today we have a special bonus episode

with Andy Juke one of the best poker players in the world bestselling author and somebody I love to talk to

she's got really unique perspective on when to fold your cards sell your shares and dump your husband

Annie thank you so much for joining us today

h thank you

I want to just clarify I would not say I'm one of the best poker players in the world anymore I did retire in 2012

that's all good

now you wrote a book called quit why is it so hard for people to quit

oh gosh you know it's I I think that the issue with quitting is that there's just a lot of cognitive biases that line up and result in this failure to stop things

so it's hard to pinpoint one thing right

so we know that we have this kind of cultural bias against quitting where we uh in English we have like lots of aphorisms like um quitters never win and winner winners never quit you know if at first you don't succeed try try again which obviously is encouraging not quitting

so when we look at a lot of the way that we we think about uh quitting from a cultural standpoint we think that quitters are are losers or weak willed or lack character

so that's kind of like on the cultural side but then there's a lot of cognitive biases that we know about sort of individually things like sun cost bias endowment effect which we can go into a whole bunch of things like that

where when you actually look across those biases they all result in a failure to stop things

so I I think it's very multi-pronged which I think is part of what makes it such a hard problem to address

well let's touch on some of these um uh some of these things so Sun costs

what what does that mean why is it so difficult to sell the the losers

yeah so when we're trying to make a decision about whether to continue something we take into account what we've already spent in other words costs that we've already sunk into the project

and that's doesn't isn't just money it can be time and attention and effort

so what we'd ideally like to do as humans is when we're approaching something that we're trying to decide whether we're going to continue we would only continue that thing if we were willing to start it fresh today

so so if we applied that to for example a stock that we bought um

let's say that there's a stock trading at 40 and we've never owned it and we look at it and we we do our analysis on it and we decide that it's not a buy that we ought not buy it at 40

uh we'd like to then if we bought it at 50 and it's now trading at 40 be able to sell it

because when it's trading at 40 regardless of whether we owned it at 50 what we're really saying is that I wouldn't buy it today

so if I wouldn't buy it today I should sell it because holding is the same as buying right

so the problem with the sun cost fallacy is that we don't do that and we have that feeling that I think everybody can intu it of if I sell it I won't be able to get my money back um

if I walk away now I'll have wasted everything that I put into it

so as an example if you're in a job that there's no way that you would take today you won't walk away because you're afraid you'll have wasted everything that you put into it uh all the training all the time and that kind of thing

but again if you wouldn't take it today you ought not to continue forward

and and really what it comes down to is that we have this we have this irrationality where we think of waste as a retrospective problem what I will have wasted as opposed to a prospective problem which is is the next dollar the next unit of effort or attention that I put into into this thing going forward going to be uh positive expected value am I going to actually win to it

and we have to start getting our eyes forward on these things

you also talk about the same uh issue when it comes to montering and for instance climbing Mont Everest

you know when do you when do you quit when do you call it a day when do you give up

yeah so so these are all expected value problems right

so expected value is just simply uh what is your the sort of weighted average of the prob abilities and payoffs you know across a set of outcomes that are available to you

and when we're investing we're we're trying to make positive expected value Investments meaning as I think about the outcomes that are available for whatever instrument it is that I'm investing in I think that in the long run on average I'm going to make money

and then we can take it a step further and say uh this is going to be a better expected value in comparison to other options that I have available to me

so an option could be negative expy on its own meaning if I buy this stock I'm actually losing to that decision or it could be I can buy this stock and I'm winning to the decision but not as much as I would win if I put my money in a different stock

okay so that's how we want to think about expected value

so expected value only makes sense uh in if you related to Nikolai what you value or what your goals are right

so something that might be positive expected value for me might be negative expected value for you and vice versa

so we can think about for me I wouldn't want to start climbing Mount Everest because like the discomfort and I'd be very cold and it wouldn't really be my thing

but for you you may be somebody who really wants to stand on the top of the world and do something that is uh different than you know almost any human being has been able to accomplish

I'll tell you one thing I'll tell you one thing Annie I can guarantee you I will never stand at the top on deest

well fair enough but let's pretend

so I'll be the person who would be willing to do that

so for you it wouldn't be positive expectancy to start but for me maybe that's something where I'm willing to tolerate certain risk

yeah in this case death and injury in order to be able to say I have stood at the top of the world and done something that most people are never going to do in their whole lives

but even so in there is some tolerance for the probability of death

so when you should stop climbing when you should say no I'm going to turn around is the moment when the probability of death and severe injury is higher than your intention at the beginning of the climb

in your book you differentiate between quitting and failure

yeah so failure for me doesn't mean uh just stopping something that you started and and you know not achieving your goal I I don't think that that's really what failure is

I I think that failure is one of two things it's stopping some something that is still worth it just because it's hard so I would consider that failure right

like if it's still worth it you shouldn't stop

but failure is also failing to stop something that is no longer worthwhile

so you know I think for example if you continue to climb Everest when you're in the middle of a blizzard I would consider that a failure

so some people don't want to turn around there because they're going to process that as a failure to have reached the Summit

but I think that once you start climbing under conditions when you're clearly negative expectancy then that's failure

if we take a very simple example like the stock right so we buy a stock at 50 we sell it at 40 we feel like a failure because we lost $10

but what's the real failure is would be to continue to hold it when you could put those resources that $40 into something that is actually going to win that's actual failure

you talk about the kill criteria

now how can one plan for quitting

yeah so here's the interesting thing about quitting is that uh we think that if we buy a stock based on a particular thesis or we invest based on on a particular thesis that when the the signals that we ought to be seeing in the future that that thesis implies don't materialize that obviously we're going to sell and we're going to take risk off

but we know that that's not true that that's a really Bonkers intuition

and in fact when we see those signals well often escalate our commitment to the cause uh

that's where we get that sort of old saw of like well now it's really cheap right and you actually want to buy more right even though you wouldn't start it today

so how do we actually overcome that problem you know because obviously if we're not if we're rationalizing away or ignoring the signals that tell us we should stop how do we solve the problem

and it turns out there's a relatively simple trick that actually really drastically increases the chance that you'll stop when the time is right and that is to think about what those signals that you might encounter are in the future and then commit before you start to actions if you see those signals

so I'll give you a very simple example

let's just imagine that it's 2021 and you have bought Bitcoin

and your stated reason your thesis for buying Bitcoin is that you believe it will be a good hedge against Market the market going down okay

so that's why you are buying it

if the market goes down you believe that that bit Bitcoin will be uncorrelated with that and so it will act as a good hedge against sort of Market chaos

so now I'm going to say to you Nikolai all right so let's say that you buy it how much of a correlation would you have to see over what time period between the market going down and Bitcoin going down as well right

so we can now write that down right

so if you see a strong enough correlation and you determine what that is right over a certain amount of time so it's durable that you'll actually start to take risk off and sell Bitcoin right

so if we do that in advance you're much more likely to take risk off than if you just say well my thesis implies that so obviously I'm going to pay attention when bitcoin's going down along with the market

and what that helps you to avoid is rationalization no I still believe it and now bitcoin's cheaper so I'll buy more or the other thing that will happen in order to avoid selling is thesis Creed well yeah okay it is correlated but actually I own Bitcoin as a philosophical uh move right or something like that

so um there's a very simple example of a kill criteria that actually Mountaineers use uh

so if you take Everest on Summit day they leave Camp 4 at about midnight uh

and the reason is that they want to get to this part of the mountain called the southeast Ridge which is really dangerous you have to go up single Le file they want to get there in daylight on the way up the mountain

but they also want to get there in time that they can come back down and and Traverse it again in daylight all right

so this is kind of a ballet right like they've got to sort of deal with this dance

so they leave at midnight but what that also means is in order to get back down the southeast Ridge you must have reached the summit by 1M

and if you reach the summit past 1 p.m. the probability that you're coming down that Southeast Ridge and darkness is too high

and the southeast Ridge again is is very very dangerous you don't want to Traverse it in darkness

so they actually set on that day a turnaround time of 1 p.m. no matter where you are on the mountain you have to turn around at 1 p.m.

so this is a very good simple example of a kill criteria that gets people to turn around when they otherwise might not

now quitting is is one aspect of decision-making but um what are the other biases you accounted the most in decision-making generally

so I think probably the biggest bias that I see and actually we just had in America um the playoffs with uh the Detroit Lions who made some decisions in the fourth quarter that people are really criticizing um

and this leads me to probably the biggest bias that I see which is um resulting so

resulting is otherwise known as outcome bias and it's a bias where you judge the quality of the decision by a quality the quality of the outcome

so the Lions had a couple times where they went went for it on fourth down and I don't know I actually don't know what the analytics are whether that was correct for them to do on those tries uh but if it was mathematically correct it was mathematically correct it doesn't really matter um

but none of it worked out

so uh I think Nate silver posted that it was going to set fourth down decisions back you know a decade just because it didn't work out

so um you know one of the famous examples of that actually also comes from American football in the 2015 Super Bowl uh the Seattle Seahawks were on the one yard line of the New England Patriots

so they have to move the ball one yard they're four points down meaning they have to score a touchdown in order to go ahead and there's only 26 seconds left in the whole game uh

and Pete Carroll decides to throw a pass play um in this situation

and uh the expected the expected play is for them to run the ball hand it off to the running back try to get off the across the goal line but he he chooses the pass play

the pass is intercepted and people to this day think it was one of the worst calls in Super Bowl history

I'm not going to going to go into the details of the math but it's not even close the choice that he made is the much better choice like by a lot

so how should so how should we evaluate a decision like that

well we should evaluate by are you is it the best expected value decision

so in this particular case we can work the math out right like what's the probability of a touchdown what's the probability of an interception what's the probability of an incomplete pass what's the probability of the Run scoring so on so forth

because we have base rates for all that stuff and we can figure out like which on average is going to get you the best results

but what happens is that the outcome so overshadows the result of the decision so overshadows our ability to think that through that um none of that really matters when we're evaluating the decision

and we can see that with the peak heral decision it's intercepted he loses the game everybody says it's the worst you know decision in super Bowl history

but we can do the thought experiment really easily well what if it had been caught for the game-winning touchdown obviously everybody would have said it was an amazing decision of course

and as you know in investing it's like if you invest in one stock and loses it doesn't mean it was a bad decision

if you invest in a well Diversified portfolio over some durable period of time where you continually are performing below beta now I can say something about your decision-making right

but but I have to have enough data points to be able to do that

and what we do instead is we take one data point we look at the outcome and say that was a mistake

what is your perspective on intuition and Analysis and decision-making

intuition can be very accurate your gut can be very accurate

the problem is it's very hard to know if it's very accurate and it's very hard to spot errors in your intuition if we don't make what your intuition is intuiting um explicit

so basically what I try to get people to do and when I'm working with clients is I take I say look you have some model that you're using for making these decisions I would like to take that model and make it explicit and then make sure that you're you're judging uh your decisions based on that model

this is for big decisions

so let me give you an example

one of the favorite things that Venture investors early stage Venture investors like to say and I'm sure you've heard this is when you you ask them how they make their decisions they say I know a good founder when I see one

so what I would say to somebody in that situation is I I can't disagree with you you may very well know a good founder when you see one I I don't have the data to be able to disagree with you but what do you mean by good founder

so now I'm going to ask them to be explicit by what they mean by good founder what is your model of a good founder right

is it someone who's gone really deep on the problem is it someone who is single-minded is it someone who whatever it is right

so we're going to write down what are the qualities of somebody a Founder that makes you put them in the category of good founder

and then I might go beyond that and say when you think about the investment broadly what are the things that you're thinking about right

so they might tell me well I want that it to be in a good Market with no headwinds and growing Tam uh you know I want the product to be something that is going to solve a problem for people whatever

so we're now going to create a decision rubric which ha basically is an explicit representation of what your model of a good investment is

so all I'm doing is taking your belief I'm not disagreeing with what you think I'm taking what you how you model these problems and I'm making explicit

now what that's going to do is as you make decisions about Investments it's going to reduce the noise in your Investments it's also going to reduce the bias because it's going to be hard for you to downplay bad signals or overplay good signals

and then the other thing it's going to do is it's going to help you to uplevel your team very quickly

because let's say Nikolai that you are actually amazing now we've created the model of how you view Investments it's now explicit we can share that out with the other people on your team who now are going to learn a lot faster how to make great Investments

not only that we become a data collection machine because every investment we're actually now writing down explicitly what is nikolai's point of view on this investment

so now when we get a good or bad result we can now go back and not fall into the resulting problem because we can go back and look at what you were thinking at the time

what are the other keys to making um group decisions better

the most important part is when you are collecting people's judgments you should do so in what we would call a nominal group

so a nominal group is a group of people who are working together but for the time that they're in a nominal group they're working independ ently L of each other

so in other words let's imagine that I create this investment rubric okay so I've got this investment rubric and I'm going to have you raid on a scale of 1 to S how strong the market is I'm simplifying how strong the product is how strong the founder is

I'm going to have you some make some forecasts of whatever like you could make a forecast of uh how many widgets do you believe this company is going to produce in the next six months whatever

so it's whatever you care about in an investment

so you're going to fill that out I don't want to get your opinion in front of other people

so I'm going to give you that rubric independently of the next person and the next person and the next person

and this is probably the single biggest thing you can do in order to improve decision-making because when you talk in groups it makes your decisions in general worse th

and what I mean by that is not that you discuss other people's opinions in groups it's that you do the the the opinion Discovery yeah in groups

because remember decisions have two parts right

there are facts but then there are also your subjective judgments right

like how are you modeling those facts

so you could look at facts about a particular market and I could look about at facts about a particular market and we could have very different judgments of that market even so

so where where we're going to be really helped as a team is to understand that you're really bullish on that market I'm really bearish on that market even though we're looking at the same set of facts

and for me to truly understand what your rationale is for why you're bull for you to truly understand what my rationale is for why I'm bearish for us not to try to convince each other of the other person's point of view but to in with curiosity understand why the person is modeling the decision that way

because all of the increase in accuracy is going to happen in those gaps

now in order to do that though I have to know the Gap exists

and the problem is if we're sort of eliciting those opinions in a group setting you're going to talk about how strongly you feel that this is a great market and me over here here who came into the room being bearish I am going to be much less likely to express that opinion

do you speak to a little people before you make an important decision

it dep so if it's a really important decision yes

who do you speak to

so um well I speak to people who I think are going to give me a good point of view

so I defin I speak to my husband I speak to and then I think about who are who are people that I know who have the right knowledge set to be able to actually give me good advice here

and then here's the key because remember this idea of I don't want to contaminate anybody right

I want to know what their true point of view is

when I elicit their advice I don't tell them what I think

so this is something that I learned in poker

so obviously if I'm coming to ask you about a hand of Poker that I played I'm asking you about something that has already occurred

so I know what my opinion was cuz I executed it my opinion was I should raise or fold or call or whatever

and I know how the hand turned out right

so I know both of those things

so if I come and I tell you the whole hand and then ask to rewind to ask you advice I'm not going to get good advice for a couple reasons

one is the resulting problem if you know I lost the hand you're going to tend to interpret my decisions negatively if you know I won the hand you're going to tend to interpret them positively

and the other thing is if you already know what I thought I should do that's going to now infect your opinion

so the way that I would describe a hand to you is hey Nicol I have a question about a hand I played you know this person was in front of me they were in first position they raised

I would tell you things about the way that person played that you needed like were they aggressive were they not aggressive uh were they tight were they loose you know these these kinds of things right

I would tell you how many chips they had and then I would say so now I'm in second position I look down and I have Ace Queen

and then that's it I say what would you do

what are some of the other lessons you learned from poker

so that was a big lesson but what's interesting in poker is that luck is your worst enemy

so let's say that we're playing chess and I lose at chess to you this is a game that has very little luck

I can't do anything but sort of say I've got to look back and examine my decisions because what's the explanation for why I lost right

and if I won I should rightly be able to say I should look back because I think I probably made decisions well

but once we add volatility and it becomes really hard to close a good feedback loop

because what I would see from players all the time and I certainly had this urge myself is that when they lost it was always Luck's fault and they W when they won it was always due to their skill of course

so one of the reasons why when I was talking to other people to get their advice I never told them how it turned out was because I wanted to make sure I was getting their true opinion because I wanted to know win or lose did I play the handbell that's what I was really obsessed with

but it's really hard because it comes to this thing and this is I think the big lesson that I learned from poker and I think that Daniel Conan you know Nobel laer I think this is I think he also thinks this is like the biggest urge for humans that really creates a lot of decision error

is that we always want to have a positive self-narrative of our life

and there's a catch 22 in there which is making great decisions over time and accepting your mistakes over time will in the end create the most positive self Nar narrative

but human beings aren't that way human beings want to feel good about themselves now not some future version of you who you've never even met now

so what happens when you lose a hand of Poker you feel bad right

oh but you feel bad maybe I made mistakes maybe I'm a bad player um

you're not advancing that positive self-image right in that moment

and so what do we do we say oh I got bad luck

so what should we should we do what we should do is say obsessively let me examine the decisions that I made and Tred to feel figure out win or lose whether I maximized my expected value did I make the best choice every single time

now that's hard to do right

I mean that's the thing that's hard to do but we can think about like a 2 by two Matrix right where you've got on one side the decision quality good decision bad decision and then you've got the outcome quality good outcome bad outcome right right

and if you've got good good that would be an earned reward if you've got good bad that would be bad luck if you've got bad good that would be dumb luck and if you've got bad bad that would be what you deserve right

all right so we can think about when we're thinking for ourselves the way that we interpret the world when when luck is an available explanation is everything that we're doing is trying to get back to this idea that we made a great good decision

so that means that we interpret the World either is earned reward or is bad luck

this is something called self-serving bias

and boy if you ever want to see that in play just go into a casino because that's all you're going to hear

I believe that Bill Gates came to the casino to watch you play

oh that's true

wait how did you know that

that's so funny

so uh Bill Gates kind of famously um used to play very very low stakes poker

and when I mean low stakes poker I mean like $3 $6 poker

so just to give you an idea if I sat down in a $3 $6 game I might risk $200

so Bill Gates would come in and so this was way back in the day um like the Bellagio Casino wasn't even open yet

it was at it was at the Mirage and I was playing I remember I was playing in a game that was kind of low stakes for me I think I was playing like an 8160 game um

and that's just the betting limits is the maximum bet is $60

well this person Taps me on the shoulder and says do you mind if I sit down behind you and watch you play

and I'm about to turn around and say no like you're a stranger why would I let you watch my play

and I look up and I see it's Bill Gates

so I was like sure sit down and watch me play

so it's interesting he sat down behind me and watched me play and he mostly asked me about bluffing

tell me about bluffing

yeah so if I'm playing a game where I can play perfectly straightforwardly then I wouldn't really need need to Bluff ever right

because I don't I don't need to I wouldn't I wouldn't really need to take that risk on

and I would only Bluff in situations where I I knew for a fact that I was well into positive expectancy in other words the bluff itself was really earning for me in that moment compared to other options that I could use that capital for right

so imagine that I'm in a game where I know that on average I just have a 5% Edge and I can run this Bluff that is maybe and remember this I'm I'm guessing at the expectancy because I can't see the other players cards

but if I'm in a situation where playing straightforward uh is going to be a problem because people are going to start to be able to read me and then they're not going to pay off my good hands and that's going to reduce my earn

now I want to bring BFF bluffing into the equation and the bluff itself can be 50/50 or slightly less than 50/50 I can actually be slightly negative expectancy on the bluff itself because it will earn me money later

so in other words Nikolai if I'm playing with you and you see that every time that I bet big I have a good hand at some point you're only going to call me when you know you have a better one

so that's going to be bad so I'm not going to get paid because you're only going to call me when I'm beat so that's bad

but if you see that sometimes when I Bluff I have an eight and a three and nothing particularly good happening and you see that from me now when I do have a really good hand you're going to not know and you're going to have to start pay what's called paying me off you're going to have to start calling me with weaker hands

so that's why that bluff is really important

now I have played in games with players who are what we call very tight meaning that they'll only ever bet when they know they have the best hand

in those types of games Bluffs on their own are very effective in other words I'm not even using the bluff for signaling value I'm using it just because I can push you around right

and then I can also play against players who are really bad who pay you off all the time and against those players I would never Bluff because you're already doing what I'm trying to get the bluff to do so I would never Bluff

and then in the in between I'll Bluff depending on where I'm sitting in that Spectrum

so that was really the discussion that I had with Bill Gates it was a fun discussion I've never seen him again since then but he sat behind me for like an hour

that's good um

now um en question are you seeing big differences between when and men and women when it comes to risk-taking

so in general again you know and these are always population differences right

men generally take on more risk um they're they're more risk-seeking um

in general again I can take an individual woman and an individual man and the individual woman might be much more risk-seeking and the individual man might be more risk averse um

but I I think that uh I think that that's generally true

and it's one of the reasons why if I'm thinking about like you know I'm thinking about a trading desk and how do you compose that desk it's really good to have a mix

why is that good because the whole point of having a team is different points of view

remember what what I said is like let's say You're really bullish on a market I'm really bearish on a market it's not so much that when we have a discussion about that that we need Nikolai and Annie to agree

it's that we want to discover those different points of view so that whoever the ultimate decision maker is can see well you could model it this way and you could model it that way right

that so that's where we're going to learn all of the information

so we have equally informed people who have a different subjective judgment about the facts on the ground

how do you get more women onto the you know into portfolio management positions on to the trading desks and so on

you know this is such a hard problem

and I'll tell you I I'm just going to give an experience from poker

so so the very first year that I played the main event of the World Series of Poker this is the Big World Championship 3% of the entrance were women

wow

now I know right

and it would always like from year to year it would toggle between three and 5% like never above five not really ever below three

so you know but this was long before poker was on television

so now uh poker gets on television and there's people like me and Vanessa salps and Liv bore and Maria ho and like a variety of women um who are are representing women and showing that women can do this professionally and being very successful

and in my case I had four children and I would talk very openly about how poker was actually a pretty good career if you have kids because you're organizing your day where I I was basically a stay-at-home mom and then when my kids would go to bed I would go play poker right

so it it actually it actually worked out pretty well in terms of my lifestyle

but anyway we're now repping right we're representing women in poker

and at the time I had the intuition and this is going back to that thing about intuition how good is intuition why you want to make it explicit

I had the intuition that it was more that people didn't know it was something that you could do right it was more that people didn't know it was something that was totally fine for a woman to do

and so now it's been since really 20022 2003 that women have been featured playing poker there's been lots of success among women in poker

and last year in the 223 Main Event of the World Series of Poker the percentage of the field that W was women was slightly over 3%

and so I look back to that first year I played which I think was 1994 to 2023 and all that happened in the interim and yet there aren't more women entering that event

So my answer to you is I don't know right

like I have this intuition that if you get to people early and you educate them um if you start thinking about uh how do you get women like more comfortable in these these very risky oh I mean not risky in the long run but like very riskhe heavy like volatile decision-making environments that naturally will get women to come into those fields

it's a problem that I would love to solve but I you know at least in poker I didn't see it solved so I the answer is I don't know

at which stage in your life did you start to get interested in decision-making

so I started getting interested in decision- making actually in graduate school

so people think of me as a poker player but they don't know I was an academic prior to that

so I was working on my PhD at pen and I was there for five years um

working in cognitive science and uh while my while my area of concentration wasn't decision-making in particular it was learning in particular first language acquisition

but I also like took classes with John Baron who's like a giant in the field of judgment and decision-making

so first language acquisition is a problem of learning under uncertainty

so uh right at the end of graduate school I ended up pivoting uh for a a variety of reasons one of which was some health reasons and uh that's when I started playing poker

and for eight years just dove into this problem which as we've discussed and we only got the tip of the iceberg poker is just this amazing laboratory to think about decision-making under uncertainty

what goes wrong how can how can you make it go right

and then in 2002 I got asked by a hedge fund to speak to their Traders um about how poker might inform risk

and what I talked about what was how poker and cognitive science informed this idea of risk attitudes and relationship to the path that you've gotten on to your decision

so what I talked about was if you've been losing how does that affect your risk attitude if you've been winning how does that affect your risk attitude

so it was that moment in 2002 that I really realized that there was this very interesting conversation to be had between cognitive science and poker where the cognitive science could really inform my thinking about poker and make me a better poker player and the poker could really form my thinking about cognitive science and make me a better cognitive scientist

so what I kind of realized was that from the time I I really was in uh College working as an assistant actually a research assistant to a cognitive science scientist what I've been really obsessed with is this idea of uncertainty and what that does to the quality of your decisions

and I think because I played poker I've been obsessed with how do you mitigate those errors right

it's not enough for me just to identify an error I want to know how you mitigate it because that's really what I was obsessed with as a practitioner

what do you and what are you curious about now what are you what are you thinking about

yeah what I'm thinking about now what I'm curious about now is I think that there's a lot of talk and work in the space of you know misinformation and disinformation which is really kind of coming from a pref pre uh premise of people are lying to you

and I actually think that people aren't mostly lying to you

I think that when people give you a data point I think that generally the data that they're giving you is probably going to survive a fact check

and that's certainly true of data that you generate within your own life and your own business right

so when someone tells you uh for example that and this happened a couple years ago that in in August 58% of the people who died of covid were vaccinated you can go look that up and it will survive a fact check

so what what I'm obsessed with is how do do you model that fact in other words how do you take something that's true and figure out what the truth is

and that takes a checklist of understanding how to model this fact

so if we take this fact of 58% of the people who died of covid were vaccinated we have to go through a series of questions the most important of which is what percentage of the population is vaccinated

because otherwise what will happen is you'll say oh vaccinations don't work because more people died who were vaccinated than were unvaccinated

but once you know that over 80% of the population in that month were vaccinated now all of a sudden that number looks very different to you

and then you could go beyond that and you could age match you could say well let's compare 70 year olds to 70 year olds and so on so forth

and then it turns out vaccinations and that months were five times better

but somebody looking at that nobody's trying to lie to you right

they're trying to give you a data point that's going to help you decide and if you don't understand how to model that how can you come up with what the truth of the matter is

and I've been super obsessed with that topic recently

well that sounds like it's going to be a good book

now taking all your all your experiences as a poker player as an academic uh and you know having uh lived uh a little while what um if you were to translate that into advice to young people what would it be

H I would it all right so if I were to translate that into advice for young people look here here's the fact of your life there are only two things that are going to determine how your life turns out

one is luck and one is the quality of your decisions

luck you have no control over

you don't you can't control the circumstances of your birth for example and we know that people are born into different circumstances that change sort of the distribution of outcomes that are available to them um

and you can't do anything about that

so first of all embrace the luck it is what it is right

I can't do anything about it

but what you can do something about is the quality of your decisions and over time if you're making better decisions than you otherwise would have those gains will acre over time and it's going to change that's the thing that can change the trajectory of your life

so it's this idea of while you can't control luck you are an agent of your own decisions

and if you can become totally focused on how do I improve the quality of your decisions that's the thing that can change your life because better decisions lead to better outcomes for individuals

and in fact that also leads to better outcome for society because Society is a collection of individuals

so really start focusing on your decisions and become an agent in your own decisions

I think that's a great place to end uh really good advice uh

big thanks to you for being uh for being on this podcast and we look forward to reading your next book

well thank you so much this was super fun oh