The Daily Devil’s Dictionary: “Significance” of Billionaires
Charlie Munger, the supposed alter ego of Warren Buffett, “significantly” takes on Elon Musk, the founder of Tesla.
Those who know his name know Charlie Munger as Warren Buffett’s alter ego. They attribute to him a similar level of unassailable wisdom about stocks, even though with a net worth of $1.67 billion he’s clearly a lightweight when compared to his partner Buffett ($83.5 billion), or the now undisputed world heavyweight champion, Jeff Bezos ($131 billion).
In a recent interview, Munger gave his appreciation of another billionaire, Elon Musk. Bloomberg estimates Musk’s net worth at $19.5 billion, which makes him ten times wealthier than Munger. That may help to explain Munger’s slightly grudging admiration for the founder of Tesla. Speaking of that company, Munger offered this analysis: “It’s already created more significance than anybody had predicted. Its founder is bold and brilliant, and he swings for the fences.”
Here is today’s 3D definition:
The illusory belief in the future monetary value of something that is objectively devoid of value in the present
Munger’s use of the word significance is in itself significant. In common usage, significant is a synonym of important. It describes something that commands our attention. The word comes from the Latin, significare or “make known, indicate.” It literally suggests “putting a sign on something,” marking it as an item of interest. With financial experts like Munger, a sign tends to be a price tag.
The tone of Munger’s statement leads us to conclude that an even more appropriate synonym for significance would be buzz. Tesla is something people talk about as if it had value, but clearly Munger, like Buffett, refuses to see value in what people merely talk about. He would undoubtedly agree with Oscar Wilde who famously wrote, “There is only one thing in the world worse than being talked about, and that is not being talked about.” He clearly believes that being talked about makes something significant, but significance suggests an absence of substance.
Munger and Musk belong two different branches of the billionaire class. They have less respect for each other than they do for the billions each has amassed. With serious condescension and very faint praise, Munger puts Musk in the class of entertainers and athletes. He calls Musk “bold and brilliant,” in other words, an actor on a public stage skilled at capturing the audience’s attention. Musk “swings for the fences,” a baseball term designating the power hitter who sacrifices strategic construction for the spectacular home run that delights the public and produces an immediate score. Swinging is not hitting!
Munger used the Berkshire Hathaway Annual Meeting to offer some historical analysis of the history of his field: “The investment world has gotten tougher. Maybe now we have small statistical advantages, when before it was like shooting fish in a barrel. It’s OK to have things get a little harder when you are filthy rich.”
The potentially satirical irony of that final remark is remarkable for the speaker’s lack of ironic intent. Many people see capitalism’s past as glorious and heroic and adulate people like Buffett and Munger for their exceptional talent and hard work. Munger compares the challenges of the past to “shooting fish in a barrel.” Is that an admission that Buffett’s and Munger’s accomplishments owed little to talent and much to luck? In which case, Musk would appear to be much more of a hero than his elders because he had to work for it in a “tougher” world.
In his Yahoo interview, Munger explained his selfish reasons for not criticizing Donald Trump, whom he judges to be better than Nero and Caligula. “I now regard all politicians higher than I used to. I did that as a matter of self-preservation. We’re way ahead of the Romans. There will come a time when those people who hate Trump will wish that he were back. I confidently predict that will happen.”
Could this be a subtle hint that Munger doesn’t share the optimism of his partner, Buffett who recently proclaimed, “This game of economic miracles is in its early innings. Americans will benefit from far more and better ‘stuff’ in the future”? Does it mean Munger the pessimist sees things getting far worse before they get better?
His confident prediction appears to chime with the warnings of progressive Pulitzer prize-winning journalist Chris Hedges who recently remarked, “Once the economy crashes and the rage across the country explodes into a firestorm, the political freaks will appear, ones that will make Trump look sagacious and benign.”
*[In the age of Oscar Wilde and Mark Twain, another American wit, the journalist Ambrose Bierce, produced a series of satirical definitions of commonly used terms, throwing light on their hidden meanings in real discourse. Bierce eventually collected and published them as a book, The Devil’s Dictionary, in 1911. We have shamelessly appropriated his title in the interest of continuing his wholesome pedagogical effort to enlighten generations of readers of the news.]
The views expressed in this article are the author’s own and do not necessarily reflect Fair Observer’s editorial policy.