Wednesday, December 29, 2010

Putting "stock" in The Almighty... SPITW

Clearly, this needs some editing...but, had to go ahead and put the ideas out there while I had 'em...otherwise, I'd probably lose the nerve or motivation...

How is it that our logical thinkers in this world are the most illogical when it comes to hedging bets?  It's not like most intellectuals are big on taking risks, especially when there is no gain. If it were so, that would make sense...but it's not, and it doesn't.
Imagine your ideal of the smartest person in the world (SPITW). Not necessarily what he or she would look like, or what their house/car/office would look like, but instead about how the ideal would "be."   Okay, would this person take risks? Sure, at opportune times. Would this person take risks at what other "normal" people would consider an inopportune time? Absolutely. That's how you rise above the rest.  Okay. Now, that's logical, hedge your bets and bet when the stakes are high for the best return (on whatever you are risking). Cool, even we "laymen" can understand that.
So he could keep the status-quo. Why not? He wouldn't gain anything, but he wouldn't risk losing...or would he?  Today's market standards dictate that, in fact, one does stand to lose if one tries to just "keep" what they have and leave the game. Even 401k's represent have to get return on what you are earning; otherwise, what you gain will eat itself up and, in the end, you will be left with nothing. We could talk about this more, but I think you get the main point.
Scenario #2:  He could invest his life savings.  Now, what type of investment would the SPINTW invest in?  Would it yield return- absolutely. Would there be risk- um, yeah how else do you get a decent return.  Okay, might SPINTW risk it all in something with no return, just to keep it status-quo then? I think not. Do you think, maybe? In what scenario would SPINTW do this? Risk his life's savings in nothing, or something with nothing in return?  Give me a logical explanation or resolution to where this makes sense- any kind of logical sense at all. I sure can't think of one...maybe you can and I can't wait to hear about it.
What about this last scenario? Would your ideal of the smartest, most successful person in the world place their entire estate as wager on an investment that could yield no return?  Maybe just because it was logical? Think of a scenario in which this would or could be logical. Putting everything you have, risking it all, into an investment that gives nothing back- and you know it.
Add this. The investment in which the smartest person in the world has risked it all has an alternative. The only alternative. Say this alternative promises to multiply any investment three-fold...or give an infinite, incomparable even, amount of return- and that return on the investment would be risk-free. A sure thing. No one and nothing could ever take the riches away from the investor.
And one final thing, SPITW has to invest in SOMETHING.

Which scenario would your SPITW choose?  Where would he place his bets?

My SPITW has to believe in God. If he didn't he would be risking his investment on "nothing"...not only without the promise of something in return, but with evidence suggesting that he may be risking it all only to be in debt. And to be damned worse off than when he began. How smart is that? I mean, why not invest in something with a promise of return? You have evidence, no "proof" of it's return...but, it is better than any alternative investment. Without a guarantee on anything, the stakes must be considered...if your the SPITW, anyway.

Next at 10, demonic stock-brokers and what they can break in you. ...and me.

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