FRI, DEC 01, 2023
Charlie Munger's final CNBC interview
On November 14, 2023, Charlie Munger sat down at his home in Los Angeles for an extensive taped interview with CNBC's Becky Quick.
We intended to use the material for a one-hour special program that would air just before his 100th birthday on January 1.
Instead, Munger died at the age of 99 on Tuesday morning.
Photo: CNBC | Dave Grogan
Editing of the special was accelerated and "Charlie Munger: A Life of Wit and Wisdom," featuring extended excerpts from the conversation, premiered Thursday evening. (This is a transcript.)
It will be re-aired, tomorrow, Saturday, December 2 at 3p ET; Sunday, December 3 at 5a ET, and Monday, December 4 at 3a ET.
In addition, the entire, un-cut interview will be posted early next week on our Warren Buffett Archive (buffett.cnbc.com).
For now, here are some highlights we haven't covered in Tuesday's follow-up newsletter.
'I am very good at learning things from dead people'
After telling Becky that fixing the U.S. government falls into his "too hard" pile, Munger said he does think governments are necessary.
"When you get right down to it, what I am is a lover of the progress of civilization. That turns me on."
His paternal grandparents felt the same way and introduced him to "Robinson Crusoe," a 1719 English adventure novel written by Daniel Defoe that tells the story of a castaway who spends 28 years on a remote tropical desert island.
According to a Wikipedia summary, "The book can be considered a spiritual autobiography as Crusoe's views on religion change dramatically from the start of his story to the end."
Munger said he never got over it. "I'm still following Robinson Crusoe's method of going at life. That's what I did. I imitated Robinson Crusoe."
He recalled that his maternal grandfather's advice to his grandchildren was similar to the lesson Munger drew from the book.
"When they give you a real opportunity -- the world's not going to do it very often and you're only going to get three or four of these invitations to the pie counter -- and when you get your invitation, for God's sakes, don't take a small helping."
'I could have done a lot better'
Munger and Warren Buffett have often advised people to "know your circle of competency," to essentially stick with what you know you can do well.
But in the interview, Munger expressed some regret he didn't venture outside that circle.
When he was growing up in Omaha, he was very impressed by the mechanical abilities of one of his father's best friends and that man's young son.
Photo: CNBC | Dave Grogan
"It was quite obvious that anything that required mechanical ability, I would not be as good [as they were] so I decided to stay the hell out of businesses where I would compete with people like [them] in their strong suit.
"But I'm not all that pleased. I could have done a lot better if I had been a little smarter, a little quicker ... I might have had multiple trillions instead of multiple billions."
"My worst trade was buying a block for the Munger family in Alibaba, which is a pretty good company.
"But I think it got over-hyped. And Jack Ma was – made mistakes in dealing with the Chinese government.
"I had some bad – everybody has some bad ones. You have an off day. The greatest tennis player goes out there some days to the center court and has a bad day. It happens."
Munger's first son, Teddy, died of leukemia in 1955 at the age of 9.
Becky asked him how he gets through his toughest times.
"Well, we all know how to get through them.
"The great philosophers of realism are also the great philosophers of what I call soldiering through.
"If you soldier through, you can get through almost anything. And it's your only option.
Photo: CNBC | Dave Grogan
"You can’t bring back the dead. You can't cure the dying child. You can’t do all kinds of things.
"You have to soldier through it. You just, somehow, you soldier through.
"If you have to walk through the streets, crying for a few hours a day as part of the soldiering, go ahead and cry away.
"But you have to – you can't quit. You can cry all right, but you can't quit."
Charlie Munger, CNBC Make It contributor
In what CNBC Make It says is "among his final writings," Charlie Munger listed the "three basic rules for career satisfaction that have always helped me" in a guest essay that was posted the day after he died.
1. Don't sell anything you wouldn't buy yourself.
2. Don't work for anyone you don't respect and admire.
3. Work only with people you enjoy.
Munger writes, "I have been incredibly fortunate in my life when it comes to these basic rules. With Warren Buffett, I had all three."
Several subscribers shared their own thoughts on the death of Charlie Munger.
Renee from Hong Kong writes that he was "the greatest teacher I've ever had, even though we don't know each other."
"When I was younger, I felt lost about my future life. He was the one who supported me spiritually for ten years... I still follow his wisdom to be a better person, to be a better investor."
Ricardo in Edmonton also saw him as a "great teacher about life."
"Underlying everything he said and did were the virtues of a good man.
"He taught us ... by his personal example, how to be wealthy and good... [and] how to be good and useful in life without being wealthy."
Berkshire counterattacks in billion-dollar battle over Pilot deal
Berkshire Hathaway has filed a countersuit against the 20% of Pilot still held by Cleveland Browns owner Jimmy Haslam and his family.
In a court filing, Berkshire says it recently learned that Haslam "secretly promised massive side payments" to high-level employees of Pilot Travel Centers that would be tied to the amount of money the Haslams would receive if they exercised their contractual option to sell their remaining 20% to Berkshire.
If it is exercised during an annual 60-day window at the beginning of 2024, that sales price would be based on Pilot Travel Center's 2023 earnings.
Berkshire's filing says the "illicit side payments were structured to incentivize some of the senior PTC employees, with the most discretion to influence PTC's financial performance, to favor short-term profits — i.e., [the Haslams'] interests —over long-term stability and profitability — i.e., [Berkshire's] interests."
A lawyer for the Haslam family calls Berkshire's allegations "a wild invention."
A view inside Pilot's headquarters in Knoxville, TN on October 8, 2021. Photo: REUTERS | Harrison McClary
Last month, the Haslam family filed its suit accusing Berkshire of using its 80% controlling stake to switch PTC to "pushdown accounting," even though the Haslams say they have a veto over "accounting changes."
That would, according to the Haslams' complaint, "artificially depress" PTC's earnings, which in turn would reduce the amount the Haslam family would get for the remaining 20%.
A Delaware Chancery Court judge is deciding whether Berkshire's countersuit will be heard at the same time as the Haslams' original complaint is scheduled to go to trial in early January.
BUFFETT AND MUNGER AROUND THE INTERNET
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HIGHLIGHTS FROM THE ARCHIVE
'I’ve lived a better life because of Charlie' (2018)
BERKSHIRE'S TOP U.S. STOCK HOLDINGS - Dec. 1, 2023
Berkshire's top holdings of disclosed publicly-traded stocks in the U.S., Japan, and Hong Kong, by market value, based on today's closing prices.
Holdings are as of September 30, 2023 as reported in Berkshire Hathaway’s 13F filing on November 14, 2023, except for:
The full list of holdings and current market values is available from CNBC.com's Berkshire Hathaway Portfolio Tracker.
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Also, Buffett's annual letters to shareholders are highly-recommended reading. There are collected here on Berkshire's website.
-- Alex Crippen, Editor, Warren Buffett Watch
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