Johnny Leon's Reviews > Thinking, Fast and Slow

Thinking, Fast and Slow by Daniel Kahneman
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it was amazing

When thinking of how to describe Daniel Kahneman's magnum opus, "Thinking, Fast and Slow" The first thing that comes to my mind is "Wow". Then, my system 2 kicks in and I think of more ways to describe this book. Behavioral Economics is something I have really found an interest in in the past couple years. My initial exposure to the subject was the first "Freakonomics" book, one that will forever be in my top 10. Levitt and Dubner exposed millions of readers to the unexpected consequences of our current economic system and how people are flawed and not inclined to react like robots, or "econs". After Freakonomics, I would say Malcolm Gladwell probably had some of the best works on behavioral science and what factors into human decision making. After this came Richard Thaler's work "Misbehaving" which explored the more technical and experimental sign of why humans behave the way they do. All of these works pale in comparison to Kahneman, however, as he has truly achieved something spectacular with his latest work, "Thinking, Fast and Slow"

Without relying too much on "recency bias" I can safely say that this book will be remembered as the definitive work on the subject of behavioral economics for years to come. Kahneman not only explores some of the most fascinating and important factors that go into making a decision, he also explains it in a way that even the most uninitiated reader can understand. The book is divided into three key parts: The first part examines the difference between our "fast" thinking mechanism that Kahneman labels System 1, and the "slow" and deliberate thinking of System 2. The second part explores many of the biases and tricks that fool humans into making incorrect decisions, even when the correct answers are as clear as day. And finally, in the third and final part of the book, Kahneman takes a look at happiness and what makes for a happy life.

This book is important for a few reasons. 1. With the reliance on social media and knee-jerk journalism in today's society, it is important that we as free thinking human beings are able to recognize the biases and reasoning behind attention grabbing headlines and are able to formulate our opinions with our System 2 instead of instantly lashing out and reacting with System 1. 2. Once we recognize these potential pitfalls and traps that we encounter everyday in our decision making processes we will be able to instantly identify when we are being fooled or swayed and we will (hopefully) avoid making the same mistake twice. 3. The finally part on happiness and the "remembered self" vs the "experiencing self" will allow us to make decisions based on which choice will give us the most happiness depending on our definition of being happy. Do we value many different memories or one specifically long and enjoyable one?

Most of the topics discussed in this book will be applicable to just about anyone. Investors specifically should head Kahneman's advice and never trust the experts, as they can't even outperform monkeys choosing stocks at random! Overall, this book will allow you to realize when you are being duped in your everyday life and will push you towards becoming a more experienced and rational decision maker. Sometimes our gut is right, sometimes we need more calculation, sometimes we are put off by "framing", "anchoring", or some other cognitive trick. No matter what the situation, "Thinking, Fast and Slow" will give you the tools you need to become a more rational thinker.
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Reading Progress

April 10, 2016 – Shelved
April 10, 2016 – Shelved as: to-read
April 11, 2016 – Started Reading
June 16, 2016 – Finished Reading

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