Change your perspective – the bigger picture

After yesterday’s discussion on the monster of uncertainty, a friend who “loves perspective shifters” reached out with a challenge: “Most people rarely question their own basic assumptions,” he said, challenging me to find 10 ideas to do just that. .

I agreed to give it a shot, putting together a list of my own, filling it with a few classics from others:

uncertainty: Objectively speaking “uncertainty” does not increase or decrease – by definition, the future is always inherently uncertain. What changes is the surrounding environment of uncertainty, which makes it more challenging for us to lie to ourselves about a sudden lack of clarity about the future.

Earnings missed estimates: its earnings season, and already has some high-profile misses. “Earnings missed estimates” rather erroneously termed by scholars.

Morgan Housel Corrects this error: “Revenue missed estimates, earnings missed estimates.” Earnings are what they are, the profits of corporate America. By definition, they cannot be wrong – only better or worse than expected.

What could go wrong? The analyst community estimates what those earnings will be. . .

Minimum wage = inflation: I should not be shocked by the announcement of increase in wages of Pandits”InflationaryBut consider this: Since the 1960s, the minimum wage has lagged behind almost everything: GDP, corporate profits, productivity, executive compensation, the stock market, and of course inflation.

Sure, lower quartile wages have increased over the last 2 years InflationaryBut for most of the last half century the minimum wage has contributed Inflation

Everything is survivorship bias: Success is deceptive, and all you see around you are winners — it’s confusing, it’s easier to cheat than to achieve success.

Survival bias rules the world around us. Anything that succeeds – products, funds, people – is the result of millions of small failures. Success is an iterative process that we often overlook; We don’t see the numerous misses, prios and faceplants behind the victory.

Behind every winner there are 100 or even 1000 losers, without whom the achievement would not have happened.

Consumers are affected by inflation: Yes, it’s true, paying for essential goods and services is not fun. But many people ignore that Buy this product regardless of price – They may be suffering from inflation, but by paying much higher prices for discretionary purchases, they are helping to create more inflation.

“The cure for high prices is high prices” goes the old commodity trader line; More supply, or less demand, helps lower prices. Not paid.

traffic: Got a call from a friend driving to meet some of us for dinner in the middle of the crowd. “Sorry, I’m going to be a little late, I’m stuck in traffic,” he said.

He’s a stickler for correct grammar, so it felt right to correct him: “You’re on the highway at 5:30pm near a major population center; You’re not stuck in traffic, you’re the traffic.”

We imagine life as this thing that happens to us, around us, where we are the narrator of events. In reality, we are always another actor in the middle of it.

What’s new?: Sir John Templeton famously observed:The four most expensive investment words are: ‘This time it’s different.’”

And people have misunderstood what he meant ever since.

What Sir John meant was that the world may change, but men are never different.

Consider: Advances in technology, many companies today are driven by obscurity, patents, algorithms, copyrights, logistics processes. “Machines, Manpower, and Materials?” Heavy commitment for? They are no longer needed. This time the management style of the companies is different.

What is different? Human nature. People will always be greedy at the top and fearful of the bottom. Not markets, because very fallible, reliably emotional people buy and sell. That which never changes – human nature is immutable.

Counterfactual:”Flip, always flip” So said Charlie Munger, channeling the great 19th-century Prussian mathematician Carl Gustav Jacob Jacoby.

Counterfactuals are a worthwhile intellectual exercise to see the world from a different perspective. Simply put, you imagine the world as if the particular issue under debate never happened.

A new corporate initiative is taken, a government policy is introduced – and declared ineffective.

How will we know? How bad could it have been if we didn’t have a lab where we could run a placebo group to see what happens. X?

Counterfactuals allow us to consider alternate universes in which a variation of those principles were implemented.

the time: Suddenly a friend announcement He wanted to speak fluent Italian. “How long do you think it will take?” I asked.

him: “5 years.”

me: “Yes, seems like a long time”

him: “5 years will pass whether I learn a new language or not.”

It has been with me ever since.

Oliver Berkman observed: “The average human lifespan is absurdly, humiliatingly short. Assuming you live to be eighty years old, you only have four thousand weeks.”

Everyone gets 24 hours. The clock is ticking, use your four thousand weeks in a way that you won’t regret in week 3,999.

self help: Why do book stores (and Amazon) give this section of the store the wrong name? This is not self-help, where you take on multiple tasks to improve yourself.

It’s just “help”.

Self-help books can be called self-help but only from the author’s point of view. For anyone who reads the book, it’s just plain old help.

These 10 seem like a good start to changing your perspective. If there is another way to share your preferred view changes, please share Here they are.

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