Investing
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Lollapalooza effects
The term lollapalooza effects/results was popularised by late Charlie Munger to describe the exponentiallly amplified outcomes when couple of forces/factors which might be mild, act in the same direction. Financial markets are the prime example for lollapalooza effect where bubbles and bursts may look sudden but these are because of the impact of many small Continue reading
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What can convergence in natural world teach us about investing?
Nature has abundance of convergence. Scientists have studied this phenomena in animals, plants, fungi and bacteria. In a study they found that different types of anoles(lizards) living in four different islands of Cuba, Jamaica, Hispaniola and Puerto Rico shared the same characteristics. For example the Trunk lizard in Cuba looks and behaves very similarly to Continue reading
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Proximate and Ultimate Causes
Our brain is wired to look for patterns and clues. We live in an information overloaded world and get tricked by what’s easily available. Behavioural economists defined the term ‘Availability heuristic’ to explain why some information is highly salient in our mind and why some is neglected or never explored further. Proximate causes are prevalent Continue reading
Thinking Space 