Kyle Grieve and Clay Finck discuss key topics from "Investing: The Last Liberal Art" by Robert Hagstrom, including the importance of using the right explanation for a business in a good investment thesis, simple ways to improve reading comprehension, using mathematical concepts for better decision-making, understanding System I and System II thinking in investing, and new mental models. IN THIS EPISODE YOU’LL LEARN: 00:00:00 - Intro 00:01:03 - How to use the proper explanations in your analysis to determine the right comparable best 00:05:16 - Why Tesla is so misunderstood 00:09:16 - Why the economics of Dino Polska make it an invalid comparison to other grocers 00:10:51 - The power of narratives in investing and how we can guard ourselves from getting overly optimistic 00:18:48 - How to optimize reading for learning 00:37:59 - How to use Bayes theorem to tip odds in your favor and change your position sizing 00:32:11 - Why value and prices become disconnected, and how human psychology plays into this 00:48:31 - Why intuition (system 1 thinking) is so difficult to rely on in the stock market 01:04:32 - How to make thinking in mental models a habit 01:10:42 - Some of the latest mental models Kyle has learned from interviewing some of his latest guests 🤝 Join the exclusive TIP Mastermind Community to engage in meaningful stock investing discussions with Clay, Kyle, and the other community members: https://theinvestorspodcast.com/mastermind 📈 Learn to invest like legend investors do — from the company that has interviewed them. Use YOUTUBE15 to get 15% off! https://theinvestorspodcast.podia.com/how-to-get-started-with-stocks 💰Click here to download your FREE guide to Stop Worrying About Your Finances In 4 Simple Steps: https://www.theinvestorspodcast.com/subscribe-youtube/ ▶️ RELATED EPISODES: - Investing Reimagined: Mental Models From Physics, Biology, and More!: https://youtu.be/TzLLi-SChHs - Timeless Lessons on What Never Changes in Markets | Same as Ever w/ Morgan Housel: https://youtu.be/pt6m4JzZJ14 - Making Smarter Decisions & Why Great Investors Are Great Quitters w/ Annie Duke: https://youtu.be/84Uisiv6VVI - A Gambler’s Guide To Investing & Life w/ Annie Duke: https://youtu.be/lIrAtIZcH5o - How to Build Wealth the Stoic Way w/ Vitaliy Katsenelson: https://youtu.be/w0ZM_AgMDIA - Mental Models For Investing & Life | The Worldly Wisdom of Charlie Munger: https://youtu.be/0RldYtkp1D4 - Mental Models of Warren Buffett & Charlie Munger | Insights from The Joys of Compounding: https://youtu.be/bWaHNa89qME - Dino Polska: A Polish Compounder w/ Clay Finck & Kyle Grieve: https://youtu.be/b3p_KSTe7Tw 🎧 Listen to our episodes here: https://open.spotify.com/show/28RHOkXkuHuotUrkCdvlOP 🖊️ Access the transcript and learn more about the guest here: https://www.theinvestorspodcast.com/episodes/improve-decision-making-with-mental-models-w-clay-finck-kyle-grieve/ 📖  BOOKS MENTIONED: - Investing: The Last Liberal Art by Robert Hagstrom: https://amzn.to/3XCzktu - Poor Charlie’s Almanack by Charlie Munger: https://amzn.to/3KZcBjZ - Quit by Annie Duke: https://amzn.to/3VWlD7G - The Misbehavior of Markets by Benoit Mandelbrot & Richard L. Hudson: https://amzn.to/45Yw3XR - How Do You Know? by Chris Mayer: https://amzn.to/4bVDNLH - Mastering the Market Cycle by Howard Marks: https://amzn.to/3XVAZL7 - Thinking, Fast and Slow by Daniel Kahneman: https://amzn.to/4bCCYqJ Disclosure: Some of the links above are affiliate links that we may earn commission from. This helps keep our show going! 😀 💡 OTHER RESOURCES - Seeking Alpha is a crowd-sourced content service for financial markets. Take control of your financial future — Use our link here for a 14-day free trial: https://www.sahg6dtr.com/59QC8Z/R74QP/ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ABOUT OUR SHOW 🎙  On We Study Billionaires, we interview and study famous financial billionaires including Warren Buffett, Bill Gates, and Ray Dalio. We teach you what we learn and how you can apply their investment strategies in the stock market. 🌍 Website: https://www.theinvestorspodcast.com/we-study-billionaires/  📝 Help us understand our audience better so we can create a more intentional user experience by answering this survey! https://www.theinvestorspodcast.com/survey2023-youtube ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ 📚OUR FREE INVESTING COURSES/RESOURCES https://www.theinvestorspodcast.com/tip-academy/ 📊TRY OUR STOCK INVESTING TOOL: TIP FINANCE https://www.theinvestorspodcast.com/tip-finance/ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ❗ DISCLAIMER: This show is for entertainment purposes only. Before making any decisions consult a professional. This show is copyrighted by The Investor’s Podcast Network. Written permission must be granted before syndication or rebroadcasting.