Thinking, Fast and Slow

by Daniel Kahneman

A recurrent theme of this book is that luck plays a large role in every story of success;

Expert intuition strikes us as magical, but it is not. Indeed, each of us performs feats of intuitive expertise many times each day.

If i want to be a better analysti should write down each pfediction about a market or product. Check the results of my prediction after the outcome event , then study what information or skil would help me forecast the next event more accurately and keep a journal of the Additional skills that are making me a better analyst. Because Professional intuition requires practice and skills for a certain subject that is being fofecasted

The psychology of accurate intuition involves no magic. Perhaps the best short

statement of it is by the great Herbert Simon, who studied chess masters and showed that after thousands of hours of practice they come to see the pieces on the board differently from the rest of us.

“The situation has provided a cue; this cue has given the expert access to information stored in memory, and the information provides the answer. Intuition is not...

This is the essence of intuitive heuristics: when faced with a difficult question, we often answer an easier one instead, usually without noticing the substitution.

Although System 2 believes itself to be

where the action is, the automatic System 1 is the hero of the book.

orderly series of steps.

In rough order of complexity,

The knowledge is stored in memory and accessed without intention and without effort.

The gorilla study illustrates two important facts about our minds: we can be blind to the obvious, and we are also blind to our blindness.

System 2 is also credited with the continuous monitoring of your own behavior—the control that keeps you polite when you are angry, and alert when you are driving at night.

In summary, most of what you (your System 2) think and do originates in your System 1, but

System 2 takes over when things get difficult, and it normally has the last word.

The division of labor between System 1 and System 2 is highly efficient: it minimizes effort and optimizes performance.

Amazingly put together sophisticated words yet a clear impression

Because System 1 operates automatically and cannot be turned off at will, errors of intuitive thought are often difficult to prevent.

Biases cannot always be avoided, because System 2 may have no clue to the error.

Even when cues to likely errors are available, errors can be prevented only by the enhanced monitoring and ...

The best we can do is a compromise: learn to recognize situations in which mistakes are likely and try harder to avoid significant mistakes when the stakes are high. The premise of this book is that it is easier to recognize other people’s mistakes than our own.

Why call them System 1 and System 2 rather than the more descriptive “automatic system” and “effortful system”? The reason is simple: “Automatic system” takes longer to say than “System 1” and therefore takes more space in your working memory. This matters, because anything that occupies

your working memory reduces your ability to think.

Much like the electricity meter outside your house or apartment, the pupils offer an index of the current rate at which mental energy is used.

A general “law of least effort” applies to cognitive as well as physical exertion. The law asserts that if there are several ways of achieving the same goal, people will eventually gravitate to the least demanding course of action. In the economy of action, effort is a cost, and the acquisition of skill is driven by the balance of benefits and costs. Laziness is built deep into our nature.

What outcomes must we purchase in the currency of attention?

It will be effortful to set yourself up for this exercise, and effortful to carry it out, though you will surely improve with practice. Psychologists speak of “executive control” to describe the adoption and termination of task sets, and neuroscientists have identified the main regions of the

brain that serve the executive function. One of these regions is involved whenever a conflict must be resolved. Another is the prefrontal area of the brain, a region that is substantially more developed in humans than in other primates, and is involved in operations that we associate with intelligence.

The most effortful forms of slow thinking are those that require you to think fast.

How to master this? it was mentioned earlier in the book that the more skilled you arein something the less effort or energy is absorbed by your brain to perform acts in which you're skilled at. Therefore to think fast when having to think slow you must develop skills in the area where you must use system 2 more often?

The psychologist Mihaly Csikszentmihalyi (pronounced six-cent-mihaly) has done more than anyone else to study this state of effortless attending, and the name he proposed for it, flow, has become part of the language. People who experience flow describe it as “a state of effortless concentration so deep that they lose their sense of time, of themselves, of their problems,” and their descriptions of the joy of that state are so compelling that Csikszentmihalyi has called it an “optimal experience.”

Flow neatly separates the two forms of effort: concentration on the task and the deliberate control of attention.

Too much concern about how well one is doing in a task sometimes disrupts performance by loading short-term memory with pointless anxious thoughts.

Another way of saying this is that controlling thoughts and behaviors is one of the tasks that System 2 performs.

I have a stronger system 2 than system 1

The evidence is persuasive: activities that impose high demands on System 2 require self-control, and the exertion of self-control is depleting and unpleasant.

The nervous system consumes more glucose than most other parts of the body, and effortful mental activity appears to be especially expensive in the currency of glucose. When you are actively involved in difficult cognitive reasoning or engaged in a task that requires self-control, your blood glucose level drops.

This experiment has discouraging implications for reasoning in everyday life. It suggests that when people believe a conclusion is true, they are also very likely to believe arguments that appear to support it, even when these arguments are unsound.

Intelligence is not only the ability to reason; it is also the ability to find relevant material in memory and to deploy attention when needed.

“Lazy” is a harsh judgment about the self-monitoring of these young people and their System 2, but it does not seem to be unfair. Those who avoid the sin of intellectual sloth could be called “engaged.” They are more alert, more intellectually active, less willing to be satisfied with superficially attractive answers, more skeptical about their intuitions. The psychologist Keith Stanovich would call them more rational.

Individuals who uncritically follow their intuitions about puzzles are also prone to accept other suggestions from System 1. In particular, they are impulsive, impatient, and keen to receive immediate

gratification.

As cognitive scientists have emphasized in recent years, cognition is embodied; you think with your body, not only with your brain.

There are different types of links: causes are linked to their effects (virus cold); things to their properties (lime green); things to the categories to which they belong (banana fruit). One way we have advanced beyond Hume is that we no longer think of the mind as going through a sequence of conscious ideas, one at a time.

Furthermore, only a few of the activated ideas will register in consciousness; most of the work of associative thinking is silent, hidden from our conscious selves. The notion that we have limited access to the workings of our minds is difficult to accept because, naturally, it is alien to our experience, but it is true: you know far less about yourself than you feel you do.

If you have recently seen or heard the word EAT, you are temporarily more likely to complete the word fragment SO_P as SOUP than as SOAP. The opposite would happen, of course, if you had just seen WASH. We call this a priming effect and say that the idea of EAT primes the idea of SOUP, and that WASH primes SOAP.

This remarkable priming phenomenon—the influencing of an action by the idea—is known as the ideomotor effect.

Although you surely were not aware of it, reading this paragraph primed you as well. If you had needed to stand up to get a glass of water, you would have been slightly

slower than usual to rise from your chair—unless you happen to dislike the elderly, in which case research suggests that you might ...

The general theme of these findings is that the idea of money primes individualism: a reluctance to be involved with others, to depend on others, or to accept demands from others.

System 1 provides the impressions that often turn into your beliefs, and is the source of the impulses that often become your choices and your actions. It offers a tacit interpretation of what happens to you and around you, linking the present with the recent past and with expectations about the near future.

The impression of familiarity is produced by System 1, and System 2 relies on that impression for a true/false judgment.

A reliable way to make people believe in falsehoods is frequent repetition, because familiarity is not easily distinguished from truth.