immutable law

When you look at history, you realize how dangerous the world is. Sometimes, significant events that changed the course of history occurred due to completely unexpected contacts or decisions made without much thought. It can produce wonderful results, or it can lead to tragedy. Author Tim Urban said: “If you time travel and go to the world before you were born, you wouldn’t be able to do anything hastily. “Because we know that even the smallest action can have a tremendous impact on the future.”
— p.27, from “Such a dangerous world” There is an irony that is felt when looking into history. The truth is that we usually know how the story ends, but we don't know where the story begins. Let me give you an example. What caused the 2008 financial crisis? To know the answer, you must first understand the structure of the mortgage market. So what has affected the mortgage market? To understand that, you need to know how interest rates fell over the past 30 years. What factors led to the decline in interest rates? To understand that, you first need to know inflation in the 1970s. Why did inflation occur in the 1970s? To know that, we need to look at the monetary system of the 1970s and the impact of the Vietnam War. Why did the Vietnam War occur? To understand that, you must know how Americans became fearful of communism after World War II and through the Cold War. If you go up like this, you will bite your tail and it will continue endlessly.
— p.40, from “Such a dangerous world”

It is no exaggeration to say that NASA is the most planned and thorough organization on Earth. Moreover, since it is not possible to send a man to the moon just by putting both hands together and praying for success, he must have prepared even more thoroughly. NASA has a Plan A, Plan B, and even Plan C for every imaginable risk. But even so, one very small mistake that no one had thought of led to disaster. Financial planner Carl Richards said: “Risk is what remains after you think you have considered all scenarios.”
— p.49, from “The Invisible, Risk”

I guarantee you, it will still be like that in the future. The biggest risk and most important news over the next decade will be something no one is talking about right now. This is true no matter what year you are reading this book. The reason I can say this with confidence is because it has always been this way. The unpredictable nature of risk makes it dangerous.
— p.53, from “The Invisible, Risk”

If someone says something will happen and it actually happens, that person's prediction was correct. If someone says something will happen and it doesn't happen, that person's prediction was wrong. People just think this way. This is because thinking that way requires less mental energy and is more comfortable. It's difficult to convince people (or yourself) that a different outcome could have been possible when the actual outcome is right in front of you. The point is this. People believe they want an accurate view of the future, but in reality, what they really want is certainty.
— p.102, from “Probability and Certainty”

Let’s consider an incident that is labeled ‘first in 100 years’. 100-year floods, hurricanes, earthquakes, financial crises, fraud, pandemics, political collapses, economic downturns, and more. Many terrible events can be called 100-year events. '100-year events' does not mean that they occur once every 100 years. This means that the probability of that event occurring in any year is about 1 percent. This feels like a low probability. But if there are hundreds of individual 100-year events, what is the probability that one of them will occur in any given year? It's pretty high.
— p.106, from “Probability and Certainty”

In a perfect world, the importance of information would not depend on the storytelling skills of the person delivering the information. However, in the world we live in, people get bored easily, lack patience, are easily controlled by their emotions, and want complex information to be easy to understand, like a scene from a story. Let’s take a closer look at our surroundings. In any situation where information is exchanged - products, companies, politics, knowledge, education, culture - great stories win. Stephen Hawking once said this about his physics books: “Someone told me that. “For every additional equation in the book, sales will be cut in half.” What readers want is a memorable story, not a boring lecture.
-pp. 129-130, from “Excellent stories win”

Historian Stephen Ambrose says that at the end of 1944, U.S. commanders Dwight Eisenhower and Omar Bradley had the best rational judgment needed to develop a wartime strategy, but they missed one detail. That was how crazy Hitler was. A close associate of Bradley said at the time: “If we had fought against rational men, they would have surrendered long ago.” But they were not rational people. And that fact, that fact that is difficult to measure with logic and reason, influenced everything.
— p.146, from “What Statistics Miss”

On September 2008, 9, Lehman Brothers' financial health appeared to be good. This bank's capital ratio (an indicator that evaluates a financial institution's ability to bear losses) was 10 percent. This was a higher figure than the previous quarter. It was higher than Goldman Sachs or Bank of America. It was a higher figure than Lehman Brothers' capital ratio in 11.7, when the financial industry was booming. And 2007 hours later, Lehman Brothers went bankrupt. The only thing that changed during those three days was investor confidence in the bank.
— p.152, from “What Statistics Miss”

One result led to another. The desire to achieve growth target numbers ultimately crowded out rational analysis and judgment. The saturation level of Starbucks stores has exceeded the limit. Even during a booming economy, same-store sales growth was down 50 percent. Howard Schultz wrote this in his 2007 email to executives: “As we grew from less than 1,000 stores to 1, we made a series of decisions that, looking back, diluted the ‘Starbucks experience.’”
— p.186, from “More, Faster”

Investor Patrick O'Shaughnessy said: “I've met many people who have achieved amazing things, and they usually don't seem happy. Rather, it would be more accurate to say that he looked ‘distressed.’” Fear, pain, and adversity are powerful motivators that positive emotions can never match. This is a great lesson from history. And this lesson ultimately gives us this realization. 'Think carefully and decide what kind of life you want.' I think I would be happy living a life without any worries, pain, or stress. But there is no motivation or progress in such a life. No one welcomes adversity with open arms. But we must acknowledge that it is the most powerful fuel for creative problem solving and innovation.
— p.212-213, from “The Moment When Magic Happens”

If I were to ask, “What are the chances that in 50 years the average American will be twice as rich as he is now?” it would sound absurd. It seems very unlikely that that will happen. You'll become twice as rich as you are now? Is your wealth increasing ‘double’? That seems like too ambitious a goal. But if I were to ask, “What are the chances of us achieving an average annual growth rate of 50 percent over the next 1.4 years?” I would be called a pessimist. People will say. “One percent? “At best?” But the above two are the same thing. We have always been that way, and we always will be that way.
— p.225, from “Tragedies are fleeting, miracles take a long time.”

It is important to be able to judge how much of this annoying problem or inconvenience is best to endure. Most people do not realize this fact. President Franklin Roosevelt was the strongest man in the world, but because he was paralyzed from the waist down, he had to be helped by an aide to go to the bathroom. He once said this: “If you have lost the use of your legs, you may want to drink orange juice, but when people bring you milk, you have to be able to say ‘It’s okay’ and drink the milk.” President Roosevelt knew how much inefficiency and inconvenience he would have to endure.
— p.280, from “All journeys are inherently difficult”

[Wall Street Journal] columnist Jason Zweig describes the three paths a full-time writer walks.
1. You can make a lot of money by lying to people who want to hear lies.
2. You can make a living by telling the truth to those who want to hear it.
3. If you tell the truth to those who want to hear lies, you will kick the can down the road.
Could there be a more neat summary of the power of incentives? And this sometimes reminds us why people do unreasonable or unreasonable things.
— p.325, from “Incentives: The Most Powerful Force in the World”

It is easy to follow advice from the investment world and say, “I will be greedy when others are fearful,” but it is not easy to put it into practice. Making such bets is because it underestimates how much your thoughts and goals can actually change if the market goes bad. When market conditions worsen, we tend to adopt previously unexpected goals and perspectives because it is not just asset prices that change during a downturn. If I asked you to imagine what you would do if stocks fell 30 percent, you would imagine that everything else stayed the same and just stocks fell 30 percent. But that's not how the world works.
— p.345, from “You have to experience it to know”

'After experiencing pain, I began to crave stability.' It is easy to look at history and say this. “Look. “If you look at it from afar and endure just a little, you will eventually recover and survive somehow.” However, this forgets the fact that the human mind is more difficult to recover than buildings or the economy. We can observe and measure almost everything in the world, but we cannot measure people's moods, fears, hopes, resentments, goals, motivations, and expectations. In part for this very reason, incomprehensible things have and will continue to happen throughout history.