Charlie Munger on the Six Pseudo-Asset Cores
1. Overpriced mansions beyond affordability: Vanity-driven home purchases turn into lifelong liabilities.
2. Luxury cars: Immediate 20% depreciation upon purchase, with annual losses of 15%-20%; should be capped at 10% of annual income.
3. Complex financial products: High-fee active funds erode over half the returns in 30 years.
4. Non-productive assets: Gold and Bitcoin generate no cash flow—essentially a greater fool game (with reservations).
5. Frequent trading: Disrupts compounding, incurs fees, and fuels emotional decisions.
6. Credit debt: High-interest credit cards are wealth vampires.
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