On Tuesday, the investing scene said goodbye to a legend as Charlie Munger passed away a month shy from his 100th birthday. Munger, who was Warren Buffett's longtime banter partner, was known as The Abominable No-Man.
Together, they turned Berkshire Hathaway Inc. from a struggling textile mill into a colossal entity valued at USD783 bn, spanning diverse industries from insurance to energy, and delivering an astounding 20% net income growth every year.
Munger's sharp wit and profound knowledge gave rise to clever one-liners, a stark contrast to Buffett's more folksy style. Buffett highlighted Charlie's consistent emphasis on "Let’s buy truly wonderful businesses," as shared with the Omaha World-Herald in 1999.
In 1972, Munger played a crucial role in guiding Buffett to acquire See's Candies Inc., what Buffet easily described as the benchmark of “the prototype of a dream business”, a move that paved the way for Berkshire's USD1 bn investment in Coca-Cola Co. stock 15 years later.
Nevertheless, Munger regards his most impactful contribution to Berkshire as the investment in BYD, an emerging Chinese automaker that has now ascended to become the leading brand in global electric vehicle sales.
If you've recently visited China, I'm certain you've noticed BYD cars on the roads. Last year, approximately one in four cars sold in China was an electric vehicle (EV). China's middle-income consumers are inclines towards BYD models priced between $14,500 and $29,000 over pricier alternatives from competitors like Tesla and Xpeng.
And when did Munger vision on BYD came?
Munger's foresight dates back to 2008 when BYD car sales were a mere 37,010 units. Fast forward to 2022, and they sold an impressive 1.85 million units, marking a 50-fold increase!
However, what’s more remarkable than his accomplishments is his profound wisdom on life.
Having served in the US Army during World War II and also lived through what he considered the best and easiest period in world history– the lowest death rates, peak investment production, and highest improvements in most people's living standards.
He emphasizes that if you're unhappy with the past 50 years, you have an unfortunate misappraisal of life.
Billionaire investor Charlie Munger asserts that he has never been concerned with comparing his wealth to that of others.
Instead, his focus for accumulating wealth stems from a desire for independence—the freedom to pursue his business and life goals as he sees fit.
According to him, the world is fueled not by greed but by envy. Munger observes that despite everyone being 5x better off than before, people tend to take it for granted.
He notes that individuals often focus on others having more now and feel it's unfair, overlooking their own improved circumstances.
I’ll close with a sentiment close to my heart from legendary investment mogul.
May his enduring legacy serve as a source of inspiration as we approach both our investment decisions and the art of living itself.