If you were to enjoy” Moneyball” now, you might find it lovely. You may remember the idea: In a earth before “data-driven decisions” was a cliché, a charming guy played by Jonah Hill helps create a football roster from a spreadsheet, beating out better-funded teams who still rely on conventional scouts. These traditional sports players are stuck in the past, more concerned with a person’s chin and how the basketball “explodes off his wicket” than with on-base percentage and difficult statistics.
The problems of” technology eating the earth” are becoming more obvious fifteen years later as algorithms have taken control of everything from politics to study to football. Kamala Harris ‘ presidential campaign is built on feelings and being “brat”, alternatively of well-articulated plans. Despite our access to information and potent model software, scientific studies are still facing a synthesis problem. Our social media feeds are targeted and addicted, but unfortunately immiserating.
Enter Nate Silver, the mathematician, social meteorologist, and casino person. His new publication, On the Edge: The Art of Risking All, is much more complex than” Moneyball”, eschewing the worship of information geniuses and their disparagement of human consciousness. Otherwise, he uses poker to explain how to live in a modern, complicated world. The game has been improved thanks to statistical models, but the best players incorporate these probabilities with their own instincts to make the best play.
The River and The Town
To most individuals, Nate Silver builds vote models. He gained notoriety for accurately predicting all 50 state in 2012, and he is now a slight brand as the November election approaches.
He’s a Democrat, but he’s not a political officer: He was boldly warning about Biden’s time being an political responsibility back in September, and his design awards precision over politics. Now, he has the culture as a toss-up with a little advantage to Harris. He strives to be a “heterodox” intellectual. To put it another way, he sees himself as a member of” The River” rather than” The Village”.
Metal coined” The River” to speak to an “ecosystem of citizens and ideas”, represented in Silicon Valley, Las Vegas, and Wall Street. These are people who are logical, aggressive, contrary, and risk-tolerant. Consider Elon Musk, Peter Thiel, yet Silver himself.
Riverians are statistical, usually supportive of business competition, and concerned with the best plan winning ( and so frustrated with identity politics and government ). It might come as a surprise that some Riverians have voted for Trump rather than Harris, whose propensity for wordplay makes her seem like a risk-averse job legislator.
Metal contrasts The River with The Village, which is basically the organizations the remaining has colonized, such as the operational state, the club, and the conventional media. The Village is concerned with equity, rather than equality of opportunity. This often leads to clamping down on free speech, the free market, and ideological diversity. Increasingly, The River and the Village are at war, whether it’s Lina Khan at the FTC or The New York Times suing OpenAI.
A Whole New World
By focusing on niche activities like poker and high-end sports gambling, Silver accomplishes a rare feat in the age of the internet—telling a contemporary, fresh, and fascinating story. He introduces readers to some of the best sports bettors in the world, dispels a claim of poker cheating with layers of intrigue, and shares the story of his first foray into sports betting.
The bottom line is that gambling is a difficult way to make money. Riverians, whether VCs or sports bettors, think in terms of expected value, asking questions such as: how likely is this event, and how big is the payoff? Slot machines have the worst odds ( and the most gamification to hook users ), but even in poker, with comparatively good odds, it’s a game of small edges. The best players always come out on top. In sports betting, the odds could be even worse.
Silver is a knowledgeable fan and builds prediction models for a living, yet here’s his summary of the 2022-23 NBA season:” I bet a total of$ 1, 809, 006. And I finished the year ahead by a whopping$ 5, 242—for a paltry ROI of 0.3 percent”. He was good enough for many of the big books to limit how much he could bet on any given game despite his modest return.
There’s a famous line in” Rounders”,” If you ca n’t spot the sucker in the first half hour at the table, then you are the sucker”. This is undoubtedly true of sports betting. If they’re letting you put money down, you’re probably the sucker.
The SBF Post-Mortem
Sam Bankman-Fried’s coverage included allegations of polyamory and drug use, his questionable deeds, and his blatant inadequacy. When Sam’s father emailed to complain about his pay at FTX, he began by saying,” Gee, Sam” and then threatened to get Sam’s mom involved.
What the majority of the accounts overlook is how a fellow Riverian would evaluate the King of the Geeks. SBF’s insatiable appetite for risk is what makes him unique, according to Silver, rather than any individual flaws.
Most regular people become more cautious because their marginal utility decreases as they become more wealthy. Betting your life savings on the Super Bowl makes more sense when it’s$ 1, 000 rather than$ 1, 000, 000. But SBF did n’t view gambling like that. Instead, he viewed caution from the wealthy as a missed opportunity.
He came to the conclusion that his “utility function” is” closer to linear” by approaching life like a spreadsheet ( both morally as a utilitarian and morally as a radical risk-taker ). Wealthy individuals who are unwilling to take the chance of financial ruin miss out on significant opportunities. So Friedman went all in on a low-probability, highly leveraged bet on FTX. And he lost. Badly.
Looking Forward
Silver concludes by assessing the potential of AI, which either appears to be the most overhyped technology of all time or will kill us or liberate us. A probabilistic thinker like him wants to determine the relative likelihoods, and he concludes that allowing OpenAI, Anthropic, and Google to advance in a hurry is justified by the potential to raise the world’s standard of living and break through our current economic stagnation.
Then, in an unsatisfying and confusing coda, he calls for greater agency, plurality, and reciprocity as we plot our future, which is essentially Silver’s update on liberté, égalité, and fraternité. The only issue is that the Big Tech companies that create these technologies frequently commit the most egregious violations of government, freedom of expression, and civic health. As they acquiesce to even more power and become less accountable, it seems a little naive to expect them to become more accountable.
Nevertheless, we must make choices, we must place our bets as we look toward an uncertain, risk-filled future. Who knows what 2030, much less 2050 will look like? Silver closes the book with a common phrase among poker players:” Glgl”. Good luck, good luck. We’ll need it.
