Fortunate Fools

By Ramesh Akkineni

from 'A Treatise on Probability' by John Maynard Keynes

The infinitely rich gambler is the public. It is against the public that the professional gambler plays, and his ruin is therefore certain.
Might not Poisson and Condorcet reply, The conditions of the game imply contradiction, for no gambler plays, as this argument supposes, for ever ? At the end of any finite quantity of play, the player, even if he is not the public, may finish with winnings of any finite size. The gambler is in a worse position if his capital is smaller than his opponents'--at poker, for instance, or on the Stock Exchange. This is clear. But our desire for moral improvement outstrips our logic if we tell him that he must lose. Besides it is paradoxical to say that everybody individually must lose and that everybody collectively must win. For every individual gambler who loses there is an individual gambler or syndicate of gamblers who win. The true moral is this, that poor men should not gamble and that millionaires should do nothing else. But millionaires gain nothing by gambling with one another, and until the poor man departs from the path of prudence the millionaire does not find his opportunity. If it be replied that in fact most millionaires are men originally poor who departed from the path of prudence, it must be admitted that the poor man is not doomed with certainty. Thus the philosopher must draw what comfort he can from conclusion with which his theory furnishes him, that millionaires are often fortunate fools who have thriven on unfortunate ones.

Popular posts from this blog

It Pays to be a Nervous Wreck

By Ramesh Akkineni
from an article in Livemint Two weeks ago, Microsoft issued the sort of quarterly report usually seen of a company in finest mettle. Redmond’s sales were up 15% and profit double that, excluding certain deferrals. And the rest of the year, it projected, would be just as sanguine—certainly unlike in the economy as a whole. Elsewhere, that would be a mandate for staying the course. In Redmond, though, they were crossing off days on their calendars, waiting until Friday, the first day of February and thus the first opportunity Microsoft would be able to truthfully state, “Okay, Yahoo, it’s been a year since we talked to you guys; where’s the beef?” Microsoft remains obsessed about Google because it reads the same things everyone else does about how Google’s style of free, “in the cloud” computing means the slow and steady decline of Windows and Office. That’s a technical debate, one in which both sides have good arguments. But....
Read more

Korean Model

By Ramesh Akkineni
from an article by Ha-Joon Chang in the Guardian In my lifetime Korea has lived through one of the greatest development miracles – half a century ago, its annual per capita income was around £50, less than half that of Ghana at the time. Today, it stands at £12,000, putting it on a par with Portugal and Slovenia. How was this possible? Korea of course did things that most people agree are important for economic development, such as investment in infrastructure, health and education. But on top of that, it also practised many policies that are now supposed to be bad for economic development: extensive use of selective industrial policy, combining protectionism with export subsidies; tough regulations on foreign direct investment; active, if not particularly extensive, use of state-owned enterprises; lax protection of patents and other intellectual property rights; heavy regulation of both domestic and international finance. The Korean experience shows that sustainabl...
Read more

The Need for a Media Regulator/Media Archive/Registry

By Ramesh Akkineni
The Recent Events in Andhra show how easy it is for a News channel to destabilize the society. I think News channels are like financial derivatives which should be controlled and regulated.There should be a national media registry/archives which record every popular channel continuously.This will be similar to a 'black box' that an airplane keeps. It will ensure accountability and check the channels which 'manufacture' the news. The investment needed to start a channel has come down to about 10 crores and enable many people to start their own channel.The amount of havoc that a channel can do is immensely greater. With a 10 crore investment I can influence policy, cause 100s of crores damage to my rivals, destabilize society etc. This shows that news channels are in the category of 'fire arms' or a 'driving license' where the user can cause significant damage to others by improper use. If a society has to be stable, we must reduce the points of failure. I...
Read more