Poor Charlie’s Almanack: The Essential Wit and Wisdom of Charles T. Munger
. 2023. Edited by Peter D. Kaufman. Pankajsihag Press.
Many sources offer advice to improve our diets, and a similar abundance of guidance exists to enhance our investment returns. The late Charlie Munger, longtime vice chair of Berkshire Hathaway, provides his insights in Poor Charlie’s Almanack: The Essential Wit and Wisdom of Charles T. Munger, sharing folksy wisdom about values and valuation accumulated over almost a century. His examples are punctuated with memorable phrases, such as the utility of “a one-legged man in an a**-kicking contest” and a man who owns only a hammer and to whom every problem looks like a nail.
Munger, who passed away on 28 November 2023, advocated common sense and wisdom while dismissing the physics envy and false precision of financial experts, as well as the efficient market hypothesis. He questioned how he and Berkshire partner Warren Buffett achieved enduring investment success if the market is perfectly efficient. Poor Charlie’s Almanack, first published in 2005, features multiple talks given between 1986 and 2005 and is a comprehensive guide to life lessons and investment guidance, reflecting the evolution of Munger’s wisdom.
Most talks are followed by a short reflection by Munger and some featured highlights from audience question-and-answer (Q&A) sessions. Poor Charlie’s Almanack equates the live experience of a Berkshire annual meeting, weaving temporal wisdom into a set of life lessons and investment guidance.
In one of many analogies from his wide range of interests, Munger draws on the card game bridge to demonstrate the importance of using all available models and the importance of model interaction. Successful players communicate the strengths and weaknesses of their hands through strategic bidding, similar to Berkshire’s investment approach.
Poor Charlie’s Almanack offers practical examples and lessons drawn from an eclectic list of tutors, providing indispensable reading for investment professionals and retail investors alike. While some of Munger’s examples may seem outdated, the bountiful wit and wisdom is still relevant and worth considering.
A glimpse into the breadth of Munger’s wisdom and investment success, Poor Charlie’s Almanack is a comprehensive body of work that deserves to be at the top of many reading lists.
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