Assorted Notes

THURSDAY, 30 JUNE 2016

On Monday, 12 November 2007 I jotted down two thoughts about making money. As is usually the case, I had some new insights today when I translated these notes.

This piece contains the original 2007 notes as well as the comments that I added today.

Monday, 12 November 2007 

All Internet marketing and e-book sales depend on one skill, one essential element, namely to convince someone to buy something.

30/06/2016:

This idea seems to refer to the skill that some people have to sell a proverbial block of ice to a resident of the North Pole. This is the wrong way to look at it. The idea is that you should find someone desperate for that block of ice, and then you make it available to him at a reasonable price; or you notice a particular group’s urgent need for regular deliveries of blocks of ice, and then you figure out a way to make those deliveries at a cost that leaves plenty of room for profit. No superior talent is required to sell the right product to the right market.

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Monday, 12 November 2007

What is the difference between sports bettors and financial traders who are mostly on the losing side at the end of the day, and people who make a living with it?

The losers have no system, or the approach they use is not built on a solid idea or on reliable statistics. Long-term winners are also patient. They wait until an optimal opportunity arises. And even then they only risk a small percentage of their capital.

What are these opportunities? How much capital is needed to start? How much should you risk? What do you do when a “gamble” ends profitably for you? What do you do when it ends in a loss?

Answering these and other questions depends on where you plan to take your calculated risks. Knowing what to do also requires thorough research; you need to spend enough time devising a strategy, and you need the discipline to stick to your plan when you hit that first rough patch.

30/06/2016:

I used to think the professional sports bettor is a highly skilled predictor of sports results. The fact of the matter is, the person who makes a living with sports betting is someone who looks for value in the available price compared to the reasonable probability of a particular outcome.

One example: If there are fifty red marbles in a bag and fifty green marbles, the probability of pulling out a green one is fifty percent. If someone offers you odds of $1.01 for every $1 you bet, you don’t think twice – you bet on, say green every time, and over the course of a hundred bets you will end up with a loss of $50 and a profit of $50.50 (in theory it could be more because you may pull the fiftieth marble from the bag after ninety rounds).

So the professional sports bettor does not necessarily try to look for a winner – every player and every team wins at some point, and everyone loses eventually; what they do is to identify value in the available prices.

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FRIDAY, 24 JUNE 2016

Since I am awake enough in the morning to register what is happening on the clock face, I think of work. I think of work when I eat breakfast, when I shower, when I brush my teeth and when I get dressed. I think of work when I’m travelling to a place where I work. After working at a particular place, I go home. Then I eat something, and then I work. When I watch TV, I am aware that I’m not working. When I lie down to take a nap, I think about how long I’m not going to work. When I open Wikipedia in my browser, or Twitter, or Reddit or Facebook, I think about the fact that I’m taking a break from work. On Saturday evening and the whole of Sunday the big thing is that I try not to work. I work when I make money, and I work when I am busy with long-term, ambitious writing projects that are most likely never going to make any money.

What I do when I work may differ from what you do when you work, but most adults accept this story that life revolves around work without thinking about it too much.

Our simple, often illiterate ancestors of five or more centuries ago only worked for a few months of the year. The rest of the time they did what they had to do to survive, they rested, and occasionally they enjoyed a little something of a life that only lasted on average about thirty or forty years.

This begs the question: Since when did we – the working masses – allow ourselves to be programmed with this thing that we have to work at least fifty weeks of the year, at least five days a week, at least eight hours per day?

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WEDNESDAY 22 JUNE 2016

Time for something of a different sort.

On 22 June 1986 Argentina defeated England 2-1 in the quarter-finals of the World Cup. Both Argentine goals were scored by their star striker, Diego Maradona. The first was the infamous “Hand of God” goal. The second, a few minutes later, is described as one of the best goals ever.

Here is how Víctor Hugo Morales, a journalist from Uruguay, described the “Goal of the Century” in his commentary (credit to Wikipedia for the translation from Spanish):

“He’s going to pass it to Diego, there’s Maradona with it, two men on him, Maradona steps on the ball, there goes down the right flank the genius of world football, he leaves the wing and he’s going to pass it to Burruchaga … Always Maradona! Genius! Genius! Genius! There, there, there, there, there, there! Goaaaaaaaal! Goaaaaaaal! I want to cry, oh holy God, long live football! What a goal! Die-goal! Maradona! It’s to cry, excuse me! Maradona, in a memorable run, in the best play of all times! Little cosmic comet, which planet did you come from, to leave so many Englishmen behind, so that the country becomes a clenched fist crying for Argentina? Argentina 2, England 0! Die-goal, Die-goal, Diego Armando Maradona! Thank you, God, for football, for Maradona, for these tears, for this Argentina 2, England 0.”

And here is footage of the legendary goal:

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FRIDAY, 17 JUNE 2016

If I have to give people advice about making money, I would advise them to consider their identity: Who are you? (Why are you this person?) Who do you want to be? (Why?) How do you see your purpose in life? (Why this purpose?) What makes you happy? (Why do these things make you happy?) Would you rather sell something – someone else’s products, or your time, your knowledge, your abilities or your experience, or would you rather take a risk speculating on some or other market?

One problem: Few people are ready with answers to these questions.

Another problem: Many people are too easily tempted to do things they shouldn’t be doing; and of course, too many people are too easily deceived.

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SATURDAY, 28 MAY 2016

I have always been an old man. The only difference is, in my twenties I could get away with trying to look young.

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