Poor.Charlie's.Almanack
What Carson said was that he couldn't tell the graduating class how to be happy, but he could tell them from personal experience how to guarantee misery. Carson's prescription for sure misery included: l. Ingesting chemicals in an effort to alter mood or perception; Envy;and Resentment
The idea of caring that someone is making money faster [than you are] is one of the deadly sins. 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. Whv would you want to get on that trolley
I think that, every time you see the word EBITDA [earnings before interest, taxes, depreciation, and amortizationf, you should substitute the words "bullshit earnings. "
Be a business analyst, not a market, macroeconomic, or security analyst
Life's Tragedy is that you get old too soon and wise too late.When you are finished changing,you are finished.
Early retirement is criticized by Cicero as virtually unthinkable. He cites the moral idea of Pythagoras that "no man should quit his post but at the command of his General; that is, of God himself
aLife employed in the Pursuit of useful Knowledge, in honourable Actions and the Practice of Virtue; in which he who labours to improve himself from his Youth, will in Age reap the happiest Fruits of them; not only because these never leave a Man, nor even in the extreamest [sic] Old Age; but because a Conscience bearing Witness that our Life was well-spent, together with the Remembrance of past good Actions, yields an unspeakable Comfort to the Soul.
The best Armour of Old Age is a well spent life preceding it;
With Nancy's support, he turned to outside ventures and alternative ways to generate income.However, he never forgot the sound principles caught by his grandfather: to concentrate on the task immediately in front of him and to control spending. Charlie marries Nancy Barry Borthwick, January 27, 1956.
Talk Eleven: The Psychology of Human Misjudgement
1. Reward and Punishment - Superresponse Tendency
- Get the incentives right e.g. Federal Express to pay per shift and let all night shift employees go home when all the planes are loaded; Xerox's commission arrangement with the salesmen gave a large and perverse incentive to push the inferior machine on customers
- If you would persuade, appeal to interest and not to reason - Ben Franklin in Poor Richard's Almanack
- One employee describes Soviet communists, 'They pretend to pay us and we pretend to work.'
- Incentive caused bias: I have never seen a management consultant's report that didn't end with the same advice: 'This problem needs more management consulting services.'; Defence Dept had much truly awful experience with misbehaving contractors motivated under contracts paying on a cost-plus-a-percentage-of-cost basis.
- Granny's rule: Children must eat carrots first before eating desserts; Business version: employees must do unpleasant tasks first before doing more pleasant tasks.
- Around the time of Caesar, there was a European tribe that, when the assembly horn blew, always killed the last warrior to reach his assigned place, adn no one enjoyed fighting this tribe.
2. Liking/ Loving Tendency
- Liker tend to ignore faults of and comply with wishes of the object of this affection; to favor people, products and actions merely associated with the objection of his affection; and to distort other facts to facilitate love.
3. Disliking / Hating Tendency
- Politics is the art of marshalling hatreds
- Disliker to ignore virtues in the object of dislike; dislike people, products and actions merely associated with the object of dislike, and distort other facts to facilitate hatred.
- When the World Trade Center was destroyed, many Pakistanis immediately concluded that the Hindus did it; while many Muslims concluded that the Jews did it. - Such factual distortions often make mediation between opponents locked in hatred either difficult or impossible.
4. Doubt-Avoidance Tendency
- To quickly reach a conclusion
5. Inconsistency- Avoidance Tendency
- Reluctant to change
- Makes it much easier to prevent a habit than to change it. When Marley's miserable ghost says, 'I wear the chains I forged in life,' he is talking about chains of habit that were too light to be felt before they became too strong to be broken.
- An ounce of prevention is worth a pound of cure
- A quickly reached conclusion triggered by Doubt-Avoidance Tendency combined with a tendency to resist any change, will naturally cause a lot of cognitive errors.
- The radically new ideas are seldom really accepted by the old guard. Instead, said Planck, the progress is made by a new generation that comes along, less brain-blocked by its previous conclusions.
- A person making big sacrifices in the course of assuming a new identity will intensify his devotion to the new identity.
- When one is maneuvered into deliberately hurting some other person, one will tend to disapprove or even hate that person.
- A near-ultimate inconsistency would be to teach something to others that one did not believe true - with the teaching pounding the learning into the teacher. For instance, when young students are taught dubious political notions and then enthusiastically push these notions on the rest of us. The pushing seldom convinces others. But as students pound into thier mental habits what they are pushing out, the students are often permanently damaged.
6. Curiosity Tendency
7. Kantian Fairness Tendency
- Golden rule to require humans to follow those behavior patterns that, if followed by all others, would make the surrounding human system work best for everybody.
8. Envy/ Jealousy Tendency
It is not greed that drives the world, but envy. - warren buffett
9. Reciprocation Tendency
- Reciprocal hostility e.g. road-rage
- Standard antidote to one's overactive hostility is to train oneself to defer reaction.
- Joins Inconsistency-Avoidance tendency in helping cause (1) the fulfillment of promises made as part of a bargain, including loyalty promises in marriage ceremonies and (2) correct behaviour expected from persons serving as priests, shoemakers, physicians etc.
- Given the subconcious level at which much Reciprocation Tendency operates, Sam Walton wouldn't let purchasing agents accept so much as a hot dog from a vendor.
- The favor does not have to real - in a negotiation it can be a concession made from the original proposal which has been inflated, even though the other party would not have normally agreed to the final proposal if it has been presented in the first place.
10. Influence-from-mere-association Tendency
- Superstition - things happen together which does not in fact have a causal relationship
- Persian Messenger Syndrome - Ancient Persians killed some messengers whose sole fault was that they brought home bad news. It was actually safer for the messenger to run away and hide, instead of doing his job as a wise boss would have wanted it done. Antidote being to develop, through exercise of will, a habit of welcoming bad news - be wise and informed that people fear not telling you bad news because you are likely to get it elsewhere.
- Sometimes when one receives a favor, his condition is unpleasant, due to poverty, sickness, subjugation. In addition, the favor may trigger an envy-driven dislike for the person who was in a favorable state as to be a favor giver. E.g. Munger's friend 'Glotz' owned an apartment building that he had bought because he wanted, eventually, to use the land in different development. Pending this outcome, Glotz was very lenient in collecting below-market rents from tenants. When at last, there was a public hearing on Glotz's proposal to tear down the bulding, one tenant who was far behind in his rent payments was particularly angry and hostile. He came to the public hearing and said, 'This proposal is outrageous. Glotz doesn't need any more money. I know this because I was supported in college by Glotz fellowships.'
- Use of classification stereotypes
11. Simple, pain-avoiding psychological denial
- In chemical dependency, wherein morals usually break down horribly, addicted persons tend to believe that they remain in respectable condition, with respectable prospects.
12. Excessive self-regard Tendency
- Ninety percent of Swedish drivers judge themselves to be above average.
- Such misappraisals also apply to a person's major 'possessions' e.g. spouse, children and also minor possessions e.g. items once owned become worth more than he would pay if he didn't already own it ('endowment effect')
- Makes man strongly prefer people like himself - bad consequences of dysfunctional group of cliquish persons, select new members of their organization persons who are very much like themselves.
- People pick their own numbers in Mark Six - irrational love of self-picked numbers; Foolish sports betting by people who love sports and think they know a lot about relative merits of the teams, is a lot more addictive than race track betting - man's overrappraisal of his own complicated conclusions.
- Tolstoy effect: the worst criminals don't appraise themselves as all that bad, believing that (1) they didn't commit their crimes or (2) that considering the pressures and disadvantages of their lives, it is understandable and forgivable that they behaved as they did.
- To counter Tolstoy effect: Personal level - Remember (1) Fixable but unfixed bad performance is bad character and (2) Fixable bad behaviour will not be tolerated in demanding institutions; Business level - (1) A fair, meritocratic, demanding culture plus personnel handling methods that build up morale and (2) severance of the worst offenders.
- Never underestimate the man who overestimates himself.
13. Overoptimism Tendency
- 'What a man wishes, that also will he believe.' - Demosthenes, the most famous Greek orator.
- Witness happy people buying lottery tickets.
- Antidote: trained habitual use of simple probability math
14. Deprival-Superreaction Tendency
- Defined as loss of possessed reward / almost possessed reward
- A ten dollar loss hurts more than a ten dollar gain
- E.g. compulsion to gamble, open-outcry auctions (Buffett practice: Don't go to such auctions)
15. Social-Proof Tendency
- Most easily triggered with puzzlement and stress e.g. poor sales practice and cult conversion
- Serpico Syndrome: Frank Serpico joined a near-totally corrupt New York police division who was then nearly murdered by gunfire because of his resistence to go along.
- Can interract with Envy / Jealousy and Deprival-Superreaction: Munger's cousin Ross and Munger, at ages three and four, fought and howled over a single surplus shingle while surrounded by a virtual sea of surplus shingles.
16. Contrast-Misreaction Tendency
- Create high artificial price then advertise his standard price as a big reduction
- When a man's steps are consecutively taken toward disaster, with each step being very small, he will go too far before he is able to stop, because each step is too small a contrast from his previous position.
17. Stress-Influence Tendency
- Really heavy stress can cause depression. 'Acute stress depression' makes thinking dysfunctional because it causes an extreme of pessimism, often extended in length and usually accompanied by activity-stopping fatigue.
- From giving stress induced nervous breakdowns to dogs, Pavlov found:
(1) he could classify dogs so as to predict how easily a particular dog would breakdown
(2) the dogs hardest to break down were also the hardest to return to their pre-breakdown state
(3) any dog could be broken down
(4) he couldn't reverse a breakdown except by reimposing stress
18. Availability-Misweighing Tendency
- The mind overweighs what is easily available: When I'm not near the girl I love, I love the girl I'm near.
- Extra-vivid evidence, being so memorable and thus more available in cognition, should often consciously be underweighed.
19. Use-It-or-Lost-It Tendency
- A wise man should engage in practice all of his useful rarely used skills.
- If a skill is raised to fluency, it will be lose more slowly and will come back faster when refreshed
20. Drug-Misinfluence Tendency
21. Senescence-Misinfluence Tendency
Natural cognitive decay with old age
22. Authority-Misinfluence Tendency
- Be careful whom you appoint to power because a dominant authority will often be hard to remove
23. Twaddle Tendency
- Bullshit that does much damage when serious work is being attempted
- The principal job of an academic administration is to keep the people who don't matter from interfering with the work of the people that do.
24. Reason-Respecting Tendency
- Teach / give orders with reasons (even meaningless or incorrect reasons will increase compliance of requests)
25. Lollapalooza Tendency - The Tendency to get extreme consequences from confluences of psychological tendencies acting in favor of a particular outcome
Getting to Yes: Negotiating Agreement Without Giving In (Roger Fisher;William L. Ury;Bruce Patton)
It is surprising how often we simply react to what someone else has said or done. Two people will often fall into a pattern of discourse that resembles a negotiation, but really has no such purpose whatsoever. They disagree with each other over some issue, and the talk goes back and forth as though they were seeking agreement. In fact, the argument is being carried on as a ritual, or simply a pastime
Ultimately, however, conflict lies not in objective reality, but in people’s heads. Truth is simply one more argument—perhaps a good one, perhaps not—for dealing with the difference. The difference itself exists because it exists in their thinking. Fears, even if ill-founded, are real fears and need to be dealt with. Hopes, even if unrealistic, may cause a war. Facts, even if established, may do nothing to solve the problem
THE METHOD
2. Separate the People from the Problem
3. Focus on Interests, Not Positions
4. Invent Options for Mutual Gain
5. Insist on Using Objective Criteria
To find your way through the jungle of people problems, it is useful to think in terms of three basic categories: perception, emotion, and communication.
Influence (Robert B. Cialdini)
we employ the factors of reciprocation, consistency, social proof, liking, authority, and scarcity so often and so automatically in making our compliance decisions.
Where all think alike, no one thinks very much. —WALTER LIPPMANN
The man who doesnt read good books has no advantage over the manwho cant read them." -Mark Twain-
马云内部讲话 (马云)
还有一个，技能很强的人，有能力的人一般都很怪的，所以我想告诉大家绝大部分能力强的人都是偏执狂，都是古怪的。这个古怪的人不能把心胸打开的时候，永远不能成为真正伟大的领导者。
你的胸怀各种各样的人都要能够包容，最后你的技能一定不如你的手下，你的技能比手下强的时候你一定不是好的领导者。
你说你恨死下面的人，下面的人都是饭桶，我今天告诉大家，阿里巴巴给你的就是饭桶，你们的职责是把他们变得不是饭桶。三年以后他们还是饭桶，你就是饭桶！
领导者就是眼光、胸怀和实力。在全世界成功无非就是这三条。
人们总是认为错误人家会犯，我一定不会犯，我告诉你百分之九十九的错误是每个人都会犯的，只不过你没有走到这个门口，走到这个门口一定会犯的。大部分人认为自己很聪明，太聪明了，这么聪明我怎么会犯。我告诉你，你没有走到这个门口，你走到这个门口一定犯。
我看到太多公司的问题是因为汽车导致的，比方说一个公司里接他用宝马，接我只有奥迪，有的人也没想到，副总裁没有感觉，但是秘书有感觉，怎么我的老板就低一点？
很多公司的失败是由汽车导致、秘书导致、贿赂导致。
别恨人家，很多人因为讨厌这个人不愿意跟他合作，又不要你嫁给他，不要你娶她，你讨厌他没有关系，你们可以不成为很好的朋友，但是可以成为很好的同事。
我们年轻人经常说爱情变成亲情多可悲，我认为，爱情变成亲情是最珍贵的，两个毫无血缘关系的人，居然可以像亲人一样。所以我想这辈子陪你走到底的，那就是另外一半。孩子不能陪你，父母也不可能陪你，陪你的是另一半。
身体锻炼，天天去跑步没感觉的，就是觉得稍微出了一身汗。锻炼指的是，同样在生很重的病时，两个人，一个人天天在锻炼，一个人不锻炼，但是生同样的病时，锻炼的人他发挥了很大的作用。平时的锻炼就是价值观的考核，价值观不是等灾难来的时候再去练的，平时就要跑步。灾难来的时候，这个人没运动，就完了，你活下来了。
Fashionable Nonsense (Alan Sokal)
What convinces us most strongly that we found the right curve is, of course, that when we perform additional experiments, the new data fit the old curve. One has to assume implicitly that there is not a cosmic conspiracy in which the real curve is very different from the curve we have drawn, but in which all our data (old and new) happen to fall on the intersection of the two. To take a phrase from Einstein, one must imagine that the Lord is subtle, but not malicious.
Jack - Jack Welch and John A. Byrne
The psychological contract had to change. I wanted to create a new contract, making GE jobs the best in the world for people willing to compete. If they signed up, we'd give them the best training and development and an environment that provided plenty of opportunities for personal and professional growth. We'd do everything to give them the skills to have 'lifetime employability', even if we couldn't guarantee them 'lifetime employment'.
Removing people will always be the hardest decision a leader faces. Anyone who 'enjoys doing it' shouldn't be on the payroll, and neither should anyone who 'can't do it'.
'This will be a whole new ball game: Change, as you have never seen it, at speeds you've never seen. What fun for those who relish it. What fear for those who don't grasp it.'
The Intelligent Investor - Benjamin Graham
Here are some of the handicaps mutual-fund managers and other professional investors are saddled with:
- With billions of dollars under management, they must gravitate toward the biggest stocks - the only ones they can buy in the multimillion-dollar quantities they need to fill their portfolios. Thus many funds end up owning the same few overpriced giants.
- Investors tend to pour more money into funds as the market rises. The managers use that new cash to buy more of the stocks they already own, driving prices to even more dangerous heights.
- If fund investors ask for their money back when the market drops, the managers may need to sell stocks to cash them out. Just as the funds are forced to buy stocks at inflated prices in a rising market, they become forced sellers as stocks get cheap again.
- Many portfolio managers get bonuses for beating the market, so they obsessively measure their returns against benchmarks like the S&P 500 Index. If a company gets added to an index, hundreds of funds compulsively buy it. (If they don't, and that stock then does well, the managers look foolish; on the other hand, if they buy it and it does poorly, no one will blame them.)
- Increasingly, fund managers are expected to specialize. Just as in medicine the general practitioner has given way to the pediatric allergist and the geriatric otolaryngologist, fund managers must buy only "small growth" stocks, or only "mid-sized value" stocks, or nothing but "large blend" stocks. If a company gets too big, or too small, or too cheap, or an itty bit too expensive, the fund has to sell it - even if the manager loves the stock.
In the old legend the wise men finally boiled down the history of mortal affairs into the single phrase, "This too will pass."
What Carson said was that he couldn't tell the graduating class how to be happy, but he could tell them from personal experience how to guarantee misery. Carson's prescription for sure misery included: l. Ingesting chemicals in an effort to alter mood or perception; Envy;and Resentment
The idea of caring that someone is making money faster [than you are] is one of the deadly sins. 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. Whv would you want to get on that trolley
I think that, every time you see the word EBITDA [earnings before interest, taxes, depreciation, and amortizationf, you should substitute the words "bullshit earnings. "
Be a business analyst, not a market, macroeconomic, or security analyst
Life's Tragedy is that you get old too soon and wise too late.When you are finished changing,you are finished.
Early retirement is criticized by Cicero as virtually unthinkable. He cites the moral idea of Pythagoras that "no man should quit his post but at the command of his General; that is, of God himself
aLife employed in the Pursuit of useful Knowledge, in honourable Actions and the Practice of Virtue; in which he who labours to improve himself from his Youth, will in Age reap the happiest Fruits of them; not only because these never leave a Man, nor even in the extreamest [sic] Old Age; but because a Conscience bearing Witness that our Life was well-spent, together with the Remembrance of past good Actions, yields an unspeakable Comfort to the Soul.
The best Armour of Old Age is a well spent life preceding it;
With Nancy's support, he turned to outside ventures and alternative ways to generate income.However, he never forgot the sound principles caught by his grandfather: to concentrate on the task immediately in front of him and to control spending. Charlie marries Nancy Barry Borthwick, January 27, 1956.
Talk Eleven: The Psychology of Human Misjudgement
1. Reward and Punishment - Superresponse Tendency
- Get the incentives right e.g. Federal Express to pay per shift and let all night shift employees go home when all the planes are loaded; Xerox's commission arrangement with the salesmen gave a large and perverse incentive to push the inferior machine on customers
- If you would persuade, appeal to interest and not to reason - Ben Franklin in Poor Richard's Almanack
- One employee describes Soviet communists, 'They pretend to pay us and we pretend to work.'
- Incentive caused bias: I have never seen a management consultant's report that didn't end with the same advice: 'This problem needs more management consulting services.'; Defence Dept had much truly awful experience with misbehaving contractors motivated under contracts paying on a cost-plus-a-percentage-of-cost basis.
- Granny's rule: Children must eat carrots first before eating desserts; Business version: employees must do unpleasant tasks first before doing more pleasant tasks.
- Around the time of Caesar, there was a European tribe that, when the assembly horn blew, always killed the last warrior to reach his assigned place, adn no one enjoyed fighting this tribe.
2. Liking/ Loving Tendency
- Liker tend to ignore faults of and comply with wishes of the object of this affection; to favor people, products and actions merely associated with the objection of his affection; and to distort other facts to facilitate love.
3. Disliking / Hating Tendency
- Politics is the art of marshalling hatreds
- Disliker to ignore virtues in the object of dislike; dislike people, products and actions merely associated with the object of dislike, and distort other facts to facilitate hatred.
- When the World Trade Center was destroyed, many Pakistanis immediately concluded that the Hindus did it; while many Muslims concluded that the Jews did it. - Such factual distortions often make mediation between opponents locked in hatred either difficult or impossible.
4. Doubt-Avoidance Tendency
- To quickly reach a conclusion
5. Inconsistency- Avoidance Tendency
- Reluctant to change
- Makes it much easier to prevent a habit than to change it. When Marley's miserable ghost says, 'I wear the chains I forged in life,' he is talking about chains of habit that were too light to be felt before they became too strong to be broken.
- An ounce of prevention is worth a pound of cure
- A quickly reached conclusion triggered by Doubt-Avoidance Tendency combined with a tendency to resist any change, will naturally cause a lot of cognitive errors.
- The radically new ideas are seldom really accepted by the old guard. Instead, said Planck, the progress is made by a new generation that comes along, less brain-blocked by its previous conclusions.
- A person making big sacrifices in the course of assuming a new identity will intensify his devotion to the new identity.
- When one is maneuvered into deliberately hurting some other person, one will tend to disapprove or even hate that person.
- A near-ultimate inconsistency would be to teach something to others that one did not believe true - with the teaching pounding the learning into the teacher. For instance, when young students are taught dubious political notions and then enthusiastically push these notions on the rest of us. The pushing seldom convinces others. But as students pound into thier mental habits what they are pushing out, the students are often permanently damaged.
6. Curiosity Tendency
7. Kantian Fairness Tendency
- Golden rule to require humans to follow those behavior patterns that, if followed by all others, would make the surrounding human system work best for everybody.
8. Envy/ Jealousy Tendency
It is not greed that drives the world, but envy. - warren buffett
9. Reciprocation Tendency
- Reciprocal hostility e.g. road-rage
- Standard antidote to one's overactive hostility is to train oneself to defer reaction.
- Joins Inconsistency-Avoidance tendency in helping cause (1) the fulfillment of promises made as part of a bargain, including loyalty promises in marriage ceremonies and (2) correct behaviour expected from persons serving as priests, shoemakers, physicians etc.
- Given the subconcious level at which much Reciprocation Tendency operates, Sam Walton wouldn't let purchasing agents accept so much as a hot dog from a vendor.
- The favor does not have to real - in a negotiation it can be a concession made from the original proposal which has been inflated, even though the other party would not have normally agreed to the final proposal if it has been presented in the first place.
10. Influence-from-mere-association Tendency
- Superstition - things happen together which does not in fact have a causal relationship
- Persian Messenger Syndrome - Ancient Persians killed some messengers whose sole fault was that they brought home bad news. It was actually safer for the messenger to run away and hide, instead of doing his job as a wise boss would have wanted it done. Antidote being to develop, through exercise of will, a habit of welcoming bad news - be wise and informed that people fear not telling you bad news because you are likely to get it elsewhere.
- Sometimes when one receives a favor, his condition is unpleasant, due to poverty, sickness, subjugation. In addition, the favor may trigger an envy-driven dislike for the person who was in a favorable state as to be a favor giver. E.g. Munger's friend 'Glotz' owned an apartment building that he had bought because he wanted, eventually, to use the land in different development. Pending this outcome, Glotz was very lenient in collecting below-market rents from tenants. When at last, there was a public hearing on Glotz's proposal to tear down the bulding, one tenant who was far behind in his rent payments was particularly angry and hostile. He came to the public hearing and said, 'This proposal is outrageous. Glotz doesn't need any more money. I know this because I was supported in college by Glotz fellowships.'
- Use of classification stereotypes
11. Simple, pain-avoiding psychological denial
- In chemical dependency, wherein morals usually break down horribly, addicted persons tend to believe that they remain in respectable condition, with respectable prospects.
12. Excessive self-regard Tendency
- Ninety percent of Swedish drivers judge themselves to be above average.
- Such misappraisals also apply to a person's major 'possessions' e.g. spouse, children and also minor possessions e.g. items once owned become worth more than he would pay if he didn't already own it ('endowment effect')
- Makes man strongly prefer people like himself - bad consequences of dysfunctional group of cliquish persons, select new members of their organization persons who are very much like themselves.
- People pick their own numbers in Mark Six - irrational love of self-picked numbers; Foolish sports betting by people who love sports and think they know a lot about relative merits of the teams, is a lot more addictive than race track betting - man's overrappraisal of his own complicated conclusions.
- Tolstoy effect: the worst criminals don't appraise themselves as all that bad, believing that (1) they didn't commit their crimes or (2) that considering the pressures and disadvantages of their lives, it is understandable and forgivable that they behaved as they did.
- To counter Tolstoy effect: Personal level - Remember (1) Fixable but unfixed bad performance is bad character and (2) Fixable bad behaviour will not be tolerated in demanding institutions; Business level - (1) A fair, meritocratic, demanding culture plus personnel handling methods that build up morale and (2) severance of the worst offenders.
- Never underestimate the man who overestimates himself.
13. Overoptimism Tendency
- 'What a man wishes, that also will he believe.' - Demosthenes, the most famous Greek orator.
- Witness happy people buying lottery tickets.
- Antidote: trained habitual use of simple probability math
14. Deprival-Superreaction Tendency
- Defined as loss of possessed reward / almost possessed reward
- A ten dollar loss hurts more than a ten dollar gain
- E.g. compulsion to gamble, open-outcry auctions (Buffett practice: Don't go to such auctions)
15. Social-Proof Tendency
- Most easily triggered with puzzlement and stress e.g. poor sales practice and cult conversion
- Serpico Syndrome: Frank Serpico joined a near-totally corrupt New York police division who was then nearly murdered by gunfire because of his resistence to go along.
- Can interract with Envy / Jealousy and Deprival-Superreaction: Munger's cousin Ross and Munger, at ages three and four, fought and howled over a single surplus shingle while surrounded by a virtual sea of surplus shingles.
16. Contrast-Misreaction Tendency
- Create high artificial price then advertise his standard price as a big reduction
- When a man's steps are consecutively taken toward disaster, with each step being very small, he will go too far before he is able to stop, because each step is too small a contrast from his previous position.
17. Stress-Influence Tendency
- Really heavy stress can cause depression. 'Acute stress depression' makes thinking dysfunctional because it causes an extreme of pessimism, often extended in length and usually accompanied by activity-stopping fatigue.
- From giving stress induced nervous breakdowns to dogs, Pavlov found:
(1) he could classify dogs so as to predict how easily a particular dog would breakdown
(2) the dogs hardest to break down were also the hardest to return to their pre-breakdown state
(3) any dog could be broken down
(4) he couldn't reverse a breakdown except by reimposing stress
18. Availability-Misweighing Tendency
- The mind overweighs what is easily available: When I'm not near the girl I love, I love the girl I'm near.
- Extra-vivid evidence, being so memorable and thus more available in cognition, should often consciously be underweighed.
19. Use-It-or-Lost-It Tendency
- A wise man should engage in practice all of his useful rarely used skills.
- If a skill is raised to fluency, it will be lose more slowly and will come back faster when refreshed
20. Drug-Misinfluence Tendency
21. Senescence-Misinfluence Tendency
Natural cognitive decay with old age
22. Authority-Misinfluence Tendency
- Be careful whom you appoint to power because a dominant authority will often be hard to remove
23. Twaddle Tendency
- Bullshit that does much damage when serious work is being attempted
- The principal job of an academic administration is to keep the people who don't matter from interfering with the work of the people that do.
24. Reason-Respecting Tendency
- Teach / give orders with reasons (even meaningless or incorrect reasons will increase compliance of requests)
25. Lollapalooza Tendency - The Tendency to get extreme consequences from confluences of psychological tendencies acting in favor of a particular outcome
Getting to Yes: Negotiating Agreement Without Giving In (Roger Fisher;William L. Ury;Bruce Patton)
It is surprising how often we simply react to what someone else has said or done. Two people will often fall into a pattern of discourse that resembles a negotiation, but really has no such purpose whatsoever. They disagree with each other over some issue, and the talk goes back and forth as though they were seeking agreement. In fact, the argument is being carried on as a ritual, or simply a pastime
Ultimately, however, conflict lies not in objective reality, but in people’s heads. Truth is simply one more argument—perhaps a good one, perhaps not—for dealing with the difference. The difference itself exists because it exists in their thinking. Fears, even if ill-founded, are real fears and need to be dealt with. Hopes, even if unrealistic, may cause a war. Facts, even if established, may do nothing to solve the problem
THE METHOD
2. Separate the People from the Problem
3. Focus on Interests, Not Positions
4. Invent Options for Mutual Gain
5. Insist on Using Objective Criteria
To find your way through the jungle of people problems, it is useful to think in terms of three basic categories: perception, emotion, and communication.
Influence (Robert B. Cialdini)
we employ the factors of reciprocation, consistency, social proof, liking, authority, and scarcity so often and so automatically in making our compliance decisions.
Where all think alike, no one thinks very much. —WALTER LIPPMANN
The man who doesnt read good books has no advantage over the manwho cant read them." -Mark Twain-
马云内部讲话 (马云)
还有一个，技能很强的人，有能力的人一般都很怪的，所以我想告诉大家绝大部分能力强的人都是偏执狂，都是古怪的。这个古怪的人不能把心胸打开的时候，永远不能成为真正伟大的领导者。
你的胸怀各种各样的人都要能够包容，最后你的技能一定不如你的手下，你的技能比手下强的时候你一定不是好的领导者。
你说你恨死下面的人，下面的人都是饭桶，我今天告诉大家，阿里巴巴给你的就是饭桶，你们的职责是把他们变得不是饭桶。三年以后他们还是饭桶，你就是饭桶！
领导者就是眼光、胸怀和实力。在全世界成功无非就是这三条。
人们总是认为错误人家会犯，我一定不会犯，我告诉你百分之九十九的错误是每个人都会犯的，只不过你没有走到这个门口，走到这个门口一定会犯的。大部分人认为自己很聪明，太聪明了，这么聪明我怎么会犯。我告诉你，你没有走到这个门口，你走到这个门口一定犯。
我看到太多公司的问题是因为汽车导致的，比方说一个公司里接他用宝马，接我只有奥迪，有的人也没想到，副总裁没有感觉，但是秘书有感觉，怎么我的老板就低一点？
很多公司的失败是由汽车导致、秘书导致、贿赂导致。
别恨人家，很多人因为讨厌这个人不愿意跟他合作，又不要你嫁给他，不要你娶她，你讨厌他没有关系，你们可以不成为很好的朋友，但是可以成为很好的同事。
我们年轻人经常说爱情变成亲情多可悲，我认为，爱情变成亲情是最珍贵的，两个毫无血缘关系的人，居然可以像亲人一样。所以我想这辈子陪你走到底的，那就是另外一半。孩子不能陪你，父母也不可能陪你，陪你的是另一半。
身体锻炼，天天去跑步没感觉的，就是觉得稍微出了一身汗。锻炼指的是，同样在生很重的病时，两个人，一个人天天在锻炼，一个人不锻炼，但是生同样的病时，锻炼的人他发挥了很大的作用。平时的锻炼就是价值观的考核，价值观不是等灾难来的时候再去练的，平时就要跑步。灾难来的时候，这个人没运动，就完了，你活下来了。
Fashionable Nonsense (Alan Sokal)
What convinces us most strongly that we found the right curve is, of course, that when we perform additional experiments, the new data fit the old curve. One has to assume implicitly that there is not a cosmic conspiracy in which the real curve is very different from the curve we have drawn, but in which all our data (old and new) happen to fall on the intersection of the two. To take a phrase from Einstein, one must imagine that the Lord is subtle, but not malicious.
Jack - Jack Welch and John A. Byrne
The psychological contract had to change. I wanted to create a new contract, making GE jobs the best in the world for people willing to compete. If they signed up, we'd give them the best training and development and an environment that provided plenty of opportunities for personal and professional growth. We'd do everything to give them the skills to have 'lifetime employability', even if we couldn't guarantee them 'lifetime employment'.
Removing people will always be the hardest decision a leader faces. Anyone who 'enjoys doing it' shouldn't be on the payroll, and neither should anyone who 'can't do it'.
'This will be a whole new ball game: Change, as you have never seen it, at speeds you've never seen. What fun for those who relish it. What fear for those who don't grasp it.'
The Intelligent Investor - Benjamin Graham
Here are some of the handicaps mutual-fund managers and other professional investors are saddled with:
- With billions of dollars under management, they must gravitate toward the biggest stocks - the only ones they can buy in the multimillion-dollar quantities they need to fill their portfolios. Thus many funds end up owning the same few overpriced giants.
- Investors tend to pour more money into funds as the market rises. The managers use that new cash to buy more of the stocks they already own, driving prices to even more dangerous heights.
- If fund investors ask for their money back when the market drops, the managers may need to sell stocks to cash them out. Just as the funds are forced to buy stocks at inflated prices in a rising market, they become forced sellers as stocks get cheap again.
- Many portfolio managers get bonuses for beating the market, so they obsessively measure their returns against benchmarks like the S&P 500 Index. If a company gets added to an index, hundreds of funds compulsively buy it. (If they don't, and that stock then does well, the managers look foolish; on the other hand, if they buy it and it does poorly, no one will blame them.)
- Increasingly, fund managers are expected to specialize. Just as in medicine the general practitioner has given way to the pediatric allergist and the geriatric otolaryngologist, fund managers must buy only "small growth" stocks, or only "mid-sized value" stocks, or nothing but "large blend" stocks. If a company gets too big, or too small, or too cheap, or an itty bit too expensive, the fund has to sell it - even if the manager loves the stock.
In the old legend the wise men finally boiled down the history of mortal affairs into the single phrase, "This too will pass."
Move fast and break things – Jonathan Taplin
What Orwell feared were those who would ban books. What Huxley feared was that there would be no reason to ban a book, for there would be no one who wanted to read one. Orwell feared those who would deprive us of information. Huxley feared those who would give us so much that we would be reduced to passivity and egoism. Orwell feared that the truth would be concealed from us. Huxley feared the truth would be drowned in a sea of irrelevance. Orwell feared we would become a captive culture. Huxley feared we would become a trivial culture, preoccupied with some equivalent of the feelies, the orgy porgy, and the centrifugal bumblepuppy.Amusing Ourselves to Death: Public Discourse in the Age of Show Business – Neil Postman
As the phrase goes, if you are not paying for it, you are not the customer, you are the product. Perhaps Mark Zuckerberg’s greatest insight was that the human desire to be “liked” was so strong that Facebook’s users would create all the content on the site for free.
The Internet’s self-curated view from everywhere has the amazing ability to distract us in trivial pursuits, narrow our choices, and keep us safe in a balkanized suburb of our own taste. Search engines and recommendation engines constantly favor the most popular options
and constantly make our discovery more limited.
[The modern Western economist] is used to measuring the “standard of living” by the amount of annual consumption, assuming all the time that a man who consumes more is “better off” than a man who consumes less. A Buddhist economist would consider this approach excessively irrational: since consumption is merely a means to human wellbeing, the aim should be to obtain the maximum of well-being with the minimum of consumption. Small is Beautiful: Economics as if People Mattered – E. F. Schumacher
