# Inversion ## The Idea in Brief Solve problems backward. Instead of asking "how do I succeed?", ask "how would I guarantee failure?" Then avoid those things. Avoiding stupidity is often more tractable than achieving brilliance. The negative checklist is frequently more valuable than the positive one. --- ## Key Concepts ### Jacobi's Principle The mathematician Carl Jacobi famously said: "Invert, always invert." Many problems that seem intractable forward become obvious backward. Can't figure out how to help India? Ask instead: "What could I do to ruin India?" Think through all the ways to cause disaster, reverse it, and avoid those actions. ### Prescriptions for Misery Munger gave students "prescriptions for guaranteed misery in life": be unreliable, avoid compromise, harbour resentments, seek revenge, indulge in envy, become addicted to substances, neglect to learn from others' mistakes, cling defiantly to existing beliefs, and stay down when struck by reverses. Don't do these things, and you're ahead of most people. ### The Negative Checklist Applied to investing: Don't pay too much. Don't invest in businesses prone to obsolescence. Don't invest with crooks and idiots. Don't invest in things you don't understand. The negative checklist works because it's easier to identify what destroys value than what creates it. Harmful practices are more reliably identifiable than optimal ones. ### Avoiding vs Achieving Most competitive advantage comes from not making mistakes rather than from brilliant moves. The investor who avoids blowups outperforms the one chasing home runs. The company that doesn't destroy value outlasts the one constantly seeking "10x" opportunities. --- ## Implications **In decision-making:** Before asking "what should I do?", ask "what should I definitely not do?" The avoidance list is often more actionable. **In risk management:** Ask "if I assume I'm wrong, what's the consequence?" Structure situations so mistakes aren't fatal. Avoiding catastrophe matters more than optimising returns. **In hiring:** Munger: screen out the untrustworthy before evaluating the brilliant. One bad actor destroys more value than one star creates. **In strategy:** Before planning what to do, list what would guarantee failure. Then systematically ensure you're not doing those things. **In life:** The path to misery is well-documented. Inverting it produces a reliable (if unsexy) path to reasonable contentment. --- ## Sources - [[Richer, Wiser, Happier]] — Munger's inversion framework; prescriptions for misery - [[Antifragile]] — Via negativa as the removal of what harms rather than addition of what might help - [[Skin in the Game]] — Survival through avoiding ruin; the first rule is "do not harm" - [[The Most Important Thing]] — Howard Marks on asymmetric risk; avoiding stupidity beats seeking brilliance - [[Good Stocks Cheap]] — The checklist as survival tool: designed to avoid mistakes that have previously led to crashes, not to identify what's desirable