Books

1. Thinking, Fast and Slow (4.1*) _24-Apr

On the first look, the book looked like a pillow, very thick, containing more than 450 pages. Upon a good review by friends, I decided to delve in. I must admit that it is very dry, hard to read kind of a book. It is similar to reading a research paper, need to devote my entire attention (System-2). No illustrative images/tables, like walking on bare foot in a hot summer. This made me to prgress very slow, consuming a lot of weeks/months.

There are many “Aaha” moments, they made me reflect on myself as a decision maker, made me realize my irrational choices. There are pleanty of examples that provoke curiosity and put us in shame because of the cognitive error that one makes. From the following example, choose any one of them:

Option-A

Would you accept a gamble that offers a 10% chance to win $95 and a 90% chance to lose $5?

Option-B

Would you pay $5 to participate in a lottery that offers a 10% chance to win $100 and a 90% chance to win nothing?

For a rational mind, both options are the same. But most of the people in the survey preferred option B, because it is framed positive. We might think that such trivial decisions won’t have huge impact on life as a total.

For instance, if the person is in the position of choosing between having the surgery OR to seek alternative less promising approach, the following statements have different outcome even though they mean the same. Writing-A

The one month survival rate is 90%.

Writing-B

There is 10% mortality in the first month.

One scares us, while the other gives us hope. Of course majority of the people chose hope (Writing-A). This is also a trick used by advertisement agencies to manipulate people.

Overall, the book is indeed a gem, which changes the perspective of how we understand the world!

2. Six Thinking Hats (3.5*) _20-Jun

When a human starts thinking, usually all categories of information are poured in. They are put forward (in a meeting) without further filtering. The author suggests categorizing them and focusing on one category at a time. This technique specifically directs the energy in one direction for a better outcome.

Blue Hat: The color of the sky.
Sky is above everything else, it is meant to control the whole process. Blue hat can be used at the beginning of the meeting to share the agenda and expectations for the meeting. And also, at the end, to share the conclusion derived from the meeting. It can also be used as a control mechanism to ask the participants to stick to the current hat.

White Hat: Neutral and objective.
Just like a white paper, only the facts and figures. Nothing else.

E.g: Last year there was 25% decrease in the meat sale because people are more health concerned.

In the above example, the first part of the 25% decrease in sales is the fact, which fits for the white hat. The second part of people buying less meat because they are health-conscious is interpretation, so it should not fall under the white hat.

Red Hat: Danger, Emotion.
Under this hat, people can bring their emotional views to the table. More importantly, there is no need to offer justification for why people feel that way. These emotions should also be a part of the decision-making process, as they might change the way people think.

My red hat feeling tells me that we are being bullied into an agreement that we do not want.

Black Hat: Negativity.
Spot out the weaknesses in the ideas logically. Critics are most welcome here, but with supporting logic.

Your conclusion doesn’t follow what you have been telling us.

Yellow Hat: Sunshine, positivity.
Optimism, making things happen, hope, proposals and suggestions.

There is abundant water in the mountains 50 miles away. Wouls it be feasible to put in a pipeline?

Green Hat: Green, Vegetation, Creativity.
New ideas, new perception. Allocate specific time to be creative to solve the problem. It is fine, if no creative idea comes up. But it is very important to allocate the time to be creative.

Cars should have square wheels.
Shoppers usually pay for the goods they buy. Lets reverse that. The store pays the customer.

They provide a good framework for a better decision making. Looking forward to using it in day-to-day life.

3. Mindset - Changing The Way You think To Fulfil Your Potential (2*) _26-Sep

This book has more critics than the actual positive contribution imo. Throughout the book, I could see the sickness of attributing good things to the positive mindset and bad things to the negative mindset. An event took place in the past, the outcome is negative, the event is tagged as fixed mindset. Looking at the past and saying things is a no brainer. A 10th grader can do that job even better.

Fixed mindset examples: Enron company which went bankrupt, Bobby Knight, Billy Beane
Growth mindset examples: Pete Sampras, Jackie Joyner Kersee, Michael Jordan

Take any random page, the sickness can be seen. Imo it is fine to propagate something that is positive, but attributing it to that past event and claiming that “because person X had the growth mindset, he/she achieved it” is wrong. There are plenty of other factors that lead to the success of the person, which might be more important.

One example from the book:

When Benjamin Bloom studied his 120 world-class concert pianists, sculptors, swimmers, tennis players, mathematicians, and research neurologists, he found something fascinating. For most of them, their first teachers were incredibly warm and accepting.

And the author goes on explaining things.

I’m very uncomfortable with such studies because of the following reasons:

1. The sample size is very small, which leads to error prone results.
2. There is no control group involved where any comparison shall be made.
   E.g: The researcher should have taken into consideration other world class people for whom the first teacher was not incredible such as Albert Einstein, etc.
3. These kinds of results are not guaranteed to be repeatable.
   E.g: Take 2000 people, let 1000 people be allocated to a control group, to which only average teachers are sent. The remaining 1000 people are the experimental group, to which the incredibly warm teachers are sent only as their first teacher and later on average teachers sent. Fast forward 25 years, will there be a significant difference between the two groups? I guess not (strongly).
4. Or even the researcher is measuring just random stuff.

I can also make such research statements. My holy statement is as follows “I have observed all the top 500 CEOs ever lived on the planet and found something fascinating. All wear black shoe and blue tie.”

My statement and the researcher’s statement are the same if you are a rational person.

1. Both have small sample sizes.
2. Both didn’t study the effect of not doing it the suggested way (no control group).
3. Both results are likely not repeatable.
4. Both measured random stuff.

I’m still better, because the researcher has spent much time and money to come up with that statement and it took only a minute for me.

Another thing with the book is that the people discussed in the book are more American oriented. Baseball, Basketball, Tennis, etc. It is not easy to grasp the context for me, because I’m not familiar with that field.

Why 2 stars for the book and not 0 stars?
The main juice of that book (as I understand) is that human potential can be developed by training. We don’t have to limit ourselves with something called inborn talent. This takeaway is very valuable imo.

4.Poor Charlie’s Almanack (2.2*) _13-Nov

Started reading it as Mr.Pabrai has recommended this book. It is a hard read for me. THe language, the content, everything was too high to grasp. The impression is that Mr.Munger was a very active person through his life, a learning machine, a strict father/teacher demanding stuff rather than requesting it.

Goods:
He stresses about the importance of multidisciplinary curriculum in the universities. The interplay of various forces will result in some consequence. If a person only knows stuff from one discipline, he/she can’t really understand the whole picture.

Psychology is another field where people didn’t pay much attention to. Indeed it should be taught at the elementary level, because this is mandatory to all. The following are my big takeaways:

• Always reverse Seek for the opposite effect to evaluate a theory/decision.
• Multi disciplinary Learn from other departments.
• Trustworthiness The highest skill one should aim for.

Critics:
Choice of language:
The language used is very hard to understand. There are places where a sentence spans 6 lines, for sure it is not for a small brainer like me. They make the book a poor reading. E.g: The following sentence from page 109

There’s nothing I said then that I wouldn’t repeat today.

The double negation word makes the brain wander around. It would be much easier for reading if it was something like this

I’ll repeat only what I said then.

No brainers:
Page 156 explains about making a billion dollar company into a trillion dollar company. The example Mr.Munger used is Coca Cola company. Imo, it was a mature company when he made that comment. A 10th grader would do such calculations, no expertise is needed.

Page 351, he talks about having a check list would have prevented losses for McDonnell Douglas flight. But it is no brainer to look at the past and tell “please use my checklist”. Challenge would be to prevent future failures with good accuracy.

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