Catching up on reading this week at the beach, including past issues of my favorite magazine, The Atlantic.
The November 2008 edition carried a fascinating article that touched on neuroeconomics, or the neurophysiology of economic decisions. I love this stuff.
According to Yale professor of psychology, Paul Bloom, “…remembering something is easiest while you are in the same state in which you originally experienced it. Students do better when they are tested in the room in which they learned the material; someone who learned something while he was angry is better at remembering that information when he is angry again; the experience of one’s drunken self is more accessible to the drunk self than to the sober self. What happens in Vegas stays in Vegas.”
Bloom’s research underscores why effective business communications need to take people to an emotional place in order to cement the message. Warren Buffett did this well in his 2009 annual letter to shareholders when he drew a parallel between derivatives and venereal disease: “Participants seeking to dodge troubles face the same problem as someone seeking to avoid venereal disease: It’s not just whom you sleep with, but also whom they are sleeping with.”
If that gives you a creepy feeling, the Oracle from Omaha met his objective; he hates derivatives.
More Buffett bon mots:
- Tony and I feel like two hungry mosquitoes in a nudist camp. Juicy targets are everywhere.
- By year end 2007, the half dozen or so companies that had been the major players in this business had all fallen into big trouble. The cause of their problems was captured long ago by Mae West: “I was Snow White,but I drifted.”
- If merely looking up past financial data would tell you what the future holds,the Forbes 400 would consist of librarians.
- The tennis crowd would call my mistakes “unforced errors.”
- Upon leaving, our feelings about the business mirrored a line in a country song: “I liked you better before I got to know you so well.”
- Investors should be skeptical of history-based models. Constructed by a nerdy-sounding priesthood using esoteric terms such as beta, gamma, sigma and the like, these models tend to look impressive. Too often, though, investors forget to examine the assumptions behind the symbols. Our advice: Beware of geeks bearing formulas.
Advice for speakers
Back to Paul Bloom in The Atlantic story, “Good smells, such as fresh bread, make people kinder and more likely to help a stranger; bad smells, like farts (the experimenters used fart spray from a novelty store), make people more judgmental. If you ask people to unscramble sentences, they tend to be more polite, minutes later, if the sentences contain positive words like honor rather than negative words like bluntly. .. All of these studies support the view that each of us contains many selves-some violent, some submissive, some thoughtful-and that different selves can be brought to the fore by different situations.“
Next time you’re delivering a presentation, keep this in mind. The oft-repeated advice to open with a joke should be tempered by what you just learned about neurophysiology — don’t make it a fart joke.