In the book Thinking, Fast and Slow, Daniel Kahneman states that we instantly recognize other people’s stupidity, slips and mistakes, but not our own.
When we see other people we instantly judge their actions as silly or sound, but when we make a mistake ourselves, we have long justifications ready, adding context to our stupid actions that would not be known to anyone.
MORE IDEAS FROM Other People’s Mistakes
It should not be a surprise that most people do not agree with each other.
Instantly, at face value, it is hard to differentiate between recklessness and boldness, ambitions and greed, a genius and an idiot.
Circumstances, luck and other external factors often end up making something look like what it isn't.
We are not really as great as we think we are, and other people aren’t really as bad as we think.
There is a blindspot hidden in this behaviour we all have, to see others mistakes instantly but not our own.
High incentives and other motivations are invisible, but everyone is susceptible to them. Incentives cloud our judgement, morality and often prompt us to do things that are not really moral, and we then end up justifying them.
The decision making process that Dalio, Buffett and Munger use is:
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