Michael J. Mauboussin Quote
While most of us are comfortable acknowledging that luck plays a role in what we do, we have difficulty assessing its role after the fact. Once something has occurred and we can put together a story to explain it, it starts to seem like the outcome was predestined. Statistics don't appeal to our need to understand cause and effect, which is why they are so frequently ignored or misinterpreted. Stories, on the other hand, are a rich means to communicate precisely because they emphasize cause and effect.
Michael J. Mauboussin
While most of us are comfortable acknowledging that luck plays a role in what we do, we have difficulty assessing its role after the fact. Once something has occurred and we can put together a story to explain it, it starts to seem like the outcome was predestined. Statistics don't appeal to our need to understand cause and effect, which is why they are so frequently ignored or misinterpreted. Stories, on the other hand, are a rich means to communicate precisely because they emphasize cause and effect.
Tags:
probability, statistics
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About Michael J. Mauboussin
Michael J. Mauboussin (born February 1964) heads consilient research at Morgan Stanley division Morgan Stanley Investment Management's Counterpoint Global, an open-end mutual fund. Previously, he was director of research at BlueMountain Capital and head of global financial strategies at Credit Suisse, where he advised clients on valuation and portfolio positioning, capital markets theory, competitive strategy analysis, and decision making. He is also an adjunct professor of finance at the Columbia Business School and serves as chairman emeritus of the board of trustees at the Santa Fe Institute, a multi-disciplinary research center for complex adaptive systems, after serving as its chairman from 2012 until retiring in May 2021.