Want To Be Smarter? Find The Correct Cause For Your Effect.

Andrew Lo (MIT business/finance prof) says, “Intelligence is the ability to generate accurate cause and effect descriptions of reality.” 

If you’re smart, you can find cause-and-effect relationships and use them to some advantage. 

You might do it for yourself, your clients, or the world writ large. 

However, if you’re dumb, you chase activities that don’t generate advantageous results. 

Full disclosure: I’ve been dumb. 

(A lot.) 

Every time it’s been not being able to see past a very compelling causal relationship to the disadvantageous, and sometimes disastrous results. 

Being smart requires us to work backward. We have to see the reality we’re looking to describe (or achieve, or create) – and tease out the causes and effects that get us there. 

Lo might be talking about advanced financial modeling, but there’s a whole heap of philosophy in that quote. 

“Intelligence is the ability to generate accurate cause and effect descriptions of reality.” 

Go forth and be smart about it.