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Things I’ve Learned from Charlie Munger about Moats (2015)

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Re: Things I’ve Learned from Charlie Munger about Moats (2015)

#21

TL;DR courtesy GPT4 API (yes I paid for it - you’re welcome) Charlie Munger on Moats 1. Importance of moats: Durable competitive advantage, or moats, are crucial for long-term investing success. Moats are created by factors such as supply-side economies of scale, demand-side economies of scale, brand, regulation, and patents/intellectual property. 2. Buying moats at a fair price: Moats are important, but overpaying f…

Followup assignment: Are those actually Charlie Munger quotes or did the GPT make them up? I'd be impressed if the GPT it can supply sources for quotes (ok I'm still impressed, but sources for facts is a weakness of it).

It summarized the article.

Re: Things I’ve Learned from Charlie Munger about Moats (2015)

#22
> Even the fate of the smallest business like a bakery or shoe store will be determined by whether they can create some form of moat.

This is the main reason I'm terrified of AI: near as I can tell, it's a 'moatpocalypse.' ('Moaterdammerung'?)

I keep seeing posts voicing self-reassuring thoughts like "if you're not a low performer you're not at risk."

But this seems to miss the basic point. Let's say that AI never replaces humans and always augments them. (A wildly optimistic view, but I have to start somewhere.)

In this case, me+AI is now competing in a job market against Bob-who-learned-to-code-last-week+AI. That's twenty-plus years of experience that, up until this year, was a deep fscking moat (who else can recite iptables lore, write a safe bash script, and work in perl, python, C, C++, Typescript, etc?)

Today the answer to that question is "virtually anyone."

This means that my employment will hinge on questions of "cultural fit" rather than talent, which, yes, means that in general, there will be less tolerance for asshole behaviour (probably a net good.) So, no new Torvalds or Stallmans (Stallmen?) will be spawned. *But it also means* that mean-girls psychology is going to triumph. Employment will literally be a popularity-contest _Survivor_, as anyone can be replaced at any time, and their replacement will be good enough.

The brunt of this impact will be felt by those of us who are "diverse hires" --- why would you hire Susan, who is brilliant but no fun at parties, when you could hire Hank, who looks, sounds, and talks exactly like you, was best man at your wedding, and holds those wild keggers? Sure, Hank only knows rudimentary Python, but who the hell cares about that now?

ChatGPT implies the Triumph of the Bro.

Re: Things I’ve Learned from Charlie Munger about Moats (2015)

#23

TL;DR courtesy GPT4 API (yes I paid for it - you’re welcome) Charlie Munger on Moats 1. Importance of moats: Durable competitive advantage, or moats, are crucial for long-term investing success. Moats are created by factors such as supply-side economies of scale, demand-side economies of scale, brand, regulation, and patents/intellectual property. 2. Buying moats at a fair price: Moats are important, but overpaying f…

Reading "Chokepoint Capitalism", I can't help but notice the similarity between 'moats' and 'chokepoints'. After all moats are essentially just a means to force traffic into more easily guarded gates. And one always wants to encircle as much of a market in ones moat as possible.
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