How could economics not be behavioral? If it isn't behavioral, what the hell is it?
Charlie MungerRead
It is one thing to think gold has some marvelous store of value because man has no way of inventing more gold or getting it very easily, so it has the advantage of rarity. Believe me, man is capable of somehow creating more bitcoin... They tell you there are rules and they can't do it. Don't believe them.
Interpretation
What this quote means
The value of gold comes from its rarity, while cryptocurrency like bitcoin can be created despite claims to the contrary.
In this quote, Charlie Munger emphasizes the inherent value tied to the scarcity of gold, contrasting it with cryptocurrencies such as bitcoin, which are perceived to have fewer limitations in their creation. Munger urges skepticism towards the idea that bitcoin's supply cannot be increased, suggesting that the rules surrounding cryptocurrencies may not be as fixed as they seem.
Themes
GoldBitcoinValueScarcityCryptocurrency
In practice
Example use cases
During a financial seminar discussing investments, this quote could illustrate the differences between traditional assets and digital currencies.
More from Charlie Munger
All quotes →The world of derivatives is full of holes that very few people are really aware of. It's like hydrogen and oxygen sitting on the corner waiting for a little flame.
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I believe in the discipline of mastering the best that other people have ever figured out. I don't believe in just sitting down and trying to dream it all up yourself. Nobody's that smart.
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Economics is in many respects the queen of the soft sciences. It's expected to be better than the rest. It's my view that economics is better at the multi-disciplinary stuff than the rest of the soft science. And it's also my view that it's still lousy.
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Look at this generation, with all of its electronic devices and multitasking. I will confidently predict less success than Warren, who just focused on reading.
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Economics profession, they've been - they've been confident in various formulas, but economics is not physics. The same formula that works in one decade doesn't work in the next. Economics is a difficult subject.
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