The Power of Compound Interest in the Intellectual Domain In the intellectual domain, compound interest rules. When you look at a business with one hundred users growing at a compound rate of 20 percent per month, it can very quickly scale up to having millions of users. Sometimes, even the founders of these companies are surprised by how large their businesses grow.
Only by ensuring the alignment of interests can we fundamentally reduce the principal-agent problem and maximize the protection of our own interests. To me, the principal-agent problem is the single most fundamental problem in microeconomics. If you do not understand the principal-agent problem, you will not know how to navigate your way through the world. It is important if you want to build a successful company or be successful in your dealings.
Victory achieved through military means cannot be lasting; the defeated will eventually retaliate. This kind of victory has occurred many times in human history, but sooner or later, it will turn into a grave disaster—because the victory obtained through force itself plants a seed of failure in the future, and the arrival of this failure is merely a matter of time.
Fear and anger make them lose their ability to think. They start to become particularly good at doing absurd things that harm their own interests. So, the first thing you need to learn is how to control these two emotions. +++
In times of disagreement and conflict, the one who maintains composure is the strongest. Only this person can master the situation, and calmness is the only way to prevent the tension from escalating.
“Being contrarian and making judgments will never be effective,” the sage commented, “on the contrary, it will only exacerbate conflict. Yet, this is something that every person trying to soothe others does subconsciously.”
Asking someone a question is giving them a chance to speak The Cycle of Refusal and Explanation When someone refuses our request, our immediate reaction is usually to explain why they should accept our proposal. If the other party doesn’t choose to concede, we often continue to explain or present more arguments. We try to force acceptance through our own explanation, and the other party is doing the exact same thing. This is like a conversation between two deaf people: “No, because…”, “Yes, because…”, “No, because…”, “Yes, because…”, endlessly. ...
We are always eager to explain to others why they are wrong, but what we should actually do is show interest in other people’s viewpoints, and this also serves our own interests. When others reject one of your proposals, you first need to show interest in the reasons behind it, and your attitude must be as sincere as possible. You can ask, “Why do you disagree?” and then listen attentively to their answer. Their answer is like a gold mine, containing many pieces of information worth considering and leveraging. That is the secret.
Avoid getting caught in the cycle of explaining, threatening, and personal attacks. Step One Calming Your Own Emotions. When we feel an urge to attack the other person internally, we need to try our best to suppress it. For example, we can achieve this through several methods mentioned in the story: Correcting misjudgments of the facts; Distracting yourself through deep breathing; Or simply restraining the fist you want to throw; Or any other method that might be effective. During communication with others, every time you feel this urge reignite internally, you must review this step in your mind. Completing this step only takes a few seconds, making it perhaps the most difficult and most important step. If you don’t have the urge to attack the other person, that is naturally better. You can then proceed directly to the next step. ...
People face trade-offs. The cost of something is what you give up to get it. Rational people consider marginal quantities. People react to incentives as they trade with each other. Trade can make everyone better off. The market is usually a good way to organize economic activity. Government can sometimes improve market outcomes and how the entire economy runs. A country’s standard of living depends on its ability to produce goods and services. When the government issues too much currency, prices rise. Society faces the short-run trade-off between inflation and unemployment.
I never ask if “I like it” or “I don’t like it.” I think “this is what it is” or “this is what it isn’t.”
A lousy way to do memory prediction is “X happened in the past, therefore X will happen in the future.” It’s too based on specific circumstances. What you want is principles. You want mental models.
Part of making effective decisions boils down to dealing with reality. How do you make sure you’re dealing with reality when you’re making decisions?
By not having a strong sense of self or judgments or mind presence. The “monkey mind” will always respond with this regurgitated emotional response to what it thinks the world should be. Those desires will cloud your reality. This happens a lot of times when people are mixing politics and business. The number one thing clouding us from being able to see reality is we have preconceived notions of the way it should be.
To see the truth, you have to get your ego out of the way because your ego doesn’t want to face the truth. The smaller you can make your ego, the less conditioned you can make your reactions, the less desires you can have about the outcome you want, the easier it will be to see the reality.
The problem is their desire is colliding with reality and preventing them from seeing the truth, no matter how much you say it. The same thing happens when I make decisions. The more desire I have for something to work out a certain way, the less likely I am to see the truth. Especially in business, if something isn’t going well, I try to acknowledge it publicly and I try to acknowledge it publicly in front of my co-founders and friends and co-workers. Then, I’m not hiding it from anybody else. If I’m not hiding it from anybody, I’m not going to delude myself from what’s actually going on.
What you feel tells you nothing about the facts—it merely tells you something about your estimate of the facts.
Almost all biases are time-saving heuristics. For important decisions, discard memory and identity, and focus on the problem.
Comment seeding (or comment traffic generation) can be traced back to the blog era, where people would mass-comment on other websites. The username and the comment content served as advertisements. By commenting on hundreds or thousands of sites, one could continuously bring in a steady stream of traffic. The veteran blogger Lu Songsong, a well-known figure in the site owner community, insisted on commenting under various blog posts back then, which provided significant help to his later traffic and fame. ...
Don’t play zero-sum games .