Causation Quote by Charlie Munger
“Don't confuse correlation and causation. Almost all great records eventually dwindle.”
About This Quote
Source Speech: Annual Shareholder Meeting, Berkshire Hathaway, 2015
Distinguish statistical relationships from true cause‑effect; recognize that many impressive trends eventually decline.
In simple terms: Correlation ≠ causation; trends fade.
Key Takeaway
Check causes before acting.
Themes
critical thinking
statistics
business
risk management
Mood
cautious
analytical
Type
advice
educational
When to use this quote
- investment analysis
- policy making
- scientific research
- media reporting
Key Concepts
causality
regression to the mean
survivorship bias
Questions to Reflect On
- What evidence confirms a true cause?
- How do you guard against over‑reliance on past performance?
A Different Perspective
Correlation can be misleading without context or deeper analysis.
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