A few smart sentences can change the way you think. Here are a few I read recently that got my mind twirling.
In his book Sapiens: A Brief History of Humankind, Yuval Harari writes that human's quick evolution left us insecure:
As lions became deadlier, so gazelles evolved to run faster, hyenas to cooperate better, and rhinoceroses to be more bad-tempered. In contrast, humankind ascended to the top so quickly that the ecosystem was not given time to adjust. Moreover, humans themselves failed to adjust. Most top predators of the planet are majestic creatures. Millions of years of dominion have filled them with self-confidence. Sapiens by contrast is more like a banana republic dictator. Having so recently been one of the underdogs of the savannah, we are full of fears and anxieties over our position, which makes us doubly cruel and dangerous. Many historical calamities, from deadly wars to ecological catastrophes, have resulted from this over-hasty jump.
This gets to what investor Barry Rithotlz says:
You're a monkey. It all comes down to that. You are a slightly clever, pants-wearing primate. If you forget that you're nothing more than a monkey who has been fashioned by eons on the plains, being chased by tigers, you shouldn't invest. You have to be aware of how your own psychology affects what you do.
In his biography of Elon Musk, Ashlee Vance shows how Musk is able to innovate at a fraction of the cost of competitors:
SpaceX needed an actuator that would trigger the gimbal action used to steer the upper stage of Falcon 1. Davis had never built a piece of hardware before in his life and naturally went out to find some suppliers who could make an electromechanical actuator for him. He got a quote back for $120,000. "Elon laughed," Davis said. "He said, 'That part is no more complicated than a garage door opener. Your budget is five thousand dollars. Go make it work.'" Davis spent nine months building the actuator. At the end of the process, he toiled for three hours writing an email to Musk covering the pros and cons of the device. The email went into gory detail about how Davis had designed the part, why he had made various choices, and what its cost would be. As he pressed send, Davis felt anxiety surge through his body knowing that he'd given his all for almost a year to do something an engineer at another aerospace company would not even attempt. Musk rewarded all of this toil and angst with one of his standard responses. He wrote back, "Ok." The actuator Davis designed ended up costing $3,900 and flew with Falcon 1 into space.
The whole book is filled with similar examples. It makes you realize why some companies are astronomically more successful than others; they start with a completely different framework of thinking through problems.
In his book At Home: A Short History of Private Life, Bill Bryson writes that life used to be so miserable that no one even tried to make things better:
It really is extraordinary how long it took people to achieve even the most elemental levels of comfort. There was one good reason for it: life was tough. Throughout the Middle Ages, a good deal of every life was devoted simply to surviving. Famine was common. The medieval world was a world without reserves; when harvests were poor, as they were about one year in four on average, hunger was immediate. When crops failed altogether, starvation inevitably followed. England suffered especially catastrophic harvests in 1272, 1277, 1283, 1292, and 1311, and then an unrelievedly murderous stretch from 1315 to 1319. And this was of course on top of plagues and other illnesses that swept away millions. People condemned to short lives and chronic hardship are perhaps unlikely to worry overmuch about decor. But even allowing for all that, there was just a great, strange slowness to strive for even modest levels of comfort. Roof holes, for instance, let smoke escape, but they also let in rain and drafts until somebody finally, belatedly invented a lantern structure with louvered slats that allowed smoke to escape but kept out rain, birds, and wind.
Key to having a good life is understanding why everything is amazing and no one is happy.
In his biography of the Wright Brothers, David McCullough writes how Wilbur and Orville balanced risk and innovation:
Wilbur stressed that he did not intend to rise many feet from the ground, and on the chance that he were "upset," there was nothing but soft sand on which to land. He was there to learn, not to take chances for thrills. "The man who wishes to keep at the problem long enough to really learn anything positively must not take dangerous risks. Carelessness and overconfidence are usually more dangerous than deliberately accepted risks." As time would show, caution and close attention to all advance preparations were to be the rule for the brothers. They would take risks when necessary, but they were no daredevils out to perform stunts and they never would be.
Warren Buffett put this a different way, describing investors who take fatal risks: "If you risk something that is important to you for something that is unimportant to you, it just does not make any sense."
In his book Why Don't We Learn from History, Liddell Hart writes that history is more subjective than most people think:
A question often debated is whether history is a science or an art. The true answer would seem to be that history is a science and an art. The subject must be approached in a scientific spirit of inquiry. Facts must be treated with scientific care for accuracy. But they cannot be interpreted without the aid of imagination and intuition. The sheer quantity of evidence is so overwhelming that selection is inevitable. Where there is selection there is art.
This is a good reminder that everyone has their own version of history.
In his book Creating the Twentieth Century, Vaclav Smil writes that huge innovation can come from improving or combining what's already in the market:
Being first to package, and slightly improve, what is readily available, being aggressive in subsequent dealings, and making alliances with powerful users can take an entrepreneur and his company a lot further than coming up with a brilliant new idea. This ... sums up what William Gates and his Microsoft Corporation did with Windows for the IBM personal computer.
Innovation isn't dead; it just takes people a long time to notice it and connect the dots.
In Thinking, Fast and Slow, Daniel Kahneman writes that the most important historical events are influenced heavily by luck:
The idea that large historical events are determined by luck is profoundly shocking, although it is demonstrably true. It is hard to think of the history of the twentieth century, including its large social movements, without bringing in the role of Hitler, Stalin, and Mao Zedong. But there was a moment in time, just before an egg was fertilized, when there was a fifty-fifty chance that the embryo that became Hitler could have been a female. Compounding the three events, there was a probability of one-eighth of a twentieth century without any of the three great villains and it is impossible to argue that history would have been roughly the same in their absence. The fertilization of these three eggs had momentous consequences, and it makes a joke of the idea that long-term developments are predictable.
In early 1945, President Roosevelt was asked if the Yalta convention set the stage for global peace. "I can answer that question if you can tell me who your descendants will be in the year 2057. We can look as far ahead as humanity believes in this sort of thing," he said. I wish more people would think like this.
In his book The Thin Green Line, Paul Sullivan writes that a lot of people are rich ... for at least a while:
[Researchers found that] 12 percent of Americans would be in the top 1 percent [of wage earners] and 39 percent would be in the top 5 percent for at least one year of their life. Over half would crack the top 10 percent -- with an income greater than $115,000 a year -- during their lives ... half of the people who earned more than $1 million between 1999 and 2007 did so for just one year; only 6 percent did it for the entire period.
People talk about "the 1%" like it's a single group of people, but it's always shifting. This is truer the higher the income ladder you go -- the richest group of Americans (by income) is a here-today-gone-tomorrow club.
The book How to Lie With Statistics gives a great example of how large a sample size we need for a study to prove anything:
A remarkable instance of this came out in connection with a test of a polio vaccine a few years ago. It appeared to be an impressively large-scale experiment as medical ones go: 450 children were vaccinated in a community and 680 were left unvaccinated, as controls. Shortly thereafter the community was visited by an epidemic. Not one of the vaccinated children contracted a recognizable case of polio. Neither did any of the controls. What the experimenters had overlooked or not understood in setting up their project was the low incidence of paralytic polio. At the usual rate, only two cases would have been expected in a group this size, and so the test was doomed from the start to have no meaning. Something like fifteen to twenty-five times this many children would have been needed to obtain an answer signifying anything.
The desire to prove something is far stronger than the means to create a good study, so the word "proved" can be fickle.
The book This Will Make You Smarter writes that the entire point of science is leaving open the room that everything we know is wrong:
There is a widely held notion that does plenty of damage: the notion of "scientifically proved." Nearly an oxymoron. The very foundation of science is to keep the door open to doubt. Precisely because we keep questioning everything, especially our own premises, we are always ready to improve our knowledge. Therefore a good scientist is never "certain." Lack of certainty is precisely what makes conclusions more reliable than the conclusions of those who are certain, because the good scientist will be ready to shift to a different point of view if better evidence or novel arguments emerge. Therefore certainty is not only something of no use but is also in fact damaging, if we value reliability.
Change your mind when the facts change. Ignore those who refuse to do the same.