I do a crappy job of finishing posts to my blogs. Here's one reason: I want to be omnipotent. Really.
God is omnipotent, but I don't want to be God. I'd like the power, but don't want the responsibility. And I'm not crazy about the people who would want to hang out with me. But I do want omniscience. I want to know everything. Always have. Always will. Until I die, of course.
Here's the pathology in action.
Yesterday I started writing a post on "pot odds." Pot odds is a rational poker betting strategy. Most poker players are poor, and they bet on whether they feel lucky, or on how much they're already put in the pot. Pot odds tells you to bet based on the expected return (the pot) on the investment (your next bet).
The post, which I started, and intend to finish after this meditation, will explain it in more detail. Assuming that writing this helps me get it done. If it does, I'll update this post with a link to it, that will go here.
Anyway.
There's a lot to betting on a poker hand. First there's the cards. Based on what you know, you can estimate the probability, of your winning the hand. So can your opponent. You can also estimate what they might estimate, for all the good that might do you.
Then there's bluffing. You can estimate the probability of a bluff based on your opponent's past behavior. So can your opponent. There are optimal strategies for bluffing, assuming that the other player is also following such a strategics. There are more complex strategies where you play one way, hoping to bias your opponent's perception of how you play. So can they. If you're playing face-to-face, there's body language, and spotting a 'tell'--an unconscious reaction that lets you know how good their hand is, and whether or not they are bluffing. Things can get even more complex. How should the number of chips you hold affect your strategy? What if a your goal is not making money, but maximizing your enjoyment, based on some combination of the value you put on money, and the value you put on the emotions that you experience when you play.
And how does all of this relate to non-poker pay-to-play decisions.
I start researching and thinking about these deeper and deeper levels of strategy. Eventually I think that anything can expand to include at least the entire subject of human behavior, and often a great deal more.
That's a bad habit.
It happens a lot.
So having identified the problem I have a solution: when a post starts to get complex, or I start feeling that a reasonably good post could be improved by editing it, again, and again, I will identify what I am not going to do in a section at the bottom of the post.
I'll call the section SIDHTFN, which stands for Shit I Don't Have Time For Now.
SIDHTFN
Editing this any more.
Grammar checking (Google has spell checked)
May 22, 2013
May 21, 2013
Pot Odds
People make two kinds mistakes when faced with decisions under uncertainty. Sometimes they stay the course when they really should quit, because they'll lose their investment if they drop out: "In for a penny, in for a pound" as they say. The other is to quit, because the odds say they won't succeed. Don't throw good money after bad."
Both are wrong, as I was reminded while I wrote an email to a poker-playing friend, John Piacente, today.
The starting point for a rational investment strategy is what hey call, in poker, and on Wikipedia, pot odds.
Pot odds means that you make decisions not on how much you've already wagered, or strictly on how likely it is that you win. Instead, it's a return on investment analysis: what does it cost you to continue (the investment), how much are you going to gain (the pot, not just your money, but all of it) and the odds: how likely are you to win.
Calculating the odds gets tougher the more rounds left to play, and even if all the cards have been dealt, it's still pretty hard. You must first calculate your probability of winning given what you know: your cards, your opponent's face-up cards, and any other cards dealt face up.
Once you make that calculation, you multiply the probability by the size of the pot, and that gives you the expected value of continuing. Compare that with the amount you have to bet or call to stay in the game and you've got what you need for a return on investment decision. But it's not that easy because you're not playing against a deck
, but against another player. And that player has choices to make.
They're going to make the same calculation as you did based on what they know and don't know. That will tell your opponent whether to stay in or fold. But Your opponent might decide to bluff. In order to deal with that you have to combine your calculation with your estimate of the probability that your opponent will bluff.
I remember a night in Hawaii, when I was around twenty, watching a game played by a friend of mine, several other students, and a sailor, whose ship was had come in to Honolulu. The sailor started out losing, and kept losing, a little bit at a time. He'd ante up, then drop out early, playing very conservatively. That went on until around midnight. Then he started to win, and the game ended early in the morning, after he'd won everyone else's money.
I found out later that he'd been making his living for years playing poker, and he'd do it the same way: lose small amounts by folding early for two reasons. First, because he wasn't focused on winning he could focus on watching the other players at the table and analyzing their play, looking for ways that they telegraphed a good hand or a bluff, and getting a sense of how often they were likely to bluff. Second, by appearing to be a guy who folded early and never bluffed, he was able to run some big luffs later. Once he knew how the other players played, and once he'd created an illusion about the way that he played, it was easy for him to win.
There's a lot more to poker strategy than that, and there's a lot more to life than poker strategy. But there's got to be an end to this post, and this is it.
SIDHTN
Should your strategy change depending on how many chips you have?
If your goal is to make money, then you should probably not play unless you know for sure that you are the best player at the table. If you are not the best, then eventually you will lose everything. But you might have other goals. You might enjoy the thrill. Or you might be playing a "training game" with better players to hone your skills.
How do the lessons of poker apply to life?
Both are wrong, as I was reminded while I wrote an email to a poker-playing friend, John Piacente, today.
 |
| Ben Affleck playing poker at the annual Ante Up For Africa event in Las Vegas during the World Series of Poker. (Photo credit: Wikipedia) |
Pot odds means that you make decisions not on how much you've already wagered, or strictly on how likely it is that you win. Instead, it's a return on investment analysis: what does it cost you to continue (the investment), how much are you going to gain (the pot, not just your money, but all of it) and the odds: how likely are you to win.
Calculating the odds gets tougher the more rounds left to play, and even if all the cards have been dealt, it's still pretty hard. You must first calculate your probability of winning given what you know: your cards, your opponent's face-up cards, and any other cards dealt face up.
Once you make that calculation, you multiply the probability by the size of the pot, and that gives you the expected value of continuing. Compare that with the amount you have to bet or call to stay in the game and you've got what you need for a return on investment decision. But it's not that easy because you're not playing against a deck
, but against another player. And that player has choices to make.
They're going to make the same calculation as you did based on what they know and don't know. That will tell your opponent whether to stay in or fold. But Your opponent might decide to bluff. In order to deal with that you have to combine your calculation with your estimate of the probability that your opponent will bluff.
I remember a night in Hawaii, when I was around twenty, watching a game played by a friend of mine, several other students, and a sailor, whose ship was had come in to Honolulu. The sailor started out losing, and kept losing, a little bit at a time. He'd ante up, then drop out early, playing very conservatively. That went on until around midnight. Then he started to win, and the game ended early in the morning, after he'd won everyone else's money.
I found out later that he'd been making his living for years playing poker, and he'd do it the same way: lose small amounts by folding early for two reasons. First, because he wasn't focused on winning he could focus on watching the other players at the table and analyzing their play, looking for ways that they telegraphed a good hand or a bluff, and getting a sense of how often they were likely to bluff. Second, by appearing to be a guy who folded early and never bluffed, he was able to run some big luffs later. Once he knew how the other players played, and once he'd created an illusion about the way that he played, it was easy for him to win.
There's a lot more to poker strategy than that, and there's a lot more to life than poker strategy. But there's got to be an end to this post, and this is it.
SIDHTN
Should your strategy change depending on how many chips you have?
If your goal is to make money, then you should probably not play unless you know for sure that you are the best player at the table. If you are not the best, then eventually you will lose everything. But you might have other goals. You might enjoy the thrill. Or you might be playing a "training game" with better players to hone your skills.
How do the lessons of poker apply to life?
May 20, 2013
Not an optimist. Not a pessimist. A hopeful scientist.
In a world that's filled with bad news, a constant barrage of current outrages, and coming disasters, I am generally unworried.
People who listen to these reports and believe them are pessimistic, and it's easy to see why. When I tell them that I am not pessimistic also, they accuse me of optimism, as though this was some sort of character defect. But, I explain, the fact that I'm not pessimistic does not mean I'm optimistic.
Unless I see the predicted doom as inevitable--and there is very little that is inevitable--then I am hopeful, which is often taken for optimism. But it's not. I can be pessimistic and hopeful or optimistic and hopeful.
My degree of optimism or pessimism is based on my assessment of the probability of either outcome, my degree of certainty about the probability statement, and whether I believe the likely outcome will ultimately be bad or good. In most cases the probabilities are uncertain. In the minority of cases where the probabilities run strongly for a bad outcome, then I will be pessimistic (though hopeful). If they run strongly for a good one, then I will be optimistic (though guardedly so; things can always go wrong.)
But in most cases I can't make a prediction primarily because there's no good basis for making a prediction, and secondarily because while first-order effects can sometimes be predicted, there are often second-order effects that may offset them. For example, one might consider a reliable prediction in the price of oil prices to be a bad thing, but one consequence of such an increase might be more investment in sustainable energy, a good thing.
For me to take any prediction seriously, it has to be scientifically credible. That means the there must be a well defined method for making such a prediction, and the method must have been tested many times, very thoroughly and have been found accurate. Note that what must be predicted is the future, and not the past: there is a vast difference between successfully predicting a future outcome, and successfully demonstrating that had the method in question could have successfully the predicted the past, from a still earlier past time that viewed that past as its future.
The "ask the expert" prediction technique is testable: see what that has expert predicted in the past, and measure how accurate have those predictions have been. Sadly, the answer, found by Philip Tetlock, is that most experts are not very good.
People who listen to these reports and believe them are pessimistic, and it's easy to see why. When I tell them that I am not pessimistic also, they accuse me of optimism, as though this was some sort of character defect. But, I explain, the fact that I'm not pessimistic does not mean I'm optimistic.
 |
| Is the glass half empty or half full? A pessimist would pick half empty, while an optimist would choose half full. An engineer, the story goes, would say that the glass was twice as large as it needed to be. A scientist would report only what was testable: that the 300 ml glass contained 150+/-3 ml of water with 99% confidence.(Photo credit: Wikipedia) |
My degree of optimism or pessimism is based on my assessment of the probability of either outcome, my degree of certainty about the probability statement, and whether I believe the likely outcome will ultimately be bad or good. In most cases the probabilities are uncertain. In the minority of cases where the probabilities run strongly for a bad outcome, then I will be pessimistic (though hopeful). If they run strongly for a good one, then I will be optimistic (though guardedly so; things can always go wrong.)
But in most cases I can't make a prediction primarily because there's no good basis for making a prediction, and secondarily because while first-order effects can sometimes be predicted, there are often second-order effects that may offset them. For example, one might consider a reliable prediction in the price of oil prices to be a bad thing, but one consequence of such an increase might be more investment in sustainable energy, a good thing.
For me to take any prediction seriously, it has to be scientifically credible. That means the there must be a well defined method for making such a prediction, and the method must have been tested many times, very thoroughly and have been found accurate. Note that what must be predicted is the future, and not the past: there is a vast difference between successfully predicting a future outcome, and successfully demonstrating that had the method in question could have successfully the predicted the past, from a still earlier past time that viewed that past as its future.
The "ask the expert" prediction technique is testable: see what that has expert predicted in the past, and measure how accurate have those predictions have been. Sadly, the answer, found by Philip Tetlock, is that most experts are not very good.
His Expert Political Judgment: How Good Is It? How Can We Know? (2005) describes a twenty-year study in which 284 experts in many fields, including government officials, professors, journalists, and other, and with many opinions, from Marxists to free-marketeers, were asked to make 28,000 predictions[1][2] about the future, finding that they were only slightly more accurate than chance, and worse than basic computer algorithms.The world is uncertain, and there's not a lot in the future that I am certain about. But as long as it's possible, even if improble, that things will work out I will remain hopeful.
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