4 ms·
This reminds me a lot of pain related to finance and gambling losses, underwent by someone being much riskier than they should have been. You can tell someone a
by ve55 6y ago
This reminds me a lot of pain related to finance and gambling losses, underwent by someone being much riskier than they should have been. You can tell someone about the risks of gambling or very-high risk investing, but in my experience the best teacher by far is for them to experience pain from something gone wrong themselves, which is generally them losing a lot of their hard-earned money, and feeling somewhere between 'terrible' and 'I want to kill myself'.
It's the one type of reinforcement that hurts badly enough that it can correct their future actions to be of more reasonable riskiness. A lot of people that I watch go through the psychological cycle of gambling, whether via casinos, cryptocurrencies, stock options, etc, will often not stop until they're forced to by the pain of a terrible loss. It's unfortunate that this is the most effective method for some things to be taught, but that is part of life.
- ericmcer 6y agoI didn’t lose a lot but enough to feel it! Trading options can teach you a lot, it is one of the few areas where you need to form an opinion, reinforce it and then have it either affirmed or torn down (at great cost). Sometimes I wish political, social and economic opinions had to withstand such an immediate and potentially costly test, would certain teach some people some things.
- ve55 6y agoIt definitely took me quite a few lessons to have a good idea what I was doing there myself. Skin in the game is definitely important, and has become increasingly less common in society, to the detriment of many systems.
- WalterBright 6y agoA big reason free markets work so well is it is an inherently "skin in the game" setup. This does a better job of weeding out irrational and unproductive behavior than any other system.
- mettamage 6y agoMy teacher (organizational psychologist) was warning banks before the 2008 crisis about their bonus culture, precisely because they don’t have enough skin in the game. Also, as an employee, I don’t have enough skin either. I could get fired, I might not be promoted. That’s a whole different level than that one could lose everything immediately as some entrepreneurs.
- akman 6y ago>but that is part of life Makes one wonder whether technology can help here. Seems that, so far, there is no substitute for direct experience.
- watwut 6y agoAren't past gamblers more likely to relapse then non-gamblers to start? I think that my point here is that while enough pain is good job in making you stop temporally, it takes much more then that to stop forever.
- WalterBright 6y agoThat's characterized by the phrase "hitting rock bottom".
- watwut 6y agoPeople who "hit rock bottom" do relapse. And when they relapse it all goes down really fast again. Rock bottom does not imply abstinence forever. When I said "takes more" I meant that long term, possibly forever, work of changing habits, values, social environment to keep not playing.