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FTA: The rightness of a decision will vary with time, what seems wrong today may in the future seem to have been the right decision ah ah ah. That's the easy c

by wiz21c 4y ago

FTA: The rightness of a decision will vary with time, what seems wrong today may in the future seem to have been the right decision ah ah ah. That's the easy case. Things get into problems when what sounded right yesterday now feels completely wrong. There are so many variables and people are not completely dumb so that usually, any decision will do. The trick is to be able to convince others that you are right (and that happens mostly in an irrational space); before and after the decision is/was taken...

Swizec 4y ago
Like when I sold 2 BTC at the first peak in ~2013. Oops. BUT that $1200 represented a 400% gain, paid my rent (which I was short for), and it took almost 5 years for bitcoin to come back to the same value. Would it have been better to wait until 2021? Yes. Was it a bad decision? Not at all.
- troebr 4y ago
  I don't play poker, but it's interesting there that the right play (because sound statistically) can make you lose the game. Over time a player that makes better decisions will come out on top. It makes me think sometimes about how the right decision can still end up exploding in your face: it was the best decision with the information at your disposal at the time.
  - Swizec 4y ago
    > the right decision can still end up exploding in your face Nassim Taleb talks about this a lot – never risk ruin. Because yes, on average it works out in the long run, but you are not average, you have 1 playthrough. Before you can win, you have to survive.
    - seanhunter 4y ago
      Risk of ruin doesn't apply in poker decision-making except in the "metagame" (ie which stakes you play and how much you actually put on the table etc). In hands themselves poker is played for "table stakes" (ie in a given hand you can only lose the chips that are in front of you at the beginning of that hand). Because of the table stakes rule, avoiding risk of ruin in poker is literally as simple as keeping some money as cash and not putting it on the table. The thing that happens in movies where someone makes a bet their opponent can't call so they throw the deeds to their house/title to their gold mine/keys to their car into the pot literally can't happen in poker. You can only bet what you have on the table at the beginning of the hand and if you call all-in (all those chips) you get to see the hand to conclusion regardless of what the opponent bet.
  - fronterablog 4y ago
    Oh, indeed. Annie Duke (professional poker player) had a great book on this called "Thinking in Bets." The main idea is that good decisions can create bad outcomes. And bad decisions can create good ones (because of luck). So she suggests making decisions by calculating expected value like a poker player. And separating the outcome from the quality of the decision.
- monksy 4y ago
  Was this a bad decision or a good decision? If you didn't pay rent, how would that have influenced your future to where you're at today? 400% Gain is a lot. How often do you think that 400% gains come arround, and how would you feel if the evaluation today was -50%? I think the major lession here was: Have a backup reserve in which you can tap into to prevent from needing to liquidate higher risk assets.
acrefoot 4y ago
I really like the ideas in Annie Duke's "Thinking in Bets". The book would suggest that the rightness of a decision shouldn't vary much with the outcome (or with time). The book suggests that we judge the quality of the decision based on how comprehensively we evaluated possibilities before we made the decision. Our habit is to re-evaluate the quality of the decision based mostly on the outcome, even if that outcome was one of the possibilities we considered. The book suggests that a good decision can't be judged by the outcome alone, as every decision is a bet with a variety of possible outcomes. (Adjusting priors for future decisions is related to this, and one should strive to allow adjusting priors in a disciplined way while not beating oneself up or congratulating oneself too much based on outcomes which were not certain going into the decision.) You can luck into winning the lottery, and luck into really bad outcomes while investing into index funds, but that does not make playing the lottery a good decision. In fact two decisions that lead to the same outcomes should be respected differently, depending on how much work went into them and the quality of the decision-making framework(s) applied.

by wiz21c 4y ago

Swizec 4y ago

Like when I sold 2 BTC at the first peak in ~2013. Oops. BUT that $1200 represented a 400% gain, paid my rent (which I was short for), and it took almost 5 years for bitcoin to come back to the same value. Would it have been better to wait until 2021? Yes. Was it a bad decision? Not at all.

troebr 4y ago
I don't play poker, but it's interesting there that the right play (because sound statistically) can make you lose the game. Over time a player that makes better decisions will come out on top. It makes me think sometimes about how the right decision can still end up exploding in your face: it was the best decision with the information at your disposal at the time.
- Swizec 4y ago
  > the right decision can still end up exploding in your face Nassim Taleb talks about this a lot – never risk ruin. Because yes, on average it works out in the long run, but you are not average, you have 1 playthrough. Before you can win, you have to survive.
  - seanhunter 4y ago
    Risk of ruin doesn't apply in poker decision-making except in the "metagame" (ie which stakes you play and how much you actually put on the table etc). In hands themselves poker is played for "table stakes" (ie in a given hand you can only lose the chips that are in front of you at the beginning of that hand). Because of the table stakes rule, avoiding risk of ruin in poker is literally as simple as keeping some money as cash and not putting it on the table. The thing that happens in movies where someone makes a bet their opponent can't call so they throw the deeds to their house/title to their gold mine/keys to their car into the pot literally can't happen in poker. You can only bet what you have on the table at the beginning of the hand and if you call all-in (all those chips) you get to see the hand to conclusion regardless of what the opponent bet.
- fronterablog 4y ago
  Oh, indeed. Annie Duke (professional poker player) had a great book on this called "Thinking in Bets." The main idea is that good decisions can create bad outcomes. And bad decisions can create good ones (because of luck). So she suggests making decisions by calculating expected value like a poker player. And separating the outcome from the quality of the decision.
monksy 4y ago
Was this a bad decision or a good decision? If you didn't pay rent, how would that have influenced your future to where you're at today? 400% Gain is a lot. How often do you think that 400% gains come arround, and how would you feel if the evaluation today was -50%? I think the major lession here was: Have a backup reserve in which you can tap into to prevent from needing to liquidate higher risk assets.

acrefoot 4y ago

I really like the ideas in Annie Duke's "Thinking in Bets". The book would suggest that the rightness of a decision shouldn't vary much with the outcome (or with time). The book suggests that we judge the quality of the decision based on how comprehensively we evaluated possibilities before we made the decision. Our habit is to re-evaluate the quality of the decision based mostly on the outcome, even if that outcome was one of the possibilities we considered. The book suggests that a good decision can't be judged by the outcome alone, as every decision is a bet with a variety of possible outcomes. (Adjusting priors for future decisions is related to this, and one should strive to allow adjusting priors in a disciplined way while not beating oneself up or congratulating oneself too much based on outcomes which were not certain going into the decision.) You can luck into winning the lottery, and luck into really bad outcomes while investing into index funds, but that does not make playing the lottery a good decision. In fact two decisions that lead to the same outcomes should be respected differently, depending on how much work went into them and the quality of the decision-making framework(s) applied.