Grandpa Ross taught all his grandchildren to play poker and shoot craps. He didn't survive the Great Depression and WWII to leave his grandchildren to grow up to be fools. My sister, Judy and our cousins Jimmie, Debbie, and Joey; and sometimes other playmates, didn't just play the games, but bet on individual hands in poker and individual rolls in craps as a way of keeping score over sessions of play. We played for pennies, so there was no wealth accumulation incentive. These are games in which one person wins and everyone else loses in the individual rounds, but over time, wins and losses often accumulate to different sets of winners and losers.
At the same time this band of middle schoolers were refining our decision-making under the uncertainty conditions of dice rolls and the next card of a shuffled deck, Daniel Kahneman was documenting the cognitive biases that show up in human thinking when predictable patterns show up randomly. While we were playing for pennies, he collected a Nobel Prize.
What Kahneman found is humans are fascinated by probability, and our brains search for patterns to make sense of them. Our brains want to latch on to the simpler short-term patterns that emerge, and miss the more nuanced complex patterns. Coin flipping is the analogy I've written about before. No one's been recorded flipping a coin repeatedly and having it come up on one side more than nine times in a row. At the same time, the tenth flip is still 50/50. This truth troubles our minds.
Coming up to today, Jenny Just has created an organization called Poker Power to introduce more women to poker. Just describes the complexity of her roles as mother, founder, investor, business transformer, poker player, self-made billionaire. Successful poker players are more likely to be physicists than risk-taking cowboys. It involves living with the bigger complexity that is beyond the next flip or the next run of flips. It involves trusting the bigger pattern that others ignore or back away from because it makes our brains hurt.
Just points to the benefit of playing a game with complex predictable randomness, “the most important thing about it is that you’re practicing making decisions.”
As humans we live inside of predictable randomness: things that are ultimately predictable, but show up at random times. Our hardest work as humans is making decisions that embrace this truth.
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Warm regards,
Francis Sopper
REFERENCED IN THIS NEWSLETTER:
Daniel Kahneman: https://en.wikipedia.org/wiki/Prospect_theory
Jenny Just: https://peak6.com/about/
Poker Power: https://www.pokerpower.com/
physicists: https://www.preposterousuniverse.com/blog/2010/10/06/physicists-playing-poker/