Saturday Serendipity

Quote, Mental Model, Twitter Thread.

Quote

“If something is too hard, we move on to something else. What could be simpler than that?”
― Charles T. Munger.

Mental Model

Relativity: Relativity is a concept which was made famous by Einstein but before him, there was a Scottish scientist Galileo who also had a theory on relativity. That was known as Galilean Relativity. Not to bore you now but in physics, terms relativity is defined as,

‘ the dependence of various physical phenomena on the relative motion of the observer and the observed objects, especially regarding the nature and behaviour of light, space, time, and gravity.’

Now if I were to explain this with the help of an example.

Imagine playing with a tennis ball on a train or a bus. To you the ball is static in your perception you are stationary and so is the ball. But now imagine your friend is outside seeing you on the moving train or bus. From his perspective, you are also moving and the ball is also moving.

Galileo concluded that this is why we don’t notice the earth moving as even we move at the same velocity as the earth.

This kind of mental model can be really important to us in investing and life.

In life

It is very important in life to understand different perceptions or different views. So from relativity what we can take is that there are many different perceptions people have and it is not necessary that you are right and they are wrong. Both can be right, so you must be open-minded and listen to different perceptions.

In Investing

In investing perception is important. One thing that is amazing about the equity market is that when you are buying a stock there is someone on the other end selling it and both of you think you are right. So you have a perception that you are right here but you should also understand the other side’s perception and take it into account. This would also help you to seek disconfirming evidence.

Twitter Thread

Aadit Sheth @aaditsh

Elon Musk is a big believer in First Principles Thinking. Not just Musk — Jeff Bezos, Peter Thiel and Feynman too. Here's what it is, how to use it, and become better at it:

That’s it for this week!