AUDIENCE MEMBER 00:08
I’ve been working in the financial services industry for the past five years, and one of the things that has surprised me is how many of my peers in the industry have sat out the market over the last five years. Holding cash in anticipation of a market downturn.
And, you know, I would think, given that we’re in our late 20s and we’ve accumulated savings and have what’s hopefully a multi-decade runway ahead of us, the right thing to do would be to start investing now. And my question is, first, do you agree with this assessment? And if so, how would you convince your friends to start investing? Thank you.
CHARLIE MUNGER 00:51
Well, it’s obvious that deferred gratifiers do better over the long pull than these impulsive children that have to spend money on Rolex watches and other folly. And not that I’m picking Rolex is any worse than Patek Philippe or something.
But I think everybody should – save and not be stupid at spending money and defer gratification to get more later. All those good things that we were taught, you know, by Benjamin Franklin, thrift and so forth.
And the odd thing about it is that people were kind of born deferred gratifiers or not. They’ve done recent psychological work on that subject. Lots of luck if you’re an impulsive person that has to be gratified immediately, you’re probably not going to have a very good life and we can’t fix you. (Laughter) But if you have a slight tendency to defer gratification, and you can feed that tendency, you’re on the way to prosperity and happiness. It’s that demand for immediate gratification, that’s the way to ruin. It may also give you a syphilis.
This is the last question.
CHARLIE MUNGER 02:42
They have a saying in vaudeville, ‘Give him the hook.’ My (friend) Guerin is just giving me the hook. You know, I’m an accidental guru. We didn’t set out to have an audience of people coming in and asking me questions about every damn subject in the world.
(Laughter) It just kind of happened by accident and I went along with it because I think it did more good than harm and I kind of enjoy it as long as I don’t have to do it too often. But I feel sorry for people who have adulating multitudes. And I also wouldn’t like a normal multitude, I love these nerds.