https://www.youtube.com/watch?v=C\_SgvSvJZdk

1 00:00:00.000 --\> 00:01:00.000 what's going on everyone my name is
alex ramose i'm the ceo and founder of allen prestige labs gym lunch and
we own a portfolio of other companies who've done 120 plus million in
the last four years and i have nothing to sell you in this video what i
want to do is show you the eight principles charlie munger taught me to
succeed in business and life and uh by no means by saying that i have
completely executed all these things in my life these are just
aspirational things that i think benefit most humans those of you who
know me i'm a huge a huge fan i've consumed a lot of his materials and
so i wanted to consolidate his speeches and his his work into these
principles for anyone who's kind of new to charlie munger and so i'm not
going to do these in order i'm going to do these in the order i think it
makes the most sense to present them the first one is invert always
invert and so he references johnny carson in one of his speeches to
always try and solve problems in reverse and this has been something
that's been immensely powerful i think because for

2 00:01:00.000 --\> 00:02:00.000 us using thinking frameworks in order
to make decisions in order to solve problems as both you know
entrepreneurs business people and then just just in daily life so many
times we try and solve it logically going forward towards it and it
gives you this entirely fresh perspective to start at what you don't
want and then try and solve from that direction and that'll kind of lead
way into the other eight excuse me the other seven of the lessons and at
the very end i'll give you the one the one thing that i if just from the
the things that we've done that i would add uh to the list that has been
really helpful for us or rather things to avoid so his first thing that
you hear him talk about all the time is just don't ingest chemicals to
alter your state right he's like i've never heard of someone like if i
wanted to be really poor or really unsuccessful in life what would i do
he's like well i would definitely get addicted to chemicals right and so
this sounds so logical like obvious to us but in instead so many of us
uh still use that stuff on a regular basis to alter our mood because we
can't cope with some of the issues that are coming up in

3 00:02:00.000 --\> 00:03:00.000 our lives he's like i can't imagine
anyone who's thought to themselves man my life is so much better now
that i because i because i do drugs and because i i drink and i'm not
saying that you know that's a judgment in any way it's just one of the
principles that he's found to be a successful trait for himself and
others number three envy so one of the things that's been a gift for
warren buffett and charlie munger together is this statement that they
made both of them being you know super billionaires and they said every
single year someone is doing better than us and for me that was so like
like uh gut wrenching's the wrong word but like that hit me because i
think i am so i am innately so competitive that i suffer from comparison
all the time i was actually texting a friend this morning who's also a
you know multi-leader deck of billionaire and he was saying he's like i
feel like the more money i make the poorer i feel and it's totally true
because what ends up happening is that your your measuring stick changes
i remember

4 00:03:00.000 --\> 00:04:00.000 you know when i when i was really
really young my measuring stick for money was chipotle burritos it was
just how many chipotle burritos does this amount of money equate to and
so i actually think that we have like a stick or a unit that becomes our
base unit when we're measuring wealth for ourselves and that's why when
i think i had a hundred thousand dollars in my bank account that was
probably the wealthiest i have ever felt because i had proportional to
what my measuring stick was which at that time was still meals a hundred
thousand dollars was so much so much money so many of those units at
this point in my life a million dollars is kind of my measuring unit
that i use as a base unit for how many how many of these do i have in
this how many how many you know how many sticks do i have in you know
real estate how many sticks i have in in in my portfolio how much do i
have in equity in these companies etc and so that stick changes but
someone is always doing better but i think it's so much more about not
thinking about them because the way that they roll the dice and play the
game has no effect on us and so simply it's an imaginary way to make
yourself suffer so if you want to suffer definitely

5 00:04:00.000 --\> 00:05:00.000 be envious of people the fourth one was
definitely resent people like really hold on to resentment if you want
to be miserable and so one of the stories that charlie tells us of a
king who committing trying to not be resentful of people what he would
do is every time he'd want to resent someone he'd write their name down
and he'd put it on a slip of paper in a drawer and periodically he'd go
to that drawer open it up and read the names and realize how life had
dealt with those people without him having to do anything and so i think
it's one of those long-term mindedness that like most people live in
karmic balance independent of whether or not you believe in you know
that kind of woo stuff but simply like people who do bad things
eventually that catches up to them and it is worse for them and so you
like someone who exists in that state is already dealing with the
suffering of being who they are and so you know if you want to be
miserable definitely resent people the next one is uh be unreliable
right like if you want to definitely be miserable like be unreliable say
you're going to do something and don't do it say you're

6 00:05:00.000 --\> 00:06:00.000 going to be somewhere and and be late
be flaky make commitments that you don't keep and this one is one of
those ones that he references a lot of times as he's like if you just
get this one right and you are reliable it's very difficult to be
miserable it's very difficult to be unsuccessful and there was a guy
that i was that i knew in high school and this is when i had a you know
a bigger ego than i have now and i was such a so i was such a dick i
honestly i was just there's no other way to say it i just was and this
kid was just like he stayed he went to all the extra credit for for
teachers he worked so hard and he had nothing going for him like he
wasn't like the best looking kid he wasn't athletic like he didn't have
like this natural processing power he wasn't quick like that but i
remember and i was such a mean guy to this kid and i remember one time
he we got in some sort of spat and i was like in what world will you
ever be better than me at anything and i remember saying that you can
you can feel it's so dripped in ego and it's just kind of disgusting but
anyways i said this to him and he ended

7 00:06:00.000 --\> 00:07:00.000 up getting into a better college than
me i ended up going to vanderbilt he ended up going to duke and i just
remembered that moment because it was such a deep lesson for me that
like he was more reliable than i was he was more long-suffering than i
was he was more consistent than i was he showed up to every teacher's
thing he showed up he did all the extra credit he did all the homework
he he like he did all those things and he just showed up and that was a
huge lesson for me that i was like if i can just show up like that guy
does like man things will open up for me but if you want to fail
definitely be unreliable the next one is overspend your income you know
definitely if you want to get if you want to if you want to put yourself
in a horrible situation on a regular basis and consistently have stress
definitely spend more than you make which you know america is doing
right now with their own gdp but we won't even get into that but
definitely overspend what you make like don't save you know spend more
than what you have always have bigger aspirations than you have the
ability to fulfill on and definitely always live in debt and the wrong
kind of debt the bad debt and so if you've any followed any of my

8 00:07:00.000 --\> 00:08:00.000 stuff my my i'm a huge proponent of
living broke all the time and it's because i believe wealth is a ratio
between income and expenses it's not a number right if you can live on
one percent of what you make as a hypothetical example then you are in
you were infinitely wealthy because you already have a hundred times
more your income is a hundred times more than your expenses which means
you could live veritably for 100 years and so just on one year's income
so that's an extreme example just to illustrate the point but if you
like for me i feel less and less anxiety the the greater the percentages
of excess i have in my expenditures versus how i live and so there's two
ways to get there one is you can increase how much you make the other
ways you can decrease how much you spend but the thing is is no matter
where you are right now the one that you can immediately change is how
much you spend over time you can use those that those extra funds invest
in yourself grow the top line so that you can even make that discrepancy
crazier so that your wealth can increase that ratio being your wealth
can increase and so for me i try and live on ten percent that that
hundred

9 00:08:00.000 --\> 00:09:00.000 thousand dollar story that i gave you
earlier once i was i had a million dollars in my bank account i still
lived on thirty thousand dollars a year and so i was you know i was
living on three percent um at that point of my wealth but my income was
was already surpassing a million dollars a year at that point and so i
was living on three percent of what i was taking home and honestly i
felt so free because i just knew that i had way more money than i would
ever need that's very freeing so but if you want to fail definitely
overspend your income the next one is learn only from your own mistakes
right don't learn from the mistakes of others don't learn from other
people's successes and what i want to add as a wrinkle to this is that
depending on where you're at in your journey this is something that i've
observed is um you in the very very beginning you have no value to offer
i get messages frequently of people being like hey uh let's start a
business together i'll give you half and i'm like well you're providing
no value i'm the one who would know how to run this business so this is
not a good trade for me you know return on my time is not very good
another one is i i'll work with you

10 00:09:00.000 --\> 00:10:00.000 you know i'll work for you for free
you know if you teach me everything and i was like yeah that's so i'm
getting someone who has no skills and no value and exchange you're
getting an education from someone you know like that's not a fair that's
not a good exchange for me right and so what you have to do is find ways
where even that you can trade your base level which is time for someone
who has a need for that level of skill who's ahead of you and that's
where like small businesses like if someone's making a hundred thousand
a year or two hundred thousand dollars a year in a business that's not a
very big business but if you if you say i will work for free for you
then someone like that can still use for lack of a better term just
hands right someone who can just help and just be there as a body and i
know that may sound diminutive towards you but if you have no base
skills that is that is your base skill that you have is you have your
time in your hands right and so you use that and then you can learn some
more skills and then from that point you develop the next level which is
where you can start affording coaches right uh from the level above that
when i say learning only from your own mistakes first is you learn from

11 00:10:00.000 --\> 00:11:00.000 people for free by exchanging your
time then you learn from coaches then you can learn from masterminds
which is people where you are now at this point equal with other people
in the room who are good and what i will tell you is this if you're at
eight figures i'm switching gears in terms of who i'm talking to but as
you go up this journey how you network and learn from others changes it
evolves and you know i i went the coach route for the first you know
three four years of my entrepreneurial journey and then it was much more
towards the mastermind route uh later on but the thing is is once we
pass eight figures for us in terms of yearly revenue and yearly income
it's shifted to being much more about networking and advisors so that's
kind of two different things networking is like other people who are at
that level that you just network with and you meet at things and you
donate to same charities that kind of thing and the other aspect is like
well if you want someone ahead of you at that point it a lot of times a
you can still get it from the network sometimes but if you really want
to get a lot from someone you need to make sure that there's some sort
of exchange that's fair and that's where kind of advisory relationships
work really well and so i

12 00:11:00.000 --\> 00:12:00.000 have an advisor and that means that
you know they get a minority percentage and something that you guys are
working on and so they have an incentive to teach you some of these
elements and you at this point you're already proven as an effective
person you have the character traits of being reliable you know not
being envious having lung suffering having the abilities to execute so
they know that they can just drop the information in and then it will be
incorporated and then they can succeed with you and then the final
aspect is what i would say the highest level is heroes because a lot of
people we don't have access to you know what i mean even this video
right now like i don't know charlie munger i have not met charlie munger
but charlie munger is a hero of mine and so i feel like i've been
directly mentored by charlie despite the fact that i've never met the
man and so i'm eternally grateful for man because he's you know
significantly changed my life for the better which will naturally lead
me to the his last point and then i'll give you the one that i would add
um just from my own experience in my life so his last point would be
quit when you have your third or fourth big failure in life

13 00:12:00.000 --\> 00:13:00.000 he said so if you want to if you want
to fail and you want to be miserable you should definitely quit soon
quit early right he's like because no matter who you are you're going to
fail not just once or twice or three times or four times but you will
fail many times and if you if you quit early then you can guarantee that
you will be you know miserable for a very long time after that because
then you have given up hope and you'll have nothing to strive towards
you'll have no purpose and so if you want to be miserable definitely
quit early right and even count the amount of times you failed because
because for some reason that means something right it doesn't mean
anything and so to wrap this up i'll give you alex's one that's been
tremendously helpful for me which is this is kind of started from a
speech i heard one of the presidents say from the past but was the the
way to be successful is to be able to handle pressure right so if you
want to if you want to if you want to fail definitely crack under
pressure like no matter what happens just crack under pressure crack
when people need you and so

14 00:13:00.000 --\> 00:14:00.000 my my candid solution for this are the
things that have helped me is understanding a what it is which is most
of us just create arbitrary expectations and then crumble under
pressures that we put on ourselves that don't actually exist in the
world we literally create things to weigh ourselves down which i feel
like the further along you get into the entrepreneurial game it becomes
headier and headier because you realize it's so much just about the
limits that you place on yourself and so here's three strategies that i
have used that are mentally have that have mentally made me much more
resilient the first and i got this from from trevor who got it from
epictetus which is aged philosopher is negative visualization and so let
me give you a tactical example of that this is a simple example so i
just spent a couple hundred dollars on a shirt and i really like the
shirt and i don't really spend money a lot on on clothing um and after i
wash the shirt it was like messed up i'll just put it simply right this
is a simple example to illustrate and and then he had just taught me
about

15 00:14:00.000 --\> 00:15:00.000 this negative visualization the day
before and he said take something that happens negative and then imagine
it happening a thousand more times in a row how would you feel in the
thousandth time and i thought to myself if every time i washed a shirt
you know it shrunk like this or something or it became rougher around
the edges and i got it because it was soft i probably wouldn't care that
much it would just be like ah that's just how these things are and so it
means is that my expectations would change in my mind to what they to
match reality and then at that point my misery would disappear and so
that's literally what i did in the moment and i felt myself just stop
caring about this thing that actually bugged me a little bit because i
was like man that's annoying but you can use that same concept with any
of the things that occur in your life when it's like man my my my wife
said this thing well what if she said that thing a thousand times in a
row you'd be like well i guess that's just kind of how how she is or
that's just kind of how things are and then all of a sudden you would
acclimate it but you can rapidly force the acclimation to stress by
visualizing it happening thousands of times and then skipping to the end

16 00:15:00.000 --\> 00:16:00.000 because if you can feel that way after
a thousand times then you might as well feel that way after the first
time and that has been so powerful for me because we have so many
stressors that come in our lives and we set expectations that we're even
not aware that we're setting and then get underperformed on the second
uh thing that's been really helpful for me is that if i want to start a
new behavior or i'm trying to do something that is difficult then what i
want to do is go into it and expect the worst and let me give you a real
that sounds obvious but let me give you a realistic reasoning for this
so let's say that you want to start working out mentally prepare
yourself for the fact that every time i work out i'm going to be tired
every time i work out i'm going to not be motivated and that's just
going to be my base reality if i happen to be motivated or i happen to
not be exhausted or i happen to not have a lot of work to do then then
that's just a bonus it's serendipitous it's just a happy uh coincidence
but i expect that every time i work out i will be tired i'll have more
things to do and i will not you know be motivated to do so and if i come
in with that

17 00:16:00.000 --\> 00:17:00.000 expectation and i set that as my
baseline then i am not surprised when i go to work out and i feel that
way because then it is in alignment with the expectations that i have in
my mind the third of the sub subtext of uh you know creating false
expectations and crumbling under pressures that we create for ourselves
is one that is will probably be controversial for some of you but this
is a belief that i hold and it has been immensely powerful for me in
terms of increasing my joy in life which is elon musk i heard him talk a
while back about how he said eventually the universe will expand
infinitely until everything becomes a fine mist everything just becomes
a fine mist if you extend the time horizon long enough and for me that
means that everything that we create on earth and as humanity will
eventually disappear so the skyscrapers the books that i write the
people that we help people who remember us the legacy that we are trying
to have after we die even that will eventually

18 00:17:00.000 --\> 00:18:00.000 turn into a fine mist and not matter
and for me that is so immensely powerful because it means that nothing
matters and at the same time it means that we get to choose what things
we we create meaning with and so i believe our brains are simply meaning
making machines and i love that term so i'm giving it to you is that
just i have this meaning making machine in my mind which everything has
no meaning and then i can choose to highlight aspects that i i will
create meaning for and so understanding that the millions that i have
maybe the billions that i'll make in my lifetime and the wealth that i
accumulate the reputation the books the impact all of that stuff will
eventually disappear truly it will eventually be gone there will be a
day where no one knows that i existed or anything like that in some ways
it frees me in the present knowing that everything that i do will
eventually mean nothing and so all of us are essentially in my mind you
know there's the the nazi concentration camps uh people would dig

19 00:18:00.000 --\> 00:19:00.000 holes and then they'd fill holes back
up again and it was it was basically meaningless work but it was only
meaningless because they believed that it was meaningless right but
essentially all of us in my own mind and my understanding of reality are
simply just digging holes every day that will eventually when the time
horizon is long enough get filled back with dirt and so what that means
is imagine i was in that same concentration camp for example which might
be an analogy for life and instead of being given a shovel to dig holes
they said you can do whatever you want but at the end of your life you
have to undo it all right well then i could probably ha i could probably
engineer a fairly joyful experience for myself because i would do things
that are stimulating for me that i find enjoyable right and so by doing
that it just removed all of the expectations and a lot of the envy that
i have for other people because i know that all of us in the end there's
no box that we take with us right and so that's just been just wildly
impactful

20 00:19:00.000 --\> 00:20:00.000 for me as a human being and in terms
of decreasing pressure in my life in business there's just nothing
that's that big of a deal right because eventually all of it's going to
disappear anyways so if someone's upset with you it's like well you know
we're all going to become a fine mist in the future eventually you know
like ah you know we've got this competitor who's who's stealing our
stuff you know we're all going to disappear into a fine mist eventually
and that has been so calming for me and has relieved so much pressure
for me mentally that may be depressing for some people for me it's
wildly freeing and so um i guess if it's depressing for you then don't
think about it but if if that resonates with you then then maybe you can
use that as a weapon in your arsenal to defend against the pressures
that we inevitably put on ourselves that we can deconstruct and deflate
and so anyways those are the lessons that i have learned from charlie
munger as my hero and mentor uh from consuming so much of his content i
hope you found value in that if you are you know if you're a business
owner i make a lot of more tactical

21 00:20:00.000 --\> 00:21:00.000 things about how to make money and all
that stuff on this channel if you like this stuff click and subscribe
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