Poor Charlie’s Almanack: The Essential Wit and Wisdom of Charles T. Munger

Especially important examples of these models include the redundancy and backup system models from engineering; the compound interest model from mathematics; the breakpoint, tipping moment, and autocatalysis models from physics and chemistry; the modern Darwinian synthesis model from biology; and cognitive misjudgment models from psychology.

Demosthenes, parsed out, was thus saying that man displays not only simple, pain-avoiding psychological denial but also an excess of optimism, even when he is already doing well.

What Keynes was reporting is that the human mind works a lot like the human egg. When one sperm gets into a human egg, there’s an automatic shut-off device that bars any other sperm from getting in. The human mind tends strongly toward the same sort of result. And so, people tend to accumulate large mental holdings of fixed conclusions and attitude

1. ignore virtues in the object of dislike; 2) dislike people, products, and actions merely associated with the object of his dislike; and 3) distort other facts to facilitate hatred.

knew, bad behavior is intensely habit-forming when it is rewarded.

reward. For instance, some people use money to buy status, and others use status to get money, while still others sort of do both things at the same time.

Granny’s rule, to be specific, is the requirement that children eat their carrots before they get dessert. The business version requires that executives force themselves daily to first do their unpleasant and necessary tasks before rewarding themselves by proceeding to their pleasant tasks.

The brain of man conserves programming space by being reluctant to change, which is a form of inconsistency avoidance.

Another generalized consequence of incentive-caused bias is that man tends to game all human systems, often displaying great ingenuity in wrongly serving himself at the expense of others. Anti-gaming features, therefore, constitute a huge and necessary part of almost all system design.