds miraculous in
fact it was rather interesting I
probably got paid about $350,000 in my
first 13 years of law practice total and
I had an army of children and no capital
to start with and when I chose this
alternative career I had over $300,000
in liquid instruments so I had and that
was ten years of living expenses so I
was not a courageous venture some
admirable man I was a cautious little
saving up more nuts than I really needed
it and not going very deep into my pile
of nuts
and so that was it wasn’t that
courageous and I kept one foot in the
law firm while I tried my capitalist
career but as soon as the capitalist
career succeeded I intended to lift that
second foot because I recognized that
the potential of law practice as I saw
it then I didn’t anticipate the boom
that came to the big firms yeah I just
saw it as being more difficult I wanted
more independence so it was going to
have her as a lawyer I hated standing
other people invoices and needing money
from richer people I thought it was
undignified I wanted my own money not
because I loved ease or social diversity
I wanted the independence rule number
four don’t super specialized I was
wondering how you can thrive as a
polymath in a world that celebrates
specialization well that’s a good
question I don’t think operating over
ranges and ones as I knew is a good idea
for most people I think it’s fun that’s
why I have done it and and I’m better at
it than most people would be I don’t
think I’m good at being the very best
dependently differential equations so
it’s it’s been a wonderful path for me
but I think the correct path for
everybody else is
toys and and get very good at something
that society rewards and they get very
efficient at doing but even if you do
that I think you should spend ten or
twenty percent of your time and of
trying to know all the big ideas and all
the other disciplines otherwise I use
the same phrase over again otherwise
you’re like oh one leg man an
ass-kicking contest this is not gonna
work you have to know the big ideas and
all the disciplines to be safe if you
have a life lived outside a cave rule
number five clone great ideas well
cloning is of course a very it’s not an
ambiguous word word we use it
biologically so you take it into some
other field cloning is a very
interesting idea
you’re do or move ideas from one place
and bring them into another if that’s
cloning I do it all the time of course
it’s useful if I were you people to look
at what other people you plug artists
great investors are doing for ideas the
trouble with it is that if you pick
people as late in the game as Berkshire
Hathaway right you’re buying our
limitations caused by size sure you
really need to do it some guys its
operating smaller places and finding
places with more advantage and of course
it’s hard to identify the people in the
small game but it’s not an idea that
won’t work if I were you people of
course I can do that what do you I would
I would want to know exactly what the
true people were doing and I would look
at every one of them of course that
would be a no-brainer for me
rule number six cherish old-fashioned
values I look at my background as
absolutely privileged I’m proud of being
an Omaha boy I sometimes use the old
saying they got the boy out of Omaha but
they never got him out of the boy
and and so I have all those
old-fashioned values family comes first
be in a position so you can help others
when troubles come
prudent sensible moral duty to be
reasonable more important than anything
else more important than being rich more
important than being important an
absolute moral duty because none of my
intelligent relatives suffered terribly
because they didn’t advance higher rule
number seven destroy bad ideas I’ve said
that any year what you don’t destroy one
of your best loved ideas it’s a wasted
year it’s well known that you helped
coax Warren towards quality which was a
difficult transition for him I was
wondering if you could speak to the
well I’d also main dumb things but I’m
very busy this during bad ideas because
I keep having them so it’s hard for me
to just single out one from such a
multitude but I actually like it when I
destroy a bad idea because I think I’m
on the right thing it’s my duty to
destroy it I know so many people whose
main problem in life is that the old
ideas displace the entry of new ideas
that are better
that is the absolute standard outcome in
life there’s an old German folk saying
that describes that he says we’re too
soon old and we’re too late smart that’s
everybody’s problem and the reason we’re
too late smart is they’re still what
ideas we always have
we can’t get rid of that’s a good thing
that we have that problem in marriage
that may be good for the stability of
marriage that we stick with our old
ideas but in most fields we you want to
get rid of your old ideas and and it’s
it’s a good habit and it gives you a big
advantage and the competitive game of
life since other people are so very bad
at it what happens is as your spouts
ideas out what you’re doing is you’re
pounding the Manimal and so you get
these ideas and you start agitating and
saying them and so forth and of course
the person you’re really convincing is
the is you already have the ideas you’re
just probably them in a harder and
harder one of the reasons I don’t spend
much time telling the world well I think
about all the federal reserve system
should behave and so forth as I know but
I’m just prompting the ideas end of my
own head
I think I’m telling the other people how
to run things so I think you have to
have mental habits that I don’t I get
one the young people will get violently
ever get violently convinced on every
damn cause or something I think we know
everything some seventeen year old wants
to tell the whole world what he done a
lot of boards on earth foreign policy in
the Middle East or something all he’s
doing when he or she spouts about what
he believe he believes is pounding at
his door he has an ax this is a very
dumb idea when you’re just starting and
have a lot to learn so it’s very
important that habit of getting rid of
the dumb ideas one of the things I do is
Pat myself on the back every time I do I
get rid of a dumb idea and you say look
you reinforce your own good behavior
yeah you can with other people won’t
pray for you to praise yourself I have a
big system of patting myself on the back
every time I get rid of the much-beloved
idea I pat myself on the back sometimes
several times I recommend this this a
mental habit to all of you that price we
pay for being able to accept the new
idea it’s just awesomely large rule
number eight evolve Berkshire and Warren
and you were known as value investors is
that not the core discipline of
Berkshire Hathaway anymore or does that
not even matter but you gotta remember
in our way of thinking all intelligent
investment is value investment because
why would you want to buy something
which wasn’t worth as much as you were
paying for it and who wouldn’t like
buying something for less than it’s
worth
so the only difference when people talk
about value investing you’re always
being a value investor now there are
various ways to look
for value investments just as their
various places to fish and of the food
first rule of fishing is to fish where
the fish are the first rule of value
investing is to find someplace to fish
for value investments where there are a
lot of them and of course it’s gotten
hard in the United States to find easy
value investments because the world is
so competitive and that accounts for a
lot of what you see in Berkshire where
we buy securities like Apple we wouldn’t
have bought in the old days when we had
more mundane things that were serving us
very well so we’re just looking in
different places but we’re value
investors and so they can some people
may say value investor they mean
somebody that emphasizes working capital
or something meaning they should use the
fish in that particular place but I
think that’s all I think it’s a bad use
of the language to think there’s a
difference between value investing and
other good and investing all good
investing is value investing by
definition and so they’re just various
places to fish for value investments and
of course as the world gets tougher you
have to fish in places you didn’t fish
before
rule number 9 think like a business
owner coming the business not as
business school graduates but as people
who would own portfolios or securities
we thought like capitalist because we
were always in the shelter mindset a lot
of people running the businesses think
like careerists and believe me you’ve
got to think like a kris to some extent
if you’re in a career but it also helps
to look at the business strategy
problems as though you’re an owner and
so my advice to you is you don’t want to
be never yet to be a career so much you
don’t see it from the owners point of
view that’s what General Motors did that
a bunch of
and an owner would have seen immediately
the situation was hopeless
and they just romped through it with a
lot of denial and stupidly and pomposity
and of course they went bankrupt the
mightiest company in the world went
bankrupt and and none of those hotshot
executives thought like an owner they
would have seen that it was hopeless and
rule number 10 the last home before a
very special bonus clip is have fun
that’s Charlotte I warn you can tell us
apart because he can hear and I can see
that’s why we work together so well so
you shall are especially boys what’s
sometime when I’m expression especially
Charlie says all he wants to know his
world dies who will never go there you
know and show you what life has been
awfully good to me and Charlie so we
have no complaints well you don’t want
to be is like the man and they have it
as funeral no minister said now it’s the
time for somebody to say something nice
about the deceased and nobody came
forward and nobody came forward he says
surely somebody can say somebody
something nice about the deceased that
nobody came forward and finally one man
came up and he said well he said his
[Music]
now I’ve got a really special bonus
charlie munger clip on how to aim low
that I think you’re really gonna enjoy
but before that it’s time for the
three-point landing questions it’s time
to move from just watching another video
to actually taking some kind of action
in your life or in your business so
answer these questions on your own at
home talk about them with a friend or
leave the replies in the comments below
here we go question number one what bad
idea do you need to destroy question
number two what change in your thinking
do you need to make to think like the
business owner that you want to be and
question number three what new
interesting thing are you going to learn
this week thank you guys so much for
watching I believe in you I hope we
continue to believe in yourself and
whatever your one word is much love I’ll
as you look back on your life experience
what’s the what’s the most important
piece of advice that you would offer
everyone in the room tonight as they
look forward and into their futures well
there are a few obvious ones they’re all
ancient Ben Franklin has married just
like the most important decision you
have not your business career and it’ll
do more for you good or bad than
anything else and Ben Franklin had the
best advice ever given on marriage you
said keep your eyes wide open before
it’s amazing how if you just get up
every morning and keep plugging and have
some discipline keep learning and it’s
amazing how it works out okay and I
don’t think I don’t think it’s wise to
have an ambition to be President United
States or a billionaire or something
like that because the odds are too much
against you much better to aim low I did
not intend to get rich I wanted to get
and by the way while you’re clapping
some of the over shooting was accidental
there’s something there’s a big you can
be very deserving and very intelligent
very disciplined but there’s also a
factor of luck that comes into this
thing and the people will get the good
the outcomes that seem extraordinary
though the people who have discipline
and intelligence and good virtue
plus a hell of a lot of luck why
wouldn’t the world work like that
so you shouldn’t give credit for the
unusual a lot of the people my friend of
mine said about a colleague of his in
his fraternity he says old George was a
duck sitting on a pond and they raised
the level of a pond there are a lot of
people that just look into the right
place and rise and then and there are a
lot of very eminent people who have many
advantages and they’ve got one little
flaw or one bit of bad luck and they
they’re mired in misery all their lives
but that makes it interesting to have
all this variation altruistic world
domination
honey Empire right I’m grateful I
understand why I’m here I think because
I am so open I wanted to think and say
it’s a bloody brief life all of you have
the potential for enormous success if
you want to know what Gary v-d-j Khalid
Oprah and others know about empire
building that most people miss check out
the link in the description for a free bonus video
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