Investors must read these books if Buffett and Munger have their way

The foundation for success

Warren Buffett and Charlie Munger have given many book recommendations in their lives and reported on their findings – often at Berkshire Hathaway’s annual general meetings.

“My job is basically about accumulating more and more facts and information and seeing from time to time whether that leads to more action,” Buffett once reported in an interview.

“First and foremost” Warren Buffett recommends a book by Wall Street legend Benjamin Graham, Buffett’s former teacher, employer and mentor. This laid the foundation for his own investment philosophy. In particular, Buffett names “The Intelligent Investor,” which originally appeared in 1949, as one of his favorites. It is a book about investing in securities – primarily about value investing. “By far the best book ever written about investing,” said Buffett. In order to invest successfully, a healthy intellectual framework for making decisions is necessary as well as the ability to “keep emotions from destroying this framework.” He was able to draw these and many other insights from Graham’s book.

Buffett and Munger’s reading list

“Guns, Germs, and Steel: The Fates of Human Societies”, with the German title “Arm und Reich: The Fates of Human Societies”, by Jared Diamond, is one of Charlie Munger’s favorites. It was the best book of its kind that he had ever read, said Munger. Diamond asks the “why” again and again, which fascinates the investor. The book, which explores why human societies develop extremely differently over the decades, won the Pulitzer Prize in 1998.

The most “representative book” of Buffett’s views is “Essays of Warren Buffett” by Larry Cunningham. The investor particularly likes the book “because he essentially took my words and rearranged them.” The book is a selection of Buffett’s annual letters to shareholders. It offers an insight into the investment philosophy of the successful investor.

In addition to Graham, Philip A. Fisher also had a great influence on Buffett. The investor is responsible for the development of Buffett’s investment method. He therefore recommends “Paths to Wealth Through Common Stocks”, from 1960, as well as “Common Stocks and Uncommon Profits and Other Writings”, published in German as “Die Profi-Investment-Strategie”. Some universities even have this book on their curriculum. “I visited Phil Fisher after reading ‘The Professional Investment Strategy’. I was impressed by the man and his ideas. With Phil’s methods you learn to really understand the investment business and invest your money intelligently. I am an avid reader of The Professional Investment Strategy and can only recommend it to everyone,” said Buffett.

More classics

In addition to these favorites from Buffett and Munger, a variety of other books belong on her reading list. These include the economic classic by Adam Smith, “The Wealth of Nations” and “Stress Test: Reflections on Financial Crises” by Tim Geithner. Equally important is “The General Theory of Employment, Interest and Money” by John Maynard, which deals with the need for investors to protect themselves against “rampant” speculation on the stock market.

Editorial team finanzen.net

– On our own behalf –

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