Presidential championing, and aligning with the world

How does one get to be the most powerful person in the most powerful country of the world?

Take a moment to imagine a hypothetical presidential candidate – what images does your brain come up with? Maybe it is someone smart and visionary, with great communication and execution skills. Maybe they are cunning and scheming and adept at amassing popularity.

Whatever the images are, continue that imagination some more. How long does it take for you to list out qualities your hypothetical candidate has, until you get to a point where you are listing not what they bring to the table, but what they’ve gotten (help , advantages or luck) ?

Now imagine yourself in some interactions with this candidate. What do you see? You posing questions and keenly listening? Autographs? Memorabilia?

How long does that imagination need to continue till you see yourself helping out this hypothetical person? Probably, a long while. In normal cases, it is difficult to fathom leader and person being helped as the same subject.

And yet, what made headlines last week was precisely that image.

“I ask you to carry her the same way you carried me.”  President Obama, DNC 2016, making the case for Hillary Clinton’s presidential candidacy

Really? Do we need to carry someone to the most powerful position in the world? President Obama’s line may make more sense after checking out this quote –

“What the pupil must learn, if he learns anything at all, is that the world will do most of the work for you, provided you cooperate with it by identifying how it really works and aligning with those realities. If we do not let the world teach us, it teaches us a lesson.” — Joseph Tussman

The beloved President, also a master communicator, does a great job at aligning with the world’s realities in two ways – (a) realizing that society’s deeply rooted sub-conscious image of a woman is someone who needs to be helped. (b) realizing that, that narrative doesn’t fly in the context of the ridiculously powerful position that said woman is aspiring to.

So, he builds some association here – “carry her the same way you carried me.”

That reads: I am not going to remind you all of your biases because, of course, you will deny them if I do so. Instead, I will build up a case that requiring help to be in power is absolutely normal. I will do so by providing my association, and stealthily transferring the object of help from me to her.

“Time and again, you’ve picked me up. I hope, sometimes, I picked you up, too. Tonight, I ask you to do for Hillary Clinton what you did for me. I ask you to carry her the same way you carried me.” 

Book Summary: Give and Take by Adam Grant

  • Reciprocity Styles: People can be classified based on reciprocity styles as givers (do more for others), matchers (operate on quid-pro-quo basis) and takers (look for personal gain at the expense of others).
  • Success and Reciprocity Styles: There is a high correlation between patterns of success/productivity and reciprocity styles. On the success ladder, the people at the bottom are givers. Surprisingly, the people at the top are also givers. The takers and matchers occupy the middle. The book is about how giving enriches you in various ways, and what differentiates givers at the bottom and the top.

Read More »

Self-Efficacy: The exercise of control

Introduction

This blog post is an attempt to condense some learnings on self-efficacy. Some of us have been introduced to the concept by this illuminating book – A Defining Decade by Meg Jay.  The internet unfortunately does not provide good content on what self-efficacy is, how to build it up, the numerous aspects in which it affects your life, so the only way to dig these up is to go straight to the source – Albert Bandura’s psychology textbook that collates his pioneering research on the subject. The book, however, is 604 pages long and extremely dense with strictly academic language. A tl;dr version exists here; short, approachable, yet in heavily academic language as well. This blog post is a ‘notes to self’ version of the book, and an attempt to make learnings from the book accessible.

What is self-efficacy?

Self-efficacy is the set of beliefs and attitudes that you can get something done, influence things and events in your environments and cause certain outcomes.
Self-efficacy is not the same thing as confidence – you can be supremely confident that you will fail. Confidence is the degree of strength of a belief.
Self-efficacy is also not the same as knowing you will succeed – self-efficacy says you have a sense of agency, and that you have control, no matter what the outcome.

If you have heard any of the following references growing up and wondered if they were merely feel-good things to tell yourself, here is the good news – self-efficacy research that provides a solid backing to and understanding of these popular sayings

  • Whether you think you can or you cannot, you are right.
  • I am the master of my fate, I am the captain of my soul. 
  • Life’s battles do not go to the strongest or biggest man, sooner or later (they) go to the one who he thinks he can.

Why should I care about it?

Research shows that people with a self-efficacious outlook –

  • approach difficult tasks as challenges to be mastered rather than threats to be avoided.
  • foster an intrinsic interest in the activities they take up, and are deeply engrossed in them.
  • set themselves challenging goals and maintain a strong commitment to them.
  • heighten and sustain their efforts in the face of failure.
  • quickly recover their sense of efficacy or belief in themselves after setbacks or failures.
  • attribute failure to insufficient effort or deficient knowledge and skills which are acquirable, rather than some innate deficiency with themselves.
  • approach threatening situations with an assurance that they can exercise control over them.
  • have reduced stress and lower vulnerability to depression.
  • have higher levels of accomplishment.

If such people sound awesome, self-efficacy is worth learning about.

 

This sounds like it is about work and accomplishments. I am not ambitious or I don’t like talking about these subjects. Why should I care about it?

Efficacy doesn’t just affect how you perform, it affects your thought-processes, the attitude you carry to pretty much any situation and as a consequence, social and emotional aspects of your life. For example, take shyness. Research shows that shy people know perfectly well how to behave socially and how to pull off smalltalk. They are simply reticent because their perception (self-efficacy) of their social skills is poor.

Read More »

Book Summary: The Happiness Advantage

Seven principles from the book:

  1. The happiness advantage: Happiness does not follow success. The reason is that each time we are successful, we change the goals (the definition of success) just a little bit so happiness remains a moving target. Instead, research shows that success orbits around happiness. Behaviors that create happiness and positivity lead to success.
  2. The fulcrum and the lever analogy: Your belief of your talent and capability to get outcomes is analogous to the length of the lever you have. Your mindset about yourself and the task at hand is the fulcrum. Remember that by shifting the fulcrum you can lift a larger weight using the same length of lever.
  3. The tetris effect: People who play too Tetris have their brains wired to spot for Tetris-like patterns and shapes in the real world. They are constantly on the lookout for ‘gaps’ that can be filled to complete a Tetris line. The human brain works similarly in the real world – you will spot whatever you are primed to look out for, so prime yourself to look for the good, the positive.
  4. Falling up: There is a way to use your failure and suffering (‘downward momentum’) to propel yourself upward. Highly resilient people are able to cope with many falls and eventually succeed because they are falling up, learning and growing with each fall.
  5. The Zorro Circle: There are two categories of people – one with an internal locus of control (they believe they have the power to shape things), another with an external locus of control (believe they can be helpless and other people or luck play all the role). Build an internal locus of control, starting with a small circle. The small circle is a metaphor for one small task that you can build control over and do well. Then gradually expand outwards to take more challenges as you strengthen your belief.
  6. The 20-second rule: Humans end up not picking happiness-generating things or activities (e.g. actual hobbies, exercise, social bonds), because they require a non-trivial initial investment or overcoming inertia. Humans instead pick activities that are low-friction, easy to start (e.g. watching TV) but don’t generate happiness or satisfaction. To change this, change the direction of friction by just 20 seconds. The author placed a guitar on a stand in the center of his living room, to avoid the 20-second effort of picking it up, and got better at keeping his goals of playing everyday. Similarly, he took off the batteries of the remote and placed them 20 seconds away, and it got easier to shun TV.
  7. Social Investment: When adversity strikes, some people are the first to abandon their investment in the people around them, spending less time with their mate, kids or friends to work instead. This is counter-productive. Your social support network is the biggest investment you can make in times of adversity – it helps you pull through.

Notes:

  • US Navy’s research shows that the prizes for efficiency and preparedness go to squadrons whose commanding officers are openly encouraging. Squadrons getting the lowest marks are frequently led by officers who are negative, controlling and of an aloof demeanour.
  • Mental construction has a direct impact on the physical aging process. In a study, a group of men of age ~75 were isolated and put into settings that faked the appearance of the year when they were 55. They spent one week in these circumstances, and objective markers of youth – agility, memory etc went up for them.
  • Mental construction and perception influences the impact of external circumstances: A group of youngsters rubbed with a placebo but told that they were being rubbed with poison ivy started showing actual signs of irritation. In another group that was actually rubbed with poison ivy but told that they were being rubbed with a harmless substance, only 2 out of the 14 allergic people developed rashes.
  • Mental construction of our daily activities, more than the activity itself, defines our reality. This is why job crafting is a good exercise. It involves looking at the activities of your day-to-day job and trying to connect parts of it with your long-term purpose and larger calling.
  • Mindset: The most successful people are not the ones who have the longest hours. These are people with a mindset that helps them work more productively and amidst more pressure than their peers. They take the same units of time given to everyone and use their mindset to become efficient and productive.
  • Note the lever in the lever and fulcrum analogy is not ‘ability’ but ‘belief in your own ability’. Belief in your own ability is a stronger predictor of on-the-job performance than the actual level of skills or training that you have had.
  • Not pursuit, but creation or construction of happiness: The term the ‘pursuit’ of happiness is misleading. It is in your power to create happiness for yourself, so use the phrase ‘creation/construction of happiness’ instead.
  • How can your current tasks be connected to your larger personal goals in life? Jot down the work that you do, and then draw an arrow to the right, and jot down the outcome. Jot down what the outcome means after another arrow, and keep asking ‘what does this lead to’ and drawing more arrows till you get a consequence of your work that is meaningful and impactful to you.
  • “A few choice words can alter a person’s mindset, which in turn can change their accomplishments.” This is worth keeping in mind as you interact with your spouse, kids, friends and colleagues.
  • Words matter: Two groups of people were asked to play the same game. One group was told it was the ‘wall street game’, the other was told it was the ‘community game’. People’s behavior and level of cooperativeness in the game was very different in the two cases, despite it being the same game.
  • The Pygmalion Effect: Pygmalion was a sculptor who created a beautiful woman’s status out of a marble block and fell in love enough to ask a Goddess to make the statue come to life. The Pygmalion effect in real life is demonstrated when absolutely ordinary kids are presented to the teachers as having ‘gifted ability’ in a class, and a year later, their performance has actually shot up. The teachers’ beliefs spread into their non-verbal cues and behavior to the students’ morale and their efforts.
  • Expectations we have about our children, co-workers and spouses – whether or not they are ever voiced, can make that expectation a reality.
  • Deadline is a negative word: Use something like lifeline instead. Talking or thinking about deadlines make you focus on the ‘end’. When you reconnect yourself to the pleasure of the ‘means’ as opposed to only focusing on the ends, you adopt a mindset that is more conducive to not only enjoyment but also better objective results.
  • The Tetris Effect is a metaphor for how our brains dictate the way we see the world around us.
  • The gorilla experiment shows we can miss something obvious when we are not looking for it. When we are looking for something, we see it everywhere. Positive tetris effect is scanning the world for opportunities and ideas that allows our success rate to grow.
  •  Optimists are able to maintain high levels of well-being during times of hardships; they hone skills crucial to high performance in a demanding work environment.
  • The photo-counting experiment shows that luck is not entirely extrinsic, unlucky people have just primed themselves to not spot opportunities that are staring them in the face.
  • This is where the ‘writing what you are grateful for, daily’ exercise helps. It primes your brain to spot goodness, till it comes to you naturally. CEOs who attempted this experiment found two useful side-effects – enlisting their kids to do this with them at the dinner table, they found that the kids refused to have dinner till the exercise was completed, holding them accountable and forcing them to ‘see’ goodness when days at work were horrible. Secondly, they became better at seeing the things to be grateful for in their marriages as well.
  • Adversarial growth – there are several calamities from people are known to emerge stronger from, including breast cancer, natural disasters and refugee displacement. By having a positive reinterpretation of the situation, and developing resilience and hope, they ‘fall up’.
  • Learned helplessness – Dogs were placed in a box with two chambers, one with shocks and one without. They could easily jump from one chamber into the other. Researchers periodically rung a bell and started the shock. They expected the dogs to jump each time the bell rang after a few attempts, instead the dogs learned to be helpless and just bear the shock.
  • People are often quick to learn helplessness. If their efforts to do something to make things better don’t work in one attempt, the first pass of the experiment, they don’t even try when faced with the situation again. Furthermore, the learned helplessness is applied (often wrongly) to other situations as well.
  • ABCD paradigm: Adversity, Belief, Consequence and Disputation. Your beliefs after adversity will shape whether you think the consequences are good, bearable or bad. If they are bad, you should dispute that in your head.
  • Two parts of the brain – the jerk and the thinker: The pre-frontal cortex is for rational decision making, its motto is ‘think, then react’. The limbic region where amygdala dominates is more emotional and its motto is ‘fight or flight’. For more effective people, their pre-frontal cortex wins in a stressful situation. Brain scans show that it lights up more. For people who are easily worried or stressed, the limbic region dominates. Irrespective of the person, once the stress has reached a critical point, even the smallest setback can trigger an amygdala response, essentially hitting the brain’s panic button.
  • Developing effective stress response: Step 1 is to verbalize it, put your feelings down into words. Step 2 is to which aspects of the situation you have control over and which ones you don’t. Surprisingly, when people focus on aspects they can control, their work ends up influencing the other aspects, seemingly out of their control, as well and the overall result is positive.
  • Self-awareness is a swift antidote for emotional hijacking.
  • Habits are like financial capital – forming one today is an investment that will automatically give out returns for years to come. By forming positive habits, you are making your nervous system your ally instead of your enemy. The dividends paid off by habits come without continued concerted effort, or extensive usage of willpower reserves. A powerful example – the author slept in gym clothes, with sneakers by the bed and a mental plan of what to do for the workout at night, for a few months. As it became a habit, working out in the mornings came naturally to him.
  • Set rules in advance, and free yourself from the barrage of choices that deplete your willpower.
  • When we encounter an unexpected challenge or threat, the only way to save ourselves is to hold on tight to the people around us and not let go. Research shows that people who believe success is a lonely path, and divest themselves socially in hardship fare worse than those who capitalize on their social support networks.
  • “Love  – full stop”: A study at Harvard followed 268 Harvard graduates for 70 years. The researcher who supervised it for 40 years, summarizes it as ‘love – full stop’. Those who scored highest on ‘warm relationship’ aspects earned $141,000 a year more at their peak than others. Social capital provides stress relief and a significant competitive advantage.
  • “If somebody must jettison a part of their life, time with a mate should be last on the list. He needs that connection to live.”  Not following this when pressed for time, is like dumping food on a life-raft but keeping the life-raft furniture.
  • We each have our own versions of the offensive line (football metaphor) -with our spouses, families and friends, big challenges feel more manageable and small challenges don’t even register on the radar.
  • How a person responds when you share good news with them, is way better a predictor of your bond with them than anything else.
  • Experiments show that in work environments, just one positive team-member can change the objective accomplishments of the group. Power to spark and spread positive emotion multiplies if you are in a leadership position.

 

Action Items from the book (do the following everyday):

  1. List 3 things that happened during the day, that you are grateful for. A persistent habit of looking for 3 good things each night will prime your brain to spot positivity and increase gratitude.
  2. Maintain a journal. The people who recover the best from setbacks and distress are those who can understand what they are feeling and put those feelings into words. Journaling helps increase self-awareness, which is the first step to gaining control.
  3. Adopt a positive tone and facial expression. It benefits the objective performance and results of people around you.

Book Recommendation: Principles of Psychology by William James

Book Summary: ‘Creativity, Inc’

Ideas from the book

  • Make sure your environment facilitates, and not hinders, the culture that you want to foster. If you want open communication oblivious to ranks and pecking order, a rectangular meeting table is a bad idea. So are name or place cards. The author changed the meeting room at Pixar to have a square table and had positions (name cards) mixed up so that executives were sitting next to front-line employees.

Read More »

Book Summary: ‘The Defining Decade’

The Defining Decade‘ is a book by clinical psychologist Meg Jay who has spent her career studying adult development and spent multiple years doing therapy for twenty-something clients helping them sort out their lives. Notes below are not exhaustive, those can be found at getAbstract which has a concise yet thorough summary of the book here.

On individual development, career and networking

  • Focus on Identity Capital not Identity Crisis: Time spent brooding over who you really are or what you should be doing should really be spent on developing identity capital. Identity capital is how you come across to the world – from how you look or speak to what you choose to focus your efforts/work on.
  • The only way to figure out what to do is to do something. As a therapist, the author met a bunch of twenty-somethings who wasted a lot of time trying to find the ideal thing to do rather than jumping into something they liked, experimenting and iterating.
  • Are you capitalizing on your weak ties?  The strength of weak ties is a seminal paper by Stanford professor Mark Granovetter – the research behind it shows that most major life-defining changes happen due to weak ties, not due to one’s inner circle.  Most people stick to their comfort zone of a small number of people they know – this is detrimental, perhaps dangerous, for personal development.
  • Weak ties promote (and sometimes force) thoughtful growth and change. Weak ties force us to communicate from a place of difference. The similarities and shared context that we have with our inner circle makes us comfortable, but also complacent.
  • Once you start getting comfortable making use of and growing/developing your weak ties, “the world seems suddenly smaller and easier to navigate”.
  • Ben Franklin effect:  If weak ties do favors for us, they start to like us. Ben Franklin’s story/anecdote is worth understanding and analyzing.
  • How Ben Franklin positioned himself for success (and what we should emulate):
    • He found out the person’s area of expertise.
    • He presented himself as a serious person with a need that matched.
    • He made himself interesting and relevant.
    • He asked for a clearly defined favor.

On marriage and picking a partner

  • The author worked on a study that followed ~100 women from their twenties into their seventies. The women were asked to write one page about their most difficult life experience so far. The saddest, most protracted stories  were about bad marriages.
  • It is a misconception that getting married later can set one up for marital success, it is however true until age 25. Research shows that after 25, one’s age at marriage does not predict divorce.
  • Cohabitating before a social commitment such as engagement or marriage usually leads to bad outcomes, contrary to assumptions that living together will prepare the couple for marriage.
  • Travelling together in a third world country is the closest thing there is to being married and raising kids.
  • Bring personality to the forefront sooner rather than later – eHarmony claims better success of the couples it matched due to ‘personality fit’.  While this is hard to prove, research does show that the Big Five personality traits are key predictors of marital success. The more similar a couple is in their extremes of the big five, the more likely to stay together.
  • Neuroticism is the only trait where an individual’s own (and not the couple’s match) trait matters – high neuroticism leads to lower relationship success.
  • People often think that relationships end or marriages break because something changed – habits, betrayal etc. In reality, more often, people split up because things don’t change. Couples reluctantly admit that the differences were there all along.

On thought patterns

  • The slower you go, the faster you get there” – the best way to help people is to slow them down enough to examine their thinking and see the gaps in their own reasoning. Shine a light on those mental ellipses and you’ll find assumptions that drive behavior without our ever being aware of them.

On brain development

  • The frontal lobe of the brain is where we learn to move beyond our search for black-and-white solutions and learn to tolerate and act on shades of grey. This portion develops/matures through your twenties.
  • This explains, why as a therapist, the author often encountered school valedictorians and high-achievers who couldn’t figure out who to date or who got nerves at the workplace. Objective problem-solving skills are located in a different part of the brain, which develops before the frontal lobe.
  •  Calm Yourself – “It may be a match made in hell, but that’s the way it is.” Twenty-somethings who get to the workplace  are still in the frontal-lobe development phase. To make things worse, they are usually paired with new, inexperienced managers. The key is to stay calm and be emotionally resilient as a twenty-something.
  •  Realize that what you are going through is normal. Twenty-somethings who don’t feel anxious and incompetent at work are usually over-confident or underemployed.

Getting along and getting ahead

  • Making strong commitments to our social roles is good for twenty-somethings. Being a cooperative colleague or successful partner is what drives personality change.

Present-bias

  • Human nature is to emphasize the present and discount the future. Most twenty-somethings can think of the here-and-now, perhaps the next five years and have a faint vision of when they are very old – close to the end of life. Not enough people have a realistic sense of what it might be to be 30 or 40, or how their current decisions influence their future life.
  • This leads to things such as (a) not enough thinking about starting a family or the challenges of fertility over 30 (its not just the women, older sperm is an issue as well). (b) not thinking enough about retirement planning (c) not thinking about what you might cherish or value at age 30 or 40 (time with your kids) and spending time in your twenties doing things you will regret later.
  • Great experiment that shows present bias: Twenty-five people entered an augmented reality environment and saw an age-morphed version of their future selves. A control group of the same size just saw themselves in the mirror. Both groups were then asked to allocate money to a hypothetical retirement savings account. The mirror group set aside ~$75, the group that saw an aged AR version of themselves set aside ~$180 (almost 2.5x).

Good stories and happy endings are way more intentional than that.. 

  • Be intentional about your life. Good authors don’t just stumble into a well-forming story with a great ending as they are writing it. More often, they start with the end in mind, working their way backwards through the plot, to figure out where the story should begin.
  • Treat your life the same way, be intentional.

Recommended reading:

  1. Self-efficacy: The exercise of control by Albert Bandura.
  2. Similarity, convergence and relationship satisfaction in dating and married couples.

 

Book Summary: Flow: The psychology of optimal experience

The concept of flow

  • What is described in popular culture as being ‘in the zone’ or ‘in the groove’.
  • Makes use of an individual’s focused attention, referred to as ‘psychic energy’. Focused attention, not time or anything, is an individual’s most precious resource.
  • The labels applied to people (“extrovert”, “high achiever”, “paranoid”) really refer to the specific patterns that people have used to structure their attention. A paranoid person is paranoid because they focus a lot of attention and energy on worrying.
  • 8 conditions together leading to flow:
    1. Confront challenging but completable tasks
    2. Concentration
    3. Clear goals
    4. Immediate feedback
    5. Deep, effortless involvement (lack of awareness of worries and frustrations)
    6. Sense of control over actions
    7. Concern for self disappears (paradoxically awareness of self is heightened immediately after flow)
    8. Sense of duration of time is altered
  • Every flow activity transforms the self by making it more and more complex. e.g. the rock climber is a different person after scaling El Capitan at Yosemite. The chess player is a different person after playing a grandmaster tournament.
  • Most enjoyable activities are not natural – they demand an effort that initially one is reluctant to make.
  • Steps to achieving flow
    1. Set a goal.
    2. Concentrate your ‘psychic energy’ on achieving it.
    3. Pay attention to the feedback
    4. Make certain that the challenge is appropriate for one’s skill level.
  • The best moments usually occur when a person’s body and mind are stretched to its limit in a voluntary effort to accomplish something difficult and worthwhile.

Read More »

Notes from The Power of Positive Thinking

Caveat Emptor: Great book, but throws in way too much Christianity/religion in the face of the reader. IMHO, it is much easier for humans to place absolute confidence and faith in an abstract higher power, than it is to place faith in their innate prowess. Substitute “prayer” and “God” in this book summary for something similar that works for you.

  • Six point action plan to stop fuming and fretting:
    1.  Get in a relaxed physical position.
    2. Visualize: Your mind is the surface of a lake, tossed by waves and in tumult. But when the waves subside, the surface of the lake is placid and unruffled. This imagery should help you calm down.
    3. Spend two-three minutes thinking about the most beautiful and calming nature scenes you’ve witnessed.
    4. Repeat, slowly to yourself, words along the lines of “tranquillity”, “serenity”, “peace” and let the effect of them sink in.
    5. Make a list of times in your life when you were worried and anxious, and things turned out fine (for the more religious, “God took care of everything”).
    6. Rely on a higher power to take charge of the situation and fix it.

Read More »

Notes from Thinking Fast and Slow

This post is a collection of insightful concepts and statements I found in Daniel Kahneman’s Thinking Fast and Slow. Apologies for the lack of coherence towards the end – the volume of the book ensured I got down to just jotting down the meat of the matter without any context or detailing.

  • Fundamental premise of the author’s work: Economics says humans are mostly rational and their thinking is sound. The departures from rationality only occur due to emotions such as fear, affection and hatred. The author documents systematic errors in the thinking of humans – these are errors due to how our cognitive machinery is designed, not a corruption of our thoughts by emotions.
  • Expert intuition: Thousands of hours of practice in anything (mostly your work) in a controlled environment with a good feedback loop can set you for taking good decisions just by “blinking” instead of having to “think”. A good example is a firefighter anecdote, where an experience guy ordered his team to head out of a  house with no visible signs of danger. Only in hindsight did he realize that his subconscious was processing subtle danger signs related to smoke and fire. Note that this only works with controlled environment, with no underlying randomness (cases of firs are different, but there is an underlying pattern to the kinds of houses and kinds of fires they deal with, and the behavior of materials reacting to fire) as opposed to environments with fundamental randomness, such as stock markets. The stock traders doesn’t have a reliable, non-random feedback loop – so he cannot develop such “blink”-style judgement expertise.
  • Notion of two Systems: A human mind has two systems – System 1 is intuitive, guided by associative memory (and hence affected by feelings) and FAST. System2 is deliberate, responsible for complex logic, reasoning and calculations, any kind of decision-making that needs effort, but it is also SLOW and LAZY. Much of the book focuses around understanding these two systems, how most humans rely more on System1 than they need and the errors arising due to biases wired into System 1. System 1 is flawed, yet it also very good at constructing coherent stories.
  • Notion of two selves: The “experiencing self” and the “remembering self”. Human memories are not perfect reconstructions of reality. Humans are guided by the remembering self and this makes them expose themselves to unnecessary pain.
  • Limited attention power of humans: As demonstrated in the selective attention experiment.
  • “We can be blind to the obvious and we are also obvious to our blindness.”
  • Illusions: Muller-Lyer illusion is a famous example of how our cognitive machinery is flawed (even after understanding the concept, it presents a reality that is hard to accept). Not all illusions are visual – many are cognitive, and those are the costly ones.
  • Example of a cognitive illusion: Psychotherapists often have a strong attraction for a patient with a repeated history of failed treatments, thinking that they may be the ones to succeed in curing him. (Hint: the patient is a psychopath!).
  • Flaws of System 2: System2 is lazy and reluctant to invest more effort than is strictly necessary. It believes it has chosen thoughts and actions, but these choices can be, in reality, guided heavily by System 1. The concept of priming is an example of this.
  • On pupils and psychology: The pupil of the eye is a window into one’s soul – if you perform a slightly non-trivial calculation with a periodic frequency with a camera focused on your eye, it will record very regular pupil dilation and contraction events. The pupil dilation is an indication of mental effort – pupils contract immediately when a person gives up or finds the solution.
  • On why training matters for System 2: Unlike a house’s circuit breaker, which completely breaks down in case of overload, System2 will focus its attention on the most important activities, letting go of the rest. The selective attention test video linked to above is proof of that. With training and over time, as you get more and more familiar with a task, fewer brain regions are involved.
  • State of flow: Flow is a state of effortless concentration,  so deeply focused on whatever one is doing at the moment that one loses a sense of self and all one’s problems. Flow leads to optimal experiences. All variants of voluntary effort – cognitive, emotional or physical – draw atleast partly from a shared pool of mental energy.
  • “Ego depletion”: This demonstrates the “shared pool of mental energy” concept. People instructed to stifle their emotional reaction to an emotionally charged film will later underperform on a test of physical stamina. Another example – studies show that favorableness of results from judges increases in the short time after lunch. Tired and hungry judges tend to fall back on the easier default possibilities of denying requests for parole.
  • Over-riding intuition takes hard work: The insistent idea that “its true, its true” coming from System 1 makes it difficult to check the logic. Lots of mental effort goes into training your System 2 to kick into action more often, whenever needed, but its worthwhile. Some lucky people are more like System2, most of us are more like our System 1.
  • Strong link between self-control and cognitive aptitude: The Stanford marshmallow experiment is a good example of this.
  • Concept of Priming: If you saw the word EAT and then saw SO_P, you are more likely to complete it as SOUP. If you saw WASH and then saw SO_P, you will complete it as SOAP. The experience you are subjected to (reading a word) triggers a portion of your associative memory, and so now your retrieval is biased.
  •  Priming as applied to experiences: Priming is not just about words, ideas and thoughts. In an experiment, young people who were asked to assemble a sentence from scrambled words related to old age, walked slower than the others in part 2 of the experiment when they had to walk down a hallway.
  • Influencing of an action by an idea – the ideomotor effect. Clasp both your hands together and index fingers of both hands pointing at each other, now think of the line joining the tips of the two fingers and see how your fingers twitch!
  • Reciprocal priming: Thoughts/ideas/words influence actions – that is priming. The inverse of it is reciprocal priming. Smiling naturally invokes positive, optimistic emotions and thoughts.
  • “Act calm and kind regardless of how you feel” – you are likely to be rewarded by actually feeling calm and kind.
  • Useful resources on priming: understanding how you are less in control of your actions than you think, and how priming affects your performance.
  • Money-priming leads to increased self-reliance – money-primed people (exposed to thoughts of money) persevered almost twice as hard in trying to solve a very difficult problem. Money-primed people are also more selfish.
  • “They were primed to find flaws and this is exactly what they found.”
  • Cognitive ease – when things are going normally. Cognitive strain – when you need more help from System 2.
  • The cognitive ease inflow-outflow machine: Things that lead to cognitive ease are repeated experience, favorable conditions such as a clear display and good font, primed idea (such as, being introduced to the concept through a nice subtle watermark in the background) and a good mood. What comes out of cognitive ease is the following feelings/emotions – “feels true” , “feels good”, “feels familiar and effortless”
  • “Cognitive easy is good and recommended in some cases, but dangerous in other cases (where it prevents System 2 from kicking in and makes the wrong judgements via System 1).” As an example, the performance of Princeton grads in puzzles went up by a notch when the font worsened, causing cognitive strain and system 2 to kick in.
  • Cognitive Ease: Pros: More creative. Cons: Makes judgement errors due to familiarity.
  • Cognitive Strain: Pros: More vigilant, suspicious, invests more efforts. Cons: Feels less comfortable, leads to less intuitiveness/creativeness.
  • “Illusions of remembering”: You think David Steinbill (made-up name) is a celebrity just because the experimenters exposed you to his name in a casual setting before the experiment!
  • “Illusions of truth”: If you are put at sufficient cognitive ease by the mood and environment around you and by previous similar questions,  you may agree to the phrase “chicken has 4 legs”. It takes a while for System 2 to kick in and tell you this is not true.
  • “Anything that makes the cognitive machine run smoothly will also bias beliefs”
  • “Familiarity is not easily distinguishable from truth”
  • “If a statement is strongly linked by logic or association to other beliefs or preferences you hold, or comes from a  source that you trust or like, you will feel a sense of cognitive ease.” This is because the lazy System2 will just accept the suggestions of System 1 and march on.
  • Awesome example of cognitive ease effects: Stocks with pronounceable tickers perform better than the tongue-twisting ones! (like PGX or RDO). 
  • Mind is biased toward “causal thinking” and doesn’t understand statistics or regression to the mean easily. Good example of regression to the mean – ask a bunch of people to take 2 attempts at darts. The ones who did the best in the first attempt will get worse (relative to themselves) in the second attempt. This causes instructors to (faultily) conclude that admonishing leads to better performance in the next attempt and praise leads to worse performance in the next attempt.
  • Intensity Matching: Humans unknowingly transfer evaluation from one situation to another (which merits a different way of thinking/evaluating) applying “intensity matching”. Trivial example – give a long description about a school girl really sharp at reading and then ask the audience to predict her college GPA. Reading skills at age 7-10 have nothing to do with GPA, yet instinctive answers from the audience indicate “intensity matching”.
  • Common human fallacies while making predictions (or forming “intuitions” about situations): neglect of base rates, and insensitivity to the quality of information.
  • Intuitive predictions tend to be overconfident and overly extreme.
  • Moderating the extremeness of intuitive predictions is not always a good thing – example, venture capitalists need to call extreme cases like Google correctly, even at the cost of overestimating the prospects of many other ventures.
  • Consider the range of uncertainty around a most likely outcome. (KR note: This is reminiscent of Aswath Damodaran’s recent lecture at Google about valuation – where he defines a range of variation on every single parameter in his valuation, so his end prediction for the stock price of Apple is a large histogram)
  • The most valuable contribution of the corrective procedures that the author proposes to fix “wrong” intuitions is that they force one to think about how much they know.
  • WYSIATI – Human mind’s bad fallacy – what you see is all there is.
  • Asked to reconstruct our former beliefs, we often bring up our current ones instead and many cannot believe they ever felt differently.
  • Hindsight bias – people cannot reconstruct their past beliefs accurately. This makes it difficult to evaluate a decision properly – in terms of the beliefs that were reasonable when the decision was made.
  • The worse the consequence, the greater the hindsight bias (KR note: reminiscent of parents saying “I told you so” when things go south in a marriage they were arm-twisted into agreeing to).
  • Hindsight and outcome biases foster risk aversion.
  • System 1 makes us see the world as more tidy, simple, predictable and coherent than it really is.
  • Halo effect: Depending on whether the company has been doing well or not recently, the same CEO will be called “flexible, methodical and decisive” or “confused, rigid and authoritarian”.
  • Therefore, you can’t do pattern mining to identify what works for successful companies. Examples of this kind of failure are “Built to Last” and “In search of excellence” (companies/theses mentioned in both the books melted down in a short period following the book).For some of our most important beliefs, we have no evidence at all, except that people we love and trust hold these beliefs!
  • Amazing experiment the author does with 25 top financial advisors – he gets a spreadsheet that has them ranked (with data on how much returns they generated), on an annual basis, for 8 consecutive years. He studied correlations between year 1 and 2, year 1 and 3…. and so on until year 7 and 8 (28 correlation coefficients, one for each pair of years). The average of the 28 corelation coefficients was 0.01!!
  • People with the most knowledge are poorer at forecasting than people with some knowledge of the field/domain/situation. With knowledge, the person develops an enhanced illusion of skill and becomes unrealistically overconfident.
  • Simplicity is often way better than complexity. Paul Meehl’s “little book” – simple, statistical rules are superior to intuitive ‘clinical’ judgements. Book by Gary Klein – “Sources of Power” – Analyzes how experienced professionals develop intuitive skills. Malcolm Gladwell’s book “Blink” is along the same lines.
  • Emotional learning is similar to Pavlo’s experiment – the dog had “learned hopes”. Learned fears are even more easily acquired (KR note: perhaps more applicable to women, being the more emotionally susceptible gender).
  • Lesson learnt: Train yourself hard, in a regular environment with a good feedback loop so that the “expert intuition” that you are developing, actually holds true.
  • When you see data that seems to define a BASE RATE, ACKNOWLEDGE IT, LET IT CHANGE YOU.
  • Planning fallacy – overestimate benefits, underestimate costs.
  • How to overcome the planning fallacy – Develop an “outside view” by involving a ton of “reference class data” about similar projects.
  • Sunk-cost fallacy – You didn’t have a reasonable baseline prediction when you started out, and when you get the baseline you ignore it because it’s too late in the game and you’re already invested.
  • More optimistic people are the ones who are inventors, politicians, military leaders etc. They take more risks than they think they are capable of.
  • Entrepreneurs are inherently more optimistic. Chances that a small business survives in USA for > 5 years are 35%. 60% of new restaurants are out of business after 3 years.. yet people still open new ones and are optimistic about them.
  • Study shows CFOs are grossly over-confident about their ability to forecast the market.
  • Pre-mortem: Just before an important decision has been finalized but not committed – you imagine you are in the future, the decision has failed, and look at what could have wrong. The main virtue of the premortem is that it legitimizes doubts.
  • “What rules govern peoples’ choices between simple gambles and between gambles and sure things?” Amos and Kahneman set out to understand humans make choices, without assuming anything about their rationality.
    Econs (perfectly rational, selfish, stable taste) & Humans (WSYIATI, tastes change, not fully rational or fully selfish).
    Bernoulli’s experiments/conclusions: “A risk-taker with diminishing marginal utility for wealth (which is most of us) will be risk-averse.”
    – Flaw in Bernoulli’s theory: You need to know the reference before you can predict the utility of a given amount of wealth.
  • People become risk-seeking when all their options are bad.” 🙂 This is insightful. Simple example – which would you pick – lose $100 for sure or lose $200 with 50% probability?
  • Loss aversion ratio for most people is in the range of 1.5-2.5 (potential gains have to be that factor higher than potential losses).
  • Brains of humans and other animals contain a mechanism that is designed to give priority to bad news.
  • Goals are reference points. Avoiding the failure to meet a goal is a stronger motivator than the desire to exceed it.
  • Perceptions of fairness are based on our reference points.
  • “Altruistic punishment” (punishing a stranger for behaving unfairly towards another stranger)
  •  Smart negotiation tactic: falsely hold on to something as very precious or important to you, thereby showing that you’ll stand to be pained a lot by giving it away, when in reality, you were prepared to give it away all along.
  • Consistent overweighting of improbable outcomes – a feature of intuitive thinking, leads to inferior outcomes.
    – Opportunities to frame a fact differently, such that one way of framing evokes a different mental/emotional response. (e.g. probability of DNA testing failure – defendant will say “1 in a 1000”, accuser will say “0.01” – because accuser wants to show DNA testing works for certain, defendant wants to create doubts in the jury’s head).
  • Human nature tends to be risk averse for gains and risk-seeking for losses – it is COSTLY to do so! You should favor taking risks in gain-scenarios and reduce risk-seeking when it comes to losses.
  • Countering the “loss aversion” mentality that you were wired with – take a $100 loss with 50% chance, $200 gain with 50% chance gamble. Offered one gamble you will probably pass it ($100 loss will feel more painful than $200 gain). However, if offered 100 of these, no fool should reject it (compute the expected value there – the chances of you losing money are insanely low- like 1 in 32000).
  • So, the next time you think of loss aversion, think of life as a bunch of these small gambles – you win a few, you lose a few, but the chances of you losing overall in the long run are slim.
  • Be rational enough to avoid your loss aversion.
  • “Combination of loss aversion and narrow framing is a costly curse.”
  • Mitigating loss aversion: evaluate your portfolio only a quarter, else loss aversion will make you overtly sensitive to minor fluctuations and make you react on daily lows.
  • Investors sell more losing stocks in December, when taxes are on their mind. The tax-loss harvesting advantage is available all year, but then mental account prevails more during the other 11 months (“disposition effect” -think you did well by selling a gainer instead of a loser).
  • The “sunk cost” fallacy is both identified and taught as a mistake in business and economics courses, and there is evidence that graduate students in these fields are more willing than others to walk away from a failing project.
  • “Losses evoke stronger negative feelings than costs.” e.g. “Would you accept a gamble that offers a 10% chance to win $95 and 90% chance to lose $5?” or “would you participate in a lottery ticket worth $5 where you have a 10% chance of winning $100 and 90% chance of winning nothing?” The two problems are identical but people like the second one way way more.
  • Interesting example: Credit card industry lobbied hard to make vendors say it’s a “cash discount, not a credit surcharge.” (if you are paying different amounts for cash v/s card). People will much more easily forego a discount than they will take a surcharge.