On today’s episode, Kyle Grieve discusses the power of mental models, how they sharpen our thinking, and how they improve our decision-making in investing and everyday life. He explores various key concepts in general thinking, including the circle of competence, inversion, first-principles thinking, probabilistic thinking, and more. IN THIS EPISODE YOU’LL LEARN: 00:00 - Intro 02:01 - What exactly are mental models? 04:37 - The three failures people have with interacting with reality. 08:43 - A simple 6-step framework for making mentals into a habit. 17:45 - How to utilize what you already know to gain an edge. 29:40 - The importance of thinking in first principles to improve your ability to innovate and simplify. 36:10 - How to use thought experiments to analyze a business. 41:14 - Why using second-order thinking can rapidly enhance your quality of thinking. 49:46 - How probabilistic thinking helps make sense of a dynamic world. 58:54 - Why spending time thinking about a problem backwards can improve your upside. 01:04:57 - Why you should focus on simple solutions over complex ones. And so much more! Disclaimer: Slight discrepancies in the timestamps may occur due to podcast platform differences. BOOKS AND RESOURCES Join Clay and a select group of passionate value investors for a retreat in Big Sky, Montana. Learn more ?????????????????here?????????????????. Join the exclusive ?????????????????TIP Mastermind Community????????????????? to engage in meaningful stock investing discussions with Stig, Clay, Kyle, and the other community members. Buy a copy of The Great Mental Models Vol. 1 here. Read Shane Parrish’s blog here here. Follow Kyle on ?X? and ?LinkedIn?. Check out all the books mentioned and discussed in our podcast episodes ?????????????????here?????????????????. Enjoy ad-free episodes when you subscribe to our ?????????????????Premium Feed?????????????????. NEW TO THE SHOW? Get smarter about valuing businesses in just a few minutes each week through our newsletter, ?????????????????The Intrinsic Value Newsletter?????????????????. Check out our ?????????????????We Study Billionaires Starter Packs?????????????????. Follow our official social media accounts: ?????????????????X (Twitter)????????????????? | ?????????????????LinkedIn????????????????? | ?????????????????Instagram????????????????? | ?????????????????Facebook????????????????? | ?????????????????TikTok?????????????????. Browse through all our episodes (complete with transcripts) ?????????????????here?????????????????. Try our tool for picking stock winners and managing our portfolios: ?????????????????TIP Finance Tool?????????????????. Enjoy exclusive perks from our ?????????????????favorite Apps and Services?????????????????. Learn how to better start, manage, and grow your business with the ?????????????????best business podcasts?????????????????. SPONSORS Support our free podcast by supporting our ???sponsors???: ??SimpleMining?? ??Hardblock?? ??AnchorWatch?? ??Onramp?? ??Human Rights Foundation?? ??Unchained?? ??Intuit?? ??Shopify?? ??Vanta?? ??reMarkable HELP US OUT! Help us reach new listeners by leaving us a ????????????????rating and review???????????????? on ????????????????Spotify????????????????! It takes less than 30 seconds, and really helps our show grow, which allows us to bring on even better guests for you all! Thank you – we really appreciate it!????? Support our show by becoming a premium member! ??https://theinvestorspodcastnetwork.supportingcast.fm Learn more about your ad choices. Visit megaphone.fm/adchoices Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm