Prophet Among Pinstripes

By: Ian WylieWed Dec 19, 2007 at 8:07 AM

James Montier is a financial heretic. And among London's banking set, he's winning plenty of converts.

"To make better decisions, we need to think more about thinking."
--James Montier

The brain isn't designed to be some kind of computational device. It was designed to keep us alive so that we can reproduce our genes. But in The Robot's Rebellion [University of Chicago Press, 2004], behavioral scientist Keith Stanovich reckons we are unique as creatures because the brain has a different set of interests from the genes. Our brains have the ability to rebel against what our genes would like us to do.

Our minds are suited to solving problems related to our survival rather than being optimized for investment decisions.

We have lived in an industrial society for 300 years. Is that enough time for our brains to have adjusted from the way they were designed for surviving the African savanna? Probably not. Just because we have a brain does not mean we understand all that it does. To make better decisions, we need to think more about thinking.

Don't equate happiness with money. Materialistic pursuits are not a path to sustainable happiness.

The industry I work in is very money-oriented. People measure success or failure in terms of monetary gain. Yet when I discussed with my wife, friends, and colleagues what people define as happiness, money rarely came up. Beyond a certain level of wealth, it seemed to make little difference.

People in this business work insane hours for ludicrous amounts of money, but they don't have time to enjoy it. I didn't understand it. We equate wealth with happiness. But the more people I spoke with, the weaker that relationship seemed to be.

We have evolved to value relative happiness over absolute happiness. But just because we developed that sense of relative standing in caveman times, is that really today's ultimate goal? If I am content with what I have, why do I need to look over the fence at my neighbor's car?

People adapt to income shifts relatively quickly; the long-lasting benefits are essentially zero.

So far, the single most important discovery in happiness research is the idea of hedonic adaptation. Put simply, we take things for granted after a while. Experiences are so much harder to get used to because they are unique events. When you buy a car, for a few months you cherish it, but within a year you're totally used to it.

The more you can do to slow down that pattern of getting used to things, the better. One of my recommendations is to stop, take note, and give thanks--not necessarily to God but just to reflect on what you've achieved and what you've got. You need to stop and think, "Actually, I'm damn fortunate."

Ian Wylie is a Fast Company contributing writer based in London.

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