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Compounding Knowledge

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Re: Compounding Knowledge

#21

Post by nicoburns »

dwighttk wrote: post #19
stakhanov wrote: post #11

Earlier quoted context omitted.

A thought experiment: Say I have a database with 1024 e-mail addresses. I split them in two groups. I send an e-mail to 512 of them saying "tomorrow, IBM is going to go up". To the other 512, I send an e-mail saying "tomorrow, IBM is going to go down". The next day, IBM is up, and I discard from my database the 512 people to whom I've just sent an incorrect stock tip. Then I repeat. I send an e-mail to 256 people say…

Except Buffet has been emailing everyone every year since 1962; unless he has a way to pick branching timelines.

> unless he has a way to pick branching timelines.

Now that would be a skill that would set you up for success!

Re: Compounding Knowledge

#22

Post by jonstewart »

RickJWagner wrote: post #8

One of the greatest things about Warren Buffet is that he wants to share with everybody the techniques for accumulating wealth. YouTube is loaded with videos in which Buffet explains clearly how to get rich slowly but surely. He's even got a cartoon series for kids, the Secret Millionaire's Club. ( http://www.smckids.com/ ) Buffet has figured out how to reliably win the game, he wants everybody to have that ability.…

Marketing himself as a folksy Nebraskan also does wonders for his dealflow, which is one of the secrets of his success. He gets first pass at a lot of privately-owned companies who agree to sell at a low price, because he’s Warren Buffett and won’t ruin their companies.

Re: Compounding Knowledge

#23

Post by kiba »

lelima wrote: post #5
stakhanov wrote: post #2

I wonder to what extent Warren Buffet is Warren Buffet because of how he thinks and acts (like all of these non-fiction authors selling books by using his name would have us believe), and to what extent he is the product of media selection bias. -- If you take a large enough group of people who take risky stakes that are large enough (like the world of financial asset management), then one of them is bound to be as s…

People like him, are made by many, many random acts, and of course dedication, around 10.000 hours is need it for be an expert in any field, any. What if "grandfather who was a grocer" was a plumber instead? I Strongly recommend this book: Outliers by Malcolm Gladwell. He studies outliers, their family, culture, timing. One of many fun facts is that almost every pro-hockey player in Canada is born in the early's mont…

I wouldn't recommend any books by Malcolm Gladwell. He oversimplified things for the sake of telling stories.

If you want to learn rigorously, better look toward academic sources.

Re: Compounding Knowledge

#24

Post by deepGem »

why “being able to quickly google the answers to questions” is inferior to “learning, knowing and remembering the answer

At least in the world of programming, this is not necessarily true. There is so much flux that you do need to rely on Google for the semantics at least. In some instances or in time crunch, it is a make or break scenario and how fast one can get to a solution trumps everything else. So the ability to quickly Google what you want is indeed not inferior. To quickly quote an anecdote, a couple of my fellow programmers couldn't start a Flask application on AWS to listen on all interfaces. Smart guys but they couldn't figure this out. 'What' to google for is also valuable.

Of course, the ability to learn, know and remember is tremendously useful and this is what most of the interviews test for, but the ability to quickly Google and find answers in the nick of time is not inferior at all.

Re: Compounding Knowledge

#25

Post by hopler »

boombust wrote: post #12
cm2187 wrote: post #3

Earlier quoted context omitted.

Except that he has been consistently successful over a very long period, unlike, say a Paulson who one could claim got lucky in 2008.

While you are right, I think the parent's idea if that with a large enough sample, even if every actor is making decisions randomly, you will get actors that will just crush it. I mean Warren Buffet invested in Apple about a year ago based on the idea that they have a sticky brand and went so far as to say that iPhones were underpriced (which is just flat out wrong given how poorly they sold relative to predictions).…

Buffet also refused to invest in computer/Internet companies for many years because he knew he didn't understand them.

Re: Compounding Knowledge

#26

Post by hopler »

jonstewart wrote: post #22
RickJWagner wrote: post #8

One of the greatest things about Warren Buffet is that he wants to share with everybody the techniques for accumulating wealth. YouTube is loaded with videos in which Buffet explains clearly how to get rich slowly but surely. He's even got a cartoon series for kids, the Secret Millionaire's Club. ( http://www.smckids.com/ ) Buffet has figured out how to reliably win the game, he wants everybody to have that ability.…

Marketing himself as a folksy Nebraskan also does wonders for his dealflow, which is one of the secrets of his success. He gets first pass at a lot of privately-owned companies who agree to sell at a low price, because he’s Warren Buffett and won’t ruin their companies.

That's not just "marketing himself". That's a reputation earned over decades of buying companies and making the previous owners and managers into winners.

Re: Compounding Knowledge

#27

Post by kiba »

deepGem wrote: post #24

why “being able to quickly google the answers to questions” is inferior to “learning, knowing and remembering the answer At least in the world of programming, this is not necessarily true. There is so much flux that you do need to rely on Google for the semantics at least. In some instances or in time crunch, it is a make or break scenario and how fast one can get to a solution trumps everything else. So the ability…

Not necessarily.

Being able to write, debug, and understand programs is the "deep" skills that you know and remember the answer to.

Googling your answers is what you used for less frequently used set of knowledge.

Re: Compounding Knowledge

#28

Post by collyw »

vp8989 wrote: post #16
keiferski wrote: post #10

This concept is essentially the reason why “being able to quickly google the answers to questions” is inferior to “learning, knowing and remembering the answer.” The former treats a piece of information as an independent, context-free item, while the latter allows you to “digest” the information and understand the answer at a deeper level, to the point where it changes the types of questions you ask. Unfortunately ou…

There is also, practically, a massive gulf between: 1) Being vaguely aware that something exists and knowing you can Google for it. 2) Having such a deep, intuitive understanding of said thing that you can actually use knowledge of that thing to solve complex problems.

You can google for two, no?

Seems like a good deal of my job as a software engineer.

Re: Compounding Knowledge

#29

Post by sokoloff »

stakhanov wrote: post #11
cm2187 wrote: post #3

Earlier quoted context omitted.

Except that he has been consistently successful over a very long period, unlike, say a Paulson who one could claim got lucky in 2008.

A thought experiment: Say I have a database with 1024 e-mail addresses. I split them in two groups. I send an e-mail to 512 of them saying "tomorrow, IBM is going to go up". To the other 512, I send an e-mail saying "tomorrow, IBM is going to go down". The next day, IBM is up, and I discard from my database the 512 people to whom I've just sent an incorrect stock tip. Then I repeat. I send an e-mail to 256 people say…

You can use the "[private] tournament winner" selection process up to a certain point, but at some point far below Warren Buffett's current level, you come into the public eye.

If it were akin to flipping coins, we'd almost surely have seen 16+ proto-Buffetts emerge into public consciousness only to see 15 of them blow up. Sure, there have been hedge fund failures and you could argue that Madoff was a public eye super-investor who turned out to fail, but I don't think there are enough examples of "this guy is a genius based on his track record" turning into "that guy we thought was a genius turned out to just be a lucky idiot" to suggest that all of Buffett's returns are luck.

Re: Compounding Knowledge

#30

Post by iambateman »

Buffet’s approach to life is interesting for the same reason an Olympic gymnast is interesting. He has specialized to an extreme and is taking advantage of the rewards of that specialization and natural talent in a unique way.

It’s easy for me to feel shame that I don’t read 8 hours per day, as Warren and Charlie do. Buffett is a phenomenal investor but by all accounts, rather odd. He eats like crap, doesn’t exercise, had a profoundly weird relationship with his wife, and seems addicted to his work at the expense of everything else.

My point is this: his practice of reading income statements and business reports 8 hours per day for 60 years doesn’t make him the kind of person I wish to emulate.

Don’t get me wrong, I respect his levelheadedness toward money, lack of polish wrt PR, and generous philanthropic efforts. There’s a lot of good. But it’s easy to idolize the guy.

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