​Listen to Charlie Munger and don’t be a right Charlie

2023-11-29
Summary:

Charlie Munger, known for being Warren Buffett’s right-hand man, died at age 99. He would have turned 100 on New Year’s Day.

Charlie Munger, known for being Warren Buffett’s right-hand man, died at age 99. He would have turned 100 on New Year’s Day.

Charlie Munger and Warren Buffett

The investing sage lost his left eye following cataract surgery in 1980, but he has been more forward-looking than most market participants over the course of his career.


“He weaned me away from the idea of buying very so-so companies at very cheap prices … and looking for some really wonderful businesses that we could buy in fair prices,” Buffett told CNBC in 2016.


In an interview with Yahoo! Finance last year, Munger made a surprising comment that fiat currency is “going to zero” in the next hundred years.


That could have in part something to do with skyrocketing inflation across the world. Regardless of the reason, the man made compounding to work for him against an unsustainable monetary system.


Let’s assume his is correct as he always was, then skewing household assets toward deposits as in China makes little sense. And it could be a good time to plough money into other assets after peak interest rates.


He has also said at a conference that AI is getting a "huge amount of hype ... probably more than it deserves." That did come not as a surprise though given the absence of either Nvidia or Microsoft in the Berkshire holdings.


AI does disrupt the financial industry. Hedge funds and other computer-driven trading firms are growing increasingly concerned about the threat that it presents to them.


Retail traders would fancy the idea of AI trading as copy-trading and EA, the most common trading assistants, are just semi-automated.

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