The Psychology of Human Misjudgment by Charlie Munger
The Psychology of Human Misjudgment by Charlie Munger
Learning the cognitive biases that Charlie Munger describes in this speech is one of the best investments you can make.
✍️ Dear CMQ Investors,
Learning the cognitive biases that Charlie Munger describes in his speech about “The Psychology of Human Misjudgment” is one of the best investments you can make. The speech was reprinted with permission here and you can listen to it below.
Did You Know: Of the 100 models Charlie Munger says to learn, approximately 20% of them are mentioned in the speech.
“The Psychology of Misjudgment” is primarily concerned with cognitive biases. The speech refers to them as “tendencies” instead of biases, but it’s the same idea.
How to master the cognitive biases…
Cognitive biases impair our ability to make rational decisions, and as investors, we can benefit from knowing them inside-and-out. Here’s some of my favorite resources that can help you do just that.
1. This list of the most relevant biases in behavioral economics is a must-see.
2. These are my favorite books that are all about cognitive biases or have extensive content about cognitive biases.
Did You Know: Paid Members receive my complete (and ever-growing) collection of book notes. My book notes about The Psychology of Money will arrive in their inboxes this week.
I hope you find all of this useful.
All the best,
CF (@ChrisFranco)
P.S. Listen to the speech below 👇
Should we make more posts like this? 🤔
Related Quotes
You need the best 100 or so models from microeconomics, physiology, psychology particularly, elementary mathematics, hard science and engineering (and so on).”
—Charlie Munger
“The elementary part of psychology—the psychology of misjudgment, as I call it—is terribly important to learn. There are about 20 little principles. And they interact, so it gets slightly complicated. But the guts of it are unbelievably important.”
—Charlie Munger
“Of all the models that people ought to have in useful form and don’t, perhaps the most important lie in the area of psychology.”
—Charlie Munger
Reminders
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