Over 400,000 people visited Farnam Street last month to learn how to make better decisions, create new ideas, and avoid stupid errors. With more than 100,000 subscribers to our popular weekly digest, we've become an online intellectual hub. To learn more about we what do, start here.

Category Archives: Reading

Schopenhauer on the Dangers of Clickbait

German Philosopher Arthur Schopenhauer (1788–1860) influenced some of the more prominent minds in the world. His writings and lessons traverse time and discipline. Schopenhauer confronted similar problems with media to the ones we face.

We live under a constant onslaught of content that is not meant to live beyond the moment in which it appears.

Weaving together two of his essays, “On Authorship” (from The Essays of Schopenhauer: The Art of Literature) and “On Reading.” we can see that he foresaw the problem of clickbait in terms of its distraction from what’s important and how we can fend it off.

Let’s first turn our attention to Schopenhauer’s beliefs on the two kinds of authors and their motivations:

[T]hose who write for the subject’s sake, and those who write for writing’s sake. The first kind have had thoughts or experiences which seem to them worth communicating, while the second kind need money and consequently write for money. They think in order to write, and they may be recognized by their spinning out their thoughts to the greatest possible length, and also by the way they work out their thoughts, which are half-true, perverse, forced, and vacillating; then also by their love of evasion, so that they may seem what they are not; and this is why their writing is lacking in definiteness and clearness.

The author has a moral duty to not cheat the reader. You could write about how our media demands this cheating. For example, the 24-hour news cycle broadcasts only for the sake of filling up time and generating pageviews. It has changed our definition of ‘news.’

The author is cheating the reader as soon as he writes for the sake of filling up paper; because his pretext for writing is that he has something to impart. Writing for money [is], at bottom, the ruin of literature. It is only the man who writes absolutely for the sake of the subject that writes anything worth writing.

(There is an argument to be made that media fragmentation and low barriers drive down the monetary value of success. If this were true, it is possible that people will once again begin to create for the value of the activity and not the dollars.) We should only read good books. More than read them we should re-read them.

What an inestimable advantage it would be, if, in every branch of literature, there existed only a few but excellent books! This can never come to pass so long as money is to be made by writing. … The best works of great men all come from the time when they had to write either for nothing or for very little pay.

The problem is these bad writers, offering little timeless value, monopolize the time and attention of people that could be otherwise spent on more profitable pursuits.

They are written merely with a view to making money or procuring places. They are not only useless, but they do positive harm. Nine-tenths of the whole of our present literature aims solely at taking a few shillings out of the public’s pocket, and to accomplish this, author, publisher, and reviewer have joined forces.

The fact these views consume us underpins why our views are so shallow. Remember, Schopenhauer was writing at a time when people valued deep work and attention in a way we no longer do. As an audience it is easier to skim the surface of the volume that is available.

Oh, how like one commonplace mind is to another! How they are all fashioned in one form! How they all think alike under similar circumstances, and never differ! This is why their views are so personal and petty. And a stupid public reads the worthless trash written by these fellows for no other reason than that is has been printed today, while it leaves the works of the great thinkers undisturbed on the bookshelves.

We often forget the existence of words is no statement on their truth.

Incredible are the folly and perversity of a public that will leave unread writings of the noblest and rarest of minds, of all times and all countries, for the sake of reading the writings of commonplace persons which appear daily and breed every year in countless numbers like flies; merely because these writings have been printed today and are still wet from the press.

This is where the art of not reading comes in. We have a choice, even if we refuse to exercise it. Schopenhauer offers us guidance on what to read.

Remember rather that the man who writes for fools always finds a large public: and only read for a limited and definite time exclusively the words of great minds, those who surpass other men of all time and countries, and whom the voice of fame points to as such. These alone really educate and instruct.

Furthering this notion, he adds:

One can never read too little of bad or too much of good books: bad books are intellectual poison; they destroy the mind.

Which can equally apply to the websites and articles that consume us. Before we know it, we develop a Pot-Belly of Ignorance.

Inverting the problem Schopenhauer suggests “in order to read what is good one must make it a condition never to read what is bad; for life is short, and both time and strength limited.”

It is because people will only read what is the newest instead of what is the best of all ages, that writers remain in the narrow circle of prevailing ideas, and that the age sinks deeper and deeper in its own mire.

If you’re looking for ways to filter out the noise consider Peter Kaufman’s idea of the three buckets of knowledge and Nassim Taleb’s lindy effect.


Peter Bevelin on Seeking Wisdom, Mental Models, Learning, and a Lot More

One of the most impactful books we’ve ever come across is the wonderful Seeking Wisdom: From Darwin to Munger, written by the Swedish investor Peter Bevelin. In the spirit of multidisciplinary learning, Seeking Wisdom is a compendium of ideas from biology, psychology, statistics, physics, economics, and human behavior.

Mr. Bevelin is out with a new book full of wisdom from Warren Buffett & Charlie Munger: All I Want to Know is Where I’m Going to Die So I Never Go There. We were fortunate enough to have a chance to interview Peter recently, and the result is the wonderful discussion below.


What was the original impetus for writing these books?

The short answer: To improve my thinking. And when I started writing on what later became Seeking Wisdom I can express it even simpler: “I was dumb and wanted to be less dumb.” As Munger says: “It’s ignorance removal…It’s dishonorable to stay stupider than you have to be.” And I had done some stupid things and I had seen a lot of stupidity being done by people in life and in business.

A seed was first planted when I read Charlie Munger’s worldly wisdom speech and another one where he referred to Darwin as a great thinker. So I said to myself: I am 42 now. Why not take some time off business and spend a year learning, reflecting and write about the subject Munger introduced to me – human behavior and judgments.

None of my writings started out as a book project. I wrote my first book – Seeking Wisdom – as a memorandum for myself with the expectation that I could transfer some of its essentials to my children. I learn and write because I want to be a little wiser day by day. I don’t want to be a great-problem-solver. I want to avoid problems – prevent them from happening and doing right from the beginning. And I focus on consequential decisions. To paraphrase Buffett and Munger – decision-making is not about making brilliant decisions, but avoiding terrible ones. Mistakes and dumb decisions are a fact of life and I’m going to make more, but as long as I can avoid the big or “fatal” ones I’m fine.

So I started to read and write to learn what works and not and why. And I liked Munger’s “All I want to know is where I’m going to die so I’ll never go there” approach. And as he said, “You understand it better if you go at it the way we do, which is to identify the main stupidities that do bright people in and then organize your patterns for thinking and developments, so you don’t stumble into those stupidities.” Then I “only” had to a) understand the central “concept” and its derivatives and describe it in as simple way as possible for me and b) organize what I learnt in a way that was logical and useful for me.

And what better way was there to learn this from those who already knew this?

After I learnt some things about our brain, I understood that thinking doesn’t come naturally to us humans – most is just unconscious automatic reactions. Therefore I needed to set up the environment and design a system that helped me make it easier to know what to do and prevent and avoid harm. Things like simple rules of thumbs, tricks and filters. Of course, I could only do that if I first had the foundation. And as the years have passed, I’ve found that filters are a great way to save time and misery. As Buffett says, “I process information very quickly since I have filters in my mind.” And they have to be simple – as the proverb says, “Beware of the door that has too many keys.” The more complicated a process is, the less effective it is.

Why do I write? Because it helps me understand and learn better. And if I can’t write something down clearly, then I have not really understood it. As Buffett says, “I learn while I think when I write it out. Some of the things, I think I think, I find don’t make any sense when I start trying to write them down and explain them to people … And if it can’t stand applying pencil to paper, you’d better think it through some more.”

My own test is one that a physicist friend of mine told me many years ago, ‘You haven’t really understood an idea if you can’t in a simple way describe it to almost anyone.’ Luckily, I don’t have to understand zillion of things to function well.

And even if some of mine and others thoughts ended up as books, they are all living documents and new starting points for further, learning, un-learning and simplifying/clarifying. To quote Feynman, “A great deal of formulation work is done in writing the paper, organizational work, organization. I think of a better way, a better way, a better way of getting there, of proving it. I never do much — I mean, it’s just cleaner, cleaner and cleaner. It’s like polishing a rough-cut vase. The shape, you know what you want and you know what it is. It’s just polishing it. Get it shined, get it clean, and everything else.

Which book did you learn the most from the experience of writing/collecting?

Seeking Wisdom because I had to do a lot of research – reading, talking to people etc. Especially in the field of biology and brain science since I wanted to first understand what influences our behavior. I also spent some time at a Neurosciences Institute to get a better understanding of how our anatomy, physiology and biochemistry constrained our behavior.

And I had to work it out my own way and write it down in my own words so I really could understand it. It took a lot of time but it was a lot of fun to figure it out and I learnt much more and it stuck better than if I just had tried to memorize what somebody else had already written. I may not have gotten everything letter perfect but good enough to be useful for me.

As I said, the expectation wasn’t to create a book. In fact, that would have removed a lot of my motivation. I did it because I had an interest in becoming better. It goes back to the importance of intrinsic motivation. As I wrote in Seeking Wisdom: “If we reward people for doing what they like to do anyway, we sometimes turn what they enjoy doing into work. The reward changes their perception. Instead of doing something because they enjoy doing it, they now do it because they are being paid. The key is what a reward implies. A reward for our achievements makes us feel that we are good at something thereby increasing our motivation. But a reward that feels controlling and makes us feel that we are only doing it because we’re paid to do it, decreases the appeal.

It may sound like a cliché but the joy was in the journey – reading, learning and writing – not the destination – the finished book. Has the book made a difference for some people? Yes, I hope so but often people revert to their old behavior. Some of them are the same people who – to paraphrase something that is attributed to Churchill – occasionally should check their intentions and strategies against their results. But reality is what Munger once said, “Everyone’s experience is that you teach only what a reader almost knows, and that seldom.” But I am happy that my books had an impact and made a difference to a few people. That’s enough.

Why did the new book (All I Want To Know Is Where I’m Going To Die So I’ll Never Go There) have a vastly different format?

It was more fun to write about what works and not in a dialogue format. But also because vivid and hopefully entertaining “lessons” are easier to remember and recall. And you will find a lot of quotes in there that most people haven’t read before.

I wanted to write a book like this to reinforce a couple of concepts in my head. So even if some of the text sometimes comes out like advice to the reader, I always think about what the mathematician Gian-Carlo Rota once said, “The advice we give others is the advice that we ourselves need.”

How do you define Mental Models?

Some kind of representation that describes how reality is (as it is known today) – a principle, an idea, basic concepts, something that works or not – that I have in my head that helps me know what to do or not. Something that has stood the test of time.

For example some timeless truths are:

  • Reality is that complete competitors – same product/niche/territory – cannot coexist (Competitive exclusion principle). What works is going where there is no or very weak competition + differentiation/advantages that others can’t copy (assuming of course we have something that is needed/wanted now and in the future)
  • Reality is that we get what we reward for. What works is making sure we reward for what we want to achieve.

I favor underlying principles and notions that I can apply broadly to different and relevant situations. Since some models don’t resemble reality, the word “model” for me is more of an illustration/story of an underlying concept, trick, method, what works etc. that agrees with reality (as Munger once said, “Models which underlie reality”) and help me remember and more easily make associations.

But I don’t judge or care how others label it or do it – models, concepts, default positions … The important thing is that whatever we use, it reflects and agrees with reality and that it works for us to help us understand or explain a situation or know what to do or not do. Useful and good enough guide me. I am pretty pragmatic – whatever works is fine. I follow Deng Xiaoping, “I don’t care whether the cat is black or white as long as it catches mice.” As Feynman said, “What is the best method to obtain the solution to a problem? The answer is, any way that works.

I’ll tell you about a thing Feynman said on education which I remind myself of from time to time in order not to complicate things (from Richard P. Feynman, Michael A. Gottlieb, Ralph Leighton, Feynman’s Tips on Physics: A Problem-Solving Supplement to the Feynman Lectures on Physics):

“There’s a round table on three legs. Where should you lean on it, so the table will be the most unstable?”
The student’s solution was, “Probably on top of one of the legs, but let me see: I’ll calculate how much force will produce what lift, and so on, at different places.”
Then I said, “Never mind calculating. Can you imagine a real table?”
“But that’s not the way you’re supposed to do it!”
“Never mind how you’re supposed to do it; you’ve got a real table here with the various legs, you see? Now, where do you think you’d lean? What would happen if you pushed down directly over a leg?”
I say, “That’s right; and what happens if you push down near the edge, halfway between two of the legs?”
“It flips over!”
I say, “OK! That’s better!”
The point is that the student had not realized that these were not just mathematical problems; they described a real table with legs. Actually, it wasn’t a real table, because it was perfectly circular, the legs were straight up and down, and so on. But it nearly described, roughly speaking, a real table, and from knowing what a real table does, you can get a very good idea of what this table does without having to calculate anything – you know darn well where you have to lean to make the table flip over. So, how to explain that, I don’t know! But once you get the idea that the problems are not mathematical problems but physical problems, it helps a lot.
Anyway, that’s just two ways of solving this problem. There’s no unique way of doing any specific problem. By greater and greater ingenuity, you can find ways that require less and less work, but that takes experience.

Which mental models “carry the most freight?” (Related follow up: Which concepts from Buffett/Munger/Mental Models do you find yourself referring to or appreciating most frequently?)

Ideas from biology and psychology since many stupidities are caused by not understanding human nature (and you get illustrations of this nearly every day). And most of our tendencies were already known by the classic writers (Publilius Syrus, Seneca, Aesop, Cicero etc.)

Others that I find very useful both in business and private is the ideas of Quantification (without the fancy math), Margin of safety, Backups, Trust, Constraints/Weakest link, Good or Bad Economics slash Competitive advantage, Opportunity cost, Scale effects. I also think Keynes idea of changing your mind when you get new facts or information is very useful.

But since reality isn’t divided into different categories but involves a lot of factors interacting, I need to synthesize many ideas and concepts.

Are there any areas of the mental models approach you feel are misunderstood or misapplied?

I don’t know about that but what I often see among many smart people agrees with Munger’s comment: “All this stuff is really quite obvious and yet most people don’t really know it in a way where they can use it.”

Anyway, I believe if you really understand an idea and what it means – not only memorizing it – you should be able to work out its different applications and functional equivalents. Take a simple big idea – think on it – and after a while you see its wider applications. To use Feynman’s advice, “It is therefore of first-rate importance that you know how to “triangulate” – that is, to know how to figure something out from what you already know.” As a good friend says, “Learn the basic ideas, and the rest will fill itself in. Either you get it or you don’t.”

Most of us learn and memorize a specific concept or method etc. and learn about its application in one situation. But when the circumstances change we don’t know what to do and we don’t see that the concept may have a wider application and can be used in many situations.

Take for example one big and useful idea – Scale effects. That the scale of size, time and outcomes changes things – characteristics, proportions, effects, behavior…and what is good or not must be tied to scale. This is a very fundamental idea from math. Munger described some of this idea’s usefulness in his worldly wisdom speech. One effect from this idea I often see people miss and I believe is important is group size and behavior. That trust, feeling of affection and altruistic actions breaks down as group size increases, which of course is important to know in business settings. I wrote about this in Seeking Wisdom (you can read more if you type in Dunbar Number on Google search). I know of some businesses that understand the importance of this and split up companies into smaller ones when they get too big (one example is Semco).

Another general idea is “Gresham’s Law” that can be generalized to any process or system where the bad drives out the good. Like natural selection or “We get what we select for” (and as Garrett Hardin writes, “The more general principle is: We get whatever we reward for).

While we are on the subject of mental models etc., let me bring up another thing that distinguishes the great thinkers from us ordinary mortals. Their ability to quickly assess and see the essence of a situation – the critical things that really matter and what can be ignored. They have a clear notion of what they want to achieve or avoid and then they have this ability to zoom in on the key factor(s) involved.

One reason to why they can do that is because they have a large repertoire of stored personal and vicarious experiences and concepts in their heads. They are masters at pattern recognition and connection. Some call it intuition but as Herbert Simon once said, “The situation has provided a cue; this cue has given the expert access to information stored in memory, and the information provides the answer. Intuition is nothing more and nothing less than recognition.

It is about making associations. For example, roughly like this:
Situation X Association (what does this remind me of?) to experience, concept, metaphor, analogy, trick, filter… (Assuming of course we are able to see the essence of the situation) What counts and what doesn’t? What works/not? What to do or what to explain?

Let’s take employing someone as an example (or looking at a business proposal). This reminds me of one key factor – trustworthiness and Buffett’s story, “If you’re looking for a manager, find someone who is intelligent, energetic and has integrity. If he doesn’t have the last, make sure he lacks the first two.”

I believe Buffett and Munger excel at this – they have seen and experienced so much about what works and not in business and behavior.

Buffett referred to the issue of trust, chain letters and pattern recognition at the latest annual meeting:

You can get into a lot of trouble with management that lacks integrity… If you’ve got an intelligent, energetic guy or woman who is pursuing a course of action, which gets put on the front page it could make you very unhappy. You can get into a lot of trouble. ..We’ve seen patterns…Pattern recognition is very important in evaluating humans and businesses. Pattern recognition isn’t one hundred percent and none of the patterns exactly repeat themselves, but there are certain things in business and securities markets that we’ve seen over and over and frequently come to a bad end but frequently look extremely good in the short run. One which I talked about last year was the chain letter scheme. You’re going to see chain letters for the rest of your life. Nobody calls them chain letters because that’s a connotation that will scare you off but they’re disguised as chain letters and many of the schemes on Wall Street, which are designed to fool people, have that particular aspect to it…There were patterns at Valeant certainly…if you go and watch the Senate hearings, you will see there are patterns that should have been picked up on.

This is what he wrote on chain letters in the 2014 annual report:

In the late 1960s, I attended a meeting at which an acquisitive CEO bragged of his “bold, imaginative accounting.” Most of the analysts listening responded with approving nods, seeing themselves as having found a manager whose forecasts were certain to be met, whatever the business results might be. Eventually, however, the clock struck twelve, and everything turned to pumpkins and mice. Once again, it became evident that business models based on the serial issuances of overpriced shares – just like chain-letter models – most assuredly redistribute wealth, but in no way create it. Both phenomena, nevertheless, periodically blossom in our country – they are every promoter’s dream – though often they appear in a carefully-crafted disguise. The ending is always the same: Money flows from the gullible to the fraudster. And with stocks, unlike chain letters, the sums hijacked can be staggering.

And of course, the more prepared we are or the more relevant concepts and “experiences” we have in our heads, the better we all will be at this. How do we get there? Reading, learning and practice so we know it “fluently.” There are no shortcuts. We have to work at it and apply it to the real world.

As a reminder to myself so I understand my limitation and “circle”, I keep a paragraph from Munger’s USC Gould School of Law Commencement Address handy so when I deal with certain issues, I don’t fool myself into believing I am Max Planck when I’m really the Chauffeur:

In this world I think we have two kinds of knowledge: One is Planck knowledge, that of the people who really know. They’ve paid the dues, they have the aptitude. Then we’ve got chauffeur knowledge. They have learned to prattle the talk. They may have a big head of hair. They often have fine timbre in their voices. They make a big impression. But in the end what they’ve got is chauffeur knowledge masquerading as real knowledge.

Which concepts from Buffett/Munger/Mental Models do you find most counterintuitive?

One trick or notion I see many of us struggling with because it goes against our intuition is the concept of inversion – to learn to think “in negatives” which goes against our normal tendency to concentrate on for example, what we want to achieve or confirmations instead of what we want to avoid and disconfirmations. Another example of this is the importance of missing confirming evidence (I call it the “Sherlock trick”) – that negative evidence and events that don’t happen, matter when something implies they should be present or happen.

Another example that is counterintuitive is Newton’s 3d law that forces work in pairs. One object exerts a force on a second object, but the second object also exerts a force equal and opposite in direction to the force acting on it – the first object. As Newton wrote, “If you press a stone with your finger, the finger is also pressed by the stone.” Same as revenge (reciprocation).

Who are some of the non-obvious, or under-the-radar thinkers that you greatly admire?

One that immediately comes to mind is one I have mentioned in the introduction in two of my books is someone I am fortunate to have as a friend – Peter Kaufman. An outstanding thinker and a great businessman and human being. On a scale of 1 to 10, he is a 15.

What have you come to appreciate more with Buffett/Munger’s lessons as you’ve studied them over the years?

Their ethics and their ethos of clarity, simplicity and common sense. These two gentlemen are outstanding in their instant ability to exclude bad ideas, what doesn’t work, bad people, scenarios that don’t matter, etc. so they can focus on what matters. Also my amazement that their ethics and ideas haven’t been more replicated. But I assume the answer lies in what Munger once said, “The reason our ideas haven’t spread faster is they’re too simple.”

This reminds me something my father-in-law once told me (a man I learnt a lot from) – the curse of knowledge and the curse of academic title. My now deceased father-in-law was an inventor and manager. He did not have any formal education but was largely self-taught. Once a big corporation asked for his services to solve a problem their 60 highly educated engineers could not solve. He solved the problem. The engineers said, “It can’t be that simple.” It was like they were saying that, “Here we have 6 years of school, an academic title, lots of follow up education. Therefore an engineering problem must be complicated”. Like Buffett once said of Ben Graham’s ideas, “I think that it comes down to those ideas – although they sound so simple and commonplace that it kind of seems like a waste to go to school and get a PhD in Economics and have it all come back to that. It’s a little like spending eight years in divinity school and having somebody tell you that the 10 commandments were all that counted. There is a certain natural tendency to overlook anything that simple and important.”

(I must admit that in the past I had a tendency to be extra drawn to elegant concepts and distracting me from the simple truths.)

What things have you come to understand more deeply in the past few years?

  • That I don’t need hundreds of concepts, methods or tricks in my head – there are a few basic, time-filtered fundamental ones that are good enough. As Munger says, “The more basic knowledge you have the less new knowledge you have to get.” And when I look at something “new”, I try to connect it to something I already understand and if possible get a wider application of an already existing basic concept that I already have in my head.
  • Neither do I have to learn everything to cover every single possibility – not only is it impossible but the big reason is well explained by the British statistician George Box. He said that we shouldn’t be preoccupied with optimal or best procedures but good enough over a range of possibilities likely to happen in practice – circumstances which the world really present to us.
  • The importance of “Picking my battles” and focus on the long-term consequences of my actions. As Munger said, “A majority of life’s errors are caused by forgetting what one is really trying to do.”
  • How quick most of us are in drawing conclusions. For example, I am often too quick in being judgmental and forget how I myself behaved or would have behaved if put in another person’s shoes (and the importance of seeing things from many views).
  • That I have to “pick my poison” since there is always a set of problems attached with any system or approach – it can’t be perfect. The key is try to move to a better set of problems one can accept after comparing what appear to be the consequences of each.
  • How efficient and simplified life is when you deal with people you can trust. This includes the importance of the right culture.
  • The extreme importance of the right CEO – a good operator, business person and investor.
  • That luck plays a big role in life.
  • That most predictions are wrong and that prevention, robustness and adaptability is way more important. I can’t help myself – I have to add one thing about the people who give out predictions on all kinds of things. Often these are the people who live in a world where their actions have no consequences and where their ideas and theories don’t have to agree with reality.
  • That people or businesses that are foolish in one setting often are foolish in another one (“The way you do anything, is the way you do everything”).
  • Buffett’s advice that “A checklist is no substitute for thinking.” And that sometimes it is easy to overestimate one’s competency in a) identifying or picking what the dominant or key factors are and b) evaluating them including their predictability. That I believe I need to know factor A when I really need to know B – the critical knowledge that counts in the situation with regards to what I want to achieve.
  • Close to this is that I sometimes get too involved in details and can’t see the forest for the trees and I get sent up too many blind alleys. Just as in medicine where a whole body scan sees too much and sends the doctor up blind alleys.
  • The wisdom in Buffett’s advice that “You only have to be right on a very, very few things in your lifetime as long as you never make any big mistakes…An investor needs to do very few things right as long as he or she avoids big mistakes.”

What’s the best investment of time/effort/money that you’ve ever made?

The best thing I have done is marrying my wife. As Buffett says and it is so so true, “Choosing a spouse is the most important decision in your life…You need everything to be stable, and if that decision isn’t good, it may affect every other decision in life, including your business decisions…If you are lucky on health and…on your spouse, you are a long way home.”

A good “investment” is taking the time to continuously improve. It just takes curiosity and a desire to know and understand – real interest. And for me this is fun.

What does your typical day look like? (How much time do you spend reading… and when?)

Every day is a little different but I read every day.

What book has most impacted your life?

There is not one single book or one single idea that has done it. I have picked up things from different books (still do). And there are different books and articles that made a difference during different periods of my life. Meeting and learning from certain people and my own practical experiences has been more important in my development. As an example – When I was in my 30s a good friend told me something that has been very useful in looking at products and businesses. He said I should always ask who the real customer is: “Who ultimately decides what to buy and what are their decision criteria and how are they measured and rewarded and who pays?

But looking back, if I have had a book like Poor Charlie’s Almanack when I was younger I would have saved myself some misery. And of course, when it comes to business, managing and investing, nothing beats learning from Warren Buffett’s Letters to Berkshire Hathaway Shareholders.

Another thing I have found is that it is way better to read and reread fewer books but good and timeless ones and then think. Unfortunately many people absorb too many new books and information without thinking.

Let me finish this with some quotes from my new book that I believe we all can learn from:

  • “There’s no magic to it…We haven’t succeeded because we have some great, complicated systems or magic formulas we apply or anything of the sort. What we have is just simplicity itself.” – Buffett
  • “Our ideas are so simple that people keep asking us for mysteries when all we have are the most elementary ideas…There’s nothing remarkable about it. I don’t have any wonderful insights that other people don’t have. Just slightly more consistently than others, I’ve avoided idiocy…It is remarkable how much long-term advantage people like us have gotten by trying to be consistently not stupid, instead of trying to be very intelligent.” – Munger
  • “It really is simple – just avoid doing the dumb things. Avoiding the dumb things is the most important.” – Buffett

Finally, I wish you and your readers an excellent day – Everyday!


Montaigne’s Rule for Reading: Pursue Pleasure



His rule in reading remained the one he had learned from Ovid: Pursue pleasure. ‘If I encounter difficulties in reading,’ he wrote, ‘I do not gnaw my nails over them; I leave them there. I do nothing without gaiety.’

How to Live: A Life of Montaigne

Michel de Montaigne (1533-1592) might have been the original “essayist” — a proto-version of Christopher Hitchens or George Orwell. Well-read, smart, critical, and with a tendency to write in a personal tone, with references to and reflections on his own thoughts and his own life.

Montaigne was known as a well-born French statesman during the time of the Reformation in Europe, when Catholic and Protestants were viciously fighting one another over the “one true church.” (The strong, violent ideologies at play ring familiar to those of us observing extreme religious terrorism today.) A century after the delivery of the printing press to the West, the Wars of Religion coincided with two historical periods that we now consider monumental —  the Renaissance and the Reformation. Such were the times molding a young Montaigne.

The son of a wealthy businessman, Montaigne was born on a chateau near Bordeaux (rough life) although his father did his best to keep him grounded — he forced Michel to spend some of his early years living with peasants in a cottage.

After a fairly rigorous education in the classics initiated by his family, a stint at boarding school, and a formal legal education, Montaigne went on to a career as a court adviser at Bordeaux Parliament, and then retired to his extensive personal library where he would begin to write. His personal essays — on topics ranging from death and the meaning of life to the cultural relativism inherent in judging Brazilian cannibals — would go on to influence every generation hence, starting with Shakespeare.

Montaigne became well-known for his devotion to skepticism in the tradition of the Pyrrhonians. In short: A constant withholding of judgment, a deep distrust of his own knowledge, and a desire to avoid ideology and overreaching.  In fact, one of the pillars of the Pyrrhonian style of thought was to construct both sides of an argument as cogently as possible before leaning one way or another, something reminiscent of Charlie Munger’s work required to hold an opinion and a foundation of modern legal training. This devotion of Montaigne’s, combined with the personal feel and wide-ranging topics of his writing, made him the first of his kind as a writer.

In the wonderful biography How to Live: A Life of Montaigne, by Sarah Bakewell, we learn a bit about the books that influenced Montaigne himself. As would have been the case for most of his contemporaries, his primary influences were classics from Greece and Rome. He started with the 16th century’s version of the Grimm Brothers: Ovid’s Metamorphoses, and then moved on to Virgil’s Aeneid and some modern comedic plays. In other words, Montaigne started out with works of fiction:

One unsuitable text which Montaigne discovered for himself at the age of seven or eight was Ovid’s Metamorphoses. This tumbling cornucopia of stories about miraculous transformations among ancient gods and mortals was the closest thing the Renaissance had to a compendium of fairy tales…In Ovid, people change. They turn into trees, animals, stars, bodies of water, or disembodied voices. They alter sex; they become werewolves. A woman called Scylla enters a poisonous pool and sees each of her limbs turn into a dog-like monster from which she cannot pull away because the monsters are also her….Once a taste of this sort of thing had started him off, Montaigne galloped through other books similarly full of good stories: Virgil’s Aeneid, then Terence, Plautus, and various modern Italian comedies. He learned, in defiance of school policy, to associate reading with excitement.

As he got older, though, Montaigne turned more and more to non-fiction, to works of real life. In his words, reading non-fiction taught you about the ‘diversity and truth of man,’ as well as ‘the variety of ways he is put together, and the accidents that threaten him.’

The best material he had available to him were from the classical stylings of writers like Tacitus, historian of the Roman periods in the early years after Christ; Plutarch, the biographer of the eminent Greeks and Romans; and Lucretius, the Roman philosophical poet. In Bakewell’s biography, we learn what it was he loved about these authors:

He loved how Tacitus treated public events from the point of view of ‘private behavior and inclinations’ and was struck by the historian’s fortune in living through a ‘strange and extreme’ period, just as Montaigne himself did. Indeed, he wrote of Tacitus ‘you would often say that it is us he is describing.’

Turning to biographers, Montaigne liked those who went beyond the external events of a life and tried to reconstruct a person’s inner world from the evidence. No one excelled in this more than his favorite writer of all — the Greek biographer Plutarch, who lived from around AD 46 to around 120 and whose vast Lives presented narratives of notable Greeks and Romans in themed pairs.

Plutarch was to Montaigne what Montaigne was to many later readers: a model to follow, and a treasure-chest of ideas, quotations, and anecdotes to plunder. ‘He is so universal and so full that on all occasions and however eccentric the subject you have taken up, he makes his way into your work.’


Montaigne also loved the strong sense of Plutarch’s own personality that comes across in his work: ‘I think I know him even into his soul.’ This was what Montaigne looked for in a book, just as people later looked for it in him: the feeling of meeting a real person across the centuries. Reading Plutarch, he lost awareness of the gap in time that divided them — much bigger than the gap between Montaigne and us.

The last point is, of course, sort of fascinating. When we think about Montaigne, he seems a whole world away. 16th century France is a place we fill in our imagination with velvet cloth and kings and queens and peasants and history class. Impossibly far in the past. But that period was only 450 short years ago; Montaigne himself was reading authors 1,500 years or more before him! A far greater gap in time. Yet he felt their insights were as relevant as when they were written — a lesson we should all learn from.

We can also get a glimpse of the kind of reader Montaigne considered himself: A pretty lazy one.

I leaf through now one book, now another,’ he wrote,’ without order and without plan, by disconnected fragments.’ He could sound positively cross if he thought anyone might suspect him of careful scholarship. Once, catching himself having said that books offer consolation, he hastily added, ‘Actually I use them scarcely any more than those who do not know them at all.’ And one of his sentences starts, ‘We who have little contact with books…’

His rule in reading remained the one he had learned from Ovid: pursue pleasure. ‘If I encounter difficulties in reading,’ he wrote, ‘I do not gnaw my nails over them; I leave them there. I do nothing without gaiety.’

Although Bakewell, and we, suspect he was feigning some humility as far as his laziness; of the second point on pursuing pleasure, Bakewell writes that Montaigne took this philosophy of gentleness and freedom and, “Of this, Montaigne made a whole principle of living.”

Still interested? Pick up Montaigne’s Essays and Bakewell’s biography for more.

Schopenhauer: On Reading and Books

One of the most timeless and beautiful meditations on reading comes from the 19th-century German philosopher Arthur Schopenhauer(1788–1860).

Schopenhauer: On Reading and Books

Finding time to read has never been an issue for me. I read different books at different levels — you don’t put the same effort into Harry Potter as you do Seneca.  Reading is the best way to get smarter. And while I’ve always taken notes while reading to improve my ability to remember what I’ve read, I’ve had a nagging feeling that I was missing part of the work.

Perhaps, I’ve been reading too much and reflecting too little.

As I reflect more on the relationship between reading and acquiring wisdom, I discovered Schopenhauer’s classic On Reading and Books.

For me, reading has always been about this website’s tagline: Mastering the best of what other people have already figured out.

In The Prince, Machiavelli offered the following advice:  “A wise man ought always to follow the paths beaten by great men, and to imitate those who have been supreme, so that if his ability does not equal theirs, at least it will savour of it.”

Seneca, writing on the same subject, said, “Men who have made these discoveries before us are not our masters, but our guides.”

So it makes sense to start with the people that came before us. No matter what problem we face, odds are someone has faced it before and written about it. No need to start from scratch right?


We return to the fundamental questions. What does it mean to read? Is reading the path to acquiring wisdom? If not why?

These are the questions that Schopenhauer attempts to address.


Mortimer Adler believed that reading is a conversation between you and the author. On this Schopenhauer comments:

When we read, another person thinks for us: we merely repeat his mental process. It is the same as the pupil, in learning to write, following with his pen the lines that have been pencilled by the teacher. Accordingly, in reading, the work of thinking is, for the greater part, done for us. This is why we are consciously relieved when we turn to reading after being occupied with our own thoughts. But, in reading, our head is, however, really only the arena of some one else’s thoughts. And so it happens that the person who reads a great deal — that is to say, almost the whole day, and recreates himself by spending the intervals in thoughtless diversion, gradually loses the ability to think for himself; just as a man who is always riding at last forgets how to walk.

Such, however, is the case with many men of learning: they have read themselves stupid. For to read in every spare moment, and to read constantly, is more paralyzing to the mind than constant manual work, which, at any rate, allows one to follow one’s own thoughts.

Just as a spring, through the continual pressure of a foreign body, at last loses its elasticity, so does the mind if it has another person’s thoughts continually forced upon it. And just as one spoils the stomach by overfeeding and thereby impairs the whole body, so can one overload and choke the mind by giving it too much nourishment. For the more one reads the fewer are the traces left of what one has read; the mind is like a tablet that has been written over and over. Hence it is impossible to reflect; and it is only by reflection that one can assimilate what one has read if one reads straight ahead without pondering over it later, what has been read does not take root, but is for the most part lost. Indeed, it is the same with mental as with bodily food: scarcely the fifth part of what a man takes is assimilated; the remainder passes off in evaporation, respiration, and the like.

From all this it may be concluded that thoughts put down on paper are nothing more than footprints in the sand: one sees the road the man has taken, but in order to know what he saw on the way, one requires his eyes.

It’s important to take time to think about what we’re reading and not merely assume the thoughts of the author. We need to digest, synthesize, and organize the thoughts of others if we are to understand. This is the grunt work of thinking. It’s how we acquire wisdom.

This is how we acquire foundational knowledge. The knowledge that allows us to pull forth relevance when reading and bring it to consciousness. Without this foundational knowledge, we are unable to separate the signal from the noise.

No literary quality can be attained by reading writers who possess it: be it, for example, persuasiveness, imagination, the gift of drawing comparisons, boldness or bitterness, brevity or grace, facility of expression or wit, unexpected contrasts, a laconic manner, naïveté, and the like. But if we are already gifted with these qualities — that is to say, if we possess them potentia — we can call them forth and bring them to consciousness; we can discern to what uses they are to be put; we can be strengthened in our inclination, nay, may have courage, to use them; we can judge by examples the effect of their application and so learn the correct use of them; and it is only after we have accomplished all this that we actu possess these qualities.

Reading consumes time. And if we equate time with money, it should not be wasted on bad books. In an argument that pulls to mind two filters for what to read, Schopenhauer writes:

It is the same in literature as in life. Wherever one goes one immediately comes upon the incorrigible mob of humanity. It exists everywhere in legions; crowding, soiling everything, like flies in summer. Hence the numberless bad books, those rank weeds of literature which extract nourishment from the corn and choke it.

They monopolise the time, money, and attention which really belong to good books and their noble aims; they are written merely with a view to making money or procuring places. They are not only useless, but they do positive harm. Nine-tenths of the whole of our present literature aims solely at taking a few shillings out of the public’s pocket, and to accomplish this, author, publisher, and reviewer have joined forces.

There is a more cunning and worse trick, albeit a profitable one. Littérateurs, hack-writers, and productive authors have succeeded, contrary to good taste and the true culture of the age, in bringing the world elegante into leading-strings, so that they have been taught to read a tempo and all the same thing — namely, the newest books order that they may have material for conversation in their social circles. … But what can be more miserable than the fate of a reading public of this kind, that feels always impelled to read the latest writings of extremely commonplace authors who write for money only, and therefore exist in numbers? And for the sake of this they merely know by name the works of the rare and superior writers, of all ages and countries.


Knowing what to read is important but so is its inversion— knowing what not to read.

This consists in not taking a book into one’s hand merely because it is interesting the great public at the time — such as political or religious pamphlets, novels, poetry, and the like, which make a noise and reach perhaps several editions in their first and last years of existence. Remember rather that the man who writes for fools always finds a large public: and only read for a limited and definite time exclusively the works of great minds, those who surpass other men of all times and countries, and whom the voice of fame points to as such. These alone really educate and instruct.

One can never read too little of bad, or too much of good books: bad books are intellectual poison; they destroy the mind.

In Norwegian Wood, Haruki Murakami makes the argument that “If you only read the books that everyone else is reading, you can only think what everyone else is thinking.” On this Schopenhauer said:

Oh, how like one commonplace mind is to another! How they are all fashioned in one form! How they all think alike under similar circumstances, and never differ! This is why their views are so personal and petty.

On the two types of literature, Schopenhauer comments:

There are at all times two literatures which, although scarcely known to each other, progress side by side — the one real, the other merely apparent. The former grows into literature that lasts. Pursued by people who live for science or poetry, it goes its way earnestly and quietly, but extremely slowly; and it produces in Europe scarcely a dozen works in a century, which, however, are permanent. The other literature is pursued by people who live on science or poetry; it goes at a gallop amid a great noise and shouting of those taking part, and brings yearly many thousand works into the market. But after a few years one asks, Where are they? where is their fame, which was so great formerly? This class of literature may be distinguished as fleeting, the other as permanent.


Commenting on why we learn little from what we read, he writes:

It would be a good thing to buy books if one could also buy the time to read them; but one usually confuses the purchase of books with the acquisition of their contents. To desire that a man should retain everything he has ever read, is the same as wishing him to retain in his stomach all that he has ever eaten. He has been bodily nourished on what he has eaten, and mentally on what he has read, and through them become what he is. As the body assimilates what is homogeneous to it, so will a man retain what interests him; in other words, what coincides with his system of thought or suits his ends. Every one has aims, but very few have anything approaching a system of thought. This is why such people do not take an objective interest in anything, and why they learn nothing from what they read: they remember nothing about it.

But reading good works is not enough. We must re-read important works immediately because it aids our understanding, a concept that Mortimer Adler echoes.

Any kind of important book should immediately be read twice, partly because one grasps the matter in its entirety the second time, and only really understands the beginning when the end is known; and partly because in reading it the second time one’s temper and mood are different, so that one gets another impression; it may be that one sees the matter in another light.

And the final part of the essay I want to draw your attention to speaks to how advancement happens in a flurry of false starts, and answers the age-old question of why so many luminaries — whether scientific or even artistic — fail to be recognized in their present age as they will later come to be seen by the world.

… imagine the progress of knowledge among mankind in the form of a planet’s course. The false paths the human race soon follows after any important progress has been made represent the epicycles in the Ptolemaic system; after passing through any one of them the planet is just where it was before it entered it. The great minds, however, which really bring the race further on its course, do not accompany it on the epicycles which it makes every time. This explains why posthumous fame is got at the expense of contemporary fame, and vice versâ.

If you think Schopenhauer is for you, pick up a copy of The Essential Schopenhauer: Key Selections from The World As Will and Representation and Other Writings.

The Top 3 Most Effective Ways to Take Notes While Reading

Taking Notes While Reading


Before you get started: Filter the book by reading the preface, index, table of contents, and inside jacket. This tells you where the author is going to take you and, importantly, the vocabulary they will use.

The three steps to effectively taking notes while reading, which I elaborate on later, are:

  1. At the end of each chapter write a few bullet points that summarize what you’ve read and make it personal if you can — that is, apply it to something in your life. Also note any unanswered questions. When you’re done the book, put it down for a week.
  2. Pick up the book again and go through all your notes. Most of these will be garbage but there will be lots you want to remember. Write the good stuff on the inside cover of the book along with a page number.
  3. Copy out the excerpts by hand or take a picture of them to pop into Evernote. Tag accordingly.


Dear Shane,
Can you tell me how you take notes while reading?

— Jeff

I’ve been asked this question a lot. Everyone wants to know how to read a book. Well, one of the best ways to better filter and connect ideas is to read with pen in hand so you can take notes while reading. This Marginalia — the tiny fragments that come into your head while reading — is a dying but important art that helps you remember what you read.

Like almost everything in life there is no magical answer that fits everyone. I can speak to the three-step process that works effectively for me on up to 150 books a year. However, you’re going to have to see if that works for you. While this sounds like a bit of trial and error (because it is), it’s the only way to create lasting habit changes, improve your recall, and be able to easily find that passage you’re looking for.

Taking Notes While Reading

Step One.
The first thing I do when I pick up a book is read the preface, the table of contents, and the inside jacket. Often, I’ll glance over the index too. This doesn’t take long and often saves me time, as a lot of books do not make it past this filter. Maybe it doesn’t contain the information I’m trying to gain. If it seems crappy, I’ll flip to a few random pages to verify.

This filter is a form of systematic skimming. This isn’t my term, Mortimer Adler, a guy who literally wrote the the book on reading, came up with it. Adler says there are four levels of reading. I tend to blend inspectional reading and analytical reading together for most books.

When I start reading the book, I have an idea what it’s about, the main argument, and some of the terminology involved. I know where the author is going to take me and the broad strokes of how they will bring me along.

While reading, I take notes. I circle words I need to look up. I star points that I think are critical to the argument. I underline anything that strikes me as interesting. I comment like a mad man in the margins. I try to tease out assumptions, etc.

Essentially, I’m trying to engage in a conversation with the author. Maybe my questions will be answered on the next page or in the next chapter. Maybe I’ll need to find another book to answer them. Who knows. But I write them down.

At the end of each chapter I write a few bullet points that summarize what I’ve just read. When I’m done, I let the book age. I put the book on my desk and I won’t touch it for anywhere from a few days to a week.

Step two.
When I pick the book up again, I re-read every scribble, underline, and comment I’ve made (assuming I can still read my writing).

I’m not the same person I was the first time I read the book, two things have changed: (1) I’ve read the entire book and (2) I’ve had a chance to sleep on what may have seemed earth-shattering at the time but now just seems meh.

If something still strikes my interest, I write a note in the first few pages of the book, in my own words, on the topic. Often this is a summary but increasingly it’s ways to apply the knowledge. I index this to the page number in the book.

Sometimes, and this depends on the book, I’ll create a sort of mental summary of the book’s main arguments and gaps. Sometimes I’ll cross-link points with other books.

Step 3 (optional).
Wait a few days. Then go through the book and copy out excerpts by hand and put them into your repository or common place book.


If you liked this article, you’ll love these four. 

The Feynman Technique: The Best Way to Learn Anything — Nobel winner Richard Feynman shares his secret to learning anything, which also works as an excellent framework for thinking and identifying gaps in other peoples knowledge.

A System for Remembering What you Read — The system I use for non-fiction books that enables me to remember quite a bit. And when I can’t remember I generally know where to look to find the answers.

The Art of Reading — We literally created a course to help people learn to read better and more effectively.

The Most Effective Way to Retain What You Read — Become a more effective reader with these simple tips from Nassim Taleb and psychologist Robert Cialdini designed to help you retain more of what you read.

The Most Effective Way to Retain What You Read

“Nothing so much assists learning
as writing down what we wish to remember.”
— Cicero


One of the keys to getting smarter is to read a lot.

But that’s not enough. How you read matters.

But reading is only one part of the equation. You need to remember what you read.

We’re going to borrow tips from Robert Cialdini, author of Influence: The Psychology of Persuasion, and Nassim Taleb, author of The Black Swan and Antifragile, to make our reading go deeper and stay with us longer.

Cialdini revealed a trick that he uses, to a reader of Farnam Street, who was kind enough to share it with me.

While on the flight to Omaha, he was reading. He took notes on the material itself, and every time he completed a chapter he pulled out a sheet of white paper and wrote a single page summary on what he had just read. He places the paper in another folder. This is how he gets his learning deeper and this also enables him to refer to summaries in the future.

This isn’t the first time we’ve talked about this. In his book, The Little Book of Talent: 52 Tips for Improving Your Skills, Daniel Coyle writes:

Research shows that people who follow strategy B [read ten pages at once, then close the book and write a one page summary] remember 50 percent more material over the long term than people who follow strategy A [read ten pages four times in a row and try to memorize them].

But is there something more we can do?

Nassim Taleb says “Don’t write [a] summary, write bullet points of what comes to mind that you can apply somewhere.”


Still curious? Check out my system for remembering what you read. And read The Little Book of Talent and Influence. Also, if you want to learn to read better, see The Art of Reading: How to Read A Book.