Better Decisions Using A Better Mental Framework
Pareto Principle (or 80/20 Principle)
The 80/20 principle is a type of power law which states that roughly 20% of a set of causes result in 80% of the effects.
The numbers don't have to be exactly 80/20 though, and they don't have to add up to 100%: both '25/95' and '5/70' are also valid.
The key idea is that in most cases cause and effect are not linear: a small subset of causes usual generate most of the effects.
Have you ever put in the time and effort to read a book only to realize the main idea could have been summarized in 5 pages instead of 200?
I find this happens to me more and more lately and it drives me nuts.
My life is busy and I really need to make the best use of what little reading time I have. I can't waste time on a book that is mostly filler ... can you???
In my whole life, I have known no wise people (over a broad subject matter area) who didn't read all the time -- none, zero. You'd be amazed at how much Warren reads -- and at how much I read. My children laugh at me. They think I'm a book with a couple of legs sticking out.
Charlie Munger is a voracious reader. He has read a lot of books, both good and bad. And on rare occasions he can be caught recommending books to the rest of us.
If you are new to the world of Charlie Munger and Mental Models then this page is for you!
It contains everything you need to get started on the path of learning how to make better decisions, become more rational, and best of all become more successful at anything you choose.
Here you will learn what his system of Mental Models can do for you.
I constantly see people rise in life who are not the smartest, sometimes not even the most diligent, but they are learning machines. They go to bed every night a little wiser than they were when they got up and boy does that help, particularly when you have a long run ahead of you.
Charlie is a learning machine. His ability to read complex material across a wide range of subjects and then later use it to make successful business decisions is almost superhuman.
I've been a student of his system for years now and have been trying to read and learn about as many models as I can.