The Psychology of Human Misjudgement - Charlie Munger Full Speech
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- Опубликовано: 28 сен 2024
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"Influence: The Psychology of Persuasion by Rober Cialdini" amzn.to/2kMkP3u
"Poor Charlie's Almanack Expanded Third Edition" amzn.to/2ld2VaX
Audio of the often referred to speech by Charlie Munger on the psychology
of human misjudgement given to an audience at Harvard University circa Jun 1995.
Mr. Munger speaks about the framework for decision making and the
factors contributing to misjudgements. c. Jun 1, 1995
FULL TEXT:
buffettmungerwi...
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This talk is like a great book that you don't grasp fully the first time, so you keep coming back again.
And again and again....
+RichReads This is my 5th time listening to this, i find something new every-time, man is amazing to put down over 60 years of his own experience and learning for the betterment of others.
Omg you are so right. Just watched for the first time & I will defitely have to watch quite a few more times to grasp everything he's saying. Great info.
i listen to this every single day i just click a random time and listen wow i made and save so much money since i started doing this try it asap
and again and again and again.... even after writing them down as notes.... but anyway, these are extremely useful.
I think it's best to read the books he's pointing out and others related to neuroscience, psychology, behavioral economics, and so on. This talk just scratches the surface on those topics, but it's a good starting point to dive on those topics.
Timestamp for 24 standard causes of human misjudgement:
1) 3:00 - Bias from reinforcement and incentive
2) 5:08 - Man with a hammer syndrome
3) 6:09 - Psychological denial (reality is too painful to bear, so you just distort it until it’s bearable)
4) 6:57 - Agency cost (too trusting of advisors who don't know more than you)
5) 10:18 - Bias from consistency and commitment tendency / Self-confirmation tendency (hard to change your mind once emotionally committed to an idea)
5.5) 11:28 - (Related to previous point) - Bias from cognitive dissonance (caused by echo chambers)
6) 12:31 - Bias from pavlovian association / past correlation for decision making
7) 19:49 - Bias from reciprocation tendency (ask for a lot and then back off to a lower offer)
8) 24:04 - Bias from over-influence of social proof
9) 26:48 - Bias from contrast (lowering/distorting your standards by comparing two options that are equally bad - or having a "grass greener on the other side" mentality by comparing to an unrealistically high standard)
10) 30:13 - Over-influenced by authority
11) 31:50 - Bias from deprival super reactions syndrome (sunk cost fallacy)
12) 35:00 - Bias caused by envy
13) 35:51 - Bias from chemical dependency (addictions)
14) 36:15 - Bias from mis-gambling compulsion (I made the choices so the odds must be better)
*[numbering gets confusing at this point] But these are my personal breakpoints*
15) 38:36 - Bias from liking distortion (over-influence/mislead by someone we like - including ourselves)
16) 38:48 - Bias from disliking distortion (under-influence by someone we dislike - especially if they are right and we are wrong)
17) 42:19 - Bias from the non mathematical nature of the human brain (too stupid to understand maths and too lazy to learn)
18) 44:00 - Bias from fear of scarcity
18.5) 45:50 - Don't trust someone who says "I've never done it before and I'll never do it again"
19) 46:34 - Bias from sympathy
20) 49:48 - Bias from over-influence and extra evidence
21) 51:00 - Bias caused by mental confusion caused by information not arrayed in the mind to create sound generalizations (you memorized new information, but you haven't learned it or know how to make it useful. Test new information by answering "why")
22) 50:49 - Starts at 53:16 - Stressed induced mental changes (small/large, temporary/permanent)
23) 54:20 - Common mental illnesses and declines temporary and permanent and quitting the tendency to lose ability through disuse (Charlie skipped this explanation: says he doesn't have time for it)
24) 54:28 - Say-something syndrome (difficult to explain new concepts to others who lack "first principles")
*Questions:*
1) 55:45 - What happens when these standard tendencies combine?
2) 1:01:01 - Isn't this list topological (meaning is there overlap and some item is a combination of other items)
3) 1:01:15 - Are these (biological) tendencies generally good or bad?
4) 1:07:31 - What special knowledge problems lie buried in the thought system indicated by the list
5) 1:09:00 - How should the best parts of psychology and economics interrelate in an enlightened economists minds
*Extra*
11:56 - It's very important to not put your brain in chains too young by what you shout out (by joining echo chambers)
1:05:54 - Confirmation bias
Thank you
Are you a human or a bot?
@@stevengiji3886 I'm a human with lots of time. Haha. I just added the timestamp and my own interpretation to the full transcript - which can be found here: buffettmungerwisdom.files.wordpress.com/2013/01/mungerspeech_june_95.pdf
Thank you SO much for posting this timeline of the video! Appreciate it
Great job!
This is one hell of a staring contest.
Yeah, I'm 9 minutes in and he hasn't blinked yet. Wish me luck ~
Hahahahaha :))))
Axem Ranger banner van price height use return left.
lol
the man is competitive holy cow
I’ve heard this over 10 times now. And it never stops parting wisdom on me each time.
This talk is like gold dust for an investor. Listen to again and again and again .. and there is still more to learn from it!
I agree. Munger and Buffett success comes from being rational. This advice is money in the bank. Most won't recognize the wisdom.
Hello, the book he's referring to is by an author named Robert Cialdini, I have posted the link to his book "Influence: The Psychology of Persuasion" above in my video description just today.
Thanks a lot!!!!
Where
tanks
“I wanted to get rich so I could be independent.” 1:14:00
Ben exactly. Kind of an a-hole answer to the question though.
@@TWN321 how bitch how
I would expect this talk to have more "hits" This is among the best, if not the best talk I've ever heard.
I agree
Jose Garcia 3 likes of your comment in two years? That proves it 😕 Just made it 4 😉
Erm... That's denial : )
This isn't the only place it is found and it is in print.
Rest in Peace Mr. Munger
Just started listening to Charles munger and Warren buffet. I feel munger really gets you to mould your mind and rewire yourself, he is so focused on the main point just for its truth and nothing else that you start to apply that to everything. He should be on the list of everyone's hero's.
Coming back to this classic speech for a listen
Excellent... World has Misjudged in understanding greatness of Charlie Munger... he is still too underrated!
I think what Munger is referring to here is the way psychology is conventionally taught in post secondary education. I think he's referring to the way in which each concept is taught in its own right and there has not been too much research into how they work on real life where they are intertwined with each other. When a combination of incentives work together, they result in different permutations in behaviour. There is more to gain from that than learning about each incentive separately.
Poor Charlie's Alamanac Brought me here. Wow this man is a genius. This generations Ben Franklin
the alamanac brought me here as well....pure brilliance
rationale over brilliance
Tiktok brought me here, I found a guy talking about interesting psychology facts in ergonomics. This video solely is making me want to really read Poor Charlie’s Almanac and any other books related to this matter! I love it
@@gracesss1 Awesome! If everyone who watched tiktok came down the same last then politica would be much better :)
First time i heard this it was so overwhelming and i felt dumb as hell lol. Now after listening dozens of times and reading all of Charlie's books years later all of his principles have helped me become more successful and will continue to do so!
The person who doesn't follow Charlie is missing out
a young man in the crowd took this talk to heart. he grew up to be very successful. that man was warren buffett.
If this is from 1995 i think Warren was very much “grown”...lol
To a man with a hammer every problem looks like a nail
Probably my favorite video on the internet.
This will be the legacy of this great man. No one has even tried to match this speech. It’s 2020 now.
Much thought is behind this talk.
A true intellect. A man after my own heart.
This talk is money in the bank after you listen to it a few times. But most won't. Love Buffett and Munger because there is not bias. They are not trying to sell you something.
My 4th time listening to this, im still learning and picking up things which i missed before, really is a wealth of information, guessing ill be back another few more times!
Yeah gotta rip this down as audio in case we can't find this vid I future.
Watching again and again helps with retention, but instead of that teach someone this, your retention will increase by 2-3x rather than re-watching the same material
Buffett and Munger have spent so much time together that they sound amazingly alike.
Agree. Sounds they both lost their breath somewhere as they speak
They may sound alike but I could listen to Charlie for hours Warren not so much..
@@TB1M1 Think Buffet is actually smarter (talking raw intelligence), Charlie is certainly wiser.
@@OmariauProbably, but IQ is not really relevant if you are born in the right place at the right time. That said these are long term investors who seized opportunity hard when it came.
They are alike even before they met each other. I was reading Almanack. In fact they being alike is one of the reasons they met
29:15 "I have this worthless friend that I like to play bridge with. He's a total intellectual amateur that lives on inherited money." 🤣
😂😂😂
Amazing knowledge, very eloquently presented, these are the kind of classes we should be having in school!
This is all Bob Cialdini’s stuff. Are you one of the 300,000 who’ve bought his book? Why not?
I love listening to what people think.
Started watching this when it had 50k views - watched it 50 times also, still hearing new things each time. Gangamstyle music video had cracked 1 billion views when this was at 50k views. The 1.2m is probably just 20k people watching to over and over. ;;)
Just realized that the “wortheless friend” he plays bridge with he mentions at 29:10 is Warren Buffett 😂😂😂
Yeah I kinda figured because of previous jokes hes made about it
Ha! I'm sure I've listened to this half a dozen times if I've listened to it once, and I never put that together. Nice one!
This man is brilliant. You can never get enough from his wisdom.
Going to listen to this 2 more times.
Think about how funny it is that many people spend 20 hours a week watching tv/netflix, and how much wiser they could have got by using that time for ONE week to listen to this 15-16 times.
The hilarious part: practically none of them will ever do anything like it, and would consider the thought ridiculous.
Oh well. I guess I'm frustrated and happy about it. Kind of sad, but less competition and it wouldn't be as valuable if everyone agreed.
Wow!! Charlie is psychology expert indeed
This is an example of what needs to be taught in schools from an early age.
The Stanford Law School article mentioned at the end of Mr. Munger's lecture is called "On Teaching Professional Judgement" by Paul Brest and Linda Krieger; copies of the article were handed out following the lecture.
almost 30 years and his voice hasn't changed much.
Incredible talk with great examples. I just order a copy of the book.
All in all, this was a phenomenal speech by Charlie Munger.
My granny always said knowledge is power. But boy its not so easy:) Having said that i love this speach! Try get financial independent and you can research what you want.
well said!
Enlightening and Scary talk both at the same time. Scary in that you never hear this psychological context related to public persuasion, or you rarely do. Thanks to technology we are truly living in the golden age of bullshit and this type of information is like the silver bullet one needs to protect themselves and their loved ones..... Thanks for posting !
One of the best talks I heard about decision making, period. It’s funny to to hear it from Munger!
All of us have this problem. We have hundreds of personalities. Religion called them capital sin.... We have a lazy personality, a lust personality, an envy personality so on and so on.... In the Tibet they called them Psychological aggregates, ancient egyptians called them red demons. Us we call it ego, This word comes from latin which means " I ".
Each personality/Ego takes turn throughout the day in controlling us, This is the reason we are 3% consciousness and 97% ego. And when each invade our psychic, They always take complete control of our thoughts, Feelings, Body.
We just need to look into our everyday life to find hundreds of examples but I will give a few so we understand a little bit better. When the "anger ego" takes control of our body.... Some one hits us in the face. Immediately the ego takes control of our feelings, we start cursing him mentally and feeling like we need to throw a rock at his face "How dare this Piece of shit does this to me, Im gonna kill him"... Eventually, (some wrongly think these changes happen at the same time, but they are wrong) It takes control of our thoughts and we start thinking on how to attack him, After it will take control of our body or motor skills and we will end up throwing punches or any other physical outcome... Of course, each human is different, We all have the same ego but some will have them in a lower level of they mind or some of them in a higher level of their mind (The mind is composed of 49 levels) In this situation or example the anger ego came out, But in another person the ego of fear could take place...
This is the reason when these aggregates take control of a man that found out his wife was cheating on him and ended up stabbing her, When he is getting interrogated by the police a lot of time they say the same phrase "It wasn't me... I don't remember.... They cry not understanding what happened , Etc etc"
In order to awaken or consciousness we need to eradicate each psychological aggregate. How? Luckily for us, we might eliminate at least 50% of it by ourselves... The other 50% Can only be done by Kundalini Shakti, or how christians called it our virgin mary, This is only possible throughout alchemy.
It is a shame that we are walking in this earth completely asleep. Completely controlled by our ego therefore we cannot see our past lives... We cannot see the elementals of this earth... We cannot see the other dimensions of space.... Etc Etc Etc ETC. But most important WE CANNOT SEE OUR INDIVIDUAL FATHER. Each one of us have a father, this is a small percentage of GOD inside us. When we awaken our consciousness we are able to see him in the astral world (unfortunately, we do not even remember what did we even dreamt yesterday, MUCH LESS we will be able to go into the astral world being conscious) . He will be able to manifest himself throughout us and perform REAL MIRACLES.
Lucky for us we have the energy to wake up from these awful state inside us.
Lucky for us Samael Aun Weor revealed all the secrets for us. He is the perfect example to understand this is COMPLETELY POSSIBLE & TRUTH.
Me myself in the name of truth could tell you I HAVE VERIFIED THIS MY SELF (OF COURSE haven't seen my father or made contact with him YET, THE MAGNUM OPUS takes your whole life to complete.. but been able to eliminate some aggregates and been able to go in the 5th dimension or astral world conscious )
Please find out the truth and start the path NOW. Let me point you in which direction to go and you follow your heart. I promise you this is the best gift the divine and our older brothers could have given us. THE TRUTH.
Many are lost, buddhism, christianity, religion, masonry, Witchcraft, Black magic, "Spiritual teachers" etc etc.... Are lost. They have lost themselves. All there is is EGO. And a blind person cannot help another blind person to see.
I am more than happy to answer you ANY QUESTION. Regarding any topic, that the pseudoscience cannot answer. Any question that religion cannot explain.
We have a well of wisdom that we all could drink from... The same well people like Jesus, Confucius, Lao Tze, Buddha, Samael Aun Weor, Pitagoras etc etc Drank from...
Thanks for subtitles !!!
59:29 "so you think this doesn't happen when picking investments?" You'd think that this whole talk is irrelevant to investing up to this point, but you'd be so wrong! This guy is a genius.
You hit the nail on the head.
As Charlie would say - "The groupies followed him here as well"
For those looking for closed captions, the full transcript can be found on this great website. fs.blog/great-talks/psychology-human-misjudgment/ I highly recommend the website/blog and the podcast.
EXTREMELY PROFOUNDD!!!!!
Wow. The brilliance of this talk sounds like Ben Graham..
He probably inadvertently picked some stuff up from Graham through Warren since Warren was a student of Graham in college. Either way, Charlie is one of the best. I remember my doctor mentioning that she had the pleasure of hearing a talk like this from him in college. Lucky.
“I have this worthless friend that I like to play bridge with... “
(29:15)
If you do sales or lead people the book by Robert Cialdini is a must read.
Thank you for posting this video, greatly appreciated!
Funny a friend of mine recommended a book last month that I picked up on amazon and I love it! I stumbled onto this video and its the book he is talking about!! The book is called Influence
@24.50. He is funny and absolutely correct. Warren is very lucky to have him as partner.
Wisdom!!! Who's listening in 2020?
Closed caption at 33:20 reads as follows, "poke his attorneys a brilliant engineers lawyers like colleges". It's cryptic, but brilliant.
"You're like a one-legged man in an arse-kicking contest" - in terms of marketing manipulation, that is just about the perfect way to sum it up.
Incredibly valuable. I've always been drawn 2 marketing any product. Then playing the market to recognize how 2 follow the money & not have mine in the position to lose it. In neatly every species there is a higher archy developed w/each one's mind determing the same conclusion yet by different perspectives. To this day I hate to stand in a line but I still go through the same checkout in the end.
Solution? Amazon!......lol
Understand people, stay true!
Knowledge ;)
very inspiring
Great talk!
I wonder what is the tendency in play and what isn't. I think I have tendencies still. Feel of urgency to hop into the markets. I need to rethink my choices for the future. Now
I thoroughly enjoyed this.
I feel enlightened after listening to this
that cackling loud lady in the background trying to laugh extra loud to make everyone think she's following along understanding everything being said.
Lol
If this isn't the most dense talk I've ever listened to, it's very nearly so.
This should be in a book, a printed book. Mr. Munger has a brilliant mind.
I say only 4 words about this: This is PURE GOLD. (And by saying that I just overestimated the Gold).
Amazingly insightful & honest. STAY + SPREAD #KAMOISM
His is the uniquely unemotional personality that does well in business.
Love Mr. Munger
Wow! This is some deep stuff.
A brilliant mind.
Of course this is Buffetts voice....Unfortunatelly I dont understand english at a level to get full of this speech...:-(
Guy Spier's "The Education of a Value Investor" brought me here
This is GOLD!
A fan of Munger too.
This guy sounds like Warren Buffet :)
They're very good friends and business partners. I heard that even to this day they still check in every day to report the status of their investments. Munger's techniques are easily some of my favorites to study. He's like a walking encyclopedia.
Warren Buffet sounds like him
"According to Max Plank the really innovative, important new physics was never really accepted by the old guard. Instead, the new guard came along that was less brainwashed by its previous conclusions.
And if Max Planks crowd had this consistency in commitment tendency, that kept their old conclusions intact in spite of disconfirming evidence, you can imagine what the crowd that you and I are a part of behaves like.
And, of course if you make a public disclosure of your conclusion, you're pounding it in to your own head. Many of these students that are screaming at us you know they aren't convincing us but
they're forming mental chains for themselves because what they're shouting out they're pounding in.
And I think that educational institutions that create a climate where to much of that goes on are in a fundamental sense they are irresponsible institutions." -- Charlie Munger 10:58
Thank You Sir!
all the best!
I understand only half of all words. Do most people in America talk like that? I have learned Oxford English in the grammar school!
+Hans Grob Not most, but rather the intelligent Americans.
+Nikoals Sandoval good answer
He speaks in the manner of which it will affect most people positively.. Mr Munger is a great man.. His achievements speak for themselves.. Regardless off the tone he takes towards the 'english' language, he knows what he is doing. My respect and love to him
thank you for posting...
Do Buffet and Munger really sound so much alike that this sounds more like Buffet to me.
thanks for always being a great influence sir, I really appreciate you mentor sessions hope you getting more wonderful things in life sir.
"Apart form bookish knowledge,we all know that many times."biases"do work for a group of bulls or bears who JUST want to hammer the stock/commodity-irrespective of its STATUS(fundamental)"There is little reasoning left in such cases!
Anyone from the great country of Texas? in SA possibly?
I was a Saucier in San Antone
@ 29:14 I bet he is talking about Warren Buffet there...lol
Clearly he ISN'T talking about Warren Buffett there.
Warren isn't an intellectual amateur that lives on inherited money, but by comparison he did start off with more family money than Charlie. In fact they first met when Charlie was working for the Buffet family business. Also, once again by comparison Warren is an intellectual amateur next to Charlie. Warren would openly admit to both of these.
Ah I see. Thank you for clarifying. I'm afraid I don't know as much about Charlie Munger compared to Warren Buffettt.
Bill gates once said Charlie Munger was the broadest thinker he's ever met...and Warren Buffett's own own said Charlie was the smartest person he ever knew....with Warren following him.
On "the bet" seeded by Amazon's Jeff Bezos, Warren said he will confidently wager that no computer will ever replicate Charlie by 2029 lol
Langa Chiruka Lol, never will be able...
It would have been useful for international listeners to have CC in the video.
What is the book Charlie munger is talking about during bias# 7? It sounds like "Seal Aldiny", but I can't find anything on that.
thank you for posting this video
At 42:19 "Non-mathematical nature of the human brain" (Availability Bias), Munger says "The right way to think is the way Zach Houser plays Bridge..." Who is Zach Houser and how does he play Bridge? I can't seem to find any direct info on this via Google (perhaps I'm spelling his name wrong.)
Amazing - have watched this 3 times now and so much more to learn. And to the 96 idiots who didn't like it, try 1 more time unless you want to work at the minimum wage for the rest of your life....
🤣🤣🤣
pure gold
he sounds like Warren because he is the Vice president of Warren's company and his best friend
how about... he sounds like warren because the way someone speaks typically stems from the area and time they grew up in... Being buddies has nothing to do with it.
Just like when two broads hang out for many years, their periods start to come at the same time. This has happened with Charlie and Warrens voice.....
Without watching I imagine Confirmation Bias to be at the top...?
Pure gold - thanks!
Thank you
Anybody know why Munger thinks it's terrible to teach psychology to the masses?
Very inspiring.
Charlie Munger is one of the best things that happened to this world.