Principle of the day: Be Imprecise.

Ray Dalio argues: Understand the concept of by-and-large and use approximations.

Because our educational system is hung up on precision, the art of being good at approximations is insufficiently valued. This impedes conceptual thinking.

For example, when asked to multiply 38 by 12, most people do it the slow and hard way rather than simply rounding 38 up to 40, rounding 12 down to 10, and quickly determining that the answer is about 400.

Look at the ice cream shop example and imagine the value of quickly seeing the approximate relationships between the dots versus taking the time to see all the edges precisely. It would be silly to spend time doing that, yet that's exactly what most people do.

By-and-large is the level that you need to understand most things in order to make effective decisions. Whenever a big-picture by-and-large statement is made and someone replies Not always, my instinctual reaction is that we are probably about to dive into the weeds- i.e., into a discussion of the exceptions rather than the rule, and in the process we will lose sight of the rule.

To help people at Bridgewater avoid this time waster, one of our just-out-of-college associates coined a saying I often repeat: When you ask someone whether something is true and they tell you that it's not totally true, it's probably by-and-large true.

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