Farnam Street
Mastering the best of what other people have already figured out
When we don’t think about the process we use to make decisions, they tend to get worse over time as we fail to learn from experience. Often, we make decisions based on the information that is easiest to access. Let’s learn how to take the …
Below find an excerpt taken from an interview between Raoul Pal and Kyle Bass (a hedge fund manager based out of Texas.) What resonates with me here is the need to find a way out of a world where we are pulled in a thousand different …
Seymour Schulich, one of Canada’s most successful businessmen and author of Get Smarter: Life and Business Lessons offers some indispensable business wisdom. Business is a means to an end not an end in itself. Nobody on his or her …
Aristotle talked about three kinds of work: theoretical, practical, and poetical. The first searches for truth. The second is practical with an objective around action. The third, however, is lost in our modern culture. The philosopher …
The first chapter in Seymour Schulich‘s book, Get Smarter: Life and Business Lessons, offers a decision tool that adds to the simple pro-and-con list that many of us have used to make decisions. Schulich, a self-made billionaire, is …
Checklists establish a higher level of baseline performance. *** A helpful reminder from Atul Gawande in The Checklist Manifesto: In a complex environment, experts are up against two main difficulties. The first is the fallibility of human …
While I’m not all that interested in military doctrine and tactics in and of themselves, I am interested in complex systems, how the weak win wars, and the lessons military leaders offer (for example, see the lessons of William …
I thought this excerpt from Warren Buffett’s 2011 interview in India was relevant to not only investing but also decision making. A member of the audience says to Buffett: “As we all know, you are an extremely intelligent …
Ruth Chang is a philosopher at Rutgers University with an interesting background. After graduating with a J.D. from Harvard Law School and dipping her toe into the legal world, she went off to Oxford University to study philosophy. Her work …
“In an uncertain world, statistical thinking and risk communication alone are not sufficient. Good rules of thumb are essential for good decisions.” *** Three minutes after taking off from LaGuardia airport in New York City, US …
We all try to avoid uncertainty, even if it means being wrong. We take comfort in certainty, and we demand it of others, even when we know it’s impossible. Gerd Gigerenzer argues in Risk Savvy: How to Make Good Decisions that life …
A bit of a preface to this post. Please read the definition of Antifragile first. While the article below is interesting, the reader should read with a critical mind. Complexity ‘solved’ with increased complexity generally only …
“The indeterminate future is somehow one in which probability and statistics are the dominant modalities for making sense of the world.” *** Decisions, where outcomes (and therefore probabilities) are unknown, are often the …
You’ve been here before. It’s Monday morning and you walk into the office only to have your boss call an urgent meeting to “streamline processes.” You haven’t thought about this enough to have an opinion but …
Most of the time we devise strategies in the default mode of problem-solving, prioritizing maximum growth and profit through rational and logical analysis. But we already know that rational and logical analysis doesn’t always result …
We see what’s visible and available. Often this is nothing more than randomness and yet we wrap a narrative around it. The trader who is rich must know what he is doing. A good outcome means we made the right decisions, right? Not so …
One of the strangest things about being human is that we can’t trust our own memories of what we were thinking. Not because we forget but rather because our brains actively edit the past to make us look better and smarter. This …
Picture this: You’re six months into your company’s ambitious expansion, and what seemed like a sure bet has turned into a nightmare. The market wasn’t just ok—it was poor. You made a big mistake. Your team is demoralized, …
When we look at situations we’re always looking for what’s unique. We should, however, give more thought to similarities. “This time is different” could be the 4 most costly words ever spoken. It’s not the …
I recently picked up Sophocles’s Antigone. Sophocles wrote more than 100 plays in his lifetime, but only seven complete tragedies remain. In Antigone, Polynices, son of Oedipus, went to war with his brother, Eteocles, the ruler of …
The first category of ignorance is when we do not know we are ignorant. This is primary ignorance. The second category of ignorance is when we recognize our ignorance. *** This article builds on Decisions Under Uncertainty. In fact, …
Knowledge workers often think they produce emails (and meetings), but this misses something fundamental. As Nobel Laureate Daniel Kahneman explained to journalist Jason Zweig, what knowledge workers really produce are decisions. The quality …
If you’re a knowledge worker you make decisions every day. In fact, whether you realize it or not, decisions are your job. Decisions are how you make a living. Of course, not every decision is easy. Decisions tend to fall into …
The more information you gather before making a decision, the more likely you are to make a poor choice. Sound crazy? Keep reading. The Raw Truth About Information Overload We’ve all been there: tabs open everywhere, endless research, …