Chris Davis: Three Generations of Wealth

The Knowledge Project with Shane Parrish

Shane Parrish

Business, Society & Culture, Technology, Education, Self-improvement, Investing, Entrepreneurship

4.7 • 2.9K Ratings

🗓️ 5 March 2024

⏱️ 163 minutes

🔗️ Recording | iTunes | RSS

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Summary

Most families who obtain immense wealth squander it by the third generation. But Chris Davis comes from a family whose grandfather and father all became independently wealthy of each other, and Davis has done the same. How does that keep happening? In this conversation, we find out. Shane and Chris discuss life and investment lessons he learned from his father and grandfather, why writing is more important to clarify one's thinking no matter who's reading it, and the surprising benefit of reading physical newspapers and wearing ties to work. Davis also shares his value-investing philosophy, what he learned from working with and meeting Charlie Munger, and what parents can do to raise kids who aren't entitled. Davis talks about his alcohol drink tracker and why it's important to him, why he never puts himself in situations where envy can grow, and the insights from Warren Buffett's key letter about why investment managers underperform. Chris Davis is on the board of Berkshire Hathaway and The Coca-Cola Company. Davis is Chairman of Davis Selected Advisers-NY, Inc., an independent investment management firm founded in 1969. Davis joined Davis Selected Advisers-NY, Inc. in 1989 as a financial analyst, and in 1995, he became a portfolio manager of the firm’s flagship funds. Watch the episode on YouTube: https://www.youtube.com/c/theknowledgeproject/videos Newsletter - I share timeless insights and ideas you can use at work and home. Join over 600k others every Sunday and subscribe to Brain Food. Try it: https://fs.blog/newsletter/ My Book! Clear Thinking: Turning Ordinary Moments into Extraordinary Results is out now - https://fs.blog/clear/ Follow me: https://beacons.ai/shaneparrish Join our membership: https://fs.blog/membership/ Sponsors: Eight Sleep: Sleep to power a whole new you. https://www.eightsleep.com/farnamstreet (00:00) Intro (03:20) Life lessons Davis learned from his grandfather and father (26:24) The importance of writing things no one reads (36:55) Davis' experiences through financial crises (52:31) Why Davis loves managing a mutual fund (55:49) Why Berkshire Hathaway operates with margin (01:01:05) What is risk? (01:04:02) On low interest rates and their future impact (01:14:46) The mismatched timelines between CEOs, companies, investors, and policy (01:22:19) How Davis and Munger met (01:30:20) Lessons learned from Munger (01:41:29) Why avoiding weaknesses is the ultimate recipe for success (01:55:46) How to raise non-entitled kids and avoid lifestyle creep (01:16:10) On happiness (02:27:00) Good vs. bad board meetings (02:31:34) Three generations of wealth (02:37:15) On success Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

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0:00.0	I just think you have to think about how do you position.
0:03.6	You have no idea if you're going to be sailing through a storm.
0:06.9	Be prepared for that and have redundancy, have resiliency.
0:11.9	But, you know, imagining there's some tropical island where you can go and drop the anchor and just wait it out, that's not an option.
0:19.8	There is no safe harbor.
0:46.8	Welcome to the Knowledge Project, a podcast about mastering the best of what other people have already figured out so you can apply their insights to your life.
0:49.7	I'm your host, Shane Parrish.
0:52.5	A quick favor to ask before we start.
0:58.7	Most people listening to this podcast on Apple or Spotify haven't yet hit the follow button. If you can hit the follow button right now, I would appreciate it.
1:02.7	The more people who follow the show, the better the guests I can get.
1:07.6	Thank you so much and enjoy the conversation.
1:10.5	If you'd like access to the podcast before
1:12.3	everyone else, special episodes just for you, hand-edited transcripts, or you just want to support
1:18.4	the show you love, join at fs.blog slash membership. Check out the show notes for a link.
1:24.4	Today, my guest is Christopher Davis. A member of the board of directors of Berkshire Hathaway
1:30.3	and the Coca-Cola company and the chairman of Davis Select Advisors, an independent investment
1:36.3	management firm founded in 1969 that oversees about 20 billion in client assets.
1:41.3	If you recognize the name, this conversation needs no introduction.
1:45.6	Just dive right in. And if you don't recognize the name, you will love this conversation.
1:50.0	It's not just about investing. We talk so much about life and living. Oh, it's just fascinating.
1:55.8	Tom Gaynor introduced us, and it was like finding this older brother you never knew you had. Our conversation
2:01.5	was supposed to go for an hour and ended up being nearly three hours. I almost missed my flight.
	...

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