My Morning With Charlie Munger
A first interview in the investor’s Los Angeles home turns into four hours packed with candor, lessons and the odd lament
I arrived at Charlie Munger’s Los Angeles home early one morning in September, hoping for some thoughts and opinions.
For nearly four hours, Charlie wouldn’t stop.
Successes and mistakes. Artificial intelligence and venture capital. Elon Musk and Donald Trump. Munger’s legacy and a secret to success in life. Even his painful hemorrhoids.
We had never met and I wasn’t sure he’d be open or loquacious. Munger usually let longtime partner Warren Buffett steal the spotlight at Berkshire Hathaway’s annual meetings. Munger was content offering a witty quip or “I have nothing to add.” I brought fresh croissants and muffins, hoping to sweeten his mood.
I needn’t have bothered. His aide ushered me into the den, pointed me to a couch, and Munger jumped right in, employing a characteristic and refreshing bluntness.
Could I tape the interview? Ask questions for a book as well as a Wall Street Journal article?
“Do whatever you want,” he said, all but rolling his eyes.
Munger dressed as one might expect of an aging and accomplished financier. Light blue shirt, dark blue sports jacket, gray pants pulled up high, black dress shoes. He sat in a tan recliner, hardly budging. Munger’s voice was a bit weak and he didn’t appear very mobile. But he was sharp, witty and full of humor.
I asked about lessons from his key investments, both at Berkshire Hathaway, where he was the longtime vice chairman, and on his own. He said Berkshire’s 1972 purchase of See’s Candies was a crucial deal. When See’s raised prices without affecting the volume of sales, it changed Munger’s approach to investing. He learned that paying full price for a beloved brand could be a bargain.
He and Buffett began looking for other companies with loyal customers, leading to their big purchases of shares of Coca-Cola and other stocks and to paying a premium for Israeli toolmaker Iscar, he said, deals that paid off.
Costco taught Munger the value of treating customers well. Munger never sold his personal stake in the company, which amounts to 187,760 shares worth about $111 million. The stock has returned 31% this year, including dividends, and 475% over the past 10 years.
As a longtime outside director, Munger encouraged Costco to pay up for choice real estate, he said, and to enter China, a nation he long admired for the work ethic of its citizens. But he kept most of his opinions to himself: Few executives want to hear critiques from outside directors, he said.
“I’ve had to pick my spots and be gentler than is my inclination,” Munger said.
Berkshire owned Costco for a while but exited its position in 2020. Buffett sometimes teased Munger for his passion for the company, an example of how they didn’t always agree on investment strategies.
“Warren has a prejudice against retailing,” Munger said.
BYD was a bet on Wang Chuanfu, someone Munger viewed as an especially capable leader. But it also demonstrated the importance of good fortune. Munger urged Wang not to enter the challenging automobile business. Wang ignored the warning, shifting BYD into electric vehicles. Today, the company is Tesla’s biggest threat.
“It teaches you to be humble,” Munger said.
Munger missed out on Amazon, even though he was a fan of founder Jeff Bezos. He also passed on automaker Tesla, whose shares have soared, but he had fewer second thoughts on that one. Munger called Musk “an extreme talent” but said “I would go crazy if I took the risks he did.”
Berkshire’s purchase of Apple was one of its biggest home runs, but Munger wished the company had bought even more of the stock. Both he and Buffett were slow to appreciate the company’s strengths, he said, and had to overcome their long-held caution about tech stocks.
Expressing a tenet he often shared about both investing and life, Munger said: “You have to let ideas die” and regularly challenge one’s own beliefs.
Munger said the rush to embrace artificial intelligence was likely overdone—“I don’t want something that behaves like a human”—and worried that too much money is chasing venture-capital deals. A lifelong Republican, Munger said he agreed with some of Trump’s policies while in office but said could never vote for him, citing character flaws and his business practices before making it to the White House.
“Biden is a typical Democratic politician,” he said. “I’m used to that type of defect.”
Munger expressed optimism about the U.S., despite its abundant challenges.
“A great nation has a lot of collapse in it,” he said.
Munger didn’t dwell on his investment legacy. He seemed prouder that his many aphorisms, which some have termed “uncommon sense” have become so popular.
“When someone says uncommon sense they really mean common sense,” he said.
He kept going without even a bathroom break. Privately, I thanked my colleague Jason Zweig, who had warned me not to drink before the sit-down.
As he spoke, I soaked up the surroundings, realizing I’d likely never have another chance. Volumes about Benjamin Franklin, Albert Einstein and Costco. A table stacked with financial books sent by various publishers; when he wasn’t looking, I snapped a photo for an author. To Munger’s left sat a small wooden table with two oversize and worn Value Line binders featuring details of various companies. Munger said he relied on these relics of a bygone era to evaluate new investments.
“They’re easy to navigate and you get a good overview of companies,” he explained.
Munger seemed to enjoy himself during our interview. He volunteered a healthy respect for the press and the role it plays scrutinizing companies, executives and others. But he really lit up toward the end of the morning when a 35-year-old neighbor, Avi Mayer, came by, clutching a handful of documents for Munger to review and sign. It turned out that the unlikely duo had launched a real-estate partnership that owned thousands of garden apartments around the country, an enterprise Munger detailed with excitement. Munger shared their plans for growth, expressing deep pride in his partner.
It was a lesson in the value of learning fresh skills and exploring new pursuits throughout one’s life, and the need to meet new people. It also was a testament to how newfound passions, even those discovered late in life, can inspire and invigorate.
“If anything, my fun has increased with time,” Munger said.
Write to Gregory Zuckerman at Gregory.Zuckerman@wsj.com
Charlie Munger’s Life
WSJ's coverage of the legendary investor, selected by editors
