{"id":244,"date":"2011-07-24T19:26:22","date_gmt":"2011-07-25T00:26:22","guid":{"rendered":"http:\/\/www.timrosenblatt.com\/blog\/?p=244"},"modified":"2011-07-24T19:26:22","modified_gmt":"2011-07-25T00:26:22","slug":"charlie-mungers-thoughts-on-the-world","status":"publish","type":"post","link":"http:\/\/www.timrosenblatt.com\/blog\/2011\/07\/24\/charlie-mungers-thoughts-on-the-world\/","title":{"rendered":"Charlie Munger’s Thoughts on the World"},"content":{"rendered":"

Economists have long been divided by a simple problem. When you go to the movie theater, soda and popcorn costs a totally unfair price compared with other locations. This just tortures economists. At least 1 million man-hours have gone into trying to solve this problem. Economists understand that a first-class ticket on an airplane costs more than coach. They get that one. Its marginal utility. But they cant figure out the movie theater to save their lives.<\/p>\n

Here’s the Munger approach to the problem. In the auto world, a car manufacturer will sell a car for $40,000, and charge $200 for the extra gizmo. No one cares about the extra $200 when you’re already spending $40,000. Its insignificant. The movie theater is basically the same thing. People are OK paying that much for a soda after they’ve paid so much for an admission ticket.<\/p>\n

Now, psychologists can explain this clearly. Economists can’t for the life of them. Its so simple what happens when you think beyond your trained field. Its amusing to see someone spend 1 million man-hours on something I can solve with my left hand.<\/p><\/blockquote>\n

– Charlie Munger<\/p>\n

I dig the guy. He’s a little angry-cynical, but often right. I wonder about his million man-hour claim on the above problem.<\/p>\n

You can read both parts of his last annual meeting by going through Google (to get around the registration process Motley Fool has):\u00a0http:\/\/www.google.com\/search?q=charlie+mungers+thoughts+on+the+world+part+motley+fool<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Economists have long been divided by a simple problem. When you go to the movie theater, soda and popcorn costs a totally unfair price compared with other locations. This just tortures economists. At least 1 million man-hours have gone into trying to solve this problem. Economists understand that a first-class ticket on an airplane costs … Continue reading “Charlie Munger’s Thoughts on the World”<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[399,146],"tags":[556],"_links":{"self":[{"href":"http:\/\/www.timrosenblatt.com\/blog\/wp-json\/wp\/v2\/posts\/244"}],"collection":[{"href":"http:\/\/www.timrosenblatt.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/www.timrosenblatt.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/www.timrosenblatt.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/www.timrosenblatt.com\/blog\/wp-json\/wp\/v2\/comments?post=244"}],"version-history":[{"count":1,"href":"http:\/\/www.timrosenblatt.com\/blog\/wp-json\/wp\/v2\/posts\/244\/revisions"}],"predecessor-version":[{"id":245,"href":"http:\/\/www.timrosenblatt.com\/blog\/wp-json\/wp\/v2\/posts\/244\/revisions\/245"}],"wp:attachment":[{"href":"http:\/\/www.timrosenblatt.com\/blog\/wp-json\/wp\/v2\/media?parent=244"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/www.timrosenblatt.com\/blog\/wp-json\/wp\/v2\/categories?post=244"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/www.timrosenblatt.com\/blog\/wp-json\/wp\/v2\/tags?post=244"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}