The Profile Dossier — Charlie Munger, the Master of Mental Models

Polina Marinova’s dossier on Charlie Munger — the Latticework of Mental Models, and the case for cross-pollinating ideas across disciplines instead of thinking in one line.

Notes

• To avoid ignorance and stupidity, Munger is famous for knitting together ideas from a variety of disciplines to create what he calls a “Latticework of mental models.” Mental Models refer to the frameworks that help us simplify and understand the world. They also help us clarify our thinking and make better decisions.
• Most people think and learn in a linear manner. Munger, on the other hand, is a proponent of the cross-pollination of ideas, which creates a mental toolbox of shortcuts that improve your decision-making.
• Peter Bevelin’s book, Seeking Wisdom — From Darwin to Munger #books-to-read
• Munger’s 1986 speech “How to Guarantee a Life of Misery” has been dubbed “one of the greatest speeches ever given.” He lays out five “prescriptions for sure misery.” They include
  • Ingesting chemicals in an effort to alter mood or perception
  • Envy and resentment
  • Unreliability
  • Letting life get you down
  • Not learning from past mistakes.
• Tren Griffin wrote the book, Charlie Munger — The Complete Investor #books-to-read
• “Life will have terrible blows in it … horrible blows, unfair blows,” he says. In those situations, he remembers the words of Epictetus, who said that every missed chance in life was an opportunity to behave well and learn something constructive.
• **Know the edge of your competence: **When Munger was younger, he continuously kept struggling to overcome his own arrogance. Over the years, he’s learned a valuable lesson: No one is infallible, and you need to operate within the subject areas you know best. “Humility means you know the edge of your own competence,” he says. “You are a disaster if you don’t know where the edge lies.” He and Warren Buffett often joke that they’d rather deal with someone who has an IQ of 130 who thinks it’s a 125 than a guy with an IQ of 185 that thinks it’s a 200. He adds, “That second guy will kill you!” Circle of Competence
• Originality is derived from the learnings of the mistakes and successes of the people who came before us. History
• “Invert, always invert.” You flip the problem around and think backward. For example, rather than asking, “What new behaviors can I take on to ensure I have a successful marriage,” it might be more useful to ask, “What behaviors could ruin my marriage?” Avoiding the most common behaviors that lead to divorce may be more helpful than trying to figure out the ingredients for a successful partnership.
• Your intelligence won’t make you a great investor if you have little emotional control. #meditation
• “I’m not entitled to have an opinion on this subject unless I can state the arguments against my position better than the people do who are supporting it,” he says. “I think only when I reach that stage am I qualified to speak.” #Compromise #debate
• What you want in your life, he says, is to build a web of deserved trust among reliable people. “And so if your proposed marriage contract has 47 pages, my suggestion is you not enter,” he says.
• Quotes
  • “In my whole life, I have known no wise people who didn’t read all the time — none, zero.” #Reading
  • “Being smart and doing something that no one has done before are two different things.”
  • “Take one simple idea, and take it seriously.” (Charlie Munger)
  • “To get what you want, you have to deserve what you want. The world is not yet a crazy enough place to reward a whole bunch of undeserving people.”
  • “How to find a good spouse? The best single way is to deserve a good spouse.” #Marriage
  • “Acquire worldly wisdom and adjust your behavior accordingly. If your new behavior gives you a little temporary unpopularity with your peer group…then to hell with them.” #Learning
  • “A majority of life’s errors are caused by forgetting what one is really trying to do.”
    • “Perhaps the most important word is remember and that our greatest need is to remember.” -Spencer W. Kimball
    • “Because we have made covenants with God, he said, “our greatest need is to remember” them.” - Henry B. Eyring
  • “Mimicking the herd invites regression to the mean.”
  • “The best thing a human being can do is to help another human being know more.” #Teaching
  • “You must force yourself to consider opposing arguments. Especially when they challenge your best loved ideas.” #debate #Compromise
  • “People calculate too much and think too little.”
  • “Like Warren, I had a considerable passion to get rich, not because I wanted Ferraris – I wanted the independence. I desperately wanted it.”
  • “Three rules for a career:
    • 1. Don’t sell anything you wouldn’t buy yourself
    • 2. Don’t work for anyone you don’t respect and admire
    • 3. Work only with people you enjoy.”
  • “The iron rule of nature is: you get what you reward for. If you want ants to come, you put sugar on the floor.”