In his own words
Munger on Temperament
38 sourced quotes. All themes
“Envy, resentment, revenge, and self-pity are disastrous modes of thought. Self-pity gets pretty close to paranoia, and paranoia is one of the very hardest things to reverse. You do not want to drift into self-pity.”
“A great character and the right temperament will beat a high IQ that lacks them, almost every time.”
Captures Munger's repeated 'temperament over IQ' point, but this exact wording is a paraphrase, not a verified verbatim quote.
“Life will have terrible blows in it, horrible blows, unfair blows. It doesn't matter. Some people recover and others don't. And there I think the attitude of Epictetus is the best. He thought that every missed chance in life was an opportunity to behave well, every missed chance in life was an opportunity to learn something.”
“Generally speaking, envy, resentment, revenge, and self-pity are disastrous modes of thought. Every time you find yourself drifting into self-pity, I don't care what the cause, your child could be dying of cancer, self-pity is not going to improve the situation.”
“A lot of people with high IQs are terrible investors because they've got terrible temperaments. And that is why we say that having a certain kind of temperament is more important than brains. You need to keep raw irrational emotion under control.”
“To everyone who finds the current investment climate hard, difficult, and somewhat confusing, I would say, welcome to adult life.”
He also used 'welcome to adult life' at the 2019 meeting; this is the 2022 one.
“It's amazing how difficult these very intelligent people find it ever to change their minds no matter how wrong they are.”
Phrasing approximate — independent notes from the same meeting render it a little differently.
“My third prescription for misery is to go down and stay down when you get your first, second, third severe reverse in the battle of life.”
Delivered ironically (a 'prescription for misery'); the real advice is resilience after your first setbacks.
“Resentment has always worked for me exactly as it worked for Carson. I cannot recommend it highly enough to you if you desire misery.”
Sardonic — part of his inverted 'prescriptions for misery,' expanding a Johnny Carson commencement bit. The real counsel is to drop resentment.
“In fact, you can argue that if you're not willing to react with equanimity to a market price decline of 50% two or three times a century, you're not fit to be a common shareholder, and you deserve the mediocre result you're going to get compared to the people who do have the temperament, who can be more philosophical about these market fluctuations.”
From his BBC interview; the widely-circulated short version drops the closing clause restored here.
“The nerds who were patient and rational eventually did well — those who lived within their income, worked at being sensible, and when they saw an opportunity grabbed it very fiercely. So if you're not a nerd, I can't help you.”
Condensed from one continuous answer — no words changed.
“The iron rule of life is everybody struggles.”
“If you soldier through, you can get through almost anything. … If you have to walk through the streets, crying for a few hours a day as part of the soldiering through — go ahead and cry away. But you have to — you can't quit. You can cry alright, but you can't quit.”
Condensed from the CNBC transcript (one elided clause); 'alright' per CNBC's rendering.
“We would never trade money for misery.”
“Conduct your life so you can handle a 50% decline with aplomb and grace. Don't try to avoid it. It will come. In fact, if it doesn't come, I would say you're not being aggressive enough.”
On enduring market drawdowns; he called his own 1973–74 ~50% decline 'a part of manhood.'
“People who cannot be alone with their own thoughts for a long time are terrible candidates to become successful investors.”
“I also think that one should recognize reality even when one doesn't like it, indeed, especially when one doesn't like it.”
“You don't want to make important decisions in anger. You want to display as much ruthlessness as your duty requires, and you do not want to add one single iota because you're angry.”
On how Berkshire handled the Sokol/Lubrizol affair; he credited Tom Murphy — 'you can always tell a man to go to hell tomorrow.'
“If you ask what one frame of mind is likely to do an individual the most damage — to his happiness, to his contribution to others — the answer would be some sort of paranoid self-pity. Couldn't imagine a more destructive frame of mind. Now you have whole departments that want everyone to feel a victim. And you pay money to send your children to places where this is what they teach them.”
Lightly compressed from a longer answer on academic victimhood culture; wording approximate.
“It's very counterproductive for an individual to feel like a victim, even if he is. To have a deep feeling that it's all somebody else's fault is a very counterproductive way to think.”
“Warren and I aren't prodigies. We can't play chess blindfolded or be concert pianists. But the results are prodigious, because we have a temperamental advantage that more than compensates for a lack of IQ points.”
“The world promoted me to the place where I'm stressed. And if you're lucky, that will happen to you. That's where you want to end up is stressed. You want to have your full powers called for.”
On wanting your full powers called for; spoken grammar preserved.
“Good investing requires a weird combination of patience and aggression — and not many people have it.”
“I'm 76 years of age. I've been through a number of down periods. If you live a long time, you're going to be out of investment fashion some of the time.”
From Lowe's biography; on enduring a down period.
“It's not supposed to be easy. Anyone who finds it easy is stupid.”
From a private conversation, preserved by Howard Marks; no public occasion.
“Why shouldn't it be hard to make money? Why should it be easy?”
“I think great investors to some extent are like great chess players — they are almost born to be investors.”
“I think speed is overestimated. I had a roommate at Caltech who had a very distinguished mind, and I could do problems faster than he could, but he never made a mistake, and I did. So I wouldn't be too discouraged if you have to go a little slower. What the hell difference does it make?”
To a questioner worried about reading slowly.
“The general idea that a person should just shout disapproval all day long of everything he disapproves of is very suspect. In the world in which we inhabit, people accomplish more if they pick their spots for public disapproval. If we all did that, we wouldn't be able to hear each other.”
“I don't think the right way to handle every tough guy that's fighting against you is with unlimited hostility. There are times I think when they ought to be killed with kindness. Even if they're wrong.”
On handling adversaries; the immediate trigger was U.S.–Russia relations.
“I am very good at recognizing unfair advantages. And I got unfair advantages in old age, the way I got unfair advantages in not old age, and when they came, I just grabbed them. Boom, boom, boom.”
From the interview CNBC released the day he died.
“My advice would be, if you have a fixable disadvantage, remove it. If it's unfixable, learn to live without it. What else can you do? You fix what can be fixed, and what can't be fixed, you endure.”
“I do think that there's a lot to be said for developing a temperament that can own securities without fretting. The fretful disposition is an enemy of long-term performance.”
Smoothed past a verbal false-start; otherwise verbatim.
“I developed more courage after I learned I could handle hardship. So maybe you should get your feet wet with a little more failure.”
Buffett's reply: 'I've certainly followed that advice.'
“It's not that we're so smart. It's that we stayed sane. Because a lot of what goes on is absolutely nuts.”
His summary of Berkshire's real edge.
“I would never buy it, and I would never sell it short.”
On Tesla; he then quoted Howard Ahmanson on Elon — 'never underestimate the man who overestimates himself.'
“The right way to go through life is to take it as it comes and to do the best you can. And if you live to an old age, you'll get your share.”
“Man is the prisoner of his talents.”
From Whitney Tilson's notes.