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Investing: The Last Liberal Art
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Offering a picture of investing within the larger world, this title explains how investment managing works by borrowing the big ideas from other complex disciplines: biology, economics, mathematics, philosophy, physics and psychology. In the biology chapter, Hagstrom analyses the central nervous system and the immune system as complex adaptive systems and then draws parall
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Paperback, 224 pages
Published
April 22nd 2002
by Texere Publishing
(first published November 17th 2000)
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Investing: The Last Liberal Art contains no direction on how to read a balance sheet, or on how to project earnings into the future and discount them back to today’s value, nor are there arcane financial terms to send readers scrambling for dictionaries. Still, Investing is an essential book for professional and amateur stock pickers who want to excel, portfolio managers preparing to interview prospective analysts, and investors trying to choose amongst the many advisors ready to serve their nee
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I have rallied against STEM and business education for some time and it's rally against the liberal arts who like Ghandi do not put up a fight. This is yet another book that articulates so well the net affect on society.
The book is written with such positive light of what a liberal arts education could do for a person. The ability to think is what should be the focus, not the acquisition of knowledge. It has several great book lists that I hope to add to my noggin. I love the examples from Char ...more
The book is written with such positive light of what a liberal arts education could do for a person. The ability to think is what should be the focus, not the acquisition of knowledge. It has several great book lists that I hope to add to my noggin. I love the examples from Char ...more

In the last chapter, the author writes something that perfectly sets the context for this in my mind slightly overlooked investment book (1st ed 2000): “Improving the resource condition of our System 2 thinking – that is to say, deepening and broadening our reserves of relevant information – is the principal reason this book was written”. Writing that in 2000, two years before Daniel Kahneman received the Swedish Riksbank’s economic prize in memory of Alfred Nobel for a lifetime’s effort to put
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Charlie Munger once said "stock picking is a subdivision of the art of worldly wisdom". Instead of looking at markets through mere finance/economics lens, you need to consider a wide body of knowledge.
Combining mental models from different disciplines to form a latticework of understanding can lead to ideas with high conviction. Physics, Biology, Sociology, Psychology, Philosophy, Literature, Mathematics, Decision making-all of them are somehow tied to the world of investing.
Economics borrowed ...more
Combining mental models from different disciplines to form a latticework of understanding can lead to ideas with high conviction. Physics, Biology, Sociology, Psychology, Philosophy, Literature, Mathematics, Decision making-all of them are somehow tied to the world of investing.
Economics borrowed ...more

I have read a few books and blogs on mental models and applying those to decisions, but this is the first book that helped me understand them on a deeper level. I hit somewhat of an obstacle with applying mental models in my life which is what led me to this book. That, and I found it for $3.
Prior to reading the book I could understand a concept (model), and then apply it to a situation, but I didn't know how to apply multiple models, and weigh them independently, in decision making. The models ...more
Prior to reading the book I could understand a concept (model), and then apply it to a situation, but I didn't know how to apply multiple models, and weigh them independently, in decision making. The models ...more

Interesting take on both investing and college education. After reading, I'd recommend reading the last 2 chapters first. Then, if intrigued, go back and read from the beginning. The author's premise is that the liberal arts degree was meant to expand our thinking not focus it in one limited area. I concur his his assessment. He spends a chapter on various liberal art topics - physics, biology, social sciences, psychology, philosophy and literature. He weaves his investment philosophy through ea
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The book is interdisciplinary in nature and talks about investing from multiple perspective. The author primarily focuses on the fact that the notion of investing, economics and markets are symbiotically associated with a larger body of human knowledge, yet the forces of this new era compels and demands us to specialise in one particular field. One needs to start on the quest of connections and parallels between Finance and ideas in multiple avenues of knowledge to be able to invest in a more in
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I thought this book was going to be for people with a liberal arts background. I hoped Hagstrom would reveal all the great qualities a liberal arts education would have for an investor, and how to apply those ideas. Instead, it worked in the opposite view, and assumed the reader was not well read at all. So, it felt like it was for an investor who needed to be convinced about the merits of opening their minds.
It had chapters on all the major fields of a liberal arts degree - math, physics, biol ...more
It had chapters on all the major fields of a liberal arts degree - math, physics, biol ...more

A book that will spark new way of thinking.
We are often blindsided by our notion of sticking to one discipline, being specialized, having a core philosophy of looking at the world. The tendency to gain expertise in one area is not a bad thing to do or bad thing to be but not having the flexibility to look at other disciplines or other school of thoughts may deprive us of building a mental model that is more useful. It’s obviously better to have lots of angles to look at things than having a sin ...more
We are often blindsided by our notion of sticking to one discipline, being specialized, having a core philosophy of looking at the world. The tendency to gain expertise in one area is not a bad thing to do or bad thing to be but not having the flexibility to look at other disciplines or other school of thoughts may deprive us of building a mental model that is more useful. It’s obviously better to have lots of angles to look at things than having a sin ...more

This is a rah rah book for the advocacy of Charlie Munger’s mental models and a more interdisciplinary attitude towards higher education. The author has separate chapters for physics, biology, sociology, psychology, philosophy, literature, mathematics, and decision making ( Kahneman’s Systems 1& 2) where he touches on basic knowledge in each discipline and then tries to show how this knowledge could help the investing professional. Not being an investing pro I guess what one could get out of thi
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This book is different from most investing-related books that I have read. It follows the principle that investing is actually a liberal art, and being a good investor requires an individual to have broader horizons and the importance of wisdom over intellect.
The book draws parallels from different streams of arts or sciences with the investing world, including physics, biology, psychology, philosophy, mathematics, etc. The conclusion is in line with Charlie Munger's investing philosophy - that ...more
The book draws parallels from different streams of arts or sciences with the investing world, including physics, biology, psychology, philosophy, mathematics, etc. The conclusion is in line with Charlie Munger's investing philosophy - that ...more

If you'd like to skip reading this book then all you really need to know are these two things:
1. Everything you learn has the potential to apply to everything you do (not just investing) so when you learn something, try and make connections.
2. Learn everything you can.
Don't misunderstand me, I don't think that reading this is a waste of times. The author takes the two concepts above and very thoroughly applies them to investing. The book is full of interesting facts and biographies of people you ...more
1. Everything you learn has the potential to apply to everything you do (not just investing) so when you learn something, try and make connections.
2. Learn everything you can.
Don't misunderstand me, I don't think that reading this is a waste of times. The author takes the two concepts above and very thoroughly applies them to investing. The book is full of interesting facts and biographies of people you ...more

Excellent. I didn’t agree with every premise, particularly the chapter dealing with evolution and even the whole idea behind the stock market being the main “investment” discussed. But this was wonderfully written, and contained so many “ah-ha” moments for me regarding how to think and how to educate yourself to be able to conduct your life in every area and discipline in a way that leads to success. The idea of the latticework of mental models is awesome and rings so true. Hagstrom has written
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Opening one's mind to absorb knowledge from multiple disciplines and linking them together so that they enforce each other to gain a better understanding of the world helps not only in investing but in many other aspects in life.
Well written book, chapters are well connected, I have learned a great many of ideas (from different disciplines) in this books that I would now have to go and study the original work by respective authors. ...more
Well written book, chapters are well connected, I have learned a great many of ideas (from different disciplines) in this books that I would now have to go and study the original work by respective authors. ...more

I really love the main concept behind this book, which is that having a broad knowledge in several fields can help improve every aspect of one's life through the combination of ideas.
Then the author tries giving an overview of some really important fields although I didn't think those can do much except provoke an interest in the reader to dive deeper into those topics; because the overviews themselves are not enough.
Overall, this is a good book. ...more
Then the author tries giving an overview of some really important fields although I didn't think those can do much except provoke an interest in the reader to dive deeper into those topics; because the overviews themselves are not enough.
Overall, this is a good book. ...more

This book is about multi disciplinary thinking. Charlie said "worldly wisdom is mostly very very simple , they are a relatively small numbers of disciplines and a relatively small number of truly big ideas. It is a lot of fun to figure out. Even better , the fun never stops further more there is a lot of money. As i can testify from my personal experience". It give broad principles from physics, chemistry, biology and psychology to be used in day to day life.
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Did not manage to squeeze into my MUST READ INVESTMENT BOOK but this book nonetheless offered me a new perspective especially on Charlie Munger's latticework of mental models. In order to survive in an unpredictable world that we are living in today, one must be equipped with worldly wisdom. A heavy duty book especially if you do not have science background.
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One of the best books to explain the 'lollapalooza effect'
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Great summary of main mental models, from different disciplines. Starting point for having Munger's elementary worldly wisdom.
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