Thinking fast and slow by Daniel Kahneman

 

Thinking Fast And Slow Summary

By: Niklas Goeke

Say what you will, they don’t hand out the Nobel prize for economics like it’s a slice of pizza. Ergo, when Daniel Kahneman does something, it’s worth paying attention to.

His 2011 book, Thinking Fast And Slow, deals with the two systems in our brain, whose fighting over who’s in charge makes us prone to errors and false decisions.

It shows you where you can and can’t trust your gut feeling and how to act more mindfully and make better decisions.

Here are 3 good lessons to know what’s going on up there:

1. Your behavior is determined by 2 systems in your mind – one conscious and the other automatic.
2. Your brain is lazy and thus keeps you from using the full power of your intelligence.
3. When you’re making decisions about money, leave your emotions at home.

Want to school your brain? Let’s take a field trip through the mind!

Lesson 1: Your behavior is determined by 2 systems in your mind – one conscious and the other automatic.

Kahneman labels the 2 systems in your mind as follows.

System 1 is automatic and impulsive.

It’s the system you use when someone sketchy enters the train and you instinctively turn towards the door and what makes you eat the entire bag of chips in front of the TV when you just wanted to have a small bowl.

System 1 is a remnant from our past, and it’s crucial to our survival. Not having to think before jumping away from a car when it honks at you is quite useful, don’t you think?

System 2 is very conscious, aware and considerate.

It helps you exert self-control and deliberately focus your attention. This system is at work when you’re meeting a friend and trying to spot them in a huge crowd of people, as it helps you recall how they look and filter out all these other people.

System 2 is one of the most ‘recent’ additions to our brain and only a few thousand years old. It’s what helps us succeed in today’s world, where our priorities have shifted from getting food and shelter to earning money, supporting a family and making many complex decisions.

However, these 2 systems don’t just perfectly alternate or work together. They often fight over who’s in charge and this conflict determines how you act and behave.

Lesson 2: Your brain is lazy and causes you to make intellectual errors.

Here’s an easy trick to show you how this conflict of 2 systems affects you, it’s called the bat and ball problem.

A baseball bat and a ball cost $1.10. The bat costs $1 more than the ball. How much does the ball cost?

I’ll give you a second.

…

Got it?

If your instant and initial answer is $0.10, I’m sorry to tell you that system 1 just tricked you.

Do the math again.

And?

Once you spent a minute or two actually thinking about it, you’ll see that the ball must cost $0.05. Then, if the bat costs $1 more, it comes out to $1.05, which, combined, gives you $1.10.

Fascinating, right? What happened here?

When system 1 faces a tough problem it can’t solve, it’ll call system 2 into action to work out the details.

But sometimes your brain perceives problems as simpler as they actually are. System 1 thinks it can handle it, even though it actually can’t, and you end up making a mistake.

Why does your brain do this? Just as with habits, it wants to save energy. The law of least effort states that your brain uses the minimum amount of energy for each task it can get away with.

So when it seems system 1 can handle things, it won’t activate system 2. In this case, though, it leads you to not use all of your IQ points, even though you’d actually need to, so our brain limits our intelligence by being lazy.

Lesson 3: When you’re making decisions about money, leave your emotions at home.

Even though Milton Friedman’s research about economics built the foundation of today’s work in the field, eventually we came to grips with the fact that the homo oeconomicus, the man (or woman) who only acts based on rational thinking, first introduced by John Stuart Mill, doesn’t quite resemble us.

Imagine these 2 scenarios:

1. You’re given $1,000. Then you have the choice between receiving another, fixed $500, or taking a 50% gamble to win another $1,000.
2. You’re given $2,000. Then you have the choice between losing $500, fixed, or taking a gamble with a 50% chance of losing another $1,000.

Which choice would you make for each one?

If you’re like most people, you would rather take the safe $500 in scenario 1, but the gamble in scenario 2. Yet the odds of ending up at $1,000, $1,500 or $2,000 are the exact same in both.

The reason has to do with loss aversion. We’re a lot more afraid to lose what we already have, as we are keen on getting more.

We also perceive value based on reference points. Starting at $2,000 makes you think you’re in a better starting position, which you want to protect.

Lastly, we get less sensitive about money (called diminishing sensitivity principle), the more we have. The loss of $500 when you have $2,000 seems smaller than the gain of $500 when you only have $1,000, so you’re more likely to take a chance.

Be aware of these things. Just knowing your emotions try to confuse you when it’s time to talk money will help you make better decisions. Try to consider statistics, probability and when the odds are in your favor, act accordingly.

Don’t let emotions get in the way where they have no business. After all, rule number 1 for any good poker player is “Leave your emotions at home.”

Daniel Kahneman: Thinking, Fast & Slow (Full Audiobook)

You can also order this book on Amazon

Need a Career Coach?

 Click here to get a free Zoom session with Suhair.          

How to Talk to Anyone, 92 Little Tricks for Big Success in Relationships

 

Order this book from Amazon

How To Talk To Anyone Summary

By  Niklas Goeke

One of the greatest things about knowing yourself well is that you can tell other people how you function. Give them an instruction manual, so to speak. One of the worst things about doing so is that they then tend to box you in. Whenever I tell people I’m an introvert, they somehow expect me to never leave the house. That’s nonsense, of course.

Human behavior lies on a spectrum. Always. And besides each situation being different, you can also train yourself to change. Like Leil Lowndes, who turned from a shy school teacher into a flight attendant, actress, cruise director, and later even coach, talk show host and speaker! How To Talk To Anyone is one of her many books on communication, highlighting 92 of her best tips for being successful in human relationships.

It’s a very practical how-to guide, so let’s see some of the specific advice she has to offer:

1. A seamless introduction will almost always lead to a fluent chat.
2. Emulating people and empathizing with them makes it easy for them to become your friend.
3. Praise is useful, but keep your most specific compliments to family and close friends.

Lesson 1: Smooth introductions tend to turn into good conversations.

The part we sweat the most when meeting new people is always the first ten seconds. Often, that’s the only part we’re sweating. If you’ve ever talked to a stranger, you know this is true. Once you’ve gotten over that initial hurdle, things usually go just fine. That’s why Leil suggests simply skipping that first, potentially awkward part. How? By getting an introduction!

If you’re at an event, ask the host to introduce you. You’ll both know them, which makes for an instant connection. Another option is to ask the host for a few details about the person, which you can use to strike up a conversation. Or just linger close by and observe their other conversations until you can drop in. Introverts could also bring a flashy conversation starter, like a dashing outfit or a gimmick, as well as smile, nod, and wave.

And if you’re trying to replicate this online, email introductions work well, if a mutual acquaintance makes them. I use them all the time. There, you can even use whatever information you find to show you’re prepared, which is called the briefcase technique. Oh, and if you’re the host, make sure you help your guests do the same!

Lesson 2: Mimicry and companionship are two powerful ways to form a connection.

The easiest way to get people to like you is to keep them talking about themselves. But while it’s nice that you don’t have to say all that much, eventually it’ll be your turn, or maybe you love to talk too. So what else can you do once the introduction is made? Two powerful tools, Lowndes says, are mimicry and companionship. Here’s what she means:

First, people will subconsciously feel comfortable around you if your and their movements are the same. If they use their hands a lot, use yours too, and so on. Another thing I tend to do naturally is to use the same words to describe the same things. What’s more, if you know they like something, use vocabulary from that area, for example call them “mate” if they enjoy sailing.

Second, showing people you’re on the same page goes a long way. I tend to interject affirmations like “yes” and “uh-huh,” but Leil suggests full sentences are better at achieving the same. If you can refer to you and your conversation partner as “we” and “us,” that’s also a win. Saying “how do you like our new cinema” puts you on the same team, an in-group, if you will. This will also lead to in-jokes quickly, which are one of the best ways to strengthen bonds over time.

Nothing like a running gag to keep spirits high, ain’t that right?

Lesson 3: The better you know someone, the more specific you should be in your praise.

One of the most common tips to get along well is to give people compliments. That’s true, but according to Leil, there are some misconceptions around the idea of praise, especially when it comes to when and how to deliver it. As a rule of thumb, the more you know and appreciate someone, the more detailed and frequent you can be in telling them.

For example, if you’re working together with someone for the first time, tell a mutual colleague to let them know they did great. If you do it personally, make it indirect, for example by stating their achievement as a fact and then asking them how they did it. Or ask for their opinion, which is something that makes us feel valued every time.

If you know someone well, like a close friend or someone you’re keen on dating, you can commend them for their performance right after an important event. And for the most special people in your life? Highlight their best, specific traits you admire. Maybe it’s their sense of humor, maybe it’s their humility, but life is short, so let those closest to you know why you love them in many ways.

To listen to the full audiobook on Youtube click on the following link

Order this book from Amazon

Need a Career Coach?

 Click here to get a free Zoom session with Suhair.