Munger on Simplicity

“Take a simple idea and take it seriously.”

One of his most-quoted maxims; widely cited from his talks, exact occasion not pinned to a single recording.

“We have a passion for keeping things simple.”

“To the man with only a hammer, every problem looks pretty much like a nail.”

Munger's framing of why a single-discipline mind misjudges; he used it to argue for a latticework of mental models.

“A lot of institutions get into terrible trouble trying to be omniscient. They think if they create 27 departments and require each to be omniscient in its field, that it makes the whole collective enterprise omniscient across all 27 fields. We regard that as madness.”

“I've done so well in life just by using organized common sense that I never wanted to get into these fields like artificial intelligence. You can walk along the shores and pick up boulders of gold, as long as the boulders keep being found and picked up, I don't want to go into placer mining, sifting vast amounts of data for some edge.”

Wording lightly reconstructed (the transcript marks one word [inaudible]); on why he avoided chasing AI / data-mining for an edge.

“There isn't one novel thought in all of how Berkshire is run. It's all about what Peter [Kaufman] calls 'exploiting unrecognized simplicities.'”

He credits the phrase to Peter Kaufman, editor of Poor Charlie's Almanack.

“I can't think of a single example in my whole life where keeping it simple has worked against us. We made mistakes, but they weren't because we kept it simple.”

“Warren talks about these discounted cash flows. I've never seen him do one.”

Griffin uses it to illustrate Munger's distaste for false precision.

“Lee Kuan Yew had the best record as a nation builder. If you're willing to count small nations, he had probably the best record that ever existed in the history of the world… The mantra he said over and over again was: figure out what works and do it.”

Quoting Singapore's Lee Kuan Yew, whom Munger admired as a nation-builder.