AUDIENCE MEMBER 00:08
If you were researching a new company that you’ve never heard of, how would you approach the research process and how much time would you spend?
If you perform the intrinsic value estimate and the company was expensive, would you still continue following the company closely and continue researching it or do kind of try to get to evaluation pretty quickly and, if it’s not cheap, kind of move on?
How do you balance the time you spend on companies?
CHARLIE MUNGER 00:35
Well, of course. If it’s complicated technology I tend to leave it to others. I may get occasional variation in that but basically I just don’t do it.
I want to think about things where I have an advantage over other people. I don’t want to play a game where the other people have an advantage over me.
So if you have a pharmaceutical company and you’re trying to guess what new drug is going to be invented, I’ve got no advantage. Other people are better at that than I am.
I don’t play in a game where the other people are wise and I’m stupid. I look for a place where I’m wise and they’re stupid. And believe me, it works better.
You know, it's – god bless our stupid competitors. They make us rich.
That’s my philosophy. You have to know the edge of your own competency. You have to kind of know if it’s too tough for me, i never figure this out. I’m very good at knowing when I can’t handle them.