Insight
Griffin: The best way to be smart is to avoid being stupid
“And a key message of the book is, probably the key message, Is the best way to be smart is to not be stupid.”
Insight
Griffin: Investors who only understand business will not be successful
“An investor who only understands business isn't going to be a very good investor.”
Insight
Griffin: Overreliance on quantitative models blinds students to hidden tail risks
“You can get people who are so caught up in formulas and teaching formulas like value at risk or things like that, the students sort of lose track of the forest. And they also become sort of unduly reliant on models, which may have tail risks, which are unappar…”
Insight
Griffin: Every business's future is worse than its present due to competition
“All moats are constantly under attack. You can't see it, but they're constantly under attack. And what Munger says is, Is the future of every business is worse than the present.”
Insight
Griffin: People spend more time picking refrigerators than mutual funds
“When people do invest, they don't think clearly. They don't understand fees. They're lazy. They spend more time picking out their refrigerator than their mutual funds.”
Insight
Griffin: Financial risk stems from ignorance, not market volatility
“Risk doesn't come from volatility. Risk comes from not knowing what you're doing.”
Insight
Griffin: Business and investing mistakes are mostly psychological, not analytical
“Well, I think, I guess the key thing in both business and investing is that most mistakes that people make are psychological and emotional.”
Insight
Griffin: Complexity theory teaches humility and margin of safety, not prediction
“Both of those things teach you not that you can create a predictive theory, but that you should be humble and that you should build in a margin of safety.”
Insight
Griffin: Hubris and compounded biases create a Lollapalooza effect of failure
“When you look at people who fall it's usually hubris, and the problem with hubris is it can have many sources, and the error can be Essentially a lullapalooza or a situation where the whole is is greater than the sum of all the biases.”
Insight
Griffin: Munger advises patient study followed by aggressive bets on rare opportunities
“People need to be patient and read and understand, but then when they see the big opportunity, you know, like social networking or You know, something in computational biology or, you know, name the field. When you see it, you'll know it, and when you see it, …”
Insight
Griffin: Spotting competitive moats is fundamentally different from building them
“One of the great contrasts in life is between people who know a moat when they see it and people who know how to build one potentially out of nothing.”
Assertion Supported
Griffin: The average VC fund relies on two or three monster wins
“The average venture business, the average fund has two or three monsters that, that determine the success of the fund.”
Insight
Griffin: Network effects scale better than other moats but are highly fragile
“Network effects are extremely powerful. And they scale better than anybody's ever been able to scale things before, but they're extremely fragile as well.”
Insight
Griffin: If competitive moats bore you, you won't be a good investor
“If the chapter on moats bores you, you're not going to be a good investor. If the chapter on moats bores you know, you, you're not going to be able to understand a good business from a bad business.”
Assertion Partly supported
Griffin: Only 35 percent of investors buy index funds
“Only 35% of people are buying indexes.”
Insight
Griffin: Decision journals and behavioral economics reduce cognitive mistakes
“If you think about thinking and do things like Reed Kahneman and Thaler and really analyze your process and keep a journal and write things down. You can get better at thinking. You'll always make mistakes, but you can learn to make fewer mistakes.”
Insight
Griffin: Munger's two-track analysis combines rational evaluation with bias checks
“He calls it a two-track analysis, which is first be rational, and then look for decisional errors.”
Assertion Not checkable as stated
Griffin: Charlie Munger reads five newspapers every day
“He reads five newspapers a day”
