Where can we find good Principles and Mental Models?

If you can think for yourself while being open-minded in a clearheaded way to find out what is best for you to do, and if you can summon up the courage to do it, you will make the most of your life.

If you can’t do that, you should reflect on why that is, because that’s most likely your greatest impediment to getting more of what you want out of life.

How can we fail well and learn our principles?

(From the book Principles)

We learn our principles by our attempts at succes. The key to success lies in knowing how to both strive for a lot and fail well. What does failing well mean? It means being able to experience painful failures that provide big learnings without failing badly enough to get knocked out of the game. When you make mistakes, spend some time reflecting on them.

As a trader, to make money in the markets, one needs to be an independent thinker who bets against the consensus and is right. That’s because the consensus view is baked into the price. One is inevitably going to be painfully wrong a lot, so knowing how to do that well is critical to one’s success. The same is true about being a successful entrepreneur too. One also has to be an independent thinker who correctly bets against the consensus, which means being painfully wrong a fair amount. So develop a healthy fear of being wrong and figure out an approach to decision making that would maximize your odds of being right.

Make “believability-weighted” decisions

(From the book Principles)

Our painful mistakes shift us from having a perspective of “I know I’m right” to having one of “How do I know I’m right?” They give us the humility we need to balance our audacity. Knowing that we could be painfully wrong and being curious about why other smart people see things differently prompts us to look at things through the eyes of others as well as our own. That allows us to see many more dimensions than if we see things just through our own eyes. Learning how to weigh people’s inputs so that we can choose the best ones - in other words, if we “believability-weight” our decision-making, that will increase our chances of being right.

Having your own principles

(From the book Principles)

Forming/Creating your principles

We come by our principles in different ways. Sometimes we gain them through our own experiences and reflections. Sometimes we accept them from others, like our parents, or we adopt holistic packages of principles, such as those of religions and legal frameworks.

Because we each have our own goals and our own natures, each of us must choose our own principles to match them. While it isn’t necessarily a bad thing to use others’ principles, adopting principles without giving them much thought can expose you to the risk of acting in ways inconsistent with your goals and your nature. At the same time, you, like me, probably don’t know everything you need to know and would be wise to embrace that fact.

When we are children, other people, typically our parents, guide us through our encounters with reality. As we get older, we begin to make our own choices. We choose what we are going after (our goals), and that influences our paths. As we move toward these goals, we encounter problems, make mistakes, and run up against our own personal weaknesses. We learn about ourselves and about reality and make new decisions.

Over the course of our lives, we make millions and millions of decisions that are essentially bets, some large and some small. It pays to think about how we make them because they are what ultimately determine the quality of our lives.

We are all born with different thinking abilities but we aren’t born with decision-making skills. We learn them from our encounters with reality. The principles we learn along the way will work well on our paths.

Ask yourself what you want, seek out examples of other people who got what they wanted, and try to discern the cause-and-effect patterns behind their achievements so you can apply them to help you achieve your own goals.

Refine and evolve your principles

Operate by principles that are so clearly laid out that their logic can easily be assessed. And you and others can see if you walk the talk. Experience teaches us certain things. It is invaluable to reflect on and write down our decision-making criteria whenever we make a decision. So, get in the habit of doing that. With time, our collection of principles will become like a collection of recipes for decision making. Share your principles with others, and invite them to help us test our principles in action. This will help us continually refine and evolve them. We can refine them to the point where we can systemize our decision-making.

Systemize your decision-making

We can do that by expressing our decision-making criteria in the form of algorithms that we can embed into our computers. By running both decision-making systems - i.e., ours in our heads, and the system in the computer - next to each other, we learn that the computer could make better decisions than us, because, it could process vastly more information than we can, and it could do it faster and unemotionally. Doing that allows us to compound our understanding over time and improve the quality of our decision making. Such decision-making systems - especially when “believability weighted” - are incredibly powerful and will soon profoundly change how people around the world make all kinds of decisions. Our principle-driven approach to decision making will improve not only our economic, investment, and management decisions, it will help us make better decisions in every aspect of our lives.

Where do you find these frameworks?

1. Create your own.

   1. https://www.google.com/search?q=picasso+approach+to+drawing+the+bull&oq=picasso+approach+to+drawing+the+bull&gs_lcrp=EgZjaHJvbWUyBggAEEUYOdIBCTEyNjkwajBqMagCALACAA&sourceid=chrome&ie=UTF-8
   2. Distill the things we know down to the very essence of it.
   3. Once you know the essence, you can think faster.
   4. All you need to look for in your brain is the structure and not just one piece of information that takes a lot of sorting through or takes a lot of memory space.
   5. If you are thinking in terms of structures, it is a lot quicker. And that is how people think fast on their feet.

2. Finding hidden frameworks online

   1. Why are they hidden? Because, if we are not trained to think in frameworks, when we find content on the internet, most of the authors who had done a lot of condensing and find the key levers to problems, they don’t call it a framework.
   2. All you have to do is take that information and structure it so that it becomes a framework for you to reference very easily when you are thinking very fast before you talk.
   3. Of course, unless you have the expertise and experience, the information that you provide be very surface level.
   4. So it is about building that library of frameworks so that you can expand the things that you can talk about comfortably. Then you have direction knowing which topics or levers into further more to expand your knowledge.