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Revisionist history... More government and less consumer spending... Remembering Charlie Munger... His wit and wisdom... How to learn, grow, and make money... 'Invert, always invert'... Ignore the brass ring... [Stansberry Research Logo] Delivering World-Class Financial Research Since 1999 [Stansberry Digest] Revisionist history... More government and less consumer spending... Remembering Charlie Munger... His wit and wisdom... How to learn, grow, and make money... 'Invert, always invert'... Ignore the brass ring... --------------------------------------------------------------- The party continues... It was a different day but the same story in the markets as we've seen for much of the past few weeks. The major U.S. stock indexes finished little changed to slightly higher and bond yields fell. The small-cap Russell 2000 Index led, up roughly half a percentage point... Take your pick of reasons why. We've seen commentary from members of the Federal Reserve in the past two days suggesting precisely what [we did yesterday]( – that the "Fed pause" is likely to stick. This morning, Uncle Sam also "revised up" a third-quarter GDP projection to 5.2% annualized growth from last month's 4.9% report... Interestingly and not surprisingly, revised government spending numbers boosted the GDP estimate. State and federal spending for the third quarter now reportedly gained 5.5% instead of the 4.6% estimated a month ago. Meanwhile, consumer spending saw a "downward revision," rising just 3.6% versus the 4% initial estimate. So, on balance, the U.S. government spent more than previously thought from July through September, and Americans spent less... That doesn't strike me (Corey McLaughlin) as rosy of a "real" economic picture as a headline GDP above 5% might suggest. Yet whatever the headline or number or perception du jour, as we wrote yesterday, momentum is in favor of the bulls... and has been since stocks' most recent low in late October. Enjoy it while it lasts, but don't neglect the risks out there, too, as stocks have quickly gone from technical "oversold" levels to "overbought" in the past four weeks. R.I.P. Charlie Munger... We were saddened to hear that legendary investor Charlie Munger, Warren Buffett's longtime right-hand man at Berkshire Hathaway (BRK-B), passed away yesterday at a California hospital, just a month before what would have been Munger's 100th birthday. We've written about Munger here before, and you've likely seen his name shared by Stansberry Research editors and analysts. Munger was obviously a highly successful investor, one of the best ever. His strategy? Simply put, he sought to buy great businesses at reasonable prices. This differed from what Buffett learned under value-investing pioneer Ben Graham – to buy reasonable businesses at great prices. Munger and Buffett were and will be inextricably linked, like Batman and Robin. And Buffett credited Munger repeatedly over the years for much of Berkshire's success as it became a multibillion-dollar conglomerate and an American icon. As the Wall Street Journal reported today... "I have been shaped tremendously by Charlie," Buffett said in 1988. "Boy, if I had listened only to Ben [Graham], would I ever be a lot poorer." In 2015, Buffett wrote that Munger taught him: "Forget what you know about buying fair businesses at wonderful prices; instead, buy wonderful businesses at fair prices." Berkshire "has been built to Charlie's blueprint," Buffett added. Munger was responsible for convincing Buffett to buy companies ranging from See's Candies in 1972 to – more recently – a stake in a Chinese battery and electric-vehicle manufacturer BYD, one of Berkshire's few non-U.S. investments. And before he partnered with Buffett, Munger was generating market-beating returns of 20% to 25% annually, in line with what Buffett was doing in the 1960s. Munger had an estimated net worth of more than $2 billion. But beyond Munger's investments at Berkshire and beyond – like the Daily Journal media company that he chaired from 1977 to 2022 – Munger is probably most known to most people for his public appearances and blunt wisdom about investing, the economy, and human nature... He was sharp even in his upper 90s. His wit and wisdom... Consider this quote from Munger that we published [in a May 2022 Digest]( – about inflation – when he was 98 years old. He said in an interview at the time, which might go down as a final warning... Inflation is a very serious subject. You could argue it is the way democracies die... It's a huge danger once you have a populace that learns it can vote itself money. If you overdo it too much, you ruin your civilization. If you look at the Roman republic, even after they went to an empire with an absolute ruler, they inflated the currency steadily for hundreds of years. Eventually, the whole damn Roman empire collapsed. It's the biggest long-range danger we have, apart from nuclear war. One of the great things about Munger was that he didn't hesitate to share his decades of investing (and life) wisdom in public with anyone willing to listen. He didn't waste any words or time, either. I've always loved watching him sit onstage next to Buffett at Berkshire Hathaway shareholder meetings, where Buffett himself would give a long-winded answer that Munger would follow with a one-liner like "I have nothing to add." So, when Munger did say something, you knew it was something he really believed in and thought was important for other people to understand. And I would say it was wise to listen. Munger, after all, went from working for Buffett's grandfather for 20 cents an hour during the Great Depression to spending more than four decades as Buffett's most trusted colleague. I know from reading his work and listening to interviews that he made plenty of mistakes and faced tragedy (like losing his 9-year-old son to leukemia and going blind in one eye from a cataract surgery gone bad), and learned a lot along the way. Thankfully, he so often shared the lessons... which were rooted in simple yet powerful ideas that were easy to grasp and put into action. Among my favorites... Those who keep learning will keep rising in life. And... Just because you like it does not mean that the world will necessarily give it to you. In other words, you may get what you want, but you might not either. Be prepared for either outcome, which can apply to investing or anything. Now, I didn't agree with everything he said, like his idea in recent years that bitcoin is "rat poison" and a "venereal disease." But there are hundreds of more lines of valuable wisdom that you can find online or in various investing books that Munger uttered over the years. About learning... Our friend and colleague Whitney Tilson knew Munger and knows Buffett better than most. Whitney has attended 26 Berkshire Hathaway shareholder meetings in a row, has been around both men, and contributed to Peter Kaufman's biography of Munger, Poor Charlie's Almanack: The Wit and Wisdom of Charles T. Munger. In [his free daily newsletter today]( Whitney shared reflections and perspective on Munger with some of the lessons he gleaned from Munger over the years, including as a market novice. As Whitney wrote, they extended beyond how to buy great companies and fair prices... Much of what [Buffett and Munger] preach is simple (as Munger joked, "If it's trite, it's right!"): work hard, become a learning machine, develop what Munger calls "worldly wisdom," have high integrity, develop good habits, be nice to everyone, marry the right person and maintain a strong relationship, and so forth. As Munger once said: I constantly see people rise in life who are not the smartest, sometimes not even the most diligent, but they are learning machines. They go to bed every night a little wiser than they were when they got up, and boy, does that help, particularly when you have a long run ahead of you. Develop into a lifelong self-learner through voracious reading. Cultivate curiosity and strive to become a little wiser every day. The idea that Munger was getting at, Whitney said, is that you must become a learning machine at work, at school, and in your personal life – and then take things to a new level and become an expert in one particular area or focus. As Whitney continued in his free letter today... Related to this, I recall Munger at a long-ago Wesco annual meeting using a tennis analogy to highlight the importance of developing deep expertise: When you're young, you should practice your forehand, backhand, serve, overheads, and net game. But at some point, if you have a particularly great forehand, you should structure your life so that all you do is pound forehands all day long. The world is too competitive these days to simply be a smart generalist. The best jobs (and highest incomes) are going to those who have a broad skillset, to be sure, but also those who have developed deep expertise in a particular area. To do so, you need to start by developing what Munger calls "a latticework of mental models," which is a fancy term for a broad background of knowledge in science, engineering, math, history, literature, psychology, one or more languages, etc. But that's just the foundation... Then you need to figure out what you're truly interested in and passionate about and then do three things: get a job at a great firm with a strong training program, get a graduate degree in your field from a prestigious institution, and find multiple mentors for whom you can apprentice. Becoming a real expert in a narrow focus – being so skilled or knowledgeable that your expertise can't be replaced – is a recipe for being valuable and making money in a free market economy. That applies to individual careers or to entire businesses. I think Munger sought to invest in businesses that provided this value. When you face a problem... One of Munger's more famous pieces of advice was to "invert, always invert," when dealing with a problem. As our colleague Dan Ferris explained [in a June 2022 Digest](... It goes like this: To understand any problem better, learn to flip it upside down. Often, that means starting at the end, then working your way backward to see how you got there... It's a simple, effective mental model for gaining a fresh perspective. Give it a try sometime. It might help solve what feels like a complicated issue. Another big topic Munger often talked about was avoiding calamities... Whitney mentioned another quip he heard from Munger at another investor meeting two decades ago. Munger said, "All I want to know is where I'm going to die, so I never go there." Everybody in the room laughed, Whitney said, but Munger continued... I'm serious. Once you reach a certain position in life, you should spend most of your time trying to avoid the things that can derail your life and send you back to "go," or worse. That's true in investing, but it's also true in life. What happens to many people is that even when they've got it made, they can't help but stretch to try to grab the brass ring – and fall, bringing themselves to ruin. Be sure to [check out Whitney's e-letter today for more]( of his perspective. Rest in peace, Charlie Munger, and thanks for the lessons. I have nothing more to add. --------------------------------------------------------------- Recommended Links: [December 6: A Severe Financial Crisis Is Underway]( It doesn't matter if you have money in the markets right now or you're waiting on the sidelines. The short period we're about to enter could have the power to make – or destroy – fortunes. And what you do on December 6 could determine your wealth for the next decade. [Click here to prepare now](. --------------------------------------------------------------- [READ IMMEDIATELY: Huge Banking Overhaul Underway]( The financial community has some big changes planned for your money. The Federal Reserve, U.S. Treasury, and White House are all involved... as are at least 41 American banks and credit unions. This overhaul could change how you cash your paycheck... access your Social Security income... even how you pay your taxes. That's why it's crucial you understand what's going on before your bank is affected. [Full story here](. --------------------------------------------------------------- New 52-week highs (as of 11/28/23): Adobe (ADBE), Alamos Gold (AGI), CBOE Global Markets (CBOE), Kinross Gold (KGC), Cheniere Energy (LNG), Microsoft (MSFT), Palo Alto Networks (PANW), StoneCo (STNE), and Sprott Physical Uranium Trust (U-U.TO). In today's mailbag, a boots-on-the-ground report about deflation, a subject we covered in [yesterday's Digest](... Do you have a comment, observation, or question? As always, e-mail us at feedback@stansberryresearch.com. "I run an outdoor power equipment retail store in Ohio, representing several large manufacturers. As an Alliance member, I read everything I can from Stansberry as I believe it helps keep me keep a pulse on the economy. I appreciate the balance between your writers and all of the research provided. Just wanted to pass along a boots-on-the-ground perspective on the pricing front and how it relates to overall disinflation vs. deflation. "Our manufacturers raised prices too far, too fast in 2021 & 2022 because they had no chance of keeping up with demand. Demand softened dramatically in 2023, so dealers like us have gone from very little on the showroom floor in 2021 & 2022 to way too much equipment on our floorplans. "The 2023 season saw many sales and promotions from manufacturers to help reduce floorplan amounts and meet their quarterly sales numbers. In the 2024 programs, we are seeing a mix of price decreases and a continuation of aggressive promotions. So prices in my industry ARE currently declining, either by outright price decreases or by aggressive promotions. "Manufacturers in our industry are currently walking the tightrope of softer demand with small price decreases and aggressive discounting in the hopes that the new high price points stick when demand returns." – Stansberry Alliance member Ryan D. Corey McLaughlin comment: Thanks for the note and the observations, Ryan. We love hearing these boots-on-the-ground reports about what you see in your business or community. I encourage anyone with a view to keep them coming. All the best, Corey McLaughlin Baltimore, Maryland November 29, 2023 --------------------------------------------------------------- Stansberry Research Top 10 Open Recommendations Top 10 highest-returning open positions across all Stansberry Research portfolios Stock Buy Date Return Publication Analyst MSFT Microsoft 11/11/10 1,300.2% Retirement Millionaire Doc MSFT Microsoft 02/10/12 1,210.8% Stansberry's Investment Advisory Porter ADP Automatic Data Processing 10/09/08 827.9% Extreme Value Ferris wstETH Wrapped Staked Ethereum 02/21/20 771.1% Stansberry Innovations Report Wade WRB W.R. Berkley 03/16/12 639.3% Stansberry's Investment Advisory Porter BRK.B Berkshire Hathaway 04/01/09 538.4% Retirement Millionaire Doc HSY Hershey 12/07/07 460.5% Stansberry's Investment Advisory Porter AFG American Financial 10/12/12 393.1% Stansberry's Investment Advisory Porter BTC/USD Bitcoin 01/16/20 331.2% Stansberry Innovations Report Wade PANW Palo Alto Networks 04/16/20 310.8% Stansberry Innovations Report Engel Please note: Securities appearing in the Top 10 are not necessarily recommended buys at current prices. The list reflects the best-performing positions currently in the model portfolio of any Stansberry Research publication. The buy date reflects when the editor recommended the investment in the listed publication, and the return shows its performance since that date. To learn if a security is still a recommended buy today, you must be a subscriber to that publication and refer to the most recent portfolio. --------------------------------------------------------------- Top 10 Totals 4 Stansberry's Investment Advisory Porter 3 Stansberry Innovations Report Engel/Wade 2 Retirement Millionaire Doc 1 Extreme Value Ferris --------------------------------------------------------------- Top 5 Crypto Capital Open Recommendations Top 5 highest-returning open positions in the Crypto Capital model portfolio Stock Buy Date Return Publication Analyst wstETH Wrapped Staked Ethereum 12/07/18 1,701.2% Crypto Capital Wade ONE/USD Harmony 12/16/19 1,086.0% Crypto Capital Wade POLYX/USD Polymesh 05/19/20 1,060.7% Crypto Capital Wade BTC/USD Bitcoin 11/27/18 906.4% Crypto Capital Wade MATIC/USD Polygon 02/25/21 822.3% Crypto Capital Wade Please note: Securities appearing in the Top 5 are not necessarily recommended buys at current prices. The list reflects the best-performing positions currently in the Crypto Capital model portfolio. The buy date reflects when the recommendation was made, and the return shows its performance since that date. To learn if it's still a recommended buy today, you must be a subscriber and refer to the most recent portfolio. --------------------------------------------------------------- Stansberry Research Hall of Fame Top 10 all-time, highest-returning closed positions across all Stansberry portfolios Investment Symbol Duration Gain Publication Analyst Nvidia^* NVDA 5.96 years 1,466% Venture Tech. Lashmet Microsoft^ MSFT 12.74 years 1,185% Retirement Millionaire Doc Band Protocol crypto 0.32 years 1,169% Crypto Capital Wade Terra crypto 0.41 years 1,164% Crypto Capital Wade Inovio Pharma.^ INO 1.01 years 1,139% Venture Tech. Lashmet Seabridge Gold^ SA 4.20 years 995% Sjug Conf. Sjuggerud Frontier crypto 0.08 years 978% Crypto Capital Wade Binance Coin crypto 1.78 years 963% Crypto Capital Wade Nvidia^* NVDA 4.12 years 777% Venture Tech. Lashmet Intellia Therapeutics NTLA 1.95 years 775% Amer. Moonshots Root ^ These gains occurred with a partial position in the respective stocks. * The two partial positions in Nvidia were part of a single recommendation. Editor Dave Lashmet closed the first leg of the position in November 2016 for a gain of about 108%. Then, he closed the second leg in July 2020 for a 777% return. And finally, in May 2022, he booked a 1,466% return on the final leg. Subscribers who followed his advice on Nvidia could've recorded a total weighted average gain of more than 600%. You have received this e-mail as part of your subscription to Stansberry Digest. If you no longer want to receive e-mails from Stansberry Digest [click here](. Published by Stansberry Research. You’re receiving this e-mail at {EMAIL}. 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