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The more they overestimated their own skill relative to luck, the less they learned from what the environment was trying to tell them, and the worse their decisions became:
Because they thought they knew more than they did, they ignored any signs to the contrary—especially when, as inevitably happens in real stock markets, winners became losers and vice versa. In other words, the illusion of control is what prevented real control over the game from emerging—and
description-experience gap.
Our experiences trump everything else, but mostly, those experiences are incredibly skewed: they teach us, but they don’t teach us well. It’s
the betting in poker isn’t incidental. It’s integral to the learning process. Our minds learn when we have a stake, a real stake, in the outcome of our learning. It’s why kids learn so much better—and remember what they’ve learned—if they know exactly how or when they’ll apply the knowledge.
nearly all stock pickers, whether they know it or not—and few of them do—are playing a game of chance.”
In many ways, poker is the skilled endeavor. The job market is the gamble. How did my job talk go? Where did I go to college? To grad school? Did I rub someone the wrong way in an interview? These details, all subject to a big dose of chance, can make or break me. At the table, I play how I play. And I rise or fall on my own merits.
It feels like starting my own business vs going back to school is this same calculation. There are too many random factors in the job market.
what I mostly get instead is a crash session on the importance of failure.
if you don’t have an objective evaluation of what’s going on, you’re a loser,”
“You become a big winner when you lose,” Dan says. “Everyone plays well when they’re winning. But can you control yourself and play well when you’re losing? And not by being too conservative, but trying to still be objective as to what your chances are in the hand. If you can do that, then you’ve conquered the game.”
learning to lose in a game—to lose constructively and productively—would help me lose in life, lose and come back, lose and not see it as a personal failure.
there’s a larger skill at play: his absolute lack of ego. His willingness to be objective about himself and his own level of play.
Because when you’re winning, it’s just too easy not to stop and analyze your process. Why bother if things are going well? When it comes to learning, Triumph is the real foe; it’s Disaster that’s your teacher. It’s Disaster that brings objectivity. It’s Disaster that’s the antidote to that greatest of delusions, overconfidence. And ultimately, both Triumph and Disaster are impostors. They are results that are subject to chance. One of them just happens to be a better teaching tool than the other.
Success led to an abject failure of objectivity: suddenly, they were in the throes of the illusion of control. They thought that they could actually predict the results of a coin toss.
Poker is all about comfort with uncertainty, after all. Only I didn’t quite realize it wasn’t just uncertainty about the outcome of the cards. It’s uncertainty about the “right” thing to do. The only certain thing is your thinking.
‘The object of poker is making good decisions.’
“When you lose because of the run of the cards, that feels fine. It’s not a big deal. It’s much more painful if you lose because you made a bad decision or a mistake.”
If you’re skeptical of any prescriptive advice to begin with, if “less certainty, more inquiry” is your guiding light, not only will you listen; you will adjust. You will grow. And if that’s not self-awareness and self-discipline, I don’t know what is.
Some people achieve much larger gains with much less investment than others who study far longer and work much harder; that’s the simple truth.
Most real-world environments are what Hogarth calls “wicked”: there’s a mismatch between action and feedback because of external noise.
In any interaction, you want to have as much information as possible. When you’re the person acting last, you have the best of it. You already know your opponents’ decisions,
“For every action, you have to go back and think through everything you know and come to the right conclusion. You can’t act too quickly.”
Each time you act, you have to reassess based on what is now known versus what was known before. You need to have a process, a system, a plan—one that evolves with feedback. If you don’t, how will you know whether the outcome of your battle—a bad one in my case, but successful ones, too—is the result of skill or luck?
Bet sizing and what it accomplishes is an incredibly useful analogue for most any decision. How much are you risking to accomplish what, exactly? What are the situations where you want to bet frequently and small? Where do you want to bet less often, but big? When do you over-bet?
A good commander never cares what others are thinking. Perception matters only insofar as you’re using it strategically to shape your image for future actions.
The dragonfly is so good not only because it sees what its prey is doing, but because it can also predict what it will do and plan its response accordingly.
If you think you can get someone to fold with enough pressure, you do it. Only you better do it in the same way each time—otherwise, the observant dragonfly will spot the deviation in motion and act accordingly.
I’ve played with this opponent before: she’s asked me to write in the past, multiple times. It was always a little too small a sum for the effort required, so I’d never actually written anything. Every time I mentioned money, she walked away.
you can’t play scared. You can’t be afraid of how you look. You can’t be afraid someone will walk away because of what you do or don’t do. You have to play smart.
Do nothing without first gauging my opponent’s reaction. Reveal nothing about the strength of my hand until I have to.
“Because it’s a particularly harsh environment for women. It’s almost impossible to be a female poker player and not get online harassment or comments or whatever it is.” That’s not the first time he’s mentioned it, and this time, something seems to stick in my head. I can’t quite figure out what, but my brain starts churning.
As a woman, you have such an uphill battle that you have to be doubly exceptional to survive.
There’s a false sense of security in passivity. You think that you can’t get into too much trouble—but really, every passive decision leads to a slow but steady loss of chips.
a lot of my failure to up the aggression factor is due to my social conditioning. Over the years, I’ve learned that it doesn’t pay to be aggressive while female. It’s unattractive to those in power—namely men, but also some of those women who have managed to make it to the top and now don’t want to jeopardize their position.
When women act in a more feminine, less confrontational way, we aren’t being shy or stupid. We are being smart. We are reacting to the realities of the world, knowing that to fail to do so is to incur potentially life-changing penalties. We are socialized into our passivity. After all, don’t we want to be liked . . . so that we will be hired and make money and make a living?
If Erik tells me to try out a strategy, I should try it out. And I simply haven’t been able to. Whenever I do, it feels off and I fail.
Runs make the human mind uncomfortable.
Our discomfort stems from the law of small numbers: we think small samples should mirror large ones, but they don’t, really.
Typically, an internal locus will lead to greater success: people who think they control events are mentally healthier and tend to take more control over their fate, so to speak. Meanwhile, people with an external locus are more prone to depression and, when it comes to work, a more lackadaisical attitude.
unless I cure my distaste for bad runs and the sense of exuberance that envelops me during the good ones, I am going to lose a lot of money.
The simple truth is that I was overwhelmed. We’ve been primed to believe that memory is reliable, and that emotion makes memories more intense.
Casinos are conceived in a way that depletes your decision-making abilities and emotional reserves. Some of it is on purpose. The slot machines, the free alcohol, the amenities crafted so that you never need to look outside the casino walls. But some are side effects. I don’t know if Sheldon Adelson studied the psychology of creativity or emotional well-being, but had he done so, he’d know that by building a world where you never have to go outside, he was building a world designed to curtail them.
you will never see the long run if, in the short term, you don’t buffer yourself against the vicissitudes of chance. It’s not an ego thing. It’s practical survival.
How often do I find myself in a landscape like this, I wonder, only I’m not tuned in, not paying attention as closely as I should, not able to separate the signal from the noise—and so, not able to realize that I’ve got a shark biting at my heels as I swim merrily along and think he’s on my side?
“Focus on the process, not the luck. Did I play correctly? Everything else is just BS in our heads,” Erik tells me. “Thinking that way won’t get you anywhere. You know about the randomness of it but it doesn’t help to think about it. You want to make sure you’re not the person in the poker room saying, ‘Can you believe what happened?’ That’s the other people.”
How we frame something affects not just our thinking but our emotional state. It may seem a small deal, but the words we select—the ones we filter out and the ones we eventually choose to put forward—are a mirror to our thinking.
There is no such thing as objective reality. Every time we experience something, we interpret it for ourselves.
Pay attention, or accept the consequences of your failure.
that disconnect, the overconfidence in your opinion that comes from thinking you know more than you do simply because you have more information available to you, can be a dangerous thing.
Attention is a powerful mitigator to overconfidence: it forces you to constantly reevaluate your knowledge and your game plan, lest you become too tied to a certain course of action. And if you lose? Well, it allows you to admit when it’s actually your fault and not a bad beat.
