• “I once had lunch with a guy who's close to Warren Buffet. This guy - we'll call him Jim (not his real name) - was driving around Omaha, Nebraska, with Buffett in late 2009. The global economy was crippled at this point, and Omaha was no exception. Stores were closed, businesses were boarded up. Jim said to Warren, "It's so bad right now. How does the economy ever bounce back from this?"
  • Warren said, "Jim, do you know what the bestselling candy bar was in 1962?"
  • "No," Jim said.
  • "Snickers," said Warren. "And do you know what the bestselling candy bar is today?"
  • "No," said Jim.
  • "Snickers," Warren said. Then silence. That was the end of the conversation.
  • This is a book of short stories about what never changes in a changing world. History is filled with surprises no one could have seen coming. But it's also filled with so much timeless wisdom. If you traveled in time to five hundred years ago or five hundred years from now, you would be astounded at how much technology and medicine has changed. The geopolitical order would make no sense to you. The language and dialect might be completely foreign. But you'd notice people falling for greed and fear just like they do in our current world. You'd see people persuaded by risk, jealousy, and tribal affiliations in ways that are familiar to you. You'd see overconfidence and shortsightedness that remind you of people's behavior today. You'd find people seeking the secret to a happy life and trying to find certainty when none exists in ways that are entirely relatable. When transported to an unfamiliar world, you'd spend a few minutes watching people behave and say, "Ah. I've seen this before. Same as ever." Change captures our attention because it's surprising and exciting. But the behaviors that never change are history's most powerful lessons, because they preview what to expect in the future. Your future. Everyone's future. No matter who you are, where you're from, how old you are, or how much money you make, there are timeless lessons from human behavior that are some of the most important things you can ever learn.” - intro
  • Voltaire: “History never repeats itself, but man always does”

Risk is What You Don’t See Coming

• Wow: “Philosophers have spent centuries discussing the idea that there are an infinite number of ways your life could play out, and you just happen to be living in this specific version. It's a wild thing to contemplate, and it leads to the question: What would be true in every imaginable version of your life, not just this one? Those universal truths are obviously the most important things to focus on, because they don't rely on chance, luck, or accident.”
• “It’s well known that people are bad at predicting the future. But this misses an important nuance: We are very good at predicting the future, except for the surprises - which tend to be all that matter. The biggest risk is always what no one sees coming, because if no one sees it coming, no one's prepared for it; and if no one's prepared for it, its damage will be amplified when it arrives.” → beware the tail risk (risk is what you don’t see) - “Look at the big news stories that move the needle: COVID-19, 9/11, Pearl Harbor, the Great Depression. Their common trait isn't necessarily that they were big; it's that they were surprises, on virtually no one's radar until they arrived. "After booms come busts" is about as close to economic law as it gets. Study history, and the calamity that followed the booming 1920s, late 1990s, and early 2000s seems more than obvious. It seems inevitable. In October 1929 - the peak of history's craziest stock bubble and the eve of the Great Depression - economist Irving Fisher famously told an audience that "stock prices have reached what looks like a permanently high plateau." - despite this, no one predicted a decade long Great Depression!
• We need to predict with humility and build in a margin of safety for the surprises: “The Economist, a magazine I admire, publishes a forecast of the year ahead each January. Its January 2020 issue does not mention a single word about COVID-19. Its January 2022 issue does not mention a single word about Russia invading Ukraine. That's not a criticism - both events were impossible to know when the issues were planned in the months before publication. But that's the point: The biggest news, the biggest risks, the most consequential events are always what you don't see coming.”
• What can you do? For starters, maybe save a little more than you think you need or take a little less debt in the rare case of a tail event → “Most of the time, when someone's caught unprepared, it's not because they didn't plan. Sometimes it's the smartest planners in the world, working tirelessly, mapping every scenario they can imagine, who end up failing. They planned for everything that made sense before getting hit by something they'd never imagined.” (LTCM saying they never envisioned losing $35mm in a day but ended up with a $553mm one-day drop due to the unexpected Russian Ruble devaluation…)

Happiness is Reality - Expectations

• Happiness is reality - expectations, where, as Munger says, the world is driven not by greed, but envy, so we always crave what our neighbor has → shares the story of the 50s seen as the glory years even though we had higher unemployment and smaller houses etc
• “If you look at the 1950s and ask, "What was different that made it feel so great?" this is at least part of your answer. The gap between you and most of the people around you wasn't that large. It created an era when it was easy to keep your expectations in check because few people in your social circle lived dramatically better than you did. Many (but not all) Americans could look around and find that not only were they living comfortable lives, they were living lives that were just about as comfortable as those around them whom they compared themselves to.” → contrast that to today, where power law outcomes in tech and social media result in never-fulfilled expectations and deep envy: “You compare yourself to your peers through a curated highlight reel of their lives, where positives are embellished and negatives are hidden from view… You see the cars other people drive, the homes they live in, the expensive schools they go to. The ability to say, I want that, why don't I have that? Why does he get it but I don't? is so much greater now than it was just a few generations ago. Today's economy is good at generating three things: wealth, the ability to show off wealth, and great envy for other people's wealth.” (This results in unhappiness because even though we have more than our predecessors, we have less than our neighbors - income comparison study)
• Amazon’s booming covid time: “Expectations were so high in 2021 that investors and employees had to achieve extraordinary things just to break even. When results were merely good, they felt terrible. Expectations are like a debt that must be repaid before you get any joy out of what you’re doing”
• “My friend Brent has a related theory about marriage: It only works when both people want to help their spouse while expecting nothing in return. If you both do that, you're both pleasantly surprised.” → Approach life with mild expectations and you’ll constantly be pleasantly surprised

The Best Story Wins

• “The best story wins. Not the best idea, or the right idea, or the most rational idea. Just whoever tells a story that catches people's attention and gets them to nod their heads is the one who tends to be rewarded. Great ideas explained poorly can go nowhere, while old or wrong ideas told compellingly can ignite a revolution.” → Martin Luther King Jr speech started off scripted and slow, then a singer yelled at him “tell em about the dream!” and that’s when he really captured the audience: “I have a dream that one day this nation will rise up and live out the true meaning of its creed: "We hold these truths to be self-evident, that all men are created equal." I have a dream that my four little children will one day live in a nation where they will not be judged by the color of their skin but by the content of their character. I have a dream today!”
• The power of the story: people know about the Titanic because of the wealth and opulence of the times, but they don’t know about other sinking ships that claimed many more lives…
• Pixar movies tell the story of complex emotions in the veil of funny animated characters…
• “Every investment price, every market valuation, is just a number from today multiplied by a story about tomorrow. Some companies are incredibly good at telling stories, and during some eras, investors become captivated by the wildest ideas of what the future might bring. If you're trying to figure out where something is going next, you have to understand more than its technical possibilities. You have to understand the stories everyone tells themselves” → Great company storytellers: LEGO (adults welcome), Trader Joe’s (cult for the over-educated and underpaid), Tesla (the new era of vehicles), Nvidia (the AI company)
• “Readers don’t want a lecture, they want a memorable story”