The Blog of Leon Apel

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  admin 6:39 am on March 11, 2011 Permalink | Log in to leave a Comment  

  Play Consistently and Competently to Succeed 

  Trying hard or trying to be smart are no substitute for doing it right. You have to play correctly/competently.

  A chess player who tries their best with brute force by working hard/long hours on learning the game through practice will not necessarily going to be a grand master.

  A chess player who has the most intelligence about the game will not necessarily become a grand master.

  A chess player who executes the optimal strategies with consistency is a more likely candidate to become a grand master.

   

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  admin 11:19 am on February 13, 2011 Permalink | Log in to leave a Comment  

  Bias Towards Extremity 

  Doom and gloomers have successfully predicted 500 of the last 3 recessions.  This is a humorous way of poking fun of the fact that soothsayers who predict extreme events may eventually be right but tend to inflate their projections.

  Results tend to be more moderate than expectations. People tend to believe or lean more towards extremities.

  What does this mean?

  • This is why some investors use strategies designed to take advantage of mean reversion–the tendency towards a price to revert to a historical average.
  • This is why people sell insurance because it makes sense, over a big enough sample of people, to cover the risk of extremities by studying the mean reversion tendencies of many behaviors. People demand insurance to be able to sleep at night and know they are covered in an extreme event.  Insurance makes sense for most individuals because they may not otherwise be able to cover a significant tail risk scenario. However, if someone knows that the odds are not stacked against them and they have sufficient resources, insurance may not make sense.
   
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  admin 11:37 am on January 23, 2011 Permalink | Log in to leave a Comment  

  To Learn Best, Write an Essay 

  This article is a must-read for anyone who wants to optimize their learning strategy: http://www.wired.com/wiredscience/2011/01/learning-methods/

   
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  admin 10:03 am on December 30, 2010 Permalink | Log in to leave a Comment
  Tags: gambling, risk   

  On Gambling / Risk-taking 

  Everything is gambling if one of the following conditions exist:
  a) You don’t understand the game
  b) You’re not smart enough to play the game or
  c) You have a losing expectancy of success when you calculate your weighted probability of success vs. failure.

   
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  admin 6:04 am on December 20, 2010 Permalink | Log in to leave a Comment  

  Governments Won’t Stop Drinking Until Livers are Transplanted 

  It seems like a collective group o f people, under a democratically elected government, are incapable of stopping their drunken debt demise until they get a liver transparent (eg. debt-restructuring or bailout).

  How do we stop this?  MORE REGULATION. MORE LEGISLATION. We need legislation that makes it illegal to run a deficit. No excuses.

  There should be no excuses. We need a small government with less socialist policy.  Capitalism and free markets can help take care of the rest.