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Charlie Munger on Elon Musk: “I don’t want my personal life to be [around] a bunch of guys who are living in a state of delusion, who happen occasionally to wi

Charlie Munger on Elon Musk: “I don’t want my personal life to be [around] a bunch of guys who are living in a state of delusion, who happen occasionally to win big,” Munger told Daily Journal’s shareholders. “I want the prudent person.” https://www.cnbc.com/2019/02/19/charlie-munger-ideal-hire-wouldnt-be-someone-like-elon-musk.html https://www.cnbc.com/2019/02/19/charlie-munger-ideal-hire-wo...

Phr0ztByte 6y ago
And from the same article "is bold and brilliant, and he swings for the fences." and ... "People like that get some remarkable results,” Munger continued. “Sometimes they get some quick failures. I haven’t the faintest idea how Elon Musk will turn out, but he has a considerable chance of success and considerable chance of failure. He seems to like it that way."
- holler 6y ago
  > but he has a considerable chance of success... Wait a second, by all measures this billionaire is _already_ successful, no? How could anyone claim the contrary?
  - ebcode 6y ago
    The success he's referring to could be the success of Elon's vision, rather than Elon himself.
  - gherkinnn 6y ago
    Depending on how it ends. Will he be reduced to a mad man shouting on twitter, with nothing left to his name but failed enterprises? Or will he carve the moon in his image?
  - ben_w 6y ago
    Money on that scale is of a very different character to money as normal people understand it. It’s more like being a medieval king: to the extent that you’re the shareholder, your wealth is the “nation’s” wealth; your guards are paid for out of your pocket; and you can be drawn into conflicts that lead to you losing everything. It’s that latter part that I’d be worried about with Musk. He took a very big gamble with SpaceX, and if one more launch had failed in the early years, he would’ve become a mere footnote on someone else’s Wikipedia page. The concern is he might make similar gambles in future.
LudwigNagasena 6y ago
A guy who consistently founds or joins successful companies is not someone I would call “who happen occasionally to win big”. He founded Zip2 that was acquired by AltaVista, he joined PayPal that was acquired by eBay, he joined Tesla, he founded SpaceX. His record is stellar. Of course it is understandable that Berkshire Hathaway wouldn’t hire anyone like Musk. They are as far from tech and VC as any investor could ever be. I admire Buffet and Munger, but the guys are 90 years old, I honestly couldn’t care less what they think about IT industry.
- mkagenius 6y ago
  > I admire Buffet and Munger, but the guys are 90 years old, Well, then you need to tell me your age, to know whether I should care about what you have written above.
  - toomuchtodo 6y ago
    Not OP, but mid 30s and I’m getting a bit tired of folks who are out of touch because of their age believing their past experience can extrapolate a future they don’t understand (Buffett in particular has done a very poor job understanding and investing in tech). It’s terribly ironic that they think Musk is just lucky considering Munger and Buffett were able to invest during one of the most prosperous times in American history. Admit you’re passed your prime and move on. Make way for innovators instead of valuing reading a 10-K and preferring conservative companies you believe are undervalued, or distressed companies you’re going to try to twist their arm into a deal (as Buffett did during the GFC with banks).
    - rdgthree 6y ago
      Your comment and OP's comment are a bit silly given the context. Munger didn't say anything controversial here. He was asked a question about Elon and answered by saying he prefers less risk. He specifically pointed out that Elon shouldn't be underestimated while saying it. Elon doesn't just like to take risks, he would probably agree with being described as "risk obsessed". If your investment strategy is risk aversion and stability, you should avoid Elon. That isn't an outdated perspective, nor is it arrogant in any way - Elon would probably agree with it. The last sentence was an exaggeration of his bias when evaluating any operator to drive his point home clearly. It's fairly difficult to imagine that Charlie Munger thinks Elon Musk has just gotten lucky for his entire career, and unsurprisingly he isn't saying that in this example. I'm all for fairly criticizing out-of-touch arrogance, but I can't see it being the case here.
rdgthree 6y ago
Taking this quote out of context is impressively dishonest. It would be incredibly inaccurate to describe Elon's history of winning big as "occasional", and for that same reason it would be incredibly surprising if Charlie Munger described Elon's career this way with no qualifiers. Not surprisingly, he didn't. This quote is the end of a much more nuanced statement to conclude the point that he generally prefers to invest in operators who take less risk. Regardless of your opinion on Elon, this sort of manipulation of reality damages the discourse. It's not helping anyone.
- KKKKkkkk1 6y ago
  The quote speaks for itself. Please do not stoop to ad hominems.
  - aaron695 6y ago
    We can listen to the quote here, and it's not about Elon at all. https://www.youtube.com/watch?v=X1Oi3esiry8&feature=youtu.be&t=3180 https://www.youtube.com/watch?v=X1Oi3esiry8&feature=youtu.be... And to me, he is only attributing a quote to Elon, nothing else, but the audience takes it a different way. Regardless the quote above is not about Elon.
centimeter 6y ago
> a bunch of guys who are living in a state of delusion Sounds like the politicians and assorted apparatchiks who still think, or claim to think, that this virus is orders of magnitude worse than it actually is.
alasdair_ 6y ago
This is the same Charlie Munger who backed airline stocks when everyone else was dumping them, outside only to finally realize how terrible they were far too late and finally dump them weeks after the rest of the market did. His opinion is absolutely valid, but it’s not like his track record is any more exceptional than Musk’s.
- ckastner 6y ago
  > It’s not like his track record is any more exceptional than Musk’s. Everyone makes mistakes, but to conclude that Berkshire Hathaways' track record is "not ... more exceptional than Musk's" is beyond folly. Their success over decades is unparalleled. Furthermore, Berkshire on principle plays the long game. They rarely act on short-term events. Tesla was also badly affected by the Covid-19 measures. The Fremont plant is still closed. You would have expected Munger to dump airlines sooner; but would you also have expected Musk to dump his TSLA stock, too? For some people, being an investor means looking at a time horizon of decades, not months.

Phr0ztByte 6y ago

And from the same article "is bold and brilliant, and he swings for the fences." and ... "People like that get some remarkable results,” Munger continued. “Sometimes they get some quick failures. I haven’t the faintest idea how Elon Musk will turn out, but he has a considerable chance of success and considerable chance of failure. He seems to like it that way."

holler 6y ago
> but he has a considerable chance of success... Wait a second, by all measures this billionaire is _already_ successful, no? How could anyone claim the contrary?
- ebcode 6y ago
  The success he's referring to could be the success of Elon's vision, rather than Elon himself.
- gherkinnn 6y ago
  Depending on how it ends. Will he be reduced to a mad man shouting on twitter, with nothing left to his name but failed enterprises? Or will he carve the moon in his image?
- ben_w 6y ago
  Money on that scale is of a very different character to money as normal people understand it. It’s more like being a medieval king: to the extent that you’re the shareholder, your wealth is the “nation’s” wealth; your guards are paid for out of your pocket; and you can be drawn into conflicts that lead to you losing everything. It’s that latter part that I’d be worried about with Musk. He took a very big gamble with SpaceX, and if one more launch had failed in the early years, he would’ve become a mere footnote on someone else’s Wikipedia page. The concern is he might make similar gambles in future.

LudwigNagasena 6y ago

A guy who consistently founds or joins successful companies is not someone I would call “who happen occasionally to win big”. He founded Zip2 that was acquired by AltaVista, he joined PayPal that was acquired by eBay, he joined Tesla, he founded SpaceX. His record is stellar. Of course it is understandable that Berkshire Hathaway wouldn’t hire anyone like Musk. They are as far from tech and VC as any investor could ever be. I admire Buffet and Munger, but the guys are 90 years old, I honestly couldn’t care less what they think about IT industry.

mkagenius 6y ago
> I admire Buffet and Munger, but the guys are 90 years old, Well, then you need to tell me your age, to know whether I should care about what you have written above.
- toomuchtodo 6y ago
  Not OP, but mid 30s and I’m getting a bit tired of folks who are out of touch because of their age believing their past experience can extrapolate a future they don’t understand (Buffett in particular has done a very poor job understanding and investing in tech). It’s terribly ironic that they think Musk is just lucky considering Munger and Buffett were able to invest during one of the most prosperous times in American history. Admit you’re passed your prime and move on. Make way for innovators instead of valuing reading a 10-K and preferring conservative companies you believe are undervalued, or distressed companies you’re going to try to twist their arm into a deal (as Buffett did during the GFC with banks).
  - rdgthree 6y ago
    Your comment and OP's comment are a bit silly given the context. Munger didn't say anything controversial here. He was asked a question about Elon and answered by saying he prefers less risk. He specifically pointed out that Elon shouldn't be underestimated while saying it. Elon doesn't just like to take risks, he would probably agree with being described as "risk obsessed". If your investment strategy is risk aversion and stability, you should avoid Elon. That isn't an outdated perspective, nor is it arrogant in any way - Elon would probably agree with it. The last sentence was an exaggeration of his bias when evaluating any operator to drive his point home clearly. It's fairly difficult to imagine that Charlie Munger thinks Elon Musk has just gotten lucky for his entire career, and unsurprisingly he isn't saying that in this example. I'm all for fairly criticizing out-of-touch arrogance, but I can't see it being the case here.

rdgthree 6y ago

Taking this quote out of context is impressively dishonest. It would be incredibly inaccurate to describe Elon's history of winning big as "occasional", and for that same reason it would be incredibly surprising if Charlie Munger described Elon's career this way with no qualifiers. Not surprisingly, he didn't. This quote is the end of a much more nuanced statement to conclude the point that he generally prefers to invest in operators who take less risk. Regardless of your opinion on Elon, this sort of manipulation of reality damages the discourse. It's not helping anyone.

KKKKkkkk1 6y ago
The quote speaks for itself. Please do not stoop to ad hominems.
- aaron695 6y ago
  We can listen to the quote here, and it's not about Elon at all. https://www.youtube.com/watch?v=X1Oi3esiry8&feature=youtu.be&t=3180 https://www.youtube.com/watch?v=X1Oi3esiry8&feature=youtu.be... And to me, he is only attributing a quote to Elon, nothing else, but the audience takes it a different way. Regardless the quote above is not about Elon.

centimeter 6y ago

> a bunch of guys who are living in a state of delusion Sounds like the politicians and assorted apparatchiks who still think, or claim to think, that this virus is orders of magnitude worse than it actually is.

alasdair_ 6y ago

This is the same Charlie Munger who backed airline stocks when everyone else was dumping them, outside only to finally realize how terrible they were far too late and finally dump them weeks after the rest of the market did. His opinion is absolutely valid, but it’s not like his track record is any more exceptional than Musk’s.

ckastner 6y ago
> It’s not like his track record is any more exceptional than Musk’s. Everyone makes mistakes, but to conclude that Berkshire Hathaways' track record is "not ... more exceptional than Musk's" is beyond folly. Their success over decades is unparalleled. Furthermore, Berkshire on principle plays the long game. They rarely act on short-term events. Tesla was also badly affected by the Covid-19 measures. The Fremont plant is still closed. You would have expected Munger to dump airlines sooner; but would you also have expected Musk to dump his TSLA stock, too? For some people, being an investor means looking at a time horizon of decades, not months.