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Tag Archives: Warren Buffett

Book Recommendations by the Legendary Washington Post CEO Don Graham

“My goal in reading a book is to entertain myself and perhaps to learn.
You won’t read much unless what you read is enjoyable for you.”
— Don Graham

***

In 1973, Warren Buffett famously began investing in the stock of the newly public Washington Post. Watergate was on, the stock market was crashing, and the Post, led by Katherine Graham, was a wonderful company selling at a cheap price.

Over time, Mrs. Graham would pass the CEO mantle to her son, Don Graham. With Buffett’s board level influence, Graham would become one of the most successful and admired CEO’s in the media business, financially and editorially.

While other papers were busy buying up news or television properties one after another, mostly financed with debt, Buffett encouraged Graham to stick to his knitting. And so when media properties (including the Post) began to rapidly lose their value in the 1990’s and 2000’s thanks to the Internet, the Post survived intact. (Helped along by the shrewd purchase of Kaplan Inc.)

The Grahams’ reign running the Post was so successful that it was later profiled in The Outsiders, a book by Columbia’s William Thorndike which showed how a group of “unconventional” CEOs generated way above average shareholder returns through smart capital allocation and decentralized operating management.

Graham, now the CEO of Graham Holdings and the lead independent director of Facebook, seems woefully understudied as an operator and a human being. But we do have one window into the man: His book recommendations.

Graham actively answers questions on Quora, mostly about books, so we went through and collected some of his thoughts.

The long time head of a major media organization is someone who must, by the nature of their work, be broadly educated and broadly wise. And his interest in books shows it: Graham is clearly a fan of the classics and of biography and history. (Not altogether surprising for a man who was part of the Pulitzer Prize board for many years.)

Among his answers are his favourite fiction and non-fiction books and the book that will stay with him forever. (One obvious choice would be his mother's wonderful memoir.)

***

First, his response to a 14-year old asking which books he should read, to which Graham gave a wonderful answer:

I would—for a lifetime—think first about “what will I enjoy reading,” and only second about “what is good for me.” If you like novels, I’d read novels. If you like biographies, I’d read biographies. If you like science fiction, mysteries, or science books, I’d read those. But read the best, and keep asking what that is.

***

What is that one book that will stay with you forever?

The Plays of William Shakespeare by William Shakespeare (“They are incomparable.”)

What is Your Favorite Non-Fiction book?

The Life of Samuel Johnson by James Boswell (Also his answer to: What is the most instructive biography you've ever read?)

The Civil War by Shelby Foote (“The greatest work of American history.”)

What is your Favorite Fiction book?

Anna Karenina by Leo Tolstoy

Middlemarch by George Eliot

Which book are you currently reading?

Margaret Thatcher: From Grantham to the Falklands by Charles Moore

What was the last book you read? 

Everybody's Fool by Richard Russo (“I would not only recommend it; I’d say it is my favorite contemporary American novel.”)

Who was the most peace-oriented US President?

Ike's Bluff: President Eisenhower's Secret Battle to Save the World by Evan Thomas (“If the subject of your question is of great interest to you, I strongly recommend reading it.

Can you suggest a book about a survivor of an extreme experience?

The Man Who Stayed Behind by Sidney Rittenberg and Amanda Bennett (“As a discharged GI in China with leftist sympathies, he hitchhiked across China to Yenan, lived in the caves with Mao Zedong and the whole leadership, and became Mao's translator, among other things.”)

What are the best literary nonfiction books about the Gilded Age?

The Robber Barons by Matthew Josephson (“The classic history of this aspect of the age.”)

Jim Fisk by W.A. Swanberg and The Murder of Jim Fisk by H. W. Brands (“Both excellent.”)

What are some books that were well-written and popular for awhile but are now largely forgotten?

Second Readings by Jonathan Yardley

A Literary Education and Other Essays by Joseph Epstein

What books should the privileged read in order to gain perspective and empathy for the underprivileged?

Behind the Beautiful Forevers by Katharine Boo (“It is a great, great book.”)

What are the best books written about the Supreme Court?

John Marshall by Jean Edward Smith

The Supreme Court by William Rehnquist

What are some good books to help one understand communism?

The Great Terror by Robert Conquest. (“Almost unbearable in its chapter-by-chapter description of life under Stalin’s rule.”)

Gulag by Anne Applebaum

What book would you recommend for becoming a “gentleman”?

Letters to His Son on Becoming a Man of the World and a Gentleman by Lord Chesterfield

Which U.S. President was the best writer?

Lincoln: Speeches and Writings: 1859-1865 by Abraham Lincoln (“There's only one choice.”)

 

Bias from Disliking/Hating

(This is a follow-up to our post on the Bias from Liking/Loving, which you can find here.)

Think of a cat snarling and spitting, lashing with its tail and standing with its back curved. Her pulse is elevated, blood vessels constricted and muscles tense. This reaction may sound familiar, because everyone has experienced the same tensed-up feeling of rage at least once in their lives.

When rage is directed towards an external object, it becomes hate. Just as we learn to love certain things or people, we learn to hate others.

There are several cognitive processes that awaken the hate within us and most of them stem from our need for self-protection.

Reciprocation

We tend to dislike people who dislike us (and, true to Newton, with equal strength.) The more we perceive they hate us, the more we hate them.

Competition

A lot of hate comes from scarcity and competition. Whenever we compete for resources, our own mistakes can mean good fortune for others. In these cases, we affirm our own standing and preserve our self-esteem by blaming others.

Robert Cialdini explains that because of the competitive environment in American classrooms, school desegregation may increase the tension between children of different races instead of decreasing it. Imagine being a secondary school child:

If you knew the right answer and the teacher called on someone else, you probably hoped that he or she would make a mistake so that you would have a chance to display your knowledge. If you were called on and failed, or if you didn't even raise your hand to compete, you probably envied and resented your classmates who knew the answer.

At first we are merely annoyed. But then as the situation fails to improve and our frustration grows, we are slowly drawn into false attributions and hate. We keep blaming and associating “the others” who are doing better with the loss and scarcity we are experiencing (or perceive we are experiencing). That is one way our emotional frustration boils into hate.

Us vs. Them

The ability to separate friends from enemies has been critical for our safety and survival. Because mistaking the two can be deadly, our mental processes have evolved to quickly spot potential threats and react accordingly. We are constantly feeding information about others into our “people information lexicon” that forms not only our view of individuals, whom we must decide how to act around, but entire classes of people, as we average out that information.

To shortcut our reactions, we classify narrowly and think in dichotomies: right or wrong, good or bad, heroes or villains. (The type of Grey Thinking we espouse is almost certainly unnatural, but, then again, so is a good golf swing.) Since most of us are merely average at everything we do, even superficial and small differences, such as race or religious affiliation, can become an important source of identification. We are, after all, creatures who seek to belong to groups above all else.

Seeing ourselves as part of a special, different and, in its own way, superior group, decreases our willingness to empathize with the other side. This works both ways – the hostility towards the others also increases the solidarity of the group. In extreme cases, we are so drawn towards the inside view that we create a strong picture of the enemy that has little to do with reality or our initial perceptions.

From Compassion to Hate

We think of ourselves as compassionate, empathetic and cooperative. So why do we learn to hate?

Part of the answer lies in the fact that we think of ourselves in a specific way. If we cannot reach a consensus, then the other side, which is in some way different from us, must necessarily be uncooperative for our assumptions about our own qualities to hold true.

Our inability to examine the situation from all sides and shake our beliefs, together with self-justifying behavior, can lead us to conclude that others are the problem. Such asymmetric views, amplified by strong perceived differences, often fuel hate.

What started off as odd or difficult to understand, has quickly turned into unholy.

If the situation is characterized by competition, we may also see ourselves as a victim. The others, who abuse our rights, take away our privileges or restrict our freedom are seen as bullies who deserve to be punished. We convince ourselves that we are doing good by doing harm to those who threaten to cross the line.

This is understandable. In critical times our survival indeed may depend on our ability to quickly spot and neutralize dangers. The cost of a false positive – mistaking a friend for a foe – is much lower than the potentially fatal false negative of mistaking our adversaries for innocent allies. As a result, it is safest to assume that anything we are not familiar with is dangerous by default. Natural selection, by its nature, “keeps what works,” and this tendency towards distrust of the unfamiliar probably survived in that way.

The Displays of Hate

Physical and psychological pain is very mobilizing. We despise foods that make us nauseous and people that have hurt us. Because we are scared to suffer, we end up either avoiding or destroying the “enemy”, which is why revenge can be pursued with such vengeance. In short, hate is a defense against enduring pain repeatedly.

There are several ways that the bias for disliking and hating display themselves to the outer world. The most obvious of them is war, which seems to have been more or less prevalent throughout the history of mankind.

This would lead us to think that war may well be unavoidable. Charlie Munger offers the more moderate opinion that while hatred and dislike cannot be avoided, the instances of war can be minimized by channeling our hate and fear into less destructive behaviors. (A good political system allows for dissent and disagreement without explosions of blood upheaval.)

Even with the spread of religion, and the advent of advanced civilization, modern war remains pretty savage. But we also get what we observe in present-day Switzerland and the United States, wherein the clever political arrangements of man “channel” the hatreds and dislikings of individuals and groups into nonlethal patterns including elections.

But these dislikings and hatreds that are arguably inherent to our nature never go away completely and transcend themselves into politics. Think of the dichotomies. There is the left versus the right wing, the nationalists versus the communists and libertarians vs. authoritarians. This might be the reason why there are maxims like: “Politics is the art of marshaling hatreds.

Finally, as we move away from politics, arguably the most sophisticated and civilized way of channeling hatred is litigation. Charlie Munger attributes the following words to Warren Buffett:

A major difference between rich and poor people is that the rich people can spend their lives suing their relatives.

While most of us reflect on our memories of growing up with our siblings with fondness, there are cases where the competition for shared attention or resources breeds hatred. If the siblings can afford it, they will sometimes litigate endlessly to lay claims over their parents' property or attention.

Under the Influence of Bias

There are several ways that bias from hating can interfere with our normal judgement and lead to suboptimal decisions.

Ignoring Virtues of The Other Side

Michael Faraday was once asked after a lecture whether he implied that a hated academic rival was always wrong. His reply was short and firm “He’s not that consistent.” Faraday must have recognized the bias from hating and corrected for it with the witty comment.

What we should recognize here is that no situation is ever black or white. We all have our virtues and we all have our weaknesses. However, when possessed by the strong emotions of hate, our perceptions can be distorted to the extent that we fail to recognize any good in the opponent at all. This is driven by consistency bias, which motivates us to form a coherent (“she is all-round bad”) opinion of ourselves and others.

Association Fueled Hate

The principle of association goes that the nature of the news tends to infect the teller. This means that the worse the experience, the worse the impression of anything related to it.

Association is why we blame the messenger who tells us something that we don't want to hear even when they didn't cause the bad news. (Of course, this creates an incentive not to speak truth and avoid giving bad news.)

A classic example is the unfortunate and confused weatherman, who receives hate mail, whenever it rains. One went so far as to seek advice from the Arizona State professor of psychology, Robert Cialdini, whose work we have discussed before.

Cialdini explained to him that in light of the destinies of other messengers, he was born lucky. Rain might ruin someone’s holiday plans, but it will rarely change the destiny of a nation, which was the case of Persian war messengers. Delivering good news meant a feast, whereas delivering bad news resulted in their death.

The weatherman left Cialdini’s office with a sense of privilege and relief.

“Doc,” he said on his way out, “I feel a lot better about my job now. I mean, I'm in Phoenix where the sun shines 300 days a year, right? Thank God I don't do the weather in Buffalo.”

Fact Distortion

Under the influence of liking or disliking bias we tend to fill gaps in our knowledge by building our conclusions on assumptions, which are based on very little evidence.

Imagine you meet a woman at a party and find her to be a self-centered, unpleasant conversation partner. Now her name comes up as someone who could be asked to contribute to a charity. How likely do you feel it is that she will give to the charity?

In reality, you have no useful knowledge, because there is little to nothing that should make you believe that people who are self-centered are not also generous contributors to charity. The two are unrelated, yet because of the well-known fundamental attribution error, we often assume one is correlated to the other.

By association, you are likely to believe that this woman is not likely to be generous towards charities despite lack of any evidence. And because now you also believe she is stingy and ungenerous, you probably dislike her even more.

This is just an innocent example, but the larger effects of such distortions can be so extreme that they lead to a major miscognition. Each side literally believes that every single bad attribute or crime is attributable to the opponent.

Charlie Munger explains this with a relatively recent example:

When the World Trade Center was destroyed, many Pakistanis immediately concluded that the Hindus did it, while many Muslims concluded that the Jews did it. Such factual distortions often make mediation between opponents locked in hatred either difficult or impossible. Mediations between Israelis and Palestinians are difficult because facts in one side's history overlap very little with facts from the other side's. These distortions and the overarching mistrust might be why some conflicts seem to never end.

Avoiding Being Hated

To varying degrees we value acceptance and affirmation from others. Very few of us wake up wanting to be disliked or rejected. Social approval, at its heart the cause of social influence, shapes behavior and contributes to conformity. Francois VI, Duc de La Rochefoucauld wrote: “We only confess our little faults to persuade people that we have no big ones.”

Remember the old adage, “The nail that sticks out gets hammered down.” This is why we don't openly speak the truth or question people, we don't want to be the nail.

How do we resolve hate?

It is only normal that we can find more common ground with some people than with others. But are we really destined to fall into the traps of hate or is there a way to take hold of these biases?

That’s a question worth over a hundred million lives. There are ways that psychologists think that we can minimize prejudice against others.

Firstly, we can engage with others in sustained close contact to breed our familiarity. The contact must not only be prolonged, but also positive and cooperative in nature – either working towards a common cause or against a common enemy.

Secondly, we also reduce prejudice by attaining equal status in all aspects, including education, income and legal rights. This effect is further reinforced, when equality is supported not only “on paper”, but also ingrained within broader social norms.

And finally the obvious – we should practice awareness of our own emotions and ability to hold back on the temptations to dismiss others. Whenever confronted with strong feelings it might simply be best to sit back, breathe and do our best to eliminate the distorted thinking.

 

***

Want more? Check out the opposite bias of liking/loving, or check out a whole bunch of mental models.

Gradually Getting Closer to the Truth

You can use a big idea without a physics-like need for exact precision. The key to remember is moving closer to reality by updating.

Consider this excerpt from Philip Tetlock and Dan Gardner in Superforecasting

The superforecasters are a numerate bunch: many know about Bayes' theorem and could deploy it if they felt it was worth the trouble. But they rarely crunch the numbers so explicitly. What matters far more to the superforecasters than Bayes' theorem is Bayes' core insight of gradually getting closer to the truth by constantly updating in proportion to the weight of the evidence.

So they know the numbers. This numerate filter is the second of Garrett Hardin‘s three filters we need to think about problems.

Hardin writes:

The numerate temperament is one that habitually looks for approximate dimensions, ratios, proportions, and rates of change in trying to grasp what is going on in the world.

[…]

Just as “literacy” is used here to mean more than merely reading and writing, so also will “numeracy” be used to mean more than measuring and counting. Examination of the origins of the sciences shows that many major discoveries were made with very little measuring and counting. The attitude science requires of its practitioners is respect, bordering on reverence, for ration, proportions, and rates of change.

Rough and ready back-of-the-envelope calculations are often sufficient to reveal the outline of a new and important scientific discovery … In truth, the essence of many of the major insights of science can be grasped with no more than child’s ability to measure, count, and calculate.

 

We can find another example in investing. Charlie Munger, commenting at the 1996 Berkshire Hathaway Annual Meeting, said: “Warren often talks about these discounted cash flows, but I’ve never seen him do one. If it isn’t perfectly obvious that it’s going to work out well if you do the calculation, then he tends to go on to the next idea.” Buffett retorted: “It's true. If (the value of a company) doesn't just scream out at you, it's too close.”

Precision is easy to teach but it's missing the point.

The Inner Scorecard

“The big question about how people behave is whether they've got an Inner Scorecard or an Outer Scorecard. It helps if you can be satisfied with an Inner Scorecard.”
— Warren Buffett

***

Human beings are, in large part, driven by the admiration of their peers.

We seek to satisfy a deep biological need by acting in such a way that we feel praise and adulation; for our wealth, our success, our skills, our looks. It could be anything. The trait we are admired for matters less than the admiration itself. The admiration is the token we dance for. We feel envy when others are getting more tokens than us, and we pity ourselves when we're not getting any.

There's nothing inherently wrong with this. The pursuit of (deserved) admiration causes us to drive and accomplish. It's a part of the explanation for why the human world has moved along so far from where it started — we're willing to do extraordinary things that are extraordinarily difficult, like starting a company from scratch, inventing a new and better product, solving some ridiculously complicated theorem, or conquering unknown territory.

This is all well and good.

The problems come when we start compromising our own standards, those we have set for ourselves, in order to earn admiration. False, undeserved admiration.

Warren Buffett frequently relates an interesting way to frame this problem. From Alice Schroeder's Buffett biography The Snowball:

Lookit. Would you rather be the world’s greatest lover, but have everyone think you’re the world’s worst lover? Or would you rather be the world’s worst lover but have everyone think you’re the world’s greatest lover? Now, that’s an interesting question. “Here’s another one. If the world couldn’t see your results, would you rather be thought of as the world’s greatest investor but in reality have the world’s worst record? Or be thought of as the world’s worst investor when you were actually the best?

Buffett's getting at a rather fundamental model he's used most of his life: The Inner Scorecard. It's a major reason Buffett has stayed so successful for so long, with so little failure or scandal intervening: While most are are “checking the official time,” Buffett is setting his watch by an internal clock!

The investor Guy Spier once won a charity lunch with Buffett, and related his experience in a book called The Education of a Value Investor. He immediately recognized Buffett's lack of falseness:

One of Buffett’s defining characteristics is that he so clearly lives by his own inner scorecard. It isn’t just that he does what’s right, but that he does what’s right for him. As I saw during our lunch, there’s nothing fake or forced about him. He sees no reason to compromise his standards or violate his beliefs. Indeed, he has told Berkshire’s shareholders that there are things he could do that would make the company bigger and more profitable, but he’s not prepared to do them. For example, he resists laying people off or selling holdings that he could easily replace with more profitable businesses. Likewise, some investors have complained that Berkshire would be much more profitable if he’d moved its tax domicile to Bermuda as many other insurers have done. But Buffett doesn’t want to base his company in Bermuda even though it would be legal and would have saved tens of billions in taxes.

We don't, by the way, claim Buffett has an unblemished record. That would not be accurate. But it does seem that his record is far more spotless than others who have climbed as far as he has.

If Buffett was “setting his clock externally” — living by the standards of others — he would not have been able to maintain the independence of mind that led him to avoid a number of financial bubbles and tremendous personal misery.

What Buffett and a lot of other people who have been successful in life — true success, not money — have in common is that they're able to remember what we all set out to do: live a fulfilling life! Not get rich. Not get famous. Not even get admiration, necessarily. But to live a satisfying existence and help others around them do the same.

It's not that getting rich or famous or admired can't be deeply satisfying. It can be! I'm positive Buffett deeply enjoys his wealth and status. He's got more “admiration tokens” than almost anyone in the world.

But all of that can be ruined very, very easily along the way by making too many compromises, by living according to an external scorecard rather than an internal one. How many stories have you heard of famous and/or wealthy folks becoming entrapped in constant lawsuits, bickering, loneliness, and pure unhappiness? A countless number, right?

Bernie Madoff achieved great admiration and wealth, but was he happy? He made it clear, after he'd been caught, that he wasn't. Here was a guy who had all the admiration tokens in the world, an External Scorecard showing an A+, and what happened when he lost it all? He felt relieved.

So, did fame or wealth actually work in giving him a satisfying and fulfilling life? No!

The little mental trick is to remember that success, money, fame, and beauty, all the things we pursue, are merely the numeratorIf the denominator — shame, regret, unhappiness, loneliness — is too large, our “Life Satisfaction Score” ends up being tiny, worthless. Even if we have all that good stuff!

Nassim Taleb once related a very similar idea:

The optimal solution to being independent and upright while remaining a social animal is: to seek first your own self-respect and, secondarily and conditionally, that of others, provided your external image does not conflict with your own self-respect. Most people get it backwards and seek the admiration of the collective and something called “a good reputation” at the expense of self-worth for, alas, the two are in frequent conflict under modernity.

It's so simple. This is why you see people that “should be happy” who are not. Big denominators destroy self-worth.

***

Adam Smith addressed this issue similarly about 225 years ago in his lesser known, though equally useful book The Theory of Moral Sentiments. Here's how he put it:

Man naturally desires, not only to be loved, but to be lovely; or to be that thing which is the natural and proper object of love. He naturally dreads, not only to be hated, but to be hateful; or to be that thing which is the natural and proper object of hatred. He desires, not only praise, but praiseworthiness; or to be that thing which, though it should be praised by nobody, is, however, the natural and proper object of praise. He dreads, not only blame, but blame-worthiness; or to be that thing which, though it should be blamed by nobody, is, however, the natural and proper object of blame.

To Smith, happiness was a combination of being loved and lovely: In modern terms, his wording makes it sound like he means “loved by others and also beautiful.”

But as you read on, you see that's not what he meant. He adds “Hated, but hateful.” “Praise, but praiseworthiness.” “Blame, but blame-worthiness.”

He's saying we're only happy if we're successful by an Inner Scorecard! We can't just earn praise, we must be praiseworthy. We can't just be loved, we must be loveable. It makes all the difference in the world. Our dissatisfaction with ourselves will always trump the satisfaction we feel with false rewards. We must, as Charlie Munger puts itearn and deserve the success we desire.

There's a simple word for this: Authenticity. We seek it, and we're only happy when we feel we've achieved it. It can't be faked. And the way to get there is to remember the Inner Scorecard and start grading yourself accordingly.

Life Changing Books (New Guy Edition)

Back in 2013, I posted the Books that Changed my Life. In doing so, I was responding to a reader request to post up the books that “literally changed my life.”

Now that we have Jeff on board, I've asked him to do the same. Here are his choices, presented in a somewhat chronological order. As always, these lists leave off a lot of important books in the name of brevity.

Rich Dad, Poor Dad – Robert Kiyosaki

Before I get hanged for apostasy, let me explain. The list is about books that changed my life and this one absolutely did. I pulled this off my father's shelf and read it in high school, and it kicked off a lifelong interest in investments, business, and the magic of compound interest. That eventually led me to find Warren Buffett and Charlie Munger, affecting the path of my life considerably. With that said, I would probably not recommend you start here. I haven't re-read the book since high school and what I've learned about Kiyosaki doesn't make me want to recommend anything to you from him. But for better or worse, this book had an impact. Another one that probably holds up better is The Millionaire Next Door, which my father recommended when I was in high school and stuck with me for a long time too.

Buffett: Making of an American Capitalist/Buffett's Letters to Shareholders – Roger Lowenstein, Warren Buffett

These two and the next book are duplicates off Shane's list, but they are also probably the reason we know each other. Learning about Warren Buffett took the kid who liked “Rich Dad, Poor Dad” and watched The Apprentice, and might have been on a path to highly leveraged real estate speculation and who knows what else, and put him on a more sound path. I read this biography many times in college, and decided I wanted to emulate some of Buffett's qualities. (I actually now prefer The Snowball, by Alice Schroeder, but Lowenstein's came first and changed my life more.) Although I have a business degree, I learned a lot more from reading and applying the collected Letters to Shareholders.

Poor Charlie's Almanack – Peter Kaufman, Charlie Munger et al.

The Almanack is the greatest book I have ever read, and I knew it from the first time I read it. As Charlie says in the book, there is no going back from the multi-disciplinary approach. It would feel like cutting off your hands. I re-read this book every year in whole or in part, and so far, 8 years on, I haven't failed to pick up a meaningful new insight. Like any great book, it grows as you grow. I like to think I understand about 40% of it on a deep level now, and I hope to add a few percent every year. I literally cannot conceive of a world in which I didn't read this.

The Nurture Assumption – Judith Rich Harris

This book affected my thinking considerably. I noticed in the Almanack that Munger recommended this book and another, No Two Alike, towards the end. Once I read it, I could see why. It is a monument to clear and careful thinking. Munger calls the author Judith Rich Harris a combination of Darwin and Sherlock Holmes, and he's right. If this book doesn't change how you think about parenting, social development, peer pressure, education, and a number of other topics, then re-read it.

Filters Against Folly/Living within Limits – Garrett Hardin

Like The Nurture Assumption, these two books are brilliantly well thought-through. Pillars of careful thought. It wasn't until years after I read them that I realized Garrett Hardin was friends with, and in fact funded by, Charlie Munger. The ideas about overpopulation in Living within Limits made a deep impression on me, but the quality of thought in general hit me the hardest. Like the Almanack, it made me want to become a better and more careful thinker.

The Black Swan – Nassim Taleb

Who has read this and not been affected by it? Like many, Nassim's books changed how I think about the world. The ideas from The Black Swan and Fooled by Randomness about the narrative fallacy and the ludic fallacy cannot be forgotten, as well as the central idea of the book itself that rare events are not predictable and yet dominate our landscape. Also, Nassim's writing style made me realize deep, practical writing didn't have to be dry and sanitized. Like him or not, he wears his soul on his sleeve.

Good Calories, Bad Calories / Why We Get Fat: And What to do About it – Gary Taubes

I've been interested in nutrition since I was young, and these books made me realize most of what I knew was not very accurate. Gary Taubes is a scientific journalist of the highest order. Like Hardin, Munger, and Harris, he thinks much more carefully than most of his peers. Nutrition is a field that is still sort of growing up, and the quality of the research and thought shows it. Taubes made me recognize that nutrition can be a real science if it's done more carefully, more Feynman-like. Hopefully his NuSi initiative will help shove the field in the right direction.

The (Honest) Truth about Dishonesty – Dan Ariely

This book by Ariely was a game-changer in that it helped me realize the extent to which we rationalize our behavior in a million little ways. I had a lot of nights thinking about my own propensity for dishonesty and cheating after I read this one, and I like to think I'm a pretty moral person to start with. I had never considered how situational dishonesty was, but now that I do, I see it constantly in myself and others. There are also good sections on incentive-caused bias and social pressure that made an impact.

Sapiens – Yuval Noah Harrari

This is fairly new so I'm still digesting this book, and I have a feeling it will take many years. But Sapiens has a lot of (for me) deep insights about humanity and how we got here. I think Yuval is a very good thinker and an excellent writer. A lot of the ideas in this book will set some people off, and not in a good way. But that doesn't mean they're not correct. Highly recommended if you're open-minded and want to learn.

***

At the end of the day, what gets me excited is my Antilibrary, all the books I have on my shelf or on my Amazon wish list that I haven't read yet. The prospect of reading another great book that changes my life like these books did is an exciting quest.

How Warren Buffett Keeps up with a Torrent of Information

A telling excerpt from an interview of Warren Buffett (below) on the value of reading.

Seems like he's taking the opposite approach to Nassim Taleb in some ways.

Warren Buffett on How he Keeps up with Information

Interviewer: How do you keep up with all the media and information that goes on in our crazy world and in your world of Berkshire Hathaway? What's your media routine?

Warren Buffett: I read and read and read. I probably read five to six hours a day. I don't read as fast now as when I was younger. But I read five daily newspapers. I read a fair number of magazines. I read 10-Ks. I read annual reports. I read a lot of other things, too. I've always enjoyed reading. I love reading biographies, for example.

Interviewer: You process information very quickly.

Warren Buffett: I have filters in my mind. If somebody calls me about an investment in a business or an investment in securities, I usually know in two or three minutes whether I have an interest. I don't waste any time with the ones which I don't have an interest.

I always worry a little bit about even appearing rude because I can tell very, very, very quickly whether it's going to be something that will lead to something, or whether it's a half an hour or an hour or two hours of chatter.

What's interesting about these filters is that Buffett has consciously developed them as heuristics to allow for rapid processing. They allow him to move quickly with few mistakes — that's what heuristics are designed to do. Most of us are trying to get rid of our heuristics to reduce error but here is one of the smartest people alive and he's doing the opposite: he's creating these filters as a means for allowing for information processing. He's moving fast and in the right direction.