2-1c 'Opportunity costs' - Look beyond the obvious. See what's hidden.

In other words, figure out the multiverse. Charlie Munger and Warren Buffett meet David Deutsch.

Next:

• 2-1c1 ‘Comparative advantage’ - If others can do it, let them
• 2-1d ‘Ecosystem’ & ‘Thermodynamics’ & ‘Double-entry bookkeeping’ - Everything is connected, there is no free lunch

Related:

• 5-2 What counts cannot be counted

• 5-1b1a8 ‘Opportunity cost’ and ‘comparative advantage’ must be rooted in explanations. Never use them as ad hoc criteria.

• 3-1d5 You can question the adequacy of the tools at hand insofar as it relates to some specific problems of yours. You don’t evaluate them ‘comparatively’ based on its ‘utility’ without explanations.

• 5-2b0a Most errors in judgement happen when we don’t know we’re supposed to be exercising judgement

• RUL3 - Write out your goals. It’s amazing how few people do.

• 3-1b2 Use the Fun Criterion to filter what problems to work on

• 5-1b1a9 The Fun Criterion is an explanation

• 9-4b2a1b Build the Idea Maze - Explain the history around an idea, and why yours is a good one. Virtually render the history of the evolution of that idea.

• 2-1b2b ‘Second-order thinking’ - Solve the root cause of a problem (prevention) and not symptoms. Be smart-lazy.

Buffett would argue:

• 1-1c6a3.1 Really good opportunities aren’t often and won’t last long

• 1-1c6a3.0 The decision should be obvious

• 5-1b1 Invest in preparedness. Be redundant and resourceful in every aspect. Minimize opportunity cost to achieve great things.

• 7-2a Be opportunistic and flexible globally rather than inverting locally and prematurely optimized

• 13-1a3.0 Return is about how much, when you expect to get it, how sure you are—in comparison with other possible returns

• 13-1a3.0a Always go for the best—work on the best project, work in the best industry, work with the best people

• RUL3 - Bounded commitment - choose one best thing available, commit for predetermined time period, then revisit. Similar to balancing depth-first vs breadth-first in search algorithms. Think of your time as quantifiable resource like capital.

• Know thyself:

  • RUL3 - List ⇒ Rank ⇒ Iterate
  • 1-2d You have to know your problem-situation (and your web of ideas) as best as you can to judge the merit of new explanations

MentalModelsMicroEcon