TMFJMo (74.05)

The Berkshire Day Begins

May 05, 2012 – Comments (0)

Well, we're in and set. Wonderful seats here in the press box for the Berkshire Hathaway meeting and quite the spread to get acclimated. Hard to believe they're going to fill this place up, but that's apparently the deal. It's going to be a long day, but in the good way. Very excited to be here for the first time.

On the plane ride out I sat next to a guy who made it all the way here from Australia. He and I chatted a bit and I cracked a smile when he asked if I had ever read Poor Charlie's Almanack. I have and the reason why I smiled was because it's such a great read, investor or not. There's just some good old-fashioned life lessons in there that apply to pretty much everything.

In particular I enjoyed reading about his take on the psychology of human misjudgement. For those unfamiliar, he breaks it down into 25 tendencies that we as humans (and investors) are subject to. He offers up some of the common mistakes along with remedies to help combat them. Well worth the read for sure. The tendencies are:

Tendency #1 – Reward and Punishment Superresponse Tendency
Tendency #2 – Liking/Loving Tendency
Tendency #3 – Disliking/Hating Tendency 
Tendency #4 – Doubt-Avoidance Tendency 
Tendency #5 – Inconsistency-Avoidance Tendency
Tendency #6 – Curiosity Tendency 
Tendency #7 – Kantian Fairness Tendency 
Tendency #8 – Envy/Jealousy Tendency 
Tendency #9 – Reciprocation Tendency 
Tendency #10 – Influence-from-Mere-Association Tendency 
Tendency #11 – Simple, Pain-Avoiding Psychological Denial 
Tendency #12 – Excessive Self-Regard Tendency 
Tendency #13 – Overoptimism Tendency 
Tendency #14 – Deprival-Superreaction Tendency 
Tendency #15 – Social-Proof Tendency 
Tendency #16 – Contrast-Misreaction Tendency 
Tendency #17 – Stress-Influence Tendency 
Tendency #18 – Availability-Misweighing Tendency
Tendency #19 – Use-It-Or-Lose-It Tendency 
Tendency #20 – Drug-Misinfluence Tendency 
Tendency #21 – Senescence-Misinfluence Tendency 
Tendency #22 – Authority-Misinfluence Tendency
Tendency #23 – Twaddle Tendency 
Tendency #24 – Reason-Respecting Tendency 
Tendency #25 – Lollapalooza Tendency 

I can't recommmend highly enough  reading more about these. Incidentally if you stroll through my CAPS Blog starting in March 2011 you can read more about them there too.

Foolish best,

Jason