Worldly wisdom

The Latticework

Munger’s central idea: you can’t think well with one discipline’s tools. You need a “latticework” of the big ideas from many fields — and the discipline to use them. Here are the models he leaned on, and the psychology that trips everyone else up.

The models

Circle of Competence Operate inside the area you genuinely understand — and know exactly where its boundary is, because the edge matters more than the size.
Inversion Solve hard problems backward — instead of asking how to succeed, ask how you'd fail, then avoid that.
Latticework of Mental Models Hang your knowledge on a framework of the big ideas from many disciplines, so facts connect into usable understanding instead of floating loose.
Margin of Safety Build a buffer into every important decision so that you survive being wrong, unlucky, or surprised.
Moats and Durable Competitive Advantage A great business is one protected by a durable advantage — a 'moat' that keeps competitors from eroding its returns over time.
Opportunity Cost The true cost of any choice is the best alternative you give up — so measure every option against your next-best one, not against zero.
Sit-on-Your-Ass Investing Find a few wonderful businesses, buy them, and hold for the long run — letting compounding work while you minimize activity, fees, and taxes.
The Man with a Hammer If your only tool is a hammer, every problem looks like a nail — which is why you need models from many disciplines, not one.
Two-Track Analysis Analyze any situation on two tracks at once: the rational factors that govern it, and the subconscious psychological forces pushing people toward error.

His most important talk

The 25 Causes of Human Misjudgment

Munger’s self-taught checklist of the psychological tendencies that make people predictably irrational — and how they stack into a “lollapalooza.” Start with the overview, or read the original 1995 talk.