Atanu Dey On India's Development

Notes from Charlie Munger’s 2007 Commencement Speech at USC Law

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Charlie Munger said, “Safest way to get what you want is to deserve what you want. Deliver to the world what you would buy if you were on the other end” in a commencement address to the USC Law School in 2007. A copy of full transcript is here. The “Cliff notes” of that speech was posted by some kind soul and I am reproducing them with gratitude (but without permission.)

Charlie Munger USC Law Commencement 2007

Accounts and Attitudes that have worked for me

Core Ideas

1. Safest way to get what you want is to deserve what you want

2. No love that is so right that is admiration based love and that love should include the instructive dead

3. Wisdom Acquisition is a moral duty
a. Warren Buffett is a continuous learning machine
b. The skill that got Berkshire through one decade would not have sufficed to get it through the next decade

4. Rapid advance of civilization came only when men invented the method of invention

a. You can progress only when you learn the methods of learning
b. Learning should be continuous
c. Half of Warren’s time is sitting on his ass and reading the other half is spent talking on the phone or in person to highly gifted person that he trusts and trust him

5. Learning all the big ideas in the big disciplines
a. Not good if you don’t practice it
b. Multi disciplinary approach can be dangerous – it works so well – that you can be in front of an expert and you will see a correct answer that he has missed and must be tactful to avoid causing offense
c. Cicero famous for saying (my paraphrase): a man who doesn’t know what happens before he is born is doomed to go through life like a child
d. Learn them in such a way that they form a mental latticework in your head that you can use in everyday life situations

6. Work Problems in Reverse
a. Inversion will help you solve problems that otherwise couldn’t be solved

7. Avoid sloth and unreliability

8. Avoid really dead ideology
a. I tell myself I’m not entitled to have an opinion on a subject unless I can state the arguments against the position better than the people who are supporting

9. Avoid self serving bias
a. You should not believe that you are entitled to do whatever you want to do
b. Live below your means – Mozart was mostly miserable because of this

10. Avoid Self Pity
a. Disastrous behavior
b. Avoid it in yourself but allow for it in others
c. When encounter it try to reflect it by appealing to the interests of that person, do it of lofty motives
d. Never improves any situation

11. Avoid Perverse Incentives system
a. Can cause you to behave foolishly

12. Avoid Perverse Associations
a. Don’t work for people you don’t admire
b. We are all subject to control of authority figures so try and figure out how to work under people you really admire

13. Objectivity Maintenance Routines Required
a. Pay attention to disconfirming evidence (i.e. Darwin)
b. Have checklist routines to avoid a lot of errors (i.e. mental checklists)

14. Non Egality
a. Get power and practice to the right people who have the best aptitude and are learning machines
b. Two types of knowledge – people who really understand the subject and people who can just repeat what they have heard (just described every politician)

15. Intense interest in the subject is key is indispensable
a. Only way to be really good in something

16. Have a lot of Assiduity
a. Sit down on your ass until you accomplish what you’re set out to do
b. Choose partners who follow this rule

17. Life can be unfair so use every mischance as an opportunity to behave and well and learn something
a. Spoke about how his grandfather saved his uncle’s bank by providing capital when the bank experienced difficulties
b. Make sure your heroes would be pleased with your actions
c. Go through life anticipating trouble and be ready to perform adequately if trouble comes

18. Highest form of civilization – seamless web of deserved trust
a. Not much procedure just totally reliable people trusting each other

“My sword I give for him that can wear it” – CM ending quote.

[Source: FocusInvestor.com.]