Poor Charlie’s Almanack

‘Poor Charlie’s Almanack – The Wit and Wisdom of Charles T. Munger’ is a compilation of essays, memoirs, interviews, and speeches regarding Warren Buffett’s closest friend and business partner, Charles T. (Charlie) Munger , edited by Peter D.Kaufman.

Charlie Munger is an admirer of Benjamin Franklin,and the book’s title is a tribute to Franklin’s ‘Poor Richard’s Almanack.’

This is a big’ heavy coffee-table book with well over 500 pages.It’s pretty heavy reading and best left in the library.Reading the book cover to cover is only for serious Munger fans.

Thumbing through the book I figured that the only solid take-aways I could get without knocking myself out by tackling this formidable book were (1)Mungerisms,(2)The concepts to be mastered to apply the Multiple Mental Models to think better and (3)A checklist of investing principles.

As best as I could see, my list of Mungerisms at https://wealthymatters.com/2011/02/12/charlie-mungers-quotes-mungerisms/ felt pretty complete.I was not getting all that much more that was compelling out of spending more time with this book.

The investment principles checklist I got out is available here : https://wealthymatters.com/2011/02/12/an-investing-principles-checklist/

Following is a list of  some ‘Big Ideas from Big Disciplines’-a checklist of concepts from different academic disciplines -to be used for decision-making using ‘Multiple Mental Models’.

• Mathematics – compound interest,time value of money,probability theory,decision trees,law of large numbers
• Accounting
• Legal System – copyright and trademark
• The Decision Making Process-asking the who,what,when,where,why questions and inversion
• Statistics – averages,standard deviation and normal distribution,regression
• Engineering-back-up systems,breakpoints
• Physics -The Theory of Equilibrium,critical mass
• Know Yourself and Understand Motivation Factors
• Economics – Law of Supply and Demand,Income and Substitution Effects,scarcity,utility and rationality,elasticity,monopolies,oligopoly
• Economies of Scale
• Pavlovian Conditioning-classic conditioning,instrumental conditioning,operant conditioning
• Competitive Destruction
• Surfing
• The Stock Pari-Mutuel System
• Psychology of Investing-social proof,denial,consistency,reciprocation tendency,authority,scarcity
• Chemistry-auto catalysis
• Biology-Natural Selection,survival by differentiation
• Lollapalooza Effect