Charlie Munger spent decades studying why smart people do dumb things with their money and their lives. His explanation usually came back to temperament, and he had little faith that a high IQ could rescue someone who couldn’t control their feelings.
Munger laid out these mental traps in his talk “The Psychology of Human Misjudgment” and in the speeches collected in Poor Charlie’s Almanack. While he never said “emotional intelligence.” His framework still reads like a field guide to what happens when emotion takes the wheel. He frequently spoke about temperament, patience, self-discipline, and controlling raw emotion.
Below are seven behaviors that point to low emotional intelligence, drawn from Munger’s own words. You’ll probably spot a few of them in people you know and maybe one or two in the mirror.
1. Indulging in Self-Pity and the Victim Mentality
Munger thought self-pity was a ridiculous way to behave. He saw it as wasted energy that could have gone toward fixing whatever went wrong.
People with low emotional intelligence constantly complain about unfairness. In their version of events, the boss is out to get them, and the market is rigged against them.
Munger addressed this head-on in his 2007 commencement speech at USC Law School. “Every time you find you’re drifting into self-pity, I don’t care what the cause, your child could be dying of cancer, self-pity is not going to improve the situation.”
He wasn’t speaking in theory. Munger lost his young son Teddy to leukemia in the 1950s, and a failed cataract surgery later cost him the sight in one eye.
2. Succumbing to Pain-Avoiding Psychological Denial
Munger listed Pain-Avoiding Psychological Denial among the tendencies that wreck judgment. When the truth hurts badly enough, the mind quietly edits it.
Traders know this one well. A losing position keeps falling, and the trader keeps telling himself it will come back. Or, a business owner watches sales slide for a year and blames the economy. Munger’s standard was simple. “I think that one should recognize reality even when one doesn’t like it.”
Bad news stings everyone. People with emotional control feel it too, but they admit what happened and cut their losses while they’re still small.
3. Over-Defending Their Best-Loved Ideas
Some people treat every disagreement as an insult. Their opinions have become part of who they are, so challenging that idea feels like a personal challenge. Munger described how the mind tends to shut the door once it reaches a conclusion. New evidence knocks, and nobody answers.
He took the opposite approach and was proud of it. “Part of the reason I’ve been a little more successful than most people is I’m good at destroying my own best-loved ideas.”
He also kept what he called an iron prescription. Munger said he wasn’t entitled to an opinion unless he could present the arguments against his position better than those of his opponents.
4. Letting Envy Dictate Their Choices
Envy came up again and again when Munger talked about bad decisions. He saw it behind reckless spending and a lot of foolish speculation. A coworker buys a lake house. A brother-in-law brags about a crypto win at Thanksgiving. Suddenly, the envious person is taking on debt or buying an investment they can’t explain.
Munger didn’t hide his contempt for the whole emotion. “Envy is a really stupid sin because it’s the only one you could never possibly have any fun at. There’s a lot of pain and no fun. Why would you want to get on that trolley?”
People with steadier emotions set their own targets. They know what enough looks like for their family, and they don’t revise the number every time a neighbor posts vacation photos.
5. Blindly Following the Crowd
Munger called it the Social-Proof Tendency. We copy what the people around us are doing, often without noticing. Standing apart from the group feels awful to people with low emotional intelligence. So they buy what everyone’s buying and panic when everyone panics, which is how bubbles inflate and crashes get worse.
Munger reduced the whole problem to one line in Poor Charlie’s Almanack. “Mimicking the herd invites regression to the mean.”
Independent thinking comes with a social cost. Friends may think you’re stubborn or out of touch for months before the results prove you right, and sometimes they never do, but emotionally independent people take their own smart risks away from the crowd.
6. Letting Dislike and Resentment Cloud Their Judgment
Munger’s Disliking/Hating Tendency describes how our feelings toward a person warp our judgment of their ideas. Dislike someone enough, and you’ll overlook anything they get right. This is the classic case of shooting the messenger. A sound warning gets tossed out because it came from a rival or a manager nobody likes.
Munger grouped resentment with the worst habits of mind. “Generally speaking, envy, resentment, revenge, and self-pity are disastrous modes of thought.”
A grudge can feel righteous. It also keeps your attention fixed on the person you can’t stand when it should be on whether they had a point.
7. Overestimating Their Own Competence
Excessive Self-Regard Tendency was Munger’s name for our habit of overrating ourselves. We tend to rate our own skills and choices higher than an outside observer would.
Low self-awareness makes it hard to admit ignorance. A lucky streak gets mistaken for talent, and the person starts placing bets in areas they barely understand.
Munger kept coming back to the same point about self-knowledge. “Knowing what you don’t know is more useful than being brilliant.”
That’s why he and Warren Buffett talked so much about their circle of competence. Buffett once wrote that the size of the circle isn’t very important, but knowing its boundaries is vital.
People with genuine self-awareness go back over their mistakes with some honesty. They write down what went wrong, even when the answer is embarrassing.
Conclusion
Munger believed temperament mattered more than raw brainpower, both in investing and in life. Every behavior on this list shows up when emotion overrules reason. He also believed these habits could be trained out. Munger spent his life catching his own errors early, and he kept at it until he died at 99.
One of his best-known lines from that 2007 USC speech spells out the stakes. “To get what you want, you have to deserve what you want. The world is not yet a crazy enough place to reward a whole bunch of undeserving people.”
Deserving it starts with how you handle your own thoughts and emotions. Pick one of these seven habits and watch for it in yourself this week.