The Ledger
Every statement that passed quotation and attribution checks. Mix any filter with any other: certainty 1/5, debate potential 5/5, or both at once.
why aren't all 35 resolved? a statement only gets an assessment when the public record can support or contradict it. opinions and what-ifs never can, and 0 checkable ones are still open, waiting for their date. predictions held up or didn't; assertions are supported or contradicted. on every card: ▮▮▮▮▮ certainty · ▮▮▮▮▮ debate potential. speakers are clickable
Mauboussin: NBA outcomes rely on skill; hockey and baseball involve luck
“The NBA is the sport that's furthest from randomness, furthest from pure luck configuration, and sports like actually ice hockey and baseball are actually quite much closer to being random.”
Mauboussin: Senior executive decisions depend far more on luck than entry-level work
“Usually when you're a lower level worker, your job actually tends to have a higher skill component, right? So you're doing something, you're on an accounts receivable clerk and you're collecting accounts receivables, right? We can measure what we're doing. It'…”
Mauboussin: Network effects create increasing returns that defy economic mean reversion
“So we're taught in economics, microeconomics, and by the way, it's still largely true that, Returns on incremental capital tend to migrate toward the cost of capital, and typically the reason for that is competition, right? If you're generating, Shane, massive…”
Mauboussin: Overcome algorithm aversion by allowing minor human adjustments
“And it turns out, they said, there's a way to overcome this which I think makes enormous amounts of sense. And they said, the way you overcome this is you say to people, you're going to, your first answer is going to be what the algorithm tells you, right? Jus…”
Mauboussin: Only pay for franchise value in stable, low-churn industries
“You don't want to pay for you know, huge amount of competitive advantage.
In an industry where there's a ton of entry and exit, where market shares are very volatile, and by contrast, you might be much more willing to pay for franchise value for an industry w…”
Mauboussin: Parents have far less influence over kids than they assume
“The argument that Harris makes, it's quite compelling is that parents aren't quite as important as they think they are.”
Mauboussin: Intuition fails in unstable, non-linear environments
“The key characteristic is gonna work in what I would call stable, linear environments. Stable, linear environments. Athletics would be another example. For history, for long parts of history, it was in warfare. Certain elements of warfare would work. But if yo…”
Mauboussin: Organizations emphasize diversity without knowing how to manage it
“I think a lot of organizations of all stripes, Emphasize the virtues of diversity, which are, which certainly is of some value, but they're not necessarily clear on how to manage diversity, right? So it's not just to have it. It's how do you take advantage of …”
Mauboussin: Equating outcomes directly with decision quality is a big mistake
“The natural thing we all do then, of course, is after the fact, is say, successes should be equated with good decisions Decisions and failures equated with bad decisions, and that's a really big mistake in a lot of circumstances.”
Mauboussin: Base rates rule luck-driven domains; inside views rule skill domains
“And the basic heuristic on this is that if there's a lot of luck, A lot of randomness. You should rely exclusively or almost exclusively on the base rate. If there's a lot of skill, you should rely almost exclusively on the inside view, right? On, on your own …”
Mauboussin: Corporate sales growth is more persistent and predictable than earnings
“In corporate performance, two measures that are very common for people to look at are Sales growth rates and earnings growth rates. And it turns out that sales growth rates are a lot more persistent. So you might say more indicative of some sort of underlying …”
Mauboussin: The majority of corporate executives rely on intuition for decisions
“And, you know, one of the things that I've always found to be fascinating and actually somewhat disconcerting is that many executives will say that they, and by the way, majority of executives will say that they rely or lean on their intuitions for making thei…”
Mauboussin: Intuition can only be developed in stable, linear environments
“And I think the general rule is intuition can be developed in realms that are stable and linear. So if there's a repeated pattern and things don't change that much, you can train your intuition. You have to train it, but you can train your intuition. It can be…”
Mauboussin: In luck-driven domains, evaluation must focus on process over outcomes
“If you are operating in this completely skilled, dominated domain, outcomes are all you really need to know about, right? And so to your point, if you're performing well or performing poorly, that's almost a pure reflection of your skill. And in those domains …”
Mauboussin: Algorithmic models fail when applied to non-stationary, dynamic systems
“You have to be very, very careful about systems that are changing, you know, the fancy term for its non-stationarity. So the statistical properties and underlying systems change over time. And that's another concern I might have, and we see it a little bit of …”
Mauboussin: Tech giants leverage capital into insurmountable data capture flywheels
“The amount of data that they can capture, and because all those companies have substantial resources, they can put a lot of resources against not only capturing, but analyzing data. It's an interesting flywheel, right?”
Mauboussin: US per capita daily energy usage dwarfs 100W biological baseline
“If you plot humans on that mass metabolic rate scale humans should use about a hundred watts a day. So, you know, what it takes to sustain your basic metabolic rate, what it takes to sustain you is about what it takes to power of light bulb, right? But it turn…”
Mauboussin: Cities scale sublinearly in infrastructure, but superlinearly in patents and crime
“If you look at cities of different sizes, as they get larger, they tend to use the physical infrastructure more efficiently. So you need fewer, you know, miles per road per person or Distance of pipes and electric wires and so forth, right? So cities like larg…”
Mauboussin: Decision-makers must start with base rates before intuition
“You should always start with the base rate, sort of the statistical approach, and then layer in your intuition. So he called it disciplined intuition. And, ah, otherwise, if you go with your intuition first, you're going to seek out, right, you're going to see…”
Mauboussin: The optimal decision-making team size is well under 10 people
“There is an optimal size for a team, and it's not 10, right? There's not 15. So people will complain, we have too many people, and that's dilutive to what we're trying to do.”
Mauboussin: Strong views from senior leaders immediately suppress alternative perspectives
“Someone in the room, ah, the senior leader, for example, might express his or her view very strongly, and that immediately suppresses alternative points of view.”
Mauboussin: CEOs make fewer, more consequential, probabilistic decisions than line workers
“As you move up in the organization, interestingly, you're probably making fewer decisions on average. So a CEO is making fewer decisions than, for example, a line employee. They're obviously more consequential decisions, but they also tend to be much more prob…”
Mauboussin: Algorithms improve decisions by removing emotion and utilizing base rates
“They're good at looking at lots of data. They're good at establishing and understanding base rates. So, for example, if you're thinking about an appropriate reference class for a particular decision, your technology will allow you to access that reference clas…”
Mauboussin: Weaker players should multiply battlefields while stronger players simplify
“The simple rules, by the way, is if you're the stronger player,
What you want to do in a head-to-head competition, what you want to do is simplify the game.
In other words, have as few battlefields as possible, so you're almost assured that your skill will ove…”
Mauboussin: People struggle to update probability estimates by the proper magnitude
“It's extremely difficult, and even if I get you to move in the right direction, I often can't get you to move the appropriate amount, so on, so forth.”
Mauboussin: An innate drive for causality impairs human statistical thinking
“We're all, as humans, we're all about causality. By the way, that's one of the reasons we start, struggle so much with understanding statistical thinking.”
Mauboussin: Kahneman Noise Study Found 40% to 60% Decision Variance
“And they first went to their managers and they said, Hey, you know how much variance do you expect in these outcomes? Right? Again, playing the same way, same software and so forth. And the manager said, you know, a priority, you know, five to 10% variance. So…”
Mauboussin: Writing and Speaking Forces Deeper Material Comprehension
“So I find myself often using things in my own research, and that is actually incredibly useful, because when I write about it, or I have to speak about it typically means I need to understand the material reasonably well.”
Mauboussin: Training System 1 Expertise Requires Structured Deliberate Practice and Feedback
“To really train your system, one, to be really, really good, I think it requires, you know, that structure, deliberate practice, and I think the essential element there is is feedback.”
Mauboussin: Some investment firms teach employees poker to train probabilistic thinking
“And so there are some investment organizations, for instance, that teach their employees how to play poker, right? To think about probabilities, to think about pot odds, right?”
Mauboussin: Reversible Experiments Help Overcome Managerial Resistance to Change
“Another card to play in that is experimentation. Say, let's try it this way for, you know, this subset or for this period of time. And if it works out great, and if it doesn't work out, we'll revert to what we were doing before. So just, if that's not too cost…”
Mauboussin: Wisdom of crowds derives from complex adaptive systems models
“Things like the wisdom of crowds, all those ideas, they naturally flow from looking at the world through the lens of complex adaptive systems.”
Mauboussin: Most gifted books are by Pinker, Wilson, and Menand
“You know, usually the books that I give away are it's usually a little trio. C. Pinker's book, How the Mind Works. E.L. Wilson's book, Consilience. And the third book is The Metaphysical Club. So those tend to be the three books that, if you said to me, and I …”
Mauboussin: Mental recall is significantly better with physical books than e-readers
“As for reading and I don't know if this is a generational thing, but I still prefer physical books to reading on the Kindle, so I might read on the Kindle on a plane or something, but usually I'll do shorter reads versus long reads, but mostly I like physical …”
Mauboussin Recommends Mortimer Adler's 'How to Read a Book' Framework
“But most of the books, you know, the great book, how to read a book, you know, is, is what I would recommend most people do in talking about different levels of attention that you would Mortimer Adler, different levels of attention you might pay to different t…”