USA

‘Untold story’ of Charlie Munger’s last years

Charlie Munger at Berkshire Hathaway’s annual meeting in Los Angeles California. May 1, 2021.

gerard miller

(This is the Warren Buffett Watch newsletter, news and analysis, covering all things Warren Buffett and Berkshire Hathaway. You can sign up Here To get it in your inbox every Friday evening.)

‘He never stopped learning’

In a “special” article titled “The Untold Story of Charlie Munger’s Final Years,” Wall Street Journal Gregory Zuckerman declared that “the Berkshire vice chairman made bold investments, forged unlikely friendships, and faced new challenges to the bitter end.”

Munger died two years ago On November 28, 2023, at the age of 99, he is just over a month away from his 100th birthday.

“Friends and family say Munger’s eventful final period offers lessons for investors and a blueprint for how to age with grace, poise and purpose,” the Journal writes.

His stepson, Hal Borthwick, is quoted as saying: “His mind was working until the day he died. He never stopped learning.”

He also never stopped looking for new investments, poring over data on publicly traded companies in green Value Line volumes.

It has defied conventional wisdom by investing in two coal-related companies in 2023, which it believes will still be needed due to rising energy demand despite environmental concerns.

Borthwick tells The Journal“He read an article that said coal goes down the chimney. ‘Horse feather,’ he said.”

Friends say he reaped more than $50 million in paper profits from coal miner Consol Energy. Alfa Metallurgy ResourcesIt provides coal for steel production.

(Console completed the merger with Arch Resources earlier this year. Basic Natural Resources.)

Coal is mined.

Jim Urquhart | Reuters

Munger also invested in real estate with an unusual partner.

In 2005, Munger began mentoring a 17-year-old neighbor whose ADHD was contributing to his difficulties in school.

Avi Mayer, now 37, tells WSJ, “He listened to my problems and talked about life principles and personal values.”

“I watched him work and learned from him, and he occasionally gave me books.”

Later, Munger backed a real estate company called Mayer and a childhood friend who became one of the largest owners of low-rise “garden” apartments in California, with assets of nearly $3 billion.

Munger “stayed involved until the end” and helped negotiate a building purchase that closed a few days after his death.

CNBC Special Podcast: Charlie Munger – A Life of Wit and Wisdom

The Journal says that as Munger got older, he spent more time with friends, including a regular Tuesday morning country club breakfast with co-workers that could last for hours.

He became less “grumpy and harsh”, telling the group, “At my age, you make new friends or you don’t have any friends at all.”

Years later, Munger’s family gave up trying to keep him on a healthy diet.

His grandson’s wife reported that Munger’s last food delivery was a whole Korean baked chicken, kimchi fried rice, and waffle fries.

A friend says Munger remained optimistic about Berkshire’s future, even though he joked that he aspired to be “86 again.”

“Once it’s built, you don’t have to be Warren and Charlie. We have a framework to look at investments.”

BUFFET ON THE INTERNET

Some links may require subscription:

HIGHLIGHTS FROM THE ARCHIVE

Munger: ‘A life well lived is just learning, learning, learning’ (2017)

Charlie Munger explains Learn why making mistakes is vital to success.

AUDIENCE MEMBER: Sorry Mr. Buffett, this question is for Mr. Munger. (Laughter)

In your career of thousands of negotiations and business deals, can you explain to the crowd which one stands out most in your mind or is otherwise notable?

Charlie Munger: I don’t actually think I have a favorite. But the thing that probably benefited us most as a learning experience was See’s Candy.

It’s just the power of the brand, the never-ending flow of ever-increasing money without any work. (Laughter)

AUDIENCE MEMBER: That sounds good. (Laughter)

Charlie Munger: It happened. And if we hadn’t bought See’s, I’m not sure we would have bought Coca-Cola.

In my opinion, a life well lived is just learning, learning, constantly learning. And I think Berkshire has learned over a long period of time and has made tremendous gains from these investment decisions.

Every time you appoint a new person who has never had major capital allocation experience, it’s like rolling the dice. And I think it’s much better that we’ve been doing this for so long. And –

But decisions get mixed up and the only feature that emerges is continuous learning. If we didn’t keep learning, you wouldn’t even be here.

You’d probably be alive, but not here. (Laughter)

WARREN BUFFET: There’s nothing better than the pain of being in a bad job – (laughs) – it makes you appreciate a good job.

Charlie Munger: There’s nothing like getting into something really good. This is a very pleasant experience and a learning experience.

I have a friend who says, “The first rule of fishing is to fish where the fish are. The second rule of fishing is to never forget the first rule.” (Laughter)

And we’ve become adept at fishing where the fish are.