Friday, October 12, 2007

Success Secrets: Munger's "Misjudgment" Part 4

This post is Part 4 of my examination of Charlie Munger’s “Psychology of Human Misjudgment”.

Part 1

Part 2

Part 3

10: Munger Descriptor: Influence-From-Mere-Association-Tendency
Alternate descriptor: The power of association encourages feeling over thought.

The power of association can influence behavior as when a product is promoted with a lifestyle, military service is promoted with impressive music, a product is “upscaled” (as in coffee with Starbucks). A second type of association occurs when we trick ourselves into repeating a behavior because it succeeded for us “the last time”. Thirdly, we may misjudge people’s abilities because we don’t alike a particular aspect of the person, and “tar” the entire person, or even a whole group of persons , “with the same brush”, although individuals vary widely from groups to which they may belong.

Munger explains to us that we human beings tend to use mental shortcuts that tempt us to avoid “drilling down” from the general to the particular. Another aspect is that our feelings are an older part of our brain anatomy, whereas our rational side is a newer evolutionary tool, that often gets downplayed because it doesn’t “feel” as “true”.

11. Munger Descriptor: Simple Pain-Avoiding Psychological Denial
Alternate Descriptor: Full or Partial Denial of Painful Facts

Expect extremely painful memories or unpleasant facts to be “re-configured” or denied. Expect that people simply find some facts (such as death, failure, chemical dependency) too painful to bear, so they act as if these unpleasant facts do not exist or deny the strength of those facts.

12. Munger Descriptor: Excessive Self-Regard Tendency
Alternate Descriptor: Overestimating one’s uniqueness in any area

We regard anything “like us”, or any decision we make, or anything we own, as “special” because it is something we personally have initiated, approved, etc. People we like, or people “like us”, are “better”, get the benefit of the doubt, etc. Munger always counsels us to search for “disconfirming evidence”. One interpretation: the stronger you “feel” it, the more you should check it before doing it.


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