"Why You Believe The Things You Do" and "Compounding Knowledge - Farnam Street"

Hatched by Kazuki
Aug 29, 2023
4 min read
5 views
Copy Link
"Why You Believe The Things You Do" and "Compounding Knowledge - Farnam Street"
Beliefs are a fascinating aspect of human psychology. What we believe to be true is often influenced by our desires and the need for certainty in an uncertain world. When faced with uncertainty, we tend to lower the bar for what we believe to be true, grasping onto anything that offers hope or comfort. This was evident during the Great Plague of London in 1722, where people turned to prophecies, astrology, and old wives' tales for solace.
In today's world, the legal concept of Gibson's Law holds true - for every PhD argument, there is an opposing PhD argument. No matter what side of the debate you're on, you can find an expert witness who will support your viewpoint for a fee. This highlights the fact that beliefs are often not about discovering truth, but rather justifying past actions, protecting one's reputation, or maximizing income. The allure of a belief can sometimes overshadow its truthfulness.
Our memories also play a significant role in shaping our beliefs. We cannot remember every detail of our experiences, so we tend to emphasize certain memories while discarding others. This process, known as sharpening and leveling, leads us to remember the parts of our experiences that make good stories, confirm stereotypes, and connect dots between other experiences. This selective memory formation further reinforces our existing beliefs.
Changing one's mind is a rare occurrence, even when faced with conflicting information. It is far easier to fool ourselves into believing a falsehood than to admit a mistake. However, the core principle of a scientific lifestyle is to change one's mind when confronted with contradictory evidence. Intellectual inertia, the resistance to change, can lead us to cling to false beliefs and hinder personal growth.
Beliefs are not just about what we know; they also serve as social signals. They offer clues about how we establish our beliefs, our confidence in our intelligence, and our ability to transmit reliable information to others. While we should value experts who are willing to change their minds in the face of new evidence, what we often seek is someone who is confident enough to never have to. Our desire to eliminate uncertainty can cause us to believe things that have little relation to reality.
On the other side of the spectrum, we have the concept of compounding knowledge. Curiosity is a fundamental driver of human nature, and the accumulation of knowledge is a lifelong pursuit. Warren Buffett and Charlie Munger are prime examples of individuals who have created immense vertical filing cabinets in their minds. They have spent years consuming information, reading newspapers, biographies, and trade press. This vast knowledge base allows them to draw upon decades of data when making decisions.
Expiring information may be enticing, but true knowledge is built upon a foundation of detailed, long-lasting information that is constantly being processed and analyzed. The internet has revolutionized our ability to retrieve information, but it cannot replace the value of having that information already stored in our minds. Buffett and Munger rarely rely on external sources because they have already internalized the knowledge. They understand the importance of making themselves as smart as possible and not solely relying on external references.
The compounding effect of knowledge is powerful. The more information we accumulate and process, the greater advantage we gain. It allows us to see patterns and connections that others may overlook. However, this requires focus and dedication. We must be mindful of what we consume and whether it will still be relevant in the future. Cumulative knowledge is built over time, and it requires a commitment to continuous learning.
In conclusion, our beliefs are influenced by various factors, including our desires, past actions, and the need for certainty. Beliefs can sometimes overshadow the truth and lead us to defend almost anything. Changing our minds is a rare occurrence, but it is essential for personal growth and the pursuit of truth. On the other hand, compounding knowledge through lifelong learning is a powerful tool. It allows us to draw upon a vast knowledge base and make more informed decisions. To harness the power of knowledge, we must be selective in what we consume and focus on building cumulative knowledge over time.
Actionable advice:
- 1. Embrace intellectual humility and be open to changing your beliefs when faced with contradictory evidence. Avoid intellectual inertia and embrace the core principle of a scientific lifestyle.
- 2. Develop a habit of lifelong learning. Continuously consume information that is detailed and long-lasting, and spend time processing and analyzing it. Build your own vertical filing cabinet of knowledge.
- 3. Be mindful of what you consume and whether it will still be relevant in the future. Focus on building cumulative knowledge in specific areas rather than spreading yourself too thin. Embrace the power of the compounding effect.
By understanding the factors that shape our beliefs and actively seeking to expand our knowledge, we can navigate the complexities of the world more effectively and make better-informed decisions.
Copy Link