Today’s we are going to talk about 20 books that Charlie recommends every person must
read. First quick side note, did you guys know Charlie Munger actually graduated law
school and was a full time lawyer before he turned his attention to wall street. On top
of that he had his own investment firm before he started working with Warren buffett.
Anyways back to the video. You might ask how do we know that Charlie Munger actually recommended
all books in this list. Well as most you might already know, Munger is an avid reader just
like warren buffett. He spends Majority of his day reading. So whenever he loves a book
he is reading, he usually shares it through his shareholders letters or at his annual
meetings.
So let's jump right into what these books are.
Fiasco: The Inside Story of a Wall Street Trader
With this book, Munger dives into the world of finance. Fiasco is the shocking story of
one man's education in the jungles of Wall Street. As a young derivatives salesman at
Morgan Stanley, Frank Partnoy learned to buy and sell billions of dollars worth of securities
that were so complex many traders themselves didn't understand them. It was the first book
to take on the derivatives trading industry, the most highly charged and risky sector of
the stock market. More importantly, it is a blistering indictment of the largely unregulated
market in derivatives and serves as a warning to unwary investors about real fiascos, which
have cost billions of dollars. Often hilarious in its recounting of the state of Morgan Stanley
and the financial sector at that time, It’s regarded as one of the best works written
on finance.
The Warren Buffett Portfolio: Mastering the Power of the Focus Investment Strategy
This best seller by Robert G. Hagstrom is an extensive case study on Buffett’s portfolio
and provided the first look into the strategies that the master uses to pick stocks. A New
York Times bestseller, it is a valuable and practical primer on the principles behind
the remarkable investment run of the famed oracle of Omaha. Hagstrom explains how a concentrated
portfolio is critical for investment success and investment strategy used with spectacular
results by Buffett. A strategy that has historically outperformed the market, focus investing is
based on the principle that a shareholder's return from owning a stock is ultimately determined
by the economics of the underlying business. Hagstrom explains in easy-to-understand terms
exactly what focus investing is, how it works, and how it can be applied by any investor
at any level of experience. He demonstrates how Buffett arranges his stocks in a focus
portfolio and reveals why this is as responsible for his incredible returns as the individual
stocks he picks. Ultimately, Hagstrom shows how to use this technique to build and manage
a portfolio to achieve the best possible results. This book is so thorough and well researched,
both Munger and Buffett have recommended it, and as far as investment books go, that’s
one of the highest honours you could receive.
Influence: The Psychology of Persuasion Influence is one of the defining texts on
the psychology of persuasion. If you’re an entrepreneur or someone who needs to talk
their way into situations in life, you no doubt know the importance of being able to
convince someone to see things your way and be able to sell your point across. In this
highly acclaimed New York Times bestseller, Dr. Robert B. Cialdini—the seminal expert
in the field of influence and persuasion—explains the psychology of why people say yes and how
to apply these principles ethically in business and everyday situations. Dr. Cialdini goes
in detail with six universal principles of influence and how to use them to become a
skilled persuader and, just as importantly, how to defend yourself against dishonest influence
attempts. Backed by over 35 years of evidence based experience, Influence is a comprehensive
guide to using these principles effectively to amplify your ability to change the behavior
of others
The Wealth and Poverty of Nations: Why Some Are So Rich and Some So Poor
The Wealth and Poverty of Nations is David S. Landes's acclaimed, best-selling exploration
of one of the most contentious and hotly debated questions of our time: Why do some nations
achieve economic success while others remain mired in poverty? The answer, as Landes definitively
illustrates, is a complex interplay of cultural mores and historical circumstance. Regarded
as one of the most ambitious works of history in decades, the book goes in detail about
the inequalities in nature and how the geography of certain regions mixed with the political
conflicts that draw the lines between nations put some communities at a vast disadvantage
with very little chance of development with the hand they’ve been dealt.
Andrew Carnegie The definitive biography of an industrial
genius, philanthropist, and enigma. Andrew Carnegie was a goliath in the 19th century
with his steel empire and became one of the richest men in American history. However,
his story and teachings from the late 1800s still give us a lot to think about today.
The story of Carnegie is one for people from all disciplines of life. His capitalistic
approach and views in the world of business, and later philanthropy, provide valuable inputs
to what people consider two sides of the same coin. There’s a lot to learn from how Carnegie
made his early fortune and what prompted him to give it all away and no resource does better
justice to his story than this biography by David Nasaw.
Titan: The Life of John D. Rockefeller, Sr. Born the son of a snake-oil salesman and a
pious, straitlaced mother, Rockefeller rose from rustic origins to become the world’s
richest man by creating America’s most powerful and feared monopoly, Standard Oil. Branded
“the Octopus” by legions of muckrakers, the trust refined and marketed nearly 90 percent
of the oil produced in America. A perfect short read for a weekend, Titan is a magnificent
biography - balanced, revelatory, elegantly written. Similar to the story of Carnegie,
Rockefeller built an empire that was feared by his competitors and in the end gave most
of it away to research, medicine and helping the community. The story from humble beginnings
to one of the richest men in America of all time is one of many lessons about great financial
planning, innovation and resilience in the time of an economic depression and the steps
he took to build an empire that kept him on top till the very end.
Ice Age Charlie Munger called this book “The best
work of science exposition and history that I’ve read in many years!” Yet another
book from the authors of Deep Simplicity, Ice Age tells the remarkable story of how
we came to understand the phenomenon of Ice Ages. The Ice Ages as a concept were not widely
accepted till the late 1800s and the book focuses on the key personalities obsessed
with the quest for answers to tantalizing questions and is a short read to understand
the discovery of evidence of the Ice Age and how it changed our understanding of the world.
How the Scots Invented the Modern World A lot of really important stuff like: the
first modern nation, the first literate society, the ideas for modern democracy and free markets,
all originated with the Scots and was a recommendation by Munger in his book Poor Charlie's Almanack.
As historian and author Arthur Herman reveals, in the eighteenth and nineteenth centuries
Scotland made crucial contributions to science, philosophy, literature, education, medicine,
commerce, and politics—contributions that have formed and nurtured the modern West ever
since. Herman has charted a fascinating journey across the centuries of Scottish history.
Here is the untold story of how John Knox and the Church of Scotland laid the foundation
for our modern idea of democracy; how the Scottish Enlightenment helped to inspire both
the American Revolution and the U.S. Constitution; and how thousands of Scottish immigrants left
their homes to create the American frontier, the Australian outback, and the British Empire
in India and Hong Kong. No one who takes this incredible historical trek will ever view
the Scots—or the modern West—in the same way again.
Models of My Life In this candid and witty autobiography, Nobel
laureate Herbert A. Simon looks at his distinguished and varied career, continually asking himself
whether and how what he learned as a scientist helps to explain other aspects of his life.
In a world of increasing specialisations in science, Herbert Simon was one of the few
who was a generalist and this broad exposure to various topics was what allowed him to
have such great insights and understanding into life. Simon's story encompasses an explosion
in the information sciences, the transformation of psychology by the information-processing
paradigm, and the use of computer simulation for modeling the behavior of highly complex
systems. This was yet another recommendation in Munger’s book - Poor Charlie's Almanack.
A Matter of Degrees: What Temperature Reveals about the Past and Future of Our Species,
Planet, and Universe In a wonderful synthesis of science, history,
and imagination, Gino Segrè, an internationally renowned theoretical physicist, embarks on
a wide-ranging exploration of how the fundamental scientific concept of temperature is bound
up with the very essence of both life and matter. Why is the internal temperature of
most mammals fixed near 98.6°? How do geologists use temperature to track the history of our
planet? In answering these and hundreds of other temperature-sensitive questions, Segrè
presents an uncanny view of the world around us.
Guns, Germs, and Steel: The Fates of Human Societies
Not only was this book recommended by Munger, it’s a must read from Bill Gates too. This
pulitzer award winning book is a major landmark in our understanding of human societies, Guns,
Germs, and Steel chronicles the way in which the modern world, and its inequalities, came
to be. It goes in detail, leaving no stone unturned from the hunter gatherers of the
stone ages all the way down to the recent wars and society, covering every topic from
the effects of climate and geography to governments and monarchies. It teaches us how every historical
event big and small, combined with the inequalities in resources around the world shaped modern
society and is considered one of the most significant projects embarked upon by any
intellectual of our generation. Bill Gates himself said the book “had a profound effect
on the way I think about history and why certain societies advance faster than others.”
The Third Chimpanzee: The Evolution and Future of the Human Animal
Ever wondered what is it about that two percent difference in DNA that has created such a
divergence between evolutionary cousins? In this fascinating, provocative, and endlessly
entertaining work, renowned Pulitzer Prize–winning author and scientist Jared Diamond, author
of the previous book on the list, Gun, Germs, and Steel, explores how the extraordinary
human animal, in a remarkably short time, developed the capacity to rule the world and
the means to irrevocably destroy it. We find out what makes us the dominant species that
gave us the abilities to build civilisations and modern technology while our evolutionary
cousins like chimps are still concerned mainly with basic survival. The Third Chimpanzee
is a compelling, sometimes alarming look at the unique and marvelous creature that is
the human animal.
Living within Limits: Ecology, Economics, and Population Taboos
In Living Within Limits, Hardin focuses on the neglected problem of overpopulation, making
a forceful case for dramatically changing the way we live in and manage our world. Our
world itself, he writes, is in the dilemma of the lifeboat: it can only hold a certain
number of people before it sinks and not everyone can be saved. Hardin argues that the old idea
of progress and limitless growth misses the point that the earth has a limited carrying
capacity. He refutes the notion that goodwill and voluntary restraints will be enough. Instead,
nations where the population is growing must suffer the consequences alone. Too often,
he writes, we operate on the faulty principle of shared costs matched with private profits.
Globalizing the 'population problem' would only ensure that it would never be solved,
says Hardin, making a case for closed borders and an end to immigration from poor nations
to rich ones. Instead, he says we should be spending resources educating the poorer nations
with population problems and providing resources instead of just relocating people around the
world.
The Selfish Gene As influential today as when it was first
published, The Selfish Gene has become a classic exposition of evolutionary thought. In this
critically acclaimed international bestseller, Professor Dawkins articulates a gene's eye
view of evolution - a view giving centre stage to these persistent units of information,
and in which organisms can be seen as vehicles for their replication. This imaginative, powerful,
and stylistically brilliant work not only brought the insights of Neo-Darwinism to a
wide audience, but galvanized the biology community, generating much debate and stimulating
whole new areas of research. Dawkins explains how the selfish gene can also be a subtle
gene. The world of the selfish gene revolves around savage competition, ruthless exploitation,
and deceit, and yet, Dawkins argues, acts of apparent altruism do exist in nature. Forty
years later, its insights remain as relevant today as on the day it was published. Oxford
Landmark Science books are 'must-read' classics of modern science writing which have crystallized
big ideas, and shaped the way we think.
Genome: The Autobiography of a Species in 23 Chapters
A book recommended by Munger more than 2 decades ago, Genome talks about arguably the most
significant scientific discovery of the new century, the mapping of the twenty-three pairs
of chromosomes that make up the human genome. This discovery opened more doors into our
knowledge of our existence and raised more questions than it answered. Questions that
will profoundly impact the way we think about disease, about longevity, and about free will.
The book calls itself the Autobiography of Humanity and offers extraordinary insight
into the ramifications of this incredible breakthrough of human DNA structure. By picking
one newly discovered gene from each pair of chromosomes and telling its story, Matt Ridley
recounts the history of our species and its ancestors from the dawn of life to the brink
of future medicine. From Huntington's disease to cancer, from the applications of gene therapy
to the horrors of eugenics, Matt Ridley probes the scientific, philosophical, and moral issues
arising as a result of the mapping of the genome.
Getting to Yes: Negotiating Agreement Without Giving In
This book is a staple in most MBA programs, and for good reason. Published 4 decades ago,
this book is considered one of the primary business texts of the modern era, and is based
on the work of the Harvard Negotiation Project, a group that deals with all levels of negotiation
and conflict resolution. It offers a step-by-step strategy for coming to mutually acceptable
agreements in every sort of conflict. It helps you break down every conflict with tips like
separating the people from the problem, working together and more. If you’re an entrepreneur
looking to sell to your customers or get a VC to fund you, or maybe you’re just negotiating
your salary with your boss, every person will come across some situations in life where
you need to sell your point across and negotiate, so it’s always a great skill to have and
be prepared
Three Scientists and Their Gods: Looking for Meaning in an Age of Information
This book takes a look at the work and beliefs of three leading American scientists: Edward
Fredkin, Edward O. Wilson and Kenneth Boulding and their quest in finding the answer to humanity’s
oldest question - What is the meaning of life? Each of the scientists behind the book has
devised a grand theory in which information plays a fundamental role in explaining the
orderliness of life. Moreover, the book is about Mr. Wright himself, a science writer
fighting off a nasty case of existential dread. The author says - “Personally, I don't like
the idea that we're mere specks in a universe indifferent to our fates. Any hint that life
has some meaning, evolution some purpose, would be refreshing.” It’s an interesting
read to gain some insights on the different perspectives about our existence and why whether
we matter as individuals and even as a society in the grand scheme of things
Only the Paranoid Survive: How to Exploit the Crisis Points That Challenge Every Company
Under Andy Grove's leadership, Intel became the world's largest chip maker and one of
the most admired companies in the world. In Only the Paranoid Survive, Grove reveals his
strategy for measuring the nightmare moment every leader dreads--when massive change occurs
and a company must, virtually overnight, adapt or fall by the wayside--in a new way. Grove
calls such a moment a Strategic Inflection Point, which can be set off by almost anything:
mega-competition, a change in regulations, or a seemingly modest change in technology.
When a Strategic Inflection Point hits, the ordinary rules of business go out the window.
Yet, managed right, a Strategic Inflection Point can be an opportunity to win in the
marketplace and emerge stronger than ever. Grove underscores his message by examining
his own record of success and failure, including how he navigated the events of the Pentium
flaw, which threatened Intel's reputation in 1994, and how he has dealt with the explosions
in growth of the Internet. The work of a lifetime, Only the Paranoid Survive is a classic of
managerial and leadership skills.
Faraday, Maxwell, and the Electromagnetic Field: How Two Men Revolutionized Physics
Mr. Munger once said “It’s just the best book of its kind I have ever read, and I just
hugely enjoyed it. Couldn’t put it down. It was a fabulous human achievement.” While
this book might not do anything to help with your portfolio, it’s a fantastic read to
really understand the scale and importance of one of the greatest discoveries and how
it changed and built the world as we know it today. Neither of the authors are physicists
so the book explains in terms anyone can pick up and talks about the lives of the men behind
the discoveries and their times and a brilliant exposition of the scientific circumstances
and significance of their work.
Deep Simplicity: Bringing Order to Chaos and Complexity
Mr. Munger seems to have a liking for understanding how the world works, and not just in the investing
sense. This is yet another recommendation of his that has its foundation in fundamental
physics. Over the past two decades, no field of scientific inquiry has had a more striking
impact across a wide array of disciplines than that known as chaos and complexity, the
study of complex systems. In this book, astrophysicist John Gribbin draws on his expertise to explore
the principles behind chaos and complexity. He reveals the remarkable ways these two revolutionary
theories have been applied over the last twenty years to explain all sorts of phenomena–from
weather patterns to mass extinctions. Charlie Munger recommends this book in his talk about
mental models and to try to make sense of the world around us that otherwise seems random
and completely unpredictable.