I recently watched the 2007 USC commencement speech given by Charlie Munger, Warren Buffett’s partner and confidante for almost 60 years.
Take 37 minutes out of your life to watch it. You will learn something.
Munger is the long-serving Vice Chairman of Buffett’s Berkshire Hathaway and like Buffett is a billionaire investor. He is as smart, if not smarter, than Buffet himself and at 93 he is in the sunset of life but as razor sharp as ever.
He is full of worldly wisdom as you would imagine. In the speech he outlines the basic tenets of living a good life that have helped him throughout his nine decades:
Seek an admiration kind of love, not the “sick” kind. Choose to live life on your terms not what people expect of you. Study history to understand the future. Acquire wisdom as a moral duty.
Munger pays homage to his pal Buffett, calling him a “lifetime learning machine” and the reason why Berkshire Hathaway is so successful.
He says that lifelong learning is paramount to long-term success. Without it you won’t succeed because you won’t get far based on what you already know.
“If you take Berkshire Hathaway which is certainly one of the best-regarded corporations in the world and may have the best long-term investment record in the entire history of civilisation. The skill that got Berkshire through one decade would not have sufficed to get it through the next decade with the achievements made.
“Without Warren Buffett being a learning machine, a continuous learning machine, the record would have been absolutely impossible.”
In a separate interview, Munger says Buffett is much better in some ways in his 70s and 80s than he was when he was younger. With age comes a greater knowledge and wisdom unlike the rest of the body which slowly withers.
Warren Buffett is a learning machine every day
He later goes on to explain how Buffett spends the majority of his working day.
“And if you take Warren Buffett and watched him with a time clock, I would say half of all the time he spends is sitting on his ass and reading. And a big chunk of the rest of the time is spent talking one on one either on the telephone or personally with highly gifted people whom he trusts and who trust him.”
In reality, Munger is a learning machine too.
In the speech he discusses when he was young and made the commitment to learn “all the big ideas in all the big disciplines” and to make them a standard part of his thinking and decision-making process.
This is what he calls Elementary Worldly Wisdom and it’s based on the premise that you can’t make a sound decision with only isolated facts. Elementary Worldly Wisdom is having the macro understanding of all the big disciplines and making calculated decisions based on this knowledge.
Munger is not your ordinary investor. Or, person, for that matter. He too is a learning machine which has served him well for years.
How to become a learning machine
Granted not everyone can spend half the day “sitting on their ass and reading” or take time out of life to learn all the big ideas in all the big disciplines.
Buffett and Munger both have exceptionally high IQs and when meshed together become an unstoppable investing force. They are the epitome of learning machines when it comes to understanding the world as it relates to investing.
1. Read every day
Like Buffett, take the time out to read each day. According to some reports, Buffett reads 500 pages a day which consists of financial reports, newspapers and biographies.
While you don’t have to read financial reports if you’re not an investor, reading a broad range of topics will stand you in good stead. Do as Munger did and learn the big disciplines.
If you’re like me you will have to take notes to refer to later. My brain isn’t as good as holding information as some people. Repetition of the information is how I learn.
Reading every day requires discipline and a prioritisation of time.
2. Develop speed reading skills
People who devour lots of books at a time don’t read cover to cover. They pick out chapters and sections of it that communicate the basic fundamentals of it.
In this excellent podcast on Shane Parrish’s Farnham Street blog with CEO and co-founder of AngelList, Naval Ravikant discusses how manages to get through a lot of books each year.
“I don’t know about you, but I have very poor attention. I skim, speed read, jump around and could not tell you specific passages or quotes from books. At some deep level, you do absorb them and they become part of the threads of the tapestry of your psyche. They do kind of weave in there.”
3. Fail and succeed often
It’s a common adage in today’s startup culture that one has to have a series of failures before they reach the path of tech enlightenment. While I disagree with the premise, the idea of failing at something to learn something else is one.
Failing at something is learning the hard way. When you learn the hard way it’s often a deeply embedded kind of learning that stays with you throughout life.
We equally learn from success too. Again, it’s a different kind of learning. It creates a sense of accomplishment and confidence which deep learning comes from.
Failing and succeeding means you’re trying new ideas and concepts and in some cases pushing the boundaries with them.
You have no excuse not to become a learning machine
At the click of a few buttons you have access to all the world’s information. You can download to a reading device almost every book ever written, including the greatest works of literature. Video lectures of the world’s recent greatest minds can be found on YouTube. Audio interviews with today’s smart thinkers can be found on iTunes.
In today’s Information Age there is no excuse not to be a learning machine. The world is moving at such a rapid pace you have to or you’ll be left behind.
Technologists proclaim we’re in the era of artificial intelligence machine learning when in reality we have yet to achieve the full potential of the natural intelligence learning machine.
Hear it from the man himself.