- A New Year’s resolution
- How I collect ideas and hypothesis
- If you want to gain wisdom – you’re going to have to read
“In my whole life, I have known no wise people (over a broad subject matter area) who didn’t read all the time—none” – Charlie Munger
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Reading is one of if not the best investments you make in yourself.
Think of it as collecting ideas and hypotheses.
The goal is to develop a temperament which leverages (good) ideas to enable more sensible decisions.
Charlie Munger taught me that.
However, the sage added that “… most people don’t grab the right ideas or don’t know what to do with them”
So how does one know what is a good idea?
Here’s my approach:
First, we test the idea to see if it works.
Not all ideas hold water.
If the idea fails – we modify it and test it again.
Rinse and repeat.
Soon enough you will find out whether the idea makes sense.
I’m lucky that reading is how I generally enjoy spending my free time (in addition to other hobbies such as painting and golf)
For example, last week week I started (and finished) “Superforecasting: The Art and Science of Prediction” (a terrific read)
But that is the type of life I like to live… one of curiousity.
One should always aim to remain curious.
I’ve always felt that if can make myself just “0.1% smarter” from every book I read – that knowledge will compound over time.
In that respect, it’s not unlike investing.
Over the years, I’ve become a lifelong self-learner through reading.
For example, my university background is in the dual fields of computing science and engineering. I didn’t study “finance” or “economics” at school.
I could write lines of computer code (in various languages) – but I would not have been able explain how “bond yields impacted stocks”
In my 20’s I picked up a book on investing and started to read.
One book leads to another.
So far, it’s been a (short) 25+ year journey of collecting ideas and testing several hypotheses through books I’ve read.
Slowly but surely I improved.
But I’m still learning and consider myself early in my investing career.
25 years isn’t a long time when it comes to asset speculation.
Part of my learning journey has also been collecting methods that don’t work; i.e., observing the mistakes others make.
That’s easy to do (and it costs nothing).
This blog – now in its 14th year – is a collection of those learnings. A collection of what works and what may not.
With respect to writing – I’ve always felt that if I can explain a complex subject in simple terms (without jargon) – it’s a good indication that I understand it.
But to do that – it’s required a meaningful investment in literature. Munger offers this:
“… if it’s wisdom you’re after, you are going to spend a lot of time sitting on your ass and reading”
Amen.
Below is a collection of 89 books which made me smarter over the years.
Let me stress this list is not intended to be exhaustive. And at some point – I will share more in another post as they come to mind.
The list primarily focuses on areas of decision making, investing, psychology and philosophy (important facets for any investor).
Each book has earned a permanent place on my Kindle (it’s also how I developed the list) – where I’ve read each book at least once. And from time to time – I pick them up again.
For example, recently I’ve been re-reading “Thinking Fast and Slow” by Daniel Kahneman. This is specifically the kind of book which will make you a better investor.
Given today is the last day of 2023 – make your New Year’s resolution to read at least three of these books in 2024.
And let me know which books you chose and why. I’d be interested to hear.
Each of these books has made me smarter.
#1. Decision Making
- Thinking in Bets: Making Smarter Decisions When You Don’t Have All the Facts – Annie Duke
- Thinking Fast and Slow – Daniel Kahneman
- Models of my Life – Herbert A. Simon
- The Art of Thinking Clearly – Rolf Dobelli
- Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets – Nassim Nicholas Taleb
- The Black Swan: The Impact of the Highly Improbable – Nassim Nicholas Taleb
- Antifragile: Things That Gain from Disorder – Nassim Nicholas Taleb
- The Success Equation: Untangling Skill and Luck in Business, Sports, and Investing – Michael J. Mauboussin
- Clear Thinking: Turning Ordinary Moments into Extraordinary Results – Shane Parrish
- The Great Mental Models: General Thinking Concepts – Rhiannon Beaubien and Shane Parrish
- Decisive: How to Make Better Choices in Life and Work – Chip Heath and Dan Heath
- Filters Against Folly: How To Survive Despite Economists, Ecologists, and the Merely Eloquent – Garrett Hardin
- Mastermind: How to Think Like Sherlock Holmes – Maria Konnikova
- Nudge: Improving Decisions About Health, Wealth, and Happiness – Richard H. Thaler, Cass R. Sunstein
- Streetlights and Shadows: Searching for the Keys to Adaptive Decision Making – Gary A. Klein (Author)
- Your Brain at Work, Revised and Updated: Strategies for Overcoming Distraction, Regaining Focus, and Working Smarter All Day Long – Dr. David Rock
- Principles: Life and Work – Ray Dalio
- Judgement in Managerial Decision Making – Max H. Bazerman
- Getting Past Burnout, Busywork, and the Myth of Total Efficiency – Tom DeMarco
- The 15 Commitments of Conscious Leadership: A New Paradigm for Sustainable Success – Jim Dethmer, Diana Chapman and Kaley Klemp
- The Theory of Poker: A Professional Poker Player Teaches You How To Think Like One – David Sklansky
- The Hard Thing About Hard Things: Building a Business When There Are No Easy Answers – Ben Horowitz
- How to Make Sense of Any Mess: Information Architecture for Everybody – Abby Covert
- How to Measure Anything: Finding the Value of Intangibles in Business – Douglas W. Hubbard (Author)
- Expert Political Judgment: How Good Is It? How Can We Know? – Philip E. Tetlock
#2. Investing
- Against the Gods – The Remarkable Story of Risk – Peter L. Bernstein
- The Most Important Thing: Uncommon Sense for the Thoughtful Investor – Howard Marks
- A Random Walk Down Wall Street: The Time-Tested Strategy for Successful Investing – Burton G. Malkiel
- Reminiscences of a Stock Operator – Edwin Lefevre
- Superforecasting: The Art and Science of Prediction – Philip E. Tetlock, Dan Gardner
- The Warren Buffett Portfolio: Mastering the Power of the Focus Investment Strategy – Robert G. Hagstrom
- The Snowball: Warren Buffett and the Business of Life – Alice Schroeder
- The Intelligent Investor: The Definitive Book on Value Investing – Benjamin Graham
- The Alchemy of Finance: Reading the Mind of the Market – George Soros
- Rogue Trader – Nick Leeson
- A Short History of Financial Euphoria – John Kenneth Galbraith
- The Man Who Solved the Market: How Jim Simons Launched the Quant Revolution – Gregory Zuckerman
- Bad Blood: Secrets and Lies in a Silicon Valley Startup – John Carreyrou
- The Bogleheads’ Guide to Investing – Mel Lindauer, Taylor Larimore, Michael LeBoeuf
- Competing Against Time: How Time-Based Competition is Reshaping Global Markets – George Stalk
- Confidence Game: How Hedge Fund Manager Bill Ackman Called Wall Street’s Bluff – Christine S. Richard
- FIASCO – Blood in the Water on Wall Street – Frank Partnoy
- Conspiracy of Fools: A True Story – Kurt Eichenwald
- Liar’s Poker: Rising Through the Wreckage on Wall Street – Michael Lewis
#3. Psychology
- The Psychology of Human Misjudgment – Charlie Munger
- Heuristics and Biases: The Psychology of Intuitive Judgment – Thomas Gilovich, Dale Griffin, Daniel Kahneman
- Mindset: The New Psychology of Success – Carol S. Dweck
- Blink: The Power of Thinking Without Thinking – Malcolm Gladwell
- On the Reality of Cognitive Illusions – Daniel Kahneman and Amos Tversky
- Becoming Wise: An Inquiry into the Mystery and Art of Living – Krista Tippet
- Influence: The Psychology of Persuasion – Robert B. Cialdini
- The Coaching Habit – Michael Stanier Bungay
- Excellent Sheep: The Miseducation of the American Elite and the Way to a Meaningful Life – William Deresiewicz
- The Four Agreements: A Practical Guide to Personal Freedom – Don Miguel Ruiz
- The Happiness Hypothesis: Finding Modern Truth in Ancient Wisdom – Jonathan Haidt
- The Language Instinct: How the Mind Creates Language – Steven Pinker
- Mastery – Robert Greene
- Mind Gym: Achieve More by Thinking Differently – Sebastian Bailey and Octavius Black
- A Mind of its Own: How Your Brain Distorts and Deceives – Cordelia Fine
- The War of Art: Break Through the Blocks and Win Your Inner Creative Battles – Steven Pressfield, Shawn Coyne
- The Righteous Mind: Why Good People Are Divided by Politics and Religion – Jonathan Haidt
- The Talent Code: Greatness isn’t born. It’s grown – Daniel Coyle
- The Worry Solution: Using Your Healing Mind to Turn Stress and Anxiety into Better Health and Happiness – Martin Rossman M.D., Andrew Weil M.D.
#4. Philosophy
- Man’s Search for Meaning – Viktor E. Frankl
- Poor Charlie’s Almanack – The Wit and Wisdom of Charlie Munger – Charles T. Munger (Author), Peter D. Kaufman (Editor), Warren Buffett (Foreword)
- Poor Richard’s Almanack – Benjamin Franklin
- Meaning and Relevance – Deirdre Wilson/Sperber
- Mindfulness in Plain English – Bhante Gunaratana
- Other Minds: The Octopus, the Sea, and the Deep Origins of Consciousness – Peter Godfrey-Smith
- 12 Rules for Life: An Antidote to Chaos – Jordan B. Peterson
- The Paradox of Choice – Why More is Less – Barry Schwartz
- Meno and Other Dialogues – Plato, Robin Waterfield
- Teaching a Stone to Talk: Expeditions and Encounters – Annie Dillard
- Three Scientists and Their Gods: Looking for Meaning in an Age of Information – Robert Wright
#5. Science, Bios, Negotiation & History
- Seeking Wisdom: From Darwin to Munger – Peter Bevelin
- Faraday, Maxwell, and the Electromagnetic Field: How Two Men Revolutionized Physics – Nancy Forbes, Basil Mahon
- Deep Simplicity: Bringing Order to Chaos and Complexity – John Gribbin
- Ice Age: How a Change of Climate Made Us Human – John Gribbin
- How the Scots Invented the Modern World – Arthur Herman
- Andrew Carnegie – David Nasaw
- Guns, Germs, and Steel: The Fates of Human Societies – Jared Diamond Ph.D.
- The Third Chimpanzee: The Evolution and Future of the Human Animal – Jared Diamond Ph.D.
- Living within Limits: Ecology, Economics, and Population Taboos – Garrett Hardin
- The Selfish Gene – Richard Dawkins
- Titan: The Life of John D. Rockefeller, Sr. – Ron Chernow
- The Wealth and Poverty of Nations: Why Some Are So Rich and Some So Poor – David S. Landes
- Genome: The Autobiography of a Species in 23 Chapters – Matt Ridley
- Getting to Yes: Negotiating Agreement Without Giving In – William L. Ury, Roger Fisher
- Never Split the Difference: Negotiating as if Your Life Depended on It – Chris Voss
Putting it All Together
Charlie Munger accelerated my love of reading.
He was one of the smartest people who ever lived. And if he recommended a book – I was quick to read it.
Many of the books above were on his list.
And if you do not have time to read – try and spend one hour watching this talk he gave on The Psychology of Human Misjudgment. It’s brilliant. The essay is also available in pdf from the web.
If you’re looking to start your journey with Munger (it’s never too late) – try Seeking Wisdom: From Darwin to Munger by Peter Bevelin.
Bevelin is also quoted the ‘About‘ section of my blog:
“I don’t want to be a great problem solver. I want to avoid problems—prevent them from happening and doing it right from the beginning.”
Bevelin said Munger’s simplicity and clarity of thought was unequal to anything he had seen.
Beyond ‘Charlie and Charles’ – Bevelin cites an range of thinkers: from first-century BCE Roman poet Publius Terentius to Mark Twain—from Albert Einstein to Richard Feynman (my favourite physician)—from 16th Century French essayist Michel de Montaigne to Charlie’s closest friend and confident Warren Buffett. Again, it’s a great read.
With that, wishing everyone a very happy new year and you find a book to learn from.
Here’s to always being curious.