Charlie Munger has been the biggest COGNITIVE INFLUENCE on my life so far.
Here are a list of my favourite PRINCIPLES from the eccentric billionaire.
“It is remarkable how much long-term advantage people like us have gotten by trying to be consistently not stupid, instead of trying to be very intelligent.”
Avoiding stupidity is easier than seeking excellence, yet nobody does it.
1. Avoid being lazy
2. Avoid being unreliable
No matter how connected, well-read or talented you are – if you don’t avoid these two, you are destined to fail.
Most gurus would respond with « Follow your passion » or « Find your why »
Munger quipped back:
« Don’t do cocaine. Don’t race trains to the track. And avoid all AIDS situations. »
Instead of asking « How do I become happy? »
Ask, « How do I become depressed? »
1. Poor sleep
2. Shit diet
3. Meaningless work
4. No exercise
5. Boring friends
Avoid those 5 and you’ve figured out 95% of hapiness.
“It’s much easier to decode life when you view events as an emerging property of underlying systems” – @danielgross
And all human systems can be explained by ONE THING – Incentives.
It was « Impossible ».
One day they decided to pay workers by the SHIFT instead of by the HOUR.
Miraculously, they never had the problem again.
« If you have a dumb incentive system, you get a dumb outcome » – Munger
What you shout out to other people, you pound into your own psyche.
Your identity is a proxy between your consciousness and reality.
Identity distorts your sense making apparatus.
The biggest danger of mental models is that you begin to identify as a « smart person who understands cognitive biases »
This is the ultimate trojan horse.
If you can’t make mistakes, you can’t iterate.
If you can’t iterate, you can’t win.
Ironically, identifying publicly as an idiot frees you.
(PS. I’m not smart – I’m a moron.)
The desire to identify how successful and happy you are to others is the thing that prevents you from being successful and happy.
You can’t present an image of you as an expert and co-exist in begginers mind at the same time.
Charlie never allows himself to have an opinion on a subject unless he can state the opposing argument better than the opposition can.
Don’t create STRAW MAN arguments, create STEEL MAN arguments.
In every debate, be like @BretWeinstein moderating @SamHarrisOrg & @jordanbpeterson.
State the strengths of your opposition and the weakness of your own.
You either prove your theory correct or end up with a better idea. Win-Win.
STRAW MANNING is Fragile.
You spend years emotionally attached to the first idea that got in your head. Lose-Lose.
« The safest way to get what you want is to earn what you want » – Munger
(How to find a romantic partner?) – « Be worthy of a worthy mate » – Munger
The ultimate cheat code to life is to realise that there are no cheat codes.
“Knowing what you don’t know is more useful than being brilliant.” – Munger
“Acknowledging what you don’t know is the dawning of wisdom.” – Munger
I then sink into panic and think about subjects I have confident opinions in yet no experience.
The Dunning-Kruger effect can only be seen in others.
MUNGERS LAW #7 – AVOID SELF PITY
« Whenever you think that some situation or some person is ruining your life, it’s actually you who are ruining your life. It’s such a simple idea. Feeling like a victim is a disastrous way to make go through life. » – Munger
Whenever this friend heard someone feel sorry for themselves, he would sarcastically give them one that read:
“Your story has touched my heart, never have I heard of anyone with as many misfortunes as you”.
Then I did a bit of research into Charlie’s life…
Shortly after the divorce, he found out his 9 year old son Teddy had leukemia.
Charlie spent his remaining pennies paying for his son’s medical bills…
At the age of 30, Charlie Munger was:
3. Burying his dead child
He had every excuse to give into self pity.
We live in a better place because he didn’t.
Charlie’s NUMBER ONE hobby is reading.
This news should’ve DESTROYED him.
How did he respond?
“It’s an opportunity for me to learn braille.” – Charlie told friends.
The ultimate reframe
1. Avoid sloth and unreliability
2. Incentives are a superpower
3. Be careful with your identity
4. Steelman arguments
5. Be worthy of a worthy mate
6. Dunning-Kruger effect is easier to see in others
7. Where is the opportunity for you to learn braile?