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Compounding Knowledge

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Re: Compounding Knowledge

#101

Post by pasta »

aarondf wrote: post #88
pasta wrote: post #34

I strongly believe that compunding knowledge is also helping to create good software. And I think software companies should give a team the opportunity to invest time to know more about the subject. For example when you write WMS software you should go to a warehouse and see what is going on, talk to the people who work there and understand why things are the way they are. Because there is a huge difference between k…

You've sent me down a real philosophical rabbit hole here... Do I know why 1+1=2?

Maybe PI is a better example.

You might know it's 3.14... but not why.

Re: Compounding Knowledge

#102

Post by yingw787 »

This reminded me of what Jeff Bezos told the founders of Basecamp: "Focus on the things that don't change". In software, the global implementation-specific knowledge changes quickly, but the global first principles knowledge expands much more slowly. Implementation-specific knowledge is "crumbly"; it can't compound effectively over time because the foundational premises for its usage disappear. Investing in knowing first principles may pay off more in this regards because first principles actively build upon each other (compilers --> just-in-time compilation, distributed memory models | distributed systems, etc.)

Re: Compounding Knowledge

#103

Post by vharuck »

aarondf wrote: post #88
pasta wrote: post #34

I strongly believe that compunding knowledge is also helping to create good software. And I think software companies should give a team the opportunity to invest time to know more about the subject. For example when you write WMS software you should go to a warehouse and see what is going on, talk to the people who work there and understand why things are the way they are. Because there is a huge difference between k…

You've sent me down a real philosophical rabbit hole here... Do I know why 1+1=2?

Probably not, but there is a proof in "Principia Mathematica" on page 379.

https://en.m.wikipedia.org/wiki/Principia_Mathematica

Re: Compounding Knowledge

#104

Post by foobiekr »

ohaideredevs wrote: post #96
iambateman wrote: post #30

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…

"He has specialized to an extreme and is taking advantage of the rewards of that specialization and natural talent in a unique way." Gates is another one of those people where most forget that his grandfather was a multi-millionaire, his mother was a director at IBM, and he had access to one of the first computers in the world. I.e. he is not an example of a self-made person, so anything he says is not really applica…

How basic is required to qualify as self-made in a meaningful sense? I’m not talking about “Should he have grounded up sand and made his own chips and boards?” stuff, I mean lots of people have similar circumstances to Gates and made nothing of themselves.

As it happens the high school I went to, as a kid from a mostly lower middle class family with severe issues being able to pay attention in school in the eighties, had a lot of kids of rich families. These kids had everything - expensive cars at 16, huge houses, nice places to live, etc.

I have followed them along. It’s been 25+ years and basically none of them did anything with their lives, though to be frank I think they could certainly have been much happier and have had more experiences. The other misfits and I have done ok.

So Gates started from a better place and did far, far better than his peers. Does he not get credit for that?

Re: Compounding Knowledge

#105

Post by aabeshou »

foobiekr wrote: post #104
ohaideredevs wrote: post #96

Earlier quoted context omitted.

"He has specialized to an extreme and is taking advantage of the rewards of that specialization and natural talent in a unique way." Gates is another one of those people where most forget that his grandfather was a multi-millionaire, his mother was a director at IBM, and he had access to one of the first computers in the world. I.e. he is not an example of a self-made person, so anything he says is not really applica…

How basic is required to qualify as self-made in a meaningful sense? I’m not talking about “Should he have grounded up sand and made his own chips and boards?” stuff, I mean lots of people have similar circumstances to Gates and made nothing of themselves. As it happens the high school I went to, as a kid from a mostly lower middle class family with severe issues being able to pay attention in school in the eighties,…

I would agree that wealth shouldn't negate his accomplishments.

I think a lot of people who point out Gates' family wealth are reacting to the current political/ideological climate which would say "look, Bill Gates is self-made, so anyone can be!" neglecting the ridiculous enabling impact that enormous family wealth has, and shaming poor people for not being able to pull themselves up by their bootstraps.

Re: Compounding Knowledge

#106

Post by jimbokun »

tryptophan wrote: post #89
jboneal wrote: post #74

Earlier quoted context omitted.

Controversial take: Buffett is actually not a great investor in the way people think. Via the float in his insurance companies, he receives a 0% infinite maturity loan to plow into the market. That financial leverage gives him the ability to beat the market year after year - not his own stockpicking prowess. If you were to start with $1B, then get an extra $2B that you never had to pay back, you too would do quite we…

Ill take it even farther: Buffet isn't statistically different than average. He just found a strategy that happened to work, was stubborn enough to stick to it through bad times, and used copious amounts of leverage to juice returns. A really interesting paper called "Buffet's Alpha" talks about this, and was able to replicate his performance by following a few simple rules. They found that he produced very little ac…

"He just found a strategy that happened to work, was stubborn enough to stick to it through bad times, and used copious amounts of leverage to juice returns."

Which is anything but average.

Re: Compounding Knowledge

#107

Post by dangoor »

tryptophan wrote: post #89
jboneal wrote: post #74

Earlier quoted context omitted.

Controversial take: Buffett is actually not a great investor in the way people think. Via the float in his insurance companies, he receives a 0% infinite maturity loan to plow into the market. That financial leverage gives him the ability to beat the market year after year - not his own stockpicking prowess. If you were to start with $1B, then get an extra $2B that you never had to pay back, you too would do quite we…

Ill take it even farther: Buffet isn't statistically different than average. He just found a strategy that happened to work, was stubborn enough to stick to it through bad times, and used copious amounts of leverage to juice returns. A really interesting paper called "Buffet's Alpha" talks about this, and was able to replicate his performance by following a few simple rules. They found that he produced very little ac…

Compared to the S&P 500 going back to 1996, Berkshire Hathaway is up 845% vs 257% for S&P 500. Is this not a statistically significant result? (Or is there another average I should be looking at?)

Re: Compounding Knowledge

#108

Post by Jimpulse »

bgroat wrote: post #58
dna_polymerase wrote: post #47

(Slightly Off-Topic) Question to those who subscribe to Farnam Street: Would you recommend it? Does it add value to your life?

I loved it for about 18 months than I figured that I'd learned everything I needed from it. The quality remained stellar, I just didn't need it anymore

What are your big take aways?

Re: Compounding Knowledge

#109

Post by p33p »

Bucephalus355 wrote: post #45

“Hard to become an expert. Easy to be an expert.” I spent many years learning how to do cloud architecture. Now I can briefly look at AWS documentation for new services out of the corner of my eye and know all I need to for the next 6 months. Yet the other day I opened a book on Java, which I haven’t studied since college, and literally had no idea what in the world I was reading.

Do you have any specific online resources you could point to in order to learn cloud architecture?

Re: Compounding Knowledge

#110

Post by lbatx »

sanderjd wrote: post #81
jboneal wrote: post #74

Earlier quoted context omitted.

Controversial take: Buffett is actually not a great investor in the way people think. Via the float in his insurance companies, he receives a 0% infinite maturity loan to plow into the market. That financial leverage gives him the ability to beat the market year after year - not his own stockpicking prowess. If you were to start with $1B, then get an extra $2B that you never had to pay back, you too would do quite we…

I think by "actually not a great investor in the way people think", what you're saying is that he isn't a particularly outstanding stock picker . To the extent that that's the way in which people think he's a great investor, it's because lots of (most?) people think investing is just stock picking. But what makes him a great investor is exactly what you outlined. He found a great strategy - insurance float for levera…

That would be weird, but "he's not a great investor" is taken out of context from "he's not a great investor in the way people think". The way it would be said is "he's not a great investor in the way people think [stock picking], he's a great investor because he found this other strategy that works well."

What about he's "not a great investor in the way people think" leads you to believe "he's not a great investor"?

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