This book is a prototypical bestseller…entertaining and just vague enough to appeal to a mass of readers, whether they are firm believers in love at first sight, analytical engineers or somewhere in between. This book is a bestseller precisely because it will validate your thinking no matter where you fall in the spectrum. Hopefully it will also challenge you to rethink how analytical and/or how emotional your decision-making process really is.
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What stood out to me about the book was how Gladwell proves the main thesis of his book: that your subconscious is capable of filtering out superfluous information in order to make snap judgments based on the few details that really matter. His proof lies in various examples of how experts in particular fields can within seconds create a diagnosis (even without understanding or acknowledging all of the symptoms).
One of the examples he uses is of a professor who has been studying couples’ communication for many years. This professor can apparently, within 30 seconds of viewing a taped dialogue between a couple, determine with 95 percent accuracy whether or not the couple will last. The proof of Gladwell’s point is supposed to come from the fact that increasing the amount of taped dialogue viewed by the professor does not improve his accuracy.
It was not lost on me, however, that all of Gladwell’s core examples (including the professor) involve experts who have been studying their particular fields for many years. This is not something clearly pointed out in the book, but something that certainly deserves mention. It would be easy for an inexperienced investor to walk away after reading this book with the notion that he or she should make more investment decisions by trusting in his or her gut. Yet the proof of Gladwell’s point relies on people with large amounts of specialized experience.
Gladwell does make a valid point that many people spend too much time fretting over the minutia. This is all too true in investing. Many investors acquire too much information, much of which is probably irrelevant (or at least too unpredictable to quantify as part of an investment decision). This can lead to either making decisions based on unimportant variables or in complete investment paralysis.
I hope you’ll discover someplace in between.
