Charlie Munger is a friend of Warren Buffett.
The pictures are by JoAnnes Eisen.
The 97-year-old business partner of Warren Buffet explained why he welcomes market panic, reflected on one of the pair's best investments, and recalled how he missed out on a multi-billion dollar windfall.
Charlie Munger, the vice-chairman of the conglomerate, criticized mutual funds for misleading marketing, as well as detailing how he avoids repeating mistakes.
Here are the 10 best quotes from the interview.
1. Warren and I look for intrinsic value and ignore the noise of stock prices. We look at the patterns of the noise to pick our hiding places.
2. The Washington Post was a treasure. There was a time when stock prices were low and panic reigned, and a place where one stock got clobbered for an unusual reason. We just paid $10 million for The Washington Post, and in due course it became worth $1 billion, because the newspaper owned television stations were "total gold mines," and because of the Watergate scandal.
3. An idiot could figure out that The Washington Post was selling at a huge discount. An opportunity like that is very rare. You don't need an opportunity very often, once in a lifetime is enough.
4. Every good card player knows that they have to not blow their opportunities. You don't get many. There isn't enough people carrying that card-playing wisdom into practical life.
5. You don't get a lot of good opportunities. When the few come along, you grab them vigorously.
6. It helped us to have everyone else believe in the efficient market theory. It was an interesting example of a learned profession going crazy.
7. The problem with the efficient markets idea is that economists think it was always right, even if it was not a law of physics. We thought the academics were crazy because we had the advantage of being imperfectly educated. Which of them was correct.
8. It's really fraudulent what they do. Nobody in the mutual-fund world finds the practice of picking a winner like that and then using it in the advertising as detestable. It is crooked and detestable, because mutual funds that launch a bunch of different strategies then later pick the best-performing one to trumpet and ignore the rest.
9. It was one of the dumbest mistakes I've ever made. It doesn't look at my record like I'm stupid because I have billions and started with nothing. If I'd made a different decision about Belridge Oil, I would have had twice as much money. Belridge was acquired by Shell two years later. Munger could have invested that money in the company and made a lot of money, but he didn't.
10. If I make my own mistakes, I'm less likely to commit the same type of mistake again. I go through my life and make mistakes. I think it would work on me because it works in training a dog.
Mario Gabelli has gained 7,000% on the stock of the company. The billionaire investor is still a fan of Warren Buffet, but he is worried about the Fed.
Business Insider has an original article.
