10 brilliant quotes from Charlie Munger, Warren Buffett's right-hand man

Charlie Munger is a college-dropout who served as a meteorologist in the US Army Air Corps before graduating from Harvard Law.

And then he met Warren Buffett.

The rest is history.

As vice chairman of Berkshire Hathaway, Munger is Buffett’s right-hand man. He has an estimated net worth of $1.19 billion.

Like Buffett, Munger’s wit and investing wisdom is incredibly sharp. You might even argue his words are more blunt and unfiltered than Buffett’s.

We compiled a list of his most insightful quotes about investing, business, and life.

Check them out below:

Overestimating your intelligence could be a major pitfall.

'If you think your IQ is 160 but it's 150, you're a disaster. It's much better to have a 130 IQ and think it's 120.'

Source: Berkshire Hathaway 2009 meeting via The Daily Beast

Smart people do dumb things.

The flight of Icarus.

'We recognised early on that very smart people do very dumb things, and we wanted to know why and who, so we could avoid them.'

Source: Berkshire Hathaway 2007 meeting via Buffett FAQ

Invest in the business that any fool can run.

King Lear and the Fool.

'Invest in a business any fool can run, because someday a fool will. If it won't stand a little mismanagement, it's not much of a business. We're not looking for mismanagement, even if we can withstand it.'

Source: Berkshire Hathaway 2009 meeting via Buffett FAQ

There's only one way to the top: hard work.

'Obviously if you want to get good at something which is competitive, you have to think about it and practice a lot. You have to keep learning because (the) world keeps changing and competitors keep learning. You have to go to bed wiser than you got up. As you try to master what you are trying to do -- people who do that almost never fail utterly. Very few have ever failed with that approach. You may rise slowly, but you are sure to rise.'

Source: Berkshire Hathaway 2010 meeting via Buffett FAQ

If you're lazy and unreliable, it doesn't even matter what you're good at.

'What do you want to avoid? Such an easy answer: sloth and unreliability. If you're unreliable it doesn't matter what your virtues are. You're going to crater immediately. Doing what you have faithfully engaged to do should be an automatic part of your conduct. You want to avoid sloth and unreliability.'

Source: Charlie Munger's USC Law Commencement Speech, May 2007

Keep it simple.

© AFP/File Natalia Kolesnikova
'Black Suprematist Square' by Kazimir Malevich.

'Well, opportunity cost is a huge filter in life. If you've got two suitors who are eager to have you, but one is way better than the other, you're going to choose that one rather than the other. That's the way we filter stock buying opportunities. Our ideas are so simple. People keep asking us for mysteries, but all we have are the most elementary ideas.'

Source: Berkshire Hathaway 1997 meeting via Buffett FAQ

Self-pity doesn't solve anything.

Oli Scarff/Getty Images

'Generally speaking, envy, resentment, revenge and self-pity are disastrous modes of thought. Self-pity gets fairly close to paranoia, and paranoia is one of the very hardest things to reverse. You do not want to drift into self-pity. ... Self-pity will not improve the situation.'

Source: Charlie Munger's USC Law Commencement Speech, May 2007

The greatest minds are in books, not classrooms.

'I met the towering intellectuals in books, not in the classroom, which is natural. I can't remember when I first read Ben Franklin. I had Thomas Jefferson over my bed at seven or eight. My family was into all that stuff, getting ahead through discipline, knowledge, and self-control.'

Source: 'Damn Right!: Behind the Scenes with Berkshire Hathaway Billionaire Charlie Munger'

If Mozart couldn't get away with it, then neither can you.

'Another thing that does one in, of course, is the self-serving bias to which we're all subject. You think the 'True Little Me' is entitled to do what it wants to do. And, for instance, why shouldn't the True Little Me overspend my income. There once was a man who became the most famous composer in the world but was utterly miserable most of the time, and one of the reasons was because he always overspent his income. That was Mozart. If Mozart can't get by with this kind of asinine conduct, I don't think you should try.'

Source: Charlie Munger's USC Law Commencement Speech, May 2007

In the future, someone will come along and do even better.

AP Images
Benjamin Graham (left).

'Ben Graham was a truly formidable mind, and he also had a clarity in writing, and we talk over and over again about the power of a few simple ideas thoroughly assimilated, and that happened with Graham's ideas which came to me indirectly through Warren, but some also directly from Graham. The interesting thing for me is that Buffett the former protégé -- by the way Buffett was the best student Graham had in 30 years of teaching at Columbia -- became better than Graham. That's the natural outcome -- as Milton said, 'If I've seen a little farther than other men, it's by standing on the shoulders of giants.' So, Warren stood on Ben's shoulders, but he ended up seeing more than Ben. No doubt somebody will come along and do a lot better than we have.'

Source: Berkshire Hathaway 1997 meeting via Buffett FAQ

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