Series Post #5: Making High-Quality Decisions
Charlie Munger, billionaire investor and vice chairman of Berkshire Hathaway, once summed up his approach to wisdom using mental models. He stressed the importance of having models in your head, and then filtering your experiences through that network of mental models to arrive at better decisions. So, what are these Core Mental Models? (Here’s the First Two)
1. The Map is Not the Territory: Maps aren’t reality, they are a representation of reality. The territory can change. Downpours, earthquakes, and bulldozers happen. Another way to think of it: The Menu is Not the Meal. Trust, but verify.
2. Circle of Competence: When ego drives what we undertake, we have blind spots. Know what