The Great Mental Models Vol. 3
FS Blog
Summary
The third book in the great mental model series by Shane Parrish and the team at FS blog. How to use mental models from a variety of disciplines and apply them to your life
Rating: 4/5
Notes
Immediate feedback isn’t the only feedback. Sometimes it takes time for feedback to happen
Customer loyalty programs are an example of positive feedback loops
An example of an information cascade is restaurants keeping people in line to make it look busy
For prisoner’s dilemma games, if only playing once then it’s best to blame the other side. But if you’re playing multiple times, like in life, you need to build trust
Just because a system is at equilibrium doesn’t mean it’s functioning as well as it can
Life is a dynamic equilibrium, constantly adjusting to many complex variables
Bottlenecks can move around systems. You fix one and introduce another
Medical science tends to advance fastest during times of war
Systems become more complex as you soak up. Greater size means more connections and interdependencies between parts
Success often sows the seeds of its destruction
Expect the unexpected - always have a margin of safety
Be careful w/ margins of safety because they can make you overconfident
Knowledge can be conceptualized as a margin of safety, a bugger against unexpected challenges you will face
The greater the threat, the more important it is to plan for the most
Within any system, parts need replacing from time to time to keep the whole functioning well and to remove anything that’s a hindrance
An algorithm is a foolproof recipe
A static algorithm uses the same input every time with the same desired output
Emergence: when systems as a whole function in ways we can’t prediction when looking at it’s parts
If you have a simple starting point on the right trajectory, surprising things can happen through the power of emergence
Working and sharing with others can create unexpected possibilities
Simplicity can convey a powerful meaning but too much simplicity conveys no meaning at all
Law of diminishing returns: more effort leads to less return past a certain point
‘What the wise do in the beginning the fools do in the end’ - Buffet
Don’t let early success make you feel complacent
Close human relationships are the greatest source of pleasure in life
Knowledge, experience, relationships and money compound
We cannot know all the opportunities that will arise as a results of investments we make today
Friendships should always come before business
The larger the sample size, the more the result obtained will converge to the true value
The insights you get from large data sets are only as good as the range of possibilities they cover
Making rules and changes based on data needs to look hard at the data being used
Randomness is the rule, not the exception
Add randomness to the creative process and see where it takes you
Pareto principle: 80% of the outputs are the result of 20% of the inputs
Extreme events and results tend to be balanced out and revert to the mean
Lost of average results do not preclude the occasional big success
A zero in a system has the power to negate everything that comes before it
The history of invention shows us smart people fail dozens of times before they succeed
People in similar situations facing similar incentives are likely to behave the same way
Surface area is recognizing when increasing our exposure will help and when it will cause problems
Sometimes we have to go down to go back up
We cannot reach our full potential if we aren’t willing to stretch ourselves, take risks and fail once in a while
It’s more powerful to make big changes before we optimize the details
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How the World Works
Noam Chomsky
Summary
A combination of books Chomsky wrote in the 80s and 90s about America and it's role in the world. Fascinating read and insight into one of the great thinkers of the 21st century
Rating: 5/5
Notes
The US invaded Greece in 1947 and supported a horrendous war which led to 160k Greek deaths. This was the model for Vietnam and allowed American business to gain and thrive
US policies in the 3rd world consistently opposed democracies if they couldn’t be controlled as real democracies believe government should respond to the needs of their own population rather than those of US investors
US-run contra forces in the 3rd world isn’t ordering killing - it’s brutal sadistic torture (Nicaragua, El Salvador, Guatemala)
From the Bolshevik revolution in 1917 till the collapse of the communist governments in eastern europe in the 80s, it was possible to justify every US attack as defense against the Soviets
If you want a global system that’s subordinated to the needs of US investors, you can’t let pieces of it wander off. It’s clearly stated in the documents of record
The US wants ‘stability’ meaning security for the upper classes and large foreign businesses
Solid case for impeaching every American president since World War 2 either outright as war criminals or involved in serious war crimes
El Salvador and Nicaragua were not covered by the US media in the 70s when US-supported brutal torture and murder were taking place
In the early 80s, America’s friends slaughtered 10s of thousands of Guatemalans with countless others tortured and raped
After Vietnam, the major US policy goal has been to maximize repression and suffering of countries demonstrated by their violence - blocked other countries from seeking aid
The US regularly carries out or supports aggression
For most of the 20th century, the US was the dominant economic power and used economic warfare as a weapon ranging from illegal embargoes to enforcement of weak IMF rules with their military becoming pre-eminent
The US tries to avoid negotiations with countries as the US fears it will lose and other countries will be better off
When a state has huge debts, it must divert the population from what’s happening and they do this by inspiring fear of our enemies (Russia in Europe)
The real enemy of the US has always been ‘the poor who seek to plunder the rich’. In America, it’s the opposite and has been for generations
‘The war on drugs’ was a manufactured media blitz by the US leadership to distract the population, increase repression in inner cities and build support for attack on civil liberties
The US government blocks international effort to seek peace (Russia and Ukraine)
Major media are large companies owned and interlinked with even larger conglomerates. The market is the advertisers and the product is audiences
The power in the US lies in the hands of people who determine investment decisions as they determine production, distribution and staff the government. They want a passive, quiescent population
The struggle of freedom is never over and requires active and sustained efforts
One important consequence of globalization is it extends the third world model to industrial nations where the average person has their jobs shipped away while the rich and elite continue to amass massive amounts of wealth
We’ve moved to an international state with the IMF, World Bank, G7 & EU, WEF where the general population doesn’t know what’s happening and it doesn’t know it doesn’t know
If the borrowing the US has done was used for constructive purposes like investment or infrastructure, the US would be better off, but it was used to enrich the rich - for consumption, financial manipulation and speculation which are all harmful
The class warfare of the last few decades has successfully weakened popular organizations leaving people to feel isolated
The US is so deeply in debt to the international financial community because of debt that they have a lock on US policy
Many of the large number of security council resolutions vetoed by the US have to do with Israeli aggression or atrocities
Invaders typically use local collaborators to run things for them by playing upon existing rivalries to get onne group to work for them against another
European wars were wars of extermination. If we were to be honest about history, we would simply describe it as barbarian invasion
There has always been racism but it developed as a leading principle of thought in the context of colonialism.
A standard technique of belief formation goes along with oppression
In the US, you’re not allowed to talk about the class differences, which is the real issue
When the US establishment talks about jobs, it means profits for its corporations
The elite are masters and they follow what Adam Smith said about ‘the vile maxim’ - all for ourselves and nothing for anyone else
People who aren’t owners and investors have nothing much to say in the US
Jefferson warned against banking institutions and corporations and said if they grow, aristocrats would’ve won and the revolution would’ve been lost
The ‘Free market’ is for the poor. We have a dual system - protection for the rich and market discipline for everyone else
There’s been a considerable increase in inequality and has the American society moving towards a third world model, thereby seeing increased crime and signs of social disintegration
A huge area of the media is dedicated to diverting people and making them more stupid and passive
There’s nothing individualistic about corporations who are totalitarian in nature
Free trade agreements result in reduced wages for local employees while predominantly benefiting the rich consumer while also destroying unions
Operation Paper Clip imported large number of known Nazi criminals
The American army’s counter-insurgency literature begins with an analysis of the German experience in Europe written with the co-operation of Naxi officials (instruments of statecraft - book)
US involvement in Chile with the coup in 1973 to reduce social democracy
The threat of a good empire is what the US worried about with reforms on uncontrolled capitalism
The US killed a few million people and destoryed 3 countries during the Vietnam war
A huge amount of business propaganda is to create wants
The answers to solve all these issues is to organize. Being alone you can’t do anything but if you join with other people, you can make changes
Under capitalism, investment is supposed to be as risk free as possible. No competition wants free markets - what they want is power
The government subsidizes corporations’ costs, protects them from market risks and lets them keep the profits
There’s never been much difference between the 2 business parties and the differences are disappearing
The CIA has been involved in drug running for generations (the politics of heroin book)
You need something to frighten people with, to prevent them from paying attention to what’s really happening to them. You have to engender fear and hatred
The first world lives in a highly indoctrinated society
Neoliberalism is nothing more than the imperial formula: free markets for you and plenty of protection for me. The rich would never accept it but they’re happy to impose it on the poor
The UN does mostly what US business wants
‘Politics is the shadow cast on society by big business’ - John Devery
If people dedicate themselves to organizing and activism, we’ll gain access to broader audiences
If you extrapolate to the future, it’s very ugly but the point is it’s not inevitable. It can be changed but we can’t change things till we understand them.
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