9 Simple Statements That Will Make You Think Differently About the World

A few smart sentences can change the way you think. Here are a few I read recently that got my mind twirling. 

First, Microsoft researcher Duncan Watts writes in his book Everything is Obvious (Once You Know the Answer) how deceiving common sense can be:

That what is self-evident to one person can be seen as silly by another should give us pause about the reliability of common sense as a basis for understanding the world. How can we be confident that what we believe is right when someone else feels equally strongly that it's wrong—especially when we can't articulate why we think we're right in the first place? Of course, we can always write them off as crazy or ignorant or something and therefore not worth paying attention to. But once you go down that road, it gets increasingly hard to account for why we ourselves believe what we do. Consider, for example, that since 1996 support among the general public for allowing same-sex couples to marry has almost doubled, from 25 percent to 45 percent. Presumably those of us who changed our minds over this period do not think that we were crazy fourteen years ago, but we obviously think that we were wrong. So if something that seemed so obvious turned out to be wrong, what else that we believe to be self-evident now will seem wrong to us in the future?

Common sense often seems right because we can't imagine thinking about a problem differently, and the reason we can't think about it differently is because we're emotional and closed-minded. It's one of the most dangerous ways of thinking.

Next, author Daniel Goleman writes in his book Focus: The hidden Driver of Excellence about the importance of personality:

Physicians who are sued for malpractice in the United States generally make no more medical errors than those who are not sued. The main difference, research shows, often comes down to the tenor of the doctor-patient relationship. Those who are sued, it turns out, have fewer signs of emotional rapport: they have shorter visits with patients, fail to ask about the patients' concerns or make sure their questions are answered, and have more emotional distance— there's little or no laughter, for example.

I wish they'd teach in school that if you're a jerk and can't work with people, it doesn't matter how smart or talented you are; you're probably going to fail.

Next, Cambridge economist Ha-Joon Chang throws the popular minimum-wage debate on its head:

Wages in rich countries are determined more by immigration control than anything else, including any minimum wage legislation. How is the immigration maximum determined? Not by the 'free' labor market, which, if left alone, will end up replacing 80– 90 per cent of native workers with cheaper, and often more productive, immigrants. Immigration is largely settled by politics ... If the same market can be perceived to have varying degrees of freedom by different people, there is really no objective way to define how free that market is. In other words, the free market is an illusion. If some markets look free, it is only because we so totally accept the regulations that are propping them up that they become invisible.

Most things we argue about in the economy are presented as black and white, but they're almost always some shade of grey. If you zoom out and look at the big picture, people probably agree on more than appears on the surface.

Next, in the book 100 Plus: How the Coming Age of Longevity Will Change Everything, Sonia Arrison writes about how fast the world is changing:

The historical record shows that the distribution of new technology is speeding up, not slowing down. In the book Myths of Rich and Poor, economist Michael Cox and author Richard Alm note that it took forty-six years for one-quarter of the population to get electricity and thirty-five years for the telephone to get that far. It took only sixteen years, however, for one-quarter of American households to get a personal computer, thirteen years for a cell phone, and seven years for Internet access."

The faster things change, the less reliable forecasts are. We really have no idea what the world is going to look like in 10 years – or even five years -- because things that will have the biggest impact probably haven't been invented yet.

Next, Nassim Taleb writes in his book Antifragile why we're so bad at thinking about risk:

Risk management professionals look in the past for information on the so-called worst-case scenario and use it to estimate future risks— this method is called "stress testing." They take the worst historical recession, the worst war, the worst historical move in interest rates, or the worst point in unemployment as an exact estimate for the worst future outcome. But they never notice the following inconsistency: this so-called worst-case event, when it happened, exceeded the worst case at the time. I have called this mental defect the Lucretius problem, after the Latin poetic philosopher who wrote that the fool believes that the tallest mountain in the world will be equal to the tallest one he has observed. We consider the biggest object of any kind that we have seen in our lives or hear about as the largest item that can possibly exist. And we have been doing this for millennia. In Pharaonic Egypt, which happens to be the first complete top-down nation-state managed by bureaucrats, scribes tracked the high-water mark of the Nile and used it as an estimate for a future worst-case scenario.

According to Nate Silver, the Fukushima nuclear reactor was designed to withstand a magnitude 8.6 earthquake, because that's what seismologists thought was the largest possible quake that could hit the region. Then came the 9.1 earthquake in 2011. Most things in life work well with a large margin of error.

Next, Scott Adams writes in his book How to Fail at Almost Anything and Still Win:

A person with a flexible schedule and average resources will be happier than a rich person who has everything except a flexible schedule. Step one in your search for happiness is to continually work toward having control of your schedule.

Having control of your time is the only reasonable financial goal.

Next, Joshua Foer writes in his book Moonwalking with Einstein:

People have been swimming for as long as people have been getting neck-deep in water. You'd think that as a species, we'd have maxed out how fast we could swim long ago. And yet new swimming records are set every year. Humans keep getting faster and faster. "Olympic swimmers from early this century would not even qualify for swim teams at competitive high schools," notes Ericsson. Likewise, "the gold medal performance at the original Olympic marathon is regularly attained by amateurs just to qualify as a participant in the Boston Marathon." And the same is true not just of athletic pursuits, but in virtually every field. The thirteenth-century philosopher Roger Bacon claimed that "nobody can obtain to proficiency in the science of mathematics by the method hitherto known unless he devotes to its study thirty or forty years." Today, the entire body of mathematics known to Bacon is now acquired by your average high school junior.

Skills grow just like compound interest, with one generation leveraging the talents of the last. Pessimists should keep this in mind.

Next, Elliot Aronson and Carol Tavris write in their book Mistakes Were Made (But Not by Me):

The brain is designed with blind spots, and one of its cleverest tricks is to confer on us the comforting delusion that we, personally, do not have any ... Social psychologist Lee Ross calls this phenomenon "naïve realism," the inescapable conviction that we perceive objects and events clearly, "as they really are." We assume that other reasonable people see things the same way we do. If they disagree with us, they obviously aren't seeing clearly. Naïve realism creates a logical labyrinth because it presupposes two things: One, people who are open-minded and fair ought to agree with a reasonable opinion. And two, any opinion I hold must be reasonable; if it weren't, I wouldn't hold it. Therefore, if I can just get my opponents to sit down here and listen to me, so I can tell them how things really are, they will agree with me. And if they don't, it must be because they are biased.

A lot of people enjoy reading about behavioral finance, and all the ways people can be stupid with money, but fail to realize they're reading about themselves.

Last, here's Sam Arbesman in his book The Half-life of Facts:

Two Australian surgeons found that half of the facts in that field also become false every forty-five years. As the French scientists noted, all of these results verify the first half of a well-known medical aphorism by John Hughlings Jackson, a British neurologist in the nineteenth and early twentieth centuries: "It takes 50 years to get a wrong idea out of medicine, and 100 years a right one into medicine." ... Max Plank codified this in a maxim: "New scientific truth does not triumph by convincing its opponents and making them see the light, but rather because its opponents eventually die, and a new generation grows up that is familiar with it."

Even when you get the facts right, you're still probably half wrong.

Food for thought.

Check back every Tuesday and Friday for Morgan Housel's columns on finance and economics. 

Looking for stock ideas?
Great. Andy Cross, The Motley Fool's chief investment officer, has selected his best stock idea for the year ahead. Find out which stock it is in our free report, "The Motley Fool's Top Stock for 2014." Just click here


Read/Post Comments (12) | Recommend This Article (81)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On May 13, 2014, at 1:27 PM, indukuri007 wrote:

    Morgan,

    Thank you for such well curated reading material !!

  • Report this Comment On May 13, 2014, at 7:32 PM, irvingfisher wrote:

    I find it shocking that aronson and tarvis were writing about me because I don't even know them!

    "any opinion I hold must be reasonable; if it weren't, I wouldn't hold it. [...] my opponents to sit down here and listen to me, so I can tell them how things really are, they will agree with me. And if they don't, it must be because they are biased."

    so true, so true.

  • Report this Comment On May 14, 2014, at 12:33 PM, MaxPower13 wrote:

    Morgan, fantastic stuff as always.

    I'd just like to clarify one common misconception regarding the Fukushima nuclear disaster. The reactors actually withstood the earthquake. The problem was the seawall was not high enough to protect against the ensuing tsunami. Once the emergency generators were flooded, the reactors were doomed.

  • Report this Comment On May 14, 2014, at 1:13 PM, TMFHousel wrote:

    Thanks Max, although my understanding is that the two were tied together: the model for how large a tsunami could hit the region was derived from the model of the largest assumed earthquake.

    -Morgan

  • Report this Comment On May 14, 2014, at 8:18 PM, cooncreekcrawler wrote:

    Very nice work, Morgan. I resemble some of those remarks.

  • Report this Comment On May 14, 2014, at 9:21 PM, devoish wrote:

    I think Sam Aberson in 'The Half Life of Facts' better describes what happened in the paragraph you referenced from Duncan Watts book concerning acceptance of homosexual marriage. It was probably as much, or even more, about old attitudes dying off as it was about changing minds.

    Of course as Elliot Aronson and Carol Tavris suggest reasonable people can look at the same facts and reach different conclusions. But I think we are more often exposed to people who spin or select the facts in their communications in order to sell.

    Best wishes,

    Steven Cecchini

  • Report this Comment On May 15, 2014, at 12:06 PM, SkepikI wrote:

    Most amusing, Housel. Somewhat educational, and fascinating. You might consider adding this to your list:

    We persist in according the quality of "truth" to academic studies and observations, particularly those of students and teachers of economics. We do this most often with little skepticism and almost NO qualification of the quality of the study or work. We rarely look backwards to determine the accuracy of these works with decades of experience that either contradict the conclusions or call them into question. Thus we get four or five decades of believing that saturated fats are bad for us and then have trouble believing the work that shows the original study that concluded this is flawed. We then will be annoyed and flummoxed when some new study shows them to be good for you.

    This also explains why one can simultaneously believe mythological and superstitious things while maintaining that science and academics are the definitive answer......

  • Report this Comment On May 15, 2014, at 8:21 PM, hbofbyu wrote:

    "...so if something that seemed so obvious turned out to be wrong, what else that we believe to be self-evident now will seem wrong to us in the future?"

    I think western culture has a misconception that "truth" is absolute and unchanging. Like the law of gravity or Planck's constant. "Truth" is what agrees with "reality" (whatever that is) and the reality was that 14 years ago most people were uncomfortable with gay marriage. Change can't happen in an instance lest we tear the fabric of tradition (continuity) and history that holds us together.

    How about this quote:

    "Tell all the truth but tell it slant —

    Success in circuit lies

    Too bright for our infirm delight

    The truth's superb surprise

    As lightning to the child is eased

    With an explanation kind

    The truth must dazzle gradually

    Or every man be blind —"

    Thanks Morgan, I always look forward to your articles. (the quote was from Emily Dickinson)

  • Report this Comment On May 16, 2014, at 12:01 AM, SuntanIronMan wrote:

    Great read as always Mr. Housel.

  • Report this Comment On May 16, 2014, at 9:24 AM, SPARTANBURG wrote:

    I am with Fool since 2006. I assumed that I am in the service for investment advice. I will stay because the communication I have with you guys goes vastly beyond investment and touches every aspect of life.

    As always, I am Foolishly impressed

  • Report this Comment On May 16, 2014, at 3:32 PM, EricHawman wrote:

    What strikes me about skills increasing is that it seems asymptotic: Olypic athletes do better now, but performance increases are slower, and likewise those at lower levels of competition. I would not be surprised to see ordinary skill levels levelling off at some point without radical change, such as cybernetic augmentation.

    About personal bias: it can be galling to find one was wrong, but what sticks out are more often the cases where "I told you so!", where you were right but couldn't convince people of it.

    Wages being determined by immigration gives conservatives/anti-immigration libertarians more strength.

    "The Half-Life of Facts" sounds like a must read, but until I get a copy, I can only think that some "facts" being mentioned are more on the order of "preferences", which are widely known to have short half-lives.

  • Report this Comment On May 17, 2014, at 9:00 AM, KayakerRW wrote:

    Morgan,

    Again, another thought provoking article. As a teacher, I agree with your wish that “they'd teach in school that if you're a jerk and can't work with people, it doesn't matter how smart or talented you are; you're probably going to fail.”

    I think many schools and teachers at least try to do that, but in our current standardized test driven environment, it’s harder to do. When my school was creating a program with a class where students worked together on projects, we constantly heard, “my kid doesn’t need this” or “why should my ‘smarter than most’ kid have to help ‘dumber’ kids” (a slight paraphrase there). Also, getting a typical teenage jerk to realize they’re a jerk can take years, by which time they are an adult and have their own cable or talk radio show.

    As a teacher, I spend more time on having students talk, write, and think about their biases and perceptions along the lines of Aronson’s and Travis’ idea that “ any opinion I hold must be reasonable; if it weren't, I wouldn't hold it.”

    Unfortunately, partly for testing purposes, schools are focused on teaching argumentation. Most standardized “writing tests” judge how well a student can state an argument, then defend it with a few references to the “other side” just to show how it’s wrong. Whether or not the information is right or subject to perception doesn’t matter, as long as it’s consistent and supports the argument, so students are not encouraged to examine multiple viewpoints and experiences and consider how their own experiences, perceptions, and biases influence their opinions and beliefs.

    I spend a lot of time having students examine multiple viewpoints and think about their own thinking, including trying to find modern parallels to past beliefs that we now see as “unreasonable.”

    It does pay off sometimes. I’ll close with a quote from a graduation speech from a senior well-known for arguing vehemently with classmates and teachers, who finally realized near the end of my class that the “individual that values my opinions above anyone else’s… is me! [but] maybe I don’t know everything. . .. The ability to question is a virtue. But you shouldn’t question because you think you’re right, you should question so that you might be proven wrong.”

Add your comment.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2955523, ~/Articles/ArticleHandler.aspx, 12/20/2014 6:54:34 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement