Farnam Street
Mastering the best of what other people have already figured out
We automatically connect a stimulus (thing/person) with pain (fear) or pleasure (hope). As pleasure seeking animals, we seek out positive associations and attempt to remove negative ones. This happens …
Mental models are tools for the mind. In his talk: Academic Economics: Strengths and Weaknesses, after Considering Interdisciplinary Needs, at the University of California at Santa Barbara, in 2003, …
Becoming a better thinker means understanding the way you think and developing a way of approaching problems that allows you to see things from multiple lenses. These lenses, or mental models, are …
It’s one thing to set big stretch goals. It’s another thing entirely to acknowledge the tension and incentives they create within an organization. Charlie Munger, speaking at the 2000 …
The most powerful skill we’re never taught is deciding what to ignore. Someone who can concentrate on what truly matters will achieve more than someone who can’t. When everything seems …
In The Art of War, Sun Tzu said: “The general who wins a battle makes many calculations in his temple before the battle is fought.” Those ‘calculations’ are the tools we have available to …
“No mind, however dull, can escape the brightness that comes from steady application.” *** In several of his speeches, Charlie Munger has referred to Sir William Osler, the Canadian …
One of the five simple notions to solve problems is the concept of inversion. To solve problems we need to look at them both forward and backward. But how does this look in practice? Let me give you …
In 1996, Charlie Munger gave a talk titled Practical Thought about Practical Thought, where he explained the success of Coca-Cola using the simplest, most fundamental mental models he could find. …
In my whole life, I have known no wise people (over a broad subject matter area) who didn’t read all the time—none. Zero. You’d be amazed at how much Warren reads—and how much I read. My …
Berkshire Hathaway is widely regarded as one of the most successful companies in the world. If you look at Warren Buffett’s 49 year track record with Berkshire, it almost looks easy in hindsight. Make …
Why do partnerships work well? That’s the question Michael Eisner explores in Working Together: Why Great Partnerships Succeed. Some of the most successful and accomplished people are really …
When it comes to making decisions, your environment matters. Just as it’s hard to eat healthily if your kitchen is full of junk food, it’s hard to make good decisions when you’re too …
Understanding where you have an edge and where you don’t can help you prevent problems, spot opportunities others miss, and rapidly learn. We all have a circle of competence – an area in …
During a recent interview Warren Buffett and Charlie Munger had some interesting comments on how to outsmart people who are smarter than you. Munger: We’ve learned how to outsmart people who are …
Iatrogenics is when a treatment causes more harm than benefit. As iatros means healer in Greek, the word means “caused by the healer” or “brought by the healer.” Healer, in …