This book is another classic by Michael Lewis focusing on decision making in our life and investing in particular. Michael has written a lot of outstanding books - our most liked ones being "The Big Short", "Boomerang" and "Liar's Poker". Visit his website: http://michaellewiswrites.com/#top where he regularly publishes his articles. In Undoing project Michael Lewis explores the joint work done by Daniel Kahneman and Amos Tversky in the filed of human cognitive biases. He in simple language decodes the complex work done both in their historic project - "The Prospect Theory" which revolutionized the field of economics.
Important Points from the Book
1. Contrary to popular belief a lot of large decisions we make in life are random choices - like picking a career due to some elders brother guidance as it was the best available
2. The smaller daily choices we make help us understand who we really are
3. Classifying things based on certain features/characteristics is an art
a) If you want to make laptop and desktop comparable you can call both of them as Computers
b) if you want to differentiate them you can call one as portable other as non portable
c) Hence classification should be judged carefully
4. Real essence of education is in knowing how to react & what to do when you don't know something
5. When you have a theory find hard evidence to prove it and also to falsify it. If you only try to prove it right you will unknowingly only find evidence that proves for your points and end up taking a biased decision.
6. Do the work you love doing
7. People who don't remember the past often repeat the history
8. If presented with same facts under different emotional conditions people take different steps
9. Lot of innovations have happened due to ideas that at first sounded awkward & funny
10. Be prepared for uncertainty - acknowledge that in planning for future - only fools are always certain
11. Planning for uncertainties helps you avoid errors it save you from negative surprises in future
12. Be a little underemployed some people waste years because they are not willing to waste hours thinking & planning
13. Wide gaps exists between what actually makes people happy and what people think make them happy
14. A decision is not good because it leads to right outcome but rather the process to achieve the outcome should be good
15. After a certain amount of capital earning additional money has no emotional happiness
16. Your mindset can easily convert a gain into a loss. Your mind defines loss as you earning something below your reference point - it's like an Olympic silver medal winner crying because his reference point was to win gold
17. Provide people certainty and they will pay you much more than the fair price
18. People are more attracted towards story rather than numbers & logic
19. Money does not buy you happiness but lack of money gives you misery