Friday, September 25, 2009

Is Thinking Back in Fashion?

According to Terry (and Berkshire-Hathaway vice-chariman Charlie Munger, among others), the answer lies in the classics. Why the classics? First, to gather a broad base of knowledge about the "big ideas" across all the major academic disciplines. And second, to develop the ways of thinking and the "habit of wisdom" Aristotle believed were critical to good decision-making. 

 

Munger is apparently well known for his belief that good decision-making--including good investment decision-making--comes from having a "lattice-work of frameworks" with which to approach a subject. If, for example, you can compare how a historian, economist, psychologist and probability theorist would look at a given situation, you can see it more clearly--including angles or weaknesses one discipline alone might miss. And as a result, you're likely to make better decisions about what to do or where to head next. 

 

Of course, "accumulating a broad knowledge base of all the major academic disciplines" isn't exactly a three-hour task you whip out over a long weekend. Fortunately, for anyone so inclined, there's Peter Bevelin. Bevelin, a businessman and investor, wanted to reduce the number of bad decisions he made in his business life. Ddrawn to Munger's approach, he took a year off just to read and study the big ideas in all the major disciplines. Bevelin's book, Seeking Wisdom: From Darwin to Munger, is the synthesis of the notes he took over that year. It's not easy or quick reading (and copies are a bit hard to find), but it's a far shorter path than doing all the original research yourself. 

 

http://correspondents.theatlantic.com/lane_wallace/2009/06/is_thinking_back_in_fashion.php