Tuesday Musing: Success is a lousy teacher.


Success is a lousy teacher. It seduces smart people into thinking they can't lose. - Bill Gates
Overconfidence is the downfall of great men. When you look at the history of man and you chart the downfalls of every great empire or nation, you will see a glimmer of overconfidence because of early successes. 

This is why I lean a lot towards Charlie Munger, and his way of reasoning. He has safeguards against confirmation biases. The data is looked at independently, he then compares the current data to the next best experiment, and finally he eliminates any biases he may have against the current data he is looking at.

His process next to fool proof. Yes, you are going to lose sometimes. Yes, you are going to take a few punches in the face, but overall the process to making great choices is there.

That's why I constantly talk about making rational choices on a personal finance site. How can we combat bad consumer habits? - By following a repeatable decision making process.

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