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Charlie Munger has lived through every hardship you can imagine.
One World War.
A great depression.
He watched his son slowly die of cancer at age nine.
And at 30, he was divorced and broke.
Naturally, people often compare him to his even more famous business partner. Even though they’ve earned similar incomes throughout their lifetime, Warren Buffett is substantially wealthier than Munger after setting out on his investing career at 19.
Charlie Munger donated most of his wealth in his earlier years to various charities losing out on the compounding effects of interest, leaving his net worth at around $2.3 billion against Warren Buffett’s net worth of $107 billion.
By any standard, both men are insanely successful, but it shows that life circumstances play a significant part in your outcomes.
I’m not saying that either of the two men was short of opportunities, given that they were born in America and are white.
Buffett says that the ovarian lottery is the greatest lottery we’ll ever participate in.
Warren Buffett — Source
“The womb from which you emerge determines your fate to an enormous degree for most of the seven billion people in the world,
Just in my own case: I was born in 1930, I had two sisters that have every bit of the intelligence that I had, have every bit of the drive, but they didn’t have the same opportunities.
My life would have been entirely different if I had been a female. You don’t know whether you will be born black or white. You don’t know whether you’ll be born male or female.
You don’t know whether you will be born infirm or able-bodied. You may be born in the United States or Afghanistan.”
You Must Learn To Fold When the Odds Are Against You.
Charlie Munger says when it comes to investing, you must learn to fold early when the odds are against you. If you have a significant edge, back it heavily because you don’t get a considerable advantage often.
Opportunity comes but doesn’t come often, so seize it when it does.
If you’re a regular investor in Cryptocurrency, you might be thinking in the back of your mind that somewhere along the line, one of these blockchains, if not multiple, will play a significant role in all of our lives.
You’d be mistaken for thinking this is the opportunity Munger says you should seize.
He and Warren Buffet are so anti-Bitcoin and Cryptocurrency in general that they even praised communist China for banning Bitcoin.
Charlie Munger — Source
“I try to avoid things that are stupid and evil and make me look bad, and Bitcoin does all three — It’s stupid, and it could go to zero.
A cryptocurrency is not a currency, not a commodity, and not a security. Instead, it’s a gambling contract with a nearly 100% edge for the house, entered into a country where gambling contracts are traditionally regulated only by states competing in laxity.”
Buffett has also given his 2 cents on Bitcoin in the past, mostly because he always gets asked. Buffet said he never wants to be the spokesperson for Bitcoin, and he’s wondering why people keep asking him, but since you asked…
Warren Buffett:
“If you tell me you own all the Bitcoin in the world and you offered it to me for $25, I wouldn’t take it because what would I do with it? It’s not going to do anything.”
Michael Saylor Addressed Charlie Munger’s Criticism.
Michael Saylor Addressed Charlie Munger’s Criticism.
In short, Michael Saylor, whose company MicroStrategy are the most significant corporate holder of Bitcoin with approximately 130,000 Bitcoin, says Charlie Munger needs to take the time to understand the digital asset before taking shots.
Saylor says he’s sympathetic to Munger’s criticism of the broader cryptocurrency market. There’s probably some merit in his criticism because buying any of the thousands of altcoins is nothing more than gambling.
However, Saylor says Munger would have a different idea about Bitcoin if he had studied it.
Michael Saylor—Source
“Charlie and the other critics are members of the western elite who are getting continually prodded for an opinion on Bitcoin, and they haven’t had the time to study it.
If he were a business leader in South America, Africa, or Asia and spent 100 hours studying the problem, he’d be more bullish on Bitcoin than I am.
These countries highlight the plight of the common man, and there’s no better solution than Bitcoin.
The Western elites have not had the time to study, but I’ve never really met someone with an incentive living in the rest of the world that spent some time thinking about it that wasn’t enthusiastic about Bitcoin.”
Michael Saylor bleeds Bitcoin.
He’s a Bitcoin maximalist through and through. He also has this core belief that there is only one true Digital currency, which is Bitcoin.
In his eyes, every other crypto that isn’t Bitcoin is centralised and corrupted by single points of failure. Humans.
Saylor says he feels like Bitcoiners are in a dysfunctional relationship with the rest of Cryptocurrency, and they want out of it. He said this in an interview following the FTX collapse, where they experienced crypto’s version of a bank run, and everyone was trying to draw their funds simultaneously, mostly because of their founder’s mismanagement and potential fraud.
Final Thoughts
Charlie Munger is insanely successful.
I applaud his career achievements and, more notably, his charitable donations, which are in the hundreds of millions, possibly billions.
Michael Saylor makes the perfect point — these traditional financial investors are constantly goaded for their opinion on Bitcoin. It doesn’t really interest them enough to do a deep dive and do the homework to understand it.
In the West, we often see things through our privileged lens. How about people who don’t have property rights or even a legitimate store of value in countries with failed banking systems and corrupt governments?
It’s no wonder Bitcoin is being adopted fastest in Africa, where becoming a government official is your route to wealth.
The people have had enough.
To me, Saylor is right. You’d have a different view of Bitcoin if you could see the economic prosperity it offers people with less than we do.
Munger’s disapproval of cryptocurrency is his actual view. But he understands that people hang off his every word, and saying the wrong thing about speculative assets could land many people in hot water.
Either way, crypto isn’t going back in time, and there’s no scenario where Blockchain doesn’t become a significant part of our lives over the next 50 years.
This article is for informational purposes only; it should not be considered financial, tax or legal advice. You can consult a financial professional before making any significant financial decisions.