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.
Charlie MungerRead
How could economics not be behavioral? If it isn't behavioral, what the hell is it?
Interpretation
What this quote means
Economics inherently involves human behavior and decision-making processes.
Charlie Munger emphasizes that economics cannot be separate from behavioral aspects, as economic actions are fundamentally driven by human choices and psychological factors. Without considering the behavior of individuals, economics loses its relevance and understanding of real-world applications.
Themes
EconomicsBehaviorHumanDecisionPsychology
In practice
Example use cases
In a discussion about market trends, one might say, 'As Munger pointed out, how could economics not be behavioral when our consumer choices define market demand?'
More from Charlie Munger
All quotes βI 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.
Charlie MungerRead
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.
Charlie MungerRead
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.
Charlie MungerRead
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.
Charlie MungerRead
As I talk about strengths and weaknesses in academic economics, one interesting fact you are entitled to know is that I never took a course in economics. And with this striking lack of credentials, you may wonder why I have the chutzpah to be up here giving this talk. The answer is I have a black belt in chutzpah. I was born with it.
Charlie MungerRead
Similar quotes
The first requisite of a sound monetary system is that it put the least possible power over the quantity or quality of money in the hands of the politicians.
Henry HazlittRead
The raw fact is that every successful example of economic development this past century ... has taken place via globalization.
Paul KrugmanRead
The hidden hand of the market will never work without a hidden fist.
Thomas FriedmanRead
Long experience, in the United States and in other advanced economies, has demonstrated that monetary policy is most successful when decisions are rendered independent of influence by elected officials.
Jerome PowellRead
The collapse of the world's banking system and the impending disaster of accelerating climate change are not separate phenomena. They are simply the most visible symptoms of a particular model of capitalism that will bring civilisation to its knees. But those symptoms will not get sorted unless and until we commit to a radical transformation of the way we create and distribute wealth in the world today
Jonathon PorrittRead
The widely accepted assertion that, only if you let markets be will everyone be paid correctly and thus fairly, according to his worth, is a myth. Only when we part with this myth and grasp the political nature of the market and the collective nature of individual productivity will we be able to build a more just society in which historical legacies and collective actions, and not just individual talents and efforts, are properly taken into account in deciding how to reward people.
Ha-Joon ChangRead