Life

The True Meaning of “Knowledge is Power”

  Bacon’s famous saying “knowledge is power” is well-known and far-reaching, but What power is knowledge?
  Recently, an old colleague told me her confusion. She graduated from a prestigious school for many years and worked very hard to study, but she did not feel the power brought by knowledge, and even lacked a basic sense of security. Moreover, under the impact of artificial intelligence, it seems that his high-level major in the past seems to be in jeopardy.
  Since knowledge is believed to be a power that can change destiny, why is this power not reliable, or even facing failure. Does it have a shelf life like food?
  Thanks to the popularity of “ChatGPT”, as well as the double pressure of the rise of Houlang and the substitution of machines, the sense of crisis among senior professionals has increased. For the white-collar workers or the middle class in the knowledge society, the 40th year should be the golden period of career and life, but they have to face the bleak reality that the user interface is already “unfriendly”.
  Perhaps it is the genes of the poor and lower-middle peasants of my ancestors and the growth environment of the military compound. I had this sense of crisis when I was in my early 30s, and I was successfully cured. strength. This is due to meeting Charlie Munger and his wisdom at that time.
knowledge is power

  At that time, under the strong recommendation of an elder brother, I read the Chinese translation of “Poor Charlie’s Almanac: Charlie Munger’s Proverbs of Wisdom” edited based on Munger’s public speeches. It was in this book that I first learned about Munger’s thoughts on the psychology of human misjudgment. Munger attaches great importance to how people avoid doing wrong things. He pointed out with his usual reverse thinking: if you make fewer mistakes or even no mistakes, you will naturally be able to do the right thing and ultimately succeed. If the elderly do not go wrong, they will have more chances of winning than youth, so they are more sure about the future.
  Munger lamented: People in this life, live to the end, basically they will have what they deserve. To be successful, you have to be worthy, and the reason is simple. In fact, this is the true meaning of long-termism that Buffett and Munger keep secret. Long-termism does not refer to “how far is forever”, time is only a superficial phenomenon. Long-termism is to plan your current and future resource investment according to the ultimate goal. These practical actions ultimately determine whether you are worthy of what you ultimately want to have.
  There is a saying that the biggest distance in the world is what you say and what you do. It is not easy to insist on long-termism. People instinctively gravitate toward short-term goals, or are limited by their inability to delay gratification. The point is, is there a solution? In my opinion, the core question is: how to understand “knowledge is power”, especially “knowledge is what power”. What is rare is that the book “Munger’s Way”, which contains Munger’s speeches at the shareholder meetings of Siko Finance and Daily Journal over the years, includes Munger’s richer and newer insights, and seems to be able to respond to these issues appropriately. .
  The meaning of the so-called “knowledge is power” is first of all to break the superstition, so as to get rid of the worship and blind obedience to authority, and to focus on individual practice and emphasize the importance of continuous trial and error and experience accumulation. And Munger’s wisdom lies in that he is well-read and accustomed to abstract thinking, but he still grasps the essence of “knowledge is power” from three aspects, or skillfully handles the three contradictions.
  The first is short-term and long-term contradictions. How to learn and use knowledge, the first thing you need to face is the attitude towards time. In this regard, the slogan of “long-termism” is almost as popular in the Chinese investment community as opportunistic decision-making, and they go hand in hand, but the goals of both aspects may not be achieved.
  And Munger put it together, first admitting that “we are not pure opportunists, but we do believe in playing by ear,” and emphasizing that Berkshire rarely makes long-term forecasts. “Who doesn’t want to see far? The thing is, you can’t see very far. Just use your head, put your head down, and get everything right in front of you, and you’ll probably end up with a great business. Company.”
  For this problem, Munger used a fictional story many times in the book to illustrate.
  A young man went to visit Mozart. He said: “Mozart, I want to write a symphony.” Mozart said: “How old are you?” The young man said: “I am 23.” Mozart said: “You are too young to write a symphony.” The young man said: “But, Mozart, you started writing symphonies when you were 10 years old.” Mozart said, “Yes, but I didn’t go around asking people how to write.” Sir William Osler built the world
  famous The Johns Hopkins University School of Medicine. Munger admired Thomas Carlyle’s famous quote believed by Sir Osler: “Instead of worrying about the hazy future, it’s better to be down-to-earth and do the things in front of you.” He also bluntly said that this is also Berkshire’s business philosophy.
  They believe that under systemic long-term risks or difficulties, it is difficult for a single company to survive alone. So long-termism “is primarily about being as conservative as possible, against the onslaught of a catastrophe. We prepare for the worst possible circumstances.” For the same reason, one needs to stay away from people of questionable character. “Stupidity is a moral defect, not an intellectual defect.” This is the famous ethicist Dietrich Bonhoeffer’s famous words. And, under this premise, from a long-term perspective, we must endure price fluctuations caused by cyclical factors, that is, “we pay attention to avoiding difficulties, but we will also take risks when the price is right.”
  In dealing with these problems, one of Munger’s most commonly used methods is “reverse thinking”. He gave an example, if someone asks him to help India, he will not first think about how to make India better, but first think about how to make India worse. Think of all the things that can harm India and don’t do them.
“Circle of Competence”

  The second is the contradiction between simplicity and complexity. Munger said, “The reason why we have created brilliant performance is mainly because we have picked simple things to do.” This is what Buffett calls the “circle of competence”. Many people think they are very smart, they are overconfident, and they only pick the hardest things to do, and they often end up with no good results. Buffett said that we don’t have the ability to jump over a 3-meter-high railing. Our approach is to step over small puddles gently, and then pick up large pieces of gold. In fact, in this respect, Coca-Cola is typical. It was many years later that the author suddenly wanted to understand this logic. The consumption of Coca-Cola is not only high-frequency and addictive, but also has no after-sales cost. This business model is so simple and effective, but we don’t know the gold on the other side of the puddle.
  Buffett also said a word, take the right path, and the wider you go, the wider you go. Kaufman, the author of “Poor Charlie’s Almanac”, has also told Munger many times that if liars know how much money they can make by being honest, they will definitely stop being liars.
  But this does not mean that you can just do simple things, you also need to know how to do them. Munger’s strategy is, “To improve yourself, you must master multiple models. Many people only understand one or two models. In life, they always use their own one or two models to copy them mechanically”; “We must consciously Train yourself to get rid of the habit of using only one or two models, so you can gain wisdom.” If you become a mental adult, you can leave a lot of smarter people far behind. Learn all the important ideas in all disciplines, and don’t listen to or believe in the popular views in any one discipline, and you will have far more wisdom than someone who only understands one discipline. Otherwise, it is difficult to understand why Berkshire can firmly grasp the opportunity of new energy vehicles.
  He also said many times that Buffett is an efficient learning machine. “He is a smart man, but what he has achieved exceeds his smartness.” Moreover, he does not particularly admire collective wisdom. He believes that Berkshire’s success is mainly the crystallization of Buffett’s personal wisdom. Likewise, he disapproves of the notion of diversification’s beta. Berkshire’s style is to focus its investments. “When the probability of winning is very high, bet heavily.”
  In a word, choose a simple business, but take pains to learn and act, keep improving, and use multidisciplinary knowledge and resources. This has also been summarized as the ensemble effect, or grid theory. This book also sporadically gives Munger’s book recommendations, which can be used as extended learning materials. In addition to the familiar “Living Within the Limits” and “Influence”, there are Gino Segre’s “Fascinating Temperature”, Ron Chernow’s “Business Tycoon: A Biography of Rockefeller”, Peter Bevelin The Scientific Martian, and Walter Isaacson’s Einstein: Life and the Universe, among others.
  Finally, there is the contradiction between optimism and pessimism.
  Of course, Munger is an optimistic and positive person. He especially admires the wisdom of the Stoic sages and sages such as Epictetus and Marcus Aurelius: Every difficulty is an opportunity, an opportunity to learn, and an opportunity to show A chance for courage. He also reminded investors to avoid a “victim” mentality. “When it is difficult, everyone will feel pain. This is human nature. However, it is definitely a serious defect in the mind to feel sorry for yourself all day long.” He is also a seemingly pessimistic person, always telling everyone to lower
  the Expected, and said that the future will inevitably catastrophe. He quoted Buddha’s words: “I have only taught one thing, and what I have taught is the source of human suffering and how to avoid some of it.”
  Munger believes that “we can succeed not because we are good at solving problems, but because we are good at solving problems.” Stay away from difficult problems.” “Prevention is very important, and an ounce of prevention is worth 10,000 points of cure.” “There are many things that people do, it is better not to do them.” Munger pays special attention to the
  cultivation of error-correcting ability, and consciously cultivates this ability. Habit. Of course, there are also some big trends that have gone wrong, such as the decline of Berkshire’s earliest textile industry. Munger’s response is: don’t always think about resolving pain, stay away from pain. Hit if you can, and run if you can’t.
  These skills seem to be contradictory, but in fact, they all use a structural thinking to promote or limit the advantages and disadvantages of human nature, and use the power of rationality to allow them to interact and empower without conflicting. Bacon’s complete famous saying is actually: “Knowledge is power, but what is more important is the skill of using knowledge.”
  Bacon explained it in “New Tools”: Although the two roads leading to human power and leading to human knowledge The two paths are closely adjacent and almost merge into one, but in view of the deep-rooted and harmful habit of people in abstraction, it is more proper to build and improve science from those foundations that have to do with practice, or Let the acting part print and determine its model, the speculative part, itself as a stamp. It follows that the primary path to knowledge is trial and error and experimentation—a force that ultimately leads to liberation and self-fulfillment.
  In this way, knowledge is not only the power for personal success, but also the power for human liberation and self-realization.

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