14. What we leave the next table

Part 18 of 19 in The Patient Owner: Charlie Munger’s Ideas, as Rakesh Jhunjhunwala Might Have Taught Them to an Indian Investor← Part 17Part 19 →

This chapter discusses the wisdom of patience in investing, drawing from the ideas of Charlie Munger and Rakesh Jhunjhunwala. It offers insights for investors looking to make thoughtful, long-term decisions.

Aniruddha. Charlie left speeches, a partnership, and a warning against fooling yourself. You left a portfolio, a set of public lines, and a crowd of people who would like the lines without the scars. I am writing this for angels and for the salaried investor who is tired of being shouted at. What should the last page say that a slogan cannot?

Rakesh. Tell them the truth about time. India will offer them a hundred reasons a year to do something. Most of those reasons are a transfer from the impatient to the patient. The transfer is not a moral lecture. It is the mechanism. Fees, taxes, bad businesses, borrowed convictions, and the simple inability to be bored — these are the pipes through which money moves from the restless table to the quiet one.

Aniruddha. And the quiet table is not a monastery. You traded. You trimmed. You were loud. Quiet is the holding, not the personality.

Rakesh. Yes. Do not let them turn me into a statue with a finger on its lips. Let them turn me into a standard. Did you buy something that can survive you? Are you sitting because the business is right, or because selling would hurt? Can you invert it? Do you know who is paid? Are you inside a circle you earned? If the answers are yes, you may ignore the noise, including mine. If the answers are no, more reading will not save you. A smaller position will. Cash will. A systematic plan will. Humility will.

Aniruddha. I am going to leave them one medical sentence, because it is the sentence you forced me to earn. Diagnosis before procedure. In a market, the procedure is the trade. The diagnosis is the business. We are a country in love with procedures.

Rakesh. Then end on that. And tell them Charlie and I would have disagreed on many shares and agreed on this: the aim is not to be brilliant. The aim is to still be in the game when brilliance is finally useful. Avoid the stupid. Own a few things you understand. Let time be a partner rather than an audience. And when a machine offers to do the understanding for you, thank it, take the footnotes, and keep the chair.

The empty chair stayed empty that evening. That was the lesson. Not every seat has to be filled for a life in markets to be full. The businesses worth owning are rare. The days on which you are required to act are rarer. Everything else is conversation, and conversation, however much this book has enjoyed it, is not a compounding asset.

The big money is not in the buying or the selling. The big money is in the waiting. — A principle he shared with the Omaha tradition, and practised in public on businesses like Titan

Last question. Ten years from now, what do you want to have owned, and what do you want to be able to say you refused? Write both lists. The second list is the almanack.