The Art of Thinking Clearly

Write down your predictions—for political changes, your career, your weight, the stock market, and so on. Then, from time to time, compare your notes with actual developments. You will be amazed at what a poor forecaster you are. Don’t forget to read history, too—not the retrospective, compacted theories compiled in textbooks, but the diaries, oral

From our own life stories to global events, we shape everything into meaningful stories.

this, too. Instead of focusing on an item’s benefits, they create a story around it. Objectively speaking, narratives are irrelevant. But still we find them irresistible. Google illustrated this masterfully in

Stories are dubious entities. They simplify and distort reality and filter things that don’t fit. But apparently we cannot do without them.

The availability bias says this: We create a picture of the world using the examples that most easily come to mind. This is idiotic, of course, because in reality, things don’t happen more frequently just because we can conceive of them more easily.

When we encounter contrasts, we react like birds to a gunshot. We jump up and get moving. Our weak spot: We don’t notice small, gradual changes.

A product that has been reduced from $100 to $70 seems a better value than a product that has always cost $70. The starting price should play no role.

Whenever you are about to make a decision, think about which authority figures might be exerting an influence on your reasoning. And when you encounter one in the flesh, do your best to challenge him or her.

contrast effect: We judge something to be beautiful, expensive, or large if we have something ugly, cheap, or small in front of us. We have difficulty with absolute judgments.