Charlie Munger Quotes

My first undertaking in the way of scientific experiment was in the field of economics and psychology.

Economists think about what people ought to do. Psychologists watch what they actually do.

Economics has increasingly become the science of human behavior in general, and it's all the more unlikely to think that it can possibly be value-free - and, in fact, it isn't. Economics rests on un-argued assumptions that need to be examined.

Economists suffer from a deep psychological disorder that I call 'physics envy'. We wish that 99 percent of economic behavior could be captured by three simple laws of nature. In fact, economists have 99 laws that capture 3 percent of behavior. Economics is a uniquely human endeavor.

How should the best parts of psychology and economics interrelate in an enlightened economist's mind?... I think that these behavioral economics...or economists are probably the ones that are bending them in the correct direction. I don't think it's going to be that hard to bend economics a little to accommodate what's right in psychology.

If I could only have cash, I know that I would spend very little.

Age about 30, I stopped looking up my books in bookstores. Paying attention to the marketplace isn't a healthy thing for me.

I wasn't actually very naturally good at economics. My brain doesn't work very well, in terms of mathematics.

There's a popular image of people who don't save for the future as lacking in self-control. But the reason saving is so hard has less to do with self-control and more to do with a scarcity of attention.

I think what Bob Shiller and I are doing is we're focusing on macroeconomics and the role of psychology in macroeconomics.

To understand someone, find out how he spends his money.

Money is a huge issue for manic depressives. Sometimes the problem is not nearly on the same scale as it has been for me, but nonetheless, it's difficult to deal with. Many get themselves into debt that can take years to clear up, write bad cheques, shoplift and borrow huge amounts from family and friends.

I practice what has come to be called behavioral economics.

Economists discount any factors that would not influence the thinking of a rational person.

Humans are hard-wired to be irrational when it comes to financial decisions. We must understand that so we don't become the sucker at the poker table.

I am saying that the economic approach provides a valuable unified framework for understanding all human behaviour

[There will be movement toward] behavioral economics... [which] involves study of those aspects of men's images, or cognitive and affective structures that are more relevant to economic decisions.

If anything is evident about people who manage money, it is that the task attracts a very low level of talent, one that is protected in its highly imperfect profession by the mystery that is thought to enfold the subject of economics in general and of money in particular.

Everyone's lost a lot of money on their 401k plans. I've heard some people calling them 201k plans. So it's even more important to get people to be saving more for retirement. Behavioral economics has helped us learn a lot about how to do that.

Economics is a social science, not a physical science.

Political Economy or Economics is a study of mankind in the ordinary business of life.

There is no such thing as economics, only social science applied to economic problems.

The faster you want to get rich, the more accurate with numbers you must be.

Control your cash. Stick to your core business. Know your numbers.

As you manage your money, you manage your life.