Book Review: Jesper Juul, Your Competent Child

1) Childrens cooperate, even when they cry or when they are aggressive.
2) There is an inner quality "self-esteem", which is nutured by being seen and by being experienced/witnessed as precious the way we are, and there is an outer, acquired quality "self-confidence", which is nutured by praise and critique. The difference between both is the difference between existence and performance.
3) Successfully setting limits typically requires a passive part, where we describe the situation and our feelings, and an active part, where we take responsibility for us and our well-being. This active part can start with "I want that you..."

The are three ideas I took from the book. They help me rethink my interaction with my partner's kids. And I could not stop thinking what all this means when dealing with my inner child as well.

The detailled descriptions and interpretation of small moments in life show that Juul is really an expert in his field.

Book Review: Noam Chomsky, What Kind of Creatures Are We?

It was a long and challenging read, partly because I am new to most topics of the book (linguistics, mind-body-problem), partly because it is not self-contained. For me, it was a book to work with -- googling, reading the footnotes, googling again, making notes -- and so on.

Here are some highlights of what I learned. First, what is the difference between humans and (other) animals? Our language. It allows to generate "unbounded arrays of [...] expressions" of what happens in our head. Animals may have languages, too, but are limited in what they can express, mainly because the elements of their language have a direct link to what happens outside them. The "atomic concepts" of human language, on the other hand, can be seen as linked to mental activities, "though there are of course actions of refering and denoting." To me, this distinction is quite sophisticated and makes a lot of sense to me.

Second, while equipped with an infinite variety of what we can express with our language, our "human mind is [still] a biological system with a limited array of admissible hypotheses." Noone would doubt that our gut brain has limited capacity to understand the world, everyone would agree that rats can never solve prime number mazes; as Donald Hoffman puts it in his TED talk, evolution seems to favour fitness, not understanding reality. So once we agree that our cognitive capacities are limited, it makes sense to separate between problems (that lie within our cognitive capacities) and mysteries (outside our understanding, including questions we can not ask, or topics we can not provide evidence for). It also means that if the reality outside our understanding/ experience is entangled with the world as we understand it, we do simply (cannot help but) ignore this.

Third, the anarchist Chomsky challenges the concept of "physical" or "material". This concept, he argues, steems from a mechanical philosophy view point of the 16th century, according to which physical objects are persistent in time and space and causality is explained through contact. This world view comes soon to its limits: Gallilei could not accept any theory that explains the tides, Decartes realized that the creativity of language can not explained in these terms and hence proclaimed a spiritual world apart from the physical, Newton discovered gravity as "action at a distance" -- without contact -- that finally proved the mechanical world view as wrong. Until today, so I understand Chomsky, noone brought new meaning to the concept of "physical" or "material". I think that is what the principle of complementarity is about, slowly moving away from the notion of a particle that acts through contact.

This great book has deserved a place in my bookshelve to be read again in a year or so when the first impressions have sunk in.

Book Review: David F. Swensen, Unconventional Success: A Fundamental Approach to Personal Investment

Swensen argues that there are basically three sources of returns: asset allocation (which market(s) do you choose? Bonds, stocks, real estate?), market timing (when to sell and when to buy) and security selection (after you chose your market(s), which stocks, bonds, etc. do you pick?). The book is structured by this argument.

I skipped large portions of the book as I realized that I want to look at different markets as Swensen. I am more interested in the token economy than the "core asset classes" he suggests, also his critique on mutual funds was not interesting to me because I do not plan to invest there.

However, I liked the way Swensen substantiates his claims. His book has some careful selected and compiled tables that actually show that his points are not some sort of gut feeling. That is something I did not see that often in Personal Finance literature.

What I remember from this book is: Market Timing is hard. Portfolio Rebalancing (for example, pick ten stocks with the highest estimated Sharpe ratio on regular intervals) may work, performance chasing most likely not. At least my investment strategy should benchmark against a strategy that does very little market timing.