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Poor Charlie's Almanack

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On Mental Models

Charlie Munger has learned a lot about the world, and he calls the main ideas from the major fields “mental models.” He stresses the importance of multidisciplinary learning and connecting the major ideas together in a latticework, where the ideas can interact with each other.

We’ll discuss the general concept of a latticework of mental models, share a synthesized list of mental models he mentions throughout the book, then discuss specific models to see how they apply to the real world.

Latticework of Mental Models

The inferior way to learn is to learn isolated facts that exist entirely in separate silos. You can recite the facts, but you don’t know the ideas underlying them, and you can’t apply those ideas to solve problems in real life. This is a failure of rote learning, which is common in many national education systems.

Munger argues that the superior way to learn is to learn lots of mental models, then assemble them into a connected latticework (or a network).

What are Mental Models?

You can think of “mental models” as important ideas in a field that have broad relevance outside the field itself.

For example, the idea of “critical mass” comes from physics. Within the field of physics, the idea of critical mass relates specifically to the mass needed to sustain a nuclear chain reaction—if you have less than the critical mass, a chain reaction won’t perpetuate itself. But this concept applies generally outside of physics—metaphorically, it can apply to the minimal mass needed to start any virtuous cycle, like the minimum number of users needed to get a social networking app off the ground.

We’ll cover a list of mental models below, but to give a brief illustration, other examples include “margin of safety” from engineering, “compound interest” from math, and “feedback loops” from biology. All of these originated from a narrow field but have metaphorical relevance outside the field.

Learn Lots of Mental Models

Think of mental models as tools in your toolkit. The more tools you have, the more you can draw upon to solve the problem.

In contrast, if you have only one or two tools, then you’ll contort the situation to be solved by just those tools, and you’ll arrive at a suboptimal solution. This is similar to the “hammer-and-nail” problem—for people who have a specific hammer they like to use, everything in the world looks like a nail.

Learn Models from Different Fields

The best ideas in the world exist in each of the major fields. No single academic department has all the answers to all the problems. To become the most versatile problem solver, you need to collect mental models from every major field of study.