1 00:00:15,356 --> 00:00:28,636 Speaker 1: Pushkin. Hi, Michael lewis here and this is Against the Rules. 2 00:00:29,436 --> 00:00:32,356 Speaker 1: A big part of sports betting is understanding risk, and 3 00:00:32,436 --> 00:00:35,596 Speaker 1: recently I spoke to an expert on that topic, Nate Silver. 4 00:00:36,436 --> 00:00:39,356 Speaker 1: Nate's been on Against the Rules before, talking about probability 5 00:00:39,356 --> 00:00:42,276 Speaker 1: as an election forecast. He's now the author of a 6 00:00:42,316 --> 00:00:45,236 Speaker 1: new book called On the Edge, and he's also the 7 00:00:45,276 --> 00:00:48,676 Speaker 1: co host of a Pushkin podcast called Risky Business, along 8 00:00:48,716 --> 00:00:53,196 Speaker 1: with writers, psychologists, and professional poker player Maria Kanakova. She's 9 00:00:53,236 --> 00:00:56,676 Speaker 1: been on our show too. Each week, Maria and Nate 10 00:00:57,036 --> 00:00:59,396 Speaker 1: get into how to think about risk and decision making, 11 00:01:00,036 --> 00:01:02,516 Speaker 1: and this month they're also talking about the US elections. 12 00:01:03,876 --> 00:01:06,556 Speaker 1: Nate and I had a fascinating conversation about why people 13 00:01:06,636 --> 00:01:09,356 Speaker 1: bet on elections, why there's so many stupid sports camps 14 00:01:09,356 --> 00:01:11,836 Speaker 1: in the United States, and how we each think about 15 00:01:11,916 --> 00:01:15,556 Speaker 1: risk ourselves. To start, I asked Nate about a key 16 00:01:15,596 --> 00:01:18,716 Speaker 1: framework he uses in his book. It's called the River 17 00:01:18,796 --> 00:01:25,436 Speaker 1: and the Village. The stinction you make between the river 18 00:01:25,476 --> 00:01:28,676 Speaker 1: and the village, is that right? Yeah? I got it right. Yeah, 19 00:01:28,916 --> 00:01:30,716 Speaker 1: describe river and village. 20 00:01:30,796 --> 00:01:32,676 Speaker 2: So the village is easier to describe. The village is 21 00:01:32,716 --> 00:01:36,036 Speaker 2: kind of the east Coast establishment, d C. New York, 22 00:01:36,116 --> 00:01:39,116 Speaker 2: it's the New York Times, Harvard University, the government when 23 00:01:39,116 --> 00:01:43,076 Speaker 2: the Democrats in charge. So it's very collective oriented. It 24 00:01:43,236 --> 00:01:45,676 Speaker 2: tends to be risk averse. It got really into like 25 00:01:46,316 --> 00:01:49,996 Speaker 2: COVID caution and cancelation and things like that. But it's 26 00:01:49,996 --> 00:01:54,676 Speaker 2: also the expert class. It's generally pretty pretty competent and 27 00:01:54,716 --> 00:01:58,876 Speaker 2: so forth. The village or the river rather is degenerate. Well, 28 00:01:58,956 --> 00:02:01,876 Speaker 2: le's gonna say degenerate gamblers, but people who take calculator 29 00:02:01,956 --> 00:02:04,236 Speaker 2: risks for a living and are really competitive about it. 30 00:02:04,316 --> 00:02:09,516 Speaker 2: So canonically you know, Wall Street, Silicon Valley Lost, it's 31 00:02:09,516 --> 00:02:12,636 Speaker 2: really both the house and the players, especially in the 32 00:02:12,636 --> 00:02:14,876 Speaker 2: skill games like poker and sports betting. I think it's 33 00:02:14,916 --> 00:02:19,596 Speaker 2: a pretty unusual personality type. There's something called anagram or 34 00:02:19,636 --> 00:02:22,676 Speaker 2: an aagram where like typologize people in nine ways. Right, 35 00:02:24,476 --> 00:02:27,676 Speaker 2: one personality type is being really analytical, and one type 36 00:02:27,756 --> 00:02:31,476 Speaker 2: is being really extremely competitive, right, wanting to dominate conquer. 37 00:02:32,636 --> 00:02:35,596 Speaker 2: Because are actually the two least common personality types in 38 00:02:35,636 --> 00:02:39,396 Speaker 2: the general population, but when you phase them together, they 39 00:02:39,396 --> 00:02:42,556 Speaker 2: can become very powerful and very high variants. I think, 40 00:02:43,956 --> 00:02:47,396 Speaker 2: and so you know that I think is the distinguishing feature. 41 00:02:47,396 --> 00:02:51,116 Speaker 2: It's not just that they're like the the actuaries are 42 00:02:51,116 --> 00:02:54,876 Speaker 2: the accountants who are good and calculating, right, It's that 43 00:02:54,956 --> 00:02:56,596 Speaker 2: they really want to win, and they have a chip 44 00:02:56,676 --> 00:02:57,236 Speaker 2: on their shoulder. 45 00:02:57,556 --> 00:03:01,316 Speaker 1: So is the distinction between river and village? Also a 46 00:03:01,356 --> 00:03:05,916 Speaker 1: distinction between is sort of the distincts that runs through 47 00:03:06,076 --> 00:03:09,316 Speaker 1: the moneyball story, between scouts and people who are offering 48 00:03:09,516 --> 00:03:11,916 Speaker 1: kind of from their gut and people who are actually 49 00:03:12,676 --> 00:03:16,996 Speaker 1: able to do higher analysis and think statistically and probabilistically. 50 00:03:17,356 --> 00:03:17,876 Speaker 1: Is it is? That? 51 00:03:18,236 --> 00:03:18,516 Speaker 3: Is it? 52 00:03:18,636 --> 00:03:20,916 Speaker 1: I think one distinction that I make in the general 53 00:03:20,956 --> 00:03:23,916 Speaker 1: population is between people who actually think in terms of 54 00:03:23,956 --> 00:03:28,556 Speaker 1: expected value and who think probably probabilistically, and people who don't. 55 00:03:28,796 --> 00:03:31,916 Speaker 1: And that these two groups collide in lots of different places, 56 00:03:32,556 --> 00:03:35,876 Speaker 1: and one of the newest places they collide is sports gambling. Uh, 57 00:03:36,116 --> 00:03:38,036 Speaker 1: which is why we're doing a whole podcast about sports 58 00:03:38,076 --> 00:03:41,236 Speaker 1: gambling and interests me this collision. But do you do 59 00:03:41,276 --> 00:03:43,716 Speaker 1: you think of village as one and river as the other? 60 00:03:44,396 --> 00:03:47,236 Speaker 2: I think, I mean the village certainly leans heavily toward 61 00:03:47,276 --> 00:03:48,796 Speaker 2: the people who they are. The people who got mad 62 00:03:48,796 --> 00:03:53,196 Speaker 2: at me about the election forecasts and said. 63 00:03:52,396 --> 00:03:55,156 Speaker 1: You were wrong. So I still don't. You and I 64 00:03:55,196 --> 00:03:57,996 Speaker 1: have talked about this. It is it's bewildering to me 65 00:03:58,076 --> 00:04:00,796 Speaker 1: that intelligent people could look at your election forecasts and 66 00:04:00,836 --> 00:04:04,836 Speaker 1: say that was wrong. They were they were better forecasts 67 00:04:04,836 --> 00:04:06,036 Speaker 1: than what the market was saying. 68 00:04:06,556 --> 00:04:09,996 Speaker 2: So that that's a very very entire toistic though, is 69 00:04:10,036 --> 00:04:13,836 Speaker 2: to say that my forecast said thirteen, the market said fifteen. 70 00:04:14,196 --> 00:04:16,556 Speaker 2: Therefore my forecast was good, and you want the thirty 71 00:04:16,596 --> 00:04:19,596 Speaker 2: percent to happen like that's a very very are people 72 00:04:19,596 --> 00:04:21,636 Speaker 2: who understand markets and have had skin in the game 73 00:04:22,676 --> 00:04:25,276 Speaker 2: in markets under understand that, and people in the in 74 00:04:25,316 --> 00:04:27,676 Speaker 2: the in the village just don't, because in the village 75 00:04:27,676 --> 00:04:30,196 Speaker 2: it's all about looking good to your peers and not 76 00:04:30,236 --> 00:04:32,956 Speaker 2: trying to beat the system and not trying to outsmart people. 77 00:04:33,196 --> 00:04:35,716 Speaker 2: It's trying to fit in in some ways. 78 00:04:35,796 --> 00:04:39,156 Speaker 1: So well, his question I've been dying to ask you 79 00:04:39,516 --> 00:04:42,396 Speaker 1: after I read the book, do you think that like 80 00:04:42,436 --> 00:04:46,316 Speaker 1: the different characters you dwell on who are inhabitants of 81 00:04:46,356 --> 00:04:50,876 Speaker 1: the river, do you think how different are they from 82 00:04:50,876 --> 00:04:53,276 Speaker 1: one another? And I'll I'll put the question this way. 83 00:04:53,476 --> 00:04:57,836 Speaker 1: So if I gave you a choice between a successful 84 00:04:57,876 --> 00:05:01,076 Speaker 1: poker player and a successful sports gambler, who would you 85 00:05:01,156 --> 00:05:02,356 Speaker 1: rather have managed your money? 86 00:05:02,796 --> 00:05:03,596 Speaker 3: The poker player. 87 00:05:03,836 --> 00:05:07,996 Speaker 2: The sports betters tend to be higher on the degeneracy. 88 00:05:09,556 --> 00:05:11,356 Speaker 2: I don't know why exactly, but these are sill. 89 00:05:11,396 --> 00:05:13,516 Speaker 1: I'm talking about the successful ones, the ones who are 90 00:05:13,676 --> 00:05:16,276 Speaker 1: who you know, who have a long and successful track 91 00:05:16,316 --> 00:05:19,956 Speaker 1: record so that they are you would never do. They're 92 00:05:19,996 --> 00:05:25,156 Speaker 1: they're operating with positive expected value, uh and and so 93 00:05:25,236 --> 00:05:26,836 Speaker 1: not the degenerates. 94 00:05:27,156 --> 00:05:27,716 Speaker 3: The poker play. 95 00:05:27,756 --> 00:05:29,556 Speaker 2: I mean, the sports betters need a bit more street 96 00:05:29,596 --> 00:05:31,916 Speaker 2: smarts because there's this whole second side to sports betting 97 00:05:31,916 --> 00:05:33,836 Speaker 2: of how do you actually how do you get your 98 00:05:33,836 --> 00:05:36,716 Speaker 2: money bad or money down good? If people think that 99 00:05:36,756 --> 00:05:41,276 Speaker 2: you're a winning better so as a result, they are 100 00:05:41,356 --> 00:05:43,276 Speaker 2: kind of wise guys are sharps a little bit more. 101 00:05:43,276 --> 00:05:46,156 Speaker 2: And I associate that persona I mean, you know, Billy 102 00:05:46,196 --> 00:05:48,476 Speaker 2: Walters in his day before he sobered up, was like 103 00:05:49,276 --> 00:05:53,276 Speaker 2: a crazy partier, you know, out party, Doyle Brunson and 104 00:05:53,316 --> 00:05:56,196 Speaker 2: all these people. It's just my anecdotal experience is like, 105 00:05:56,756 --> 00:05:59,916 Speaker 2: you definitely have that type among poker players too, but like, 106 00:06:00,676 --> 00:06:02,156 Speaker 2: but there are people who can be like a little 107 00:06:02,196 --> 00:06:05,956 Speaker 2: bit more rules following and play poker. I think, yep, 108 00:06:06,076 --> 00:06:07,876 Speaker 2: you know ninety percent of them are kind of less 109 00:06:07,956 --> 00:06:09,876 Speaker 2: rule of following than the population. 110 00:06:09,476 --> 00:06:09,956 Speaker 3: As a whole. 111 00:06:09,956 --> 00:06:12,756 Speaker 2: But you can be you have some kids who will 112 00:06:12,756 --> 00:06:15,396 Speaker 2: like study computer solvers all day, just get a lot 113 00:06:15,436 --> 00:06:21,436 Speaker 2: of reps in have very good personal habits and ecount 114 00:06:21,436 --> 00:06:24,596 Speaker 2: of living playing poker. Whereas sports betters, your edge could 115 00:06:24,596 --> 00:06:26,636 Speaker 2: go away at any time, right if you were cut 116 00:06:26,676 --> 00:06:30,956 Speaker 2: off or or the market adjusts at any time, you 117 00:06:30,996 --> 00:06:34,036 Speaker 2: could go from winning to losing. And that mentality, I 118 00:06:34,036 --> 00:06:36,876 Speaker 2: think is is rarer and harder in some ways. 119 00:06:37,396 --> 00:06:40,396 Speaker 1: How do you feel about the sports gambling markets? Just generally? 120 00:06:41,636 --> 00:06:43,396 Speaker 1: You are you? Are you a sports gambler? 121 00:06:44,396 --> 00:06:45,916 Speaker 3: Not at the moment. 122 00:06:45,996 --> 00:06:48,036 Speaker 1: This is so funny to me, because how you start 123 00:06:48,076 --> 00:06:51,156 Speaker 1: is with baseball. Yeah right. I mean that if you 124 00:06:51,276 --> 00:06:54,396 Speaker 1: had had the markets that are now available available to 125 00:06:54,436 --> 00:06:59,676 Speaker 1: you in in two the year two thousand, you could 126 00:06:59,716 --> 00:07:00,316 Speaker 1: have been a killing. 127 00:07:00,476 --> 00:07:02,956 Speaker 2: I think at that point the markets were were yeah, 128 00:07:03,116 --> 00:07:06,156 Speaker 2: not very efficient, you know, Spanky kiro Loos. One of 129 00:07:06,196 --> 00:07:07,556 Speaker 2: the people I talked to is likeyeh, I used use 130 00:07:07,556 --> 00:07:10,196 Speaker 2: Pakoda and that's when we had like actual real five 131 00:07:10,276 --> 00:07:13,116 Speaker 2: or six percent edges. So I bet the NBA for 132 00:07:13,236 --> 00:07:16,636 Speaker 2: a year in the course of running the book made 133 00:07:16,676 --> 00:07:19,796 Speaker 2: a total of twenty or excuse me, two million dollars 134 00:07:19,796 --> 00:07:23,476 Speaker 2: in bets roughly to betting, basically ten thousand dollars a day, 135 00:07:23,516 --> 00:07:26,596 Speaker 2: probably five two thousand dollars bets a day every day 136 00:07:26,636 --> 00:07:29,516 Speaker 2: of the NBA season for two hundred days. And of 137 00:07:29,516 --> 00:07:32,156 Speaker 2: that two million, I made a profit of five thousand, right, 138 00:07:32,236 --> 00:07:35,156 Speaker 2: so like zero point zero three percent or whatever. ROI 139 00:07:35,436 --> 00:07:37,516 Speaker 2: if you break it down, it's like the same as 140 00:07:37,556 --> 00:07:39,476 Speaker 2: like working a job at taco bell or something. 141 00:07:39,516 --> 00:07:40,276 Speaker 3: In those hours. 142 00:07:41,116 --> 00:07:43,036 Speaker 2: Now most players lose money, so you're already in the 143 00:07:43,116 --> 00:07:46,636 Speaker 2: like ninety seven percentile or something. But like, but yeah, 144 00:07:46,796 --> 00:07:49,756 Speaker 2: but I'm aware that like to win at sports betting, 145 00:07:51,116 --> 00:07:52,476 Speaker 2: you need to really be. 146 00:07:53,156 --> 00:07:53,876 Speaker 3: Devoted to it. 147 00:07:53,916 --> 00:07:56,636 Speaker 2: And also I got like limited by by all but 148 00:07:56,756 --> 00:07:58,756 Speaker 2: three sites in New York State. I went from like 149 00:07:58,796 --> 00:08:02,116 Speaker 2: nine places I could place bets to like two and 150 00:08:02,116 --> 00:08:02,476 Speaker 2: a half. 151 00:08:03,076 --> 00:08:05,676 Speaker 1: Basically, do you remember how do you remember how that happened? 152 00:08:05,716 --> 00:08:08,196 Speaker 1: Like who was quick as to find out that you 153 00:08:08,596 --> 00:08:10,116 Speaker 1: didn't belie on their site? 154 00:08:10,276 --> 00:08:14,556 Speaker 2: It was MGM where And I was out at a 155 00:08:14,556 --> 00:08:17,996 Speaker 2: bar with a friend watching the NBA playoffs, And there's 156 00:08:17,996 --> 00:08:19,956 Speaker 2: like a message on the bottom line screing to bet 157 00:08:20,156 --> 00:08:27,156 Speaker 2: ESPN that Chris Middleton, the bucks second best player, is 158 00:08:27,196 --> 00:08:31,436 Speaker 2: out for the next round against Boston, right, and so 159 00:08:31,436 --> 00:08:33,596 Speaker 2: so they were smart enough to like take the line 160 00:08:33,636 --> 00:08:36,916 Speaker 2: off for the upcoming series, but they weren't smart enough 161 00:08:36,956 --> 00:08:38,236 Speaker 2: to think about the derivative bets. 162 00:08:38,316 --> 00:08:40,276 Speaker 3: Right now, all of a sudden, the Celtics. 163 00:08:39,996 --> 00:08:41,716 Speaker 2: Are much more likely would in the Eastern Conference finals 164 00:08:41,756 --> 00:08:44,196 Speaker 2: because they had this much easier path and their odds 165 00:08:44,196 --> 00:08:46,676 Speaker 2: hadn't change. And I and I went to place a 166 00:08:46,716 --> 00:08:49,676 Speaker 2: bet right and it was like for two thousand bucks 167 00:08:49,716 --> 00:08:53,796 Speaker 2: or something. It's like you're limited to one thousand dollars 168 00:08:53,796 --> 00:08:56,556 Speaker 2: in ninety nine cents some weird number or something like that. 169 00:08:57,836 --> 00:08:59,556 Speaker 2: And then I'm like, this must be a mistake, right, 170 00:08:59,636 --> 00:09:01,196 Speaker 2: And I try doing it again and doing it again, 171 00:09:01,236 --> 00:09:03,516 Speaker 2: and so yeah, every time it's like a little bit 172 00:09:04,116 --> 00:09:05,756 Speaker 2: it's a little bit heartbreaking because it's like they never 173 00:09:05,836 --> 00:09:07,396 Speaker 2: like reverse it, right, They never You can never like 174 00:09:07,396 --> 00:09:10,956 Speaker 2: appeal to them and say and say, oh please let 175 00:09:10,956 --> 00:09:13,596 Speaker 2: me go. But if if you're if you're not trying 176 00:09:13,596 --> 00:09:17,276 Speaker 2: to recover your tracks, then like MGM and DraftKings in 177 00:09:17,276 --> 00:09:20,356 Speaker 2: particular seem to have a pretty heavy hand. I can 178 00:09:20,356 --> 00:09:24,196 Speaker 2: still bet at Caesar, So congrats to them, Fan Duel, 179 00:09:24,276 --> 00:09:29,276 Speaker 2: I have some limitations but commit reasonable amounts. But but yeah, 180 00:09:29,316 --> 00:09:31,596 Speaker 2: I mean DraftKings explicitly is like we do not want 181 00:09:31,596 --> 00:09:35,356 Speaker 2: winning betters, right, and that's their their operating model. 182 00:09:36,876 --> 00:09:38,116 Speaker 1: Have you ever bet politics? 183 00:09:39,796 --> 00:09:43,196 Speaker 2: The short version is not really by the way, I 184 00:09:43,276 --> 00:09:45,916 Speaker 2: am a paid advisor to Polymarket, so I'm not placing 185 00:09:45,916 --> 00:09:49,716 Speaker 2: bits directly. We'll talk about the election, and they may 186 00:09:49,876 --> 00:09:53,396 Speaker 2: place bets on on partly based on the information that 187 00:09:53,436 --> 00:09:55,356 Speaker 2: I make, but I haven't. I don't have any problem 188 00:09:55,396 --> 00:09:57,796 Speaker 2: with it in principle. I mean you get into like 189 00:09:57,836 --> 00:10:00,996 Speaker 2: weird things where you know whether our numbers can move 190 00:10:01,036 --> 00:10:02,476 Speaker 2: the markets or thinks. 191 00:10:02,396 --> 00:10:04,076 Speaker 1: You can you can move that you could prop there 192 00:10:04,156 --> 00:10:06,116 Speaker 1: was certainly times when you could move the line. 193 00:10:06,596 --> 00:10:10,196 Speaker 2: Yeah I I yeah, I if y'ell slightly uncomfortable. But 194 00:10:10,396 --> 00:10:13,196 Speaker 2: then again, like I am consulting, and so I don't 195 00:10:13,196 --> 00:10:15,836 Speaker 2: think I have any problem with it. But in a 196 00:10:15,956 --> 00:10:18,116 Speaker 2: narrow sense, I have not been on politics. But also 197 00:10:18,156 --> 00:10:21,236 Speaker 2: because like this selection doesn't apply because it's like fifty 198 00:10:21,236 --> 00:10:25,516 Speaker 2: to fifties, so my reputational risks are probably get blamed 199 00:10:25,516 --> 00:10:28,156 Speaker 2: by half the country either way, but their heads at least. 200 00:10:29,996 --> 00:10:32,036 Speaker 1: Is do you have a sense of how efficient the 201 00:10:33,316 --> 00:10:37,556 Speaker 1: political prediction markets are. Like, do you think you certainly 202 00:10:37,596 --> 00:10:40,156 Speaker 1: would have had an edge ten years ago? But do 203 00:10:40,196 --> 00:10:43,556 Speaker 1: you think you would you could actually have have systematic 204 00:10:43,676 --> 00:10:44,796 Speaker 1: edge in those markets. 205 00:10:45,236 --> 00:10:46,996 Speaker 2: I do, but less than before. So I'll give you 206 00:10:47,036 --> 00:10:49,476 Speaker 2: a slightly long winded answer. I mean, you know, so 207 00:10:49,636 --> 00:10:52,516 Speaker 2: as recently as twenty twenty, there were lots of people 208 00:10:52,556 --> 00:10:55,676 Speaker 2: willing to bet on Trump at you know, eight to 209 00:10:55,716 --> 00:10:58,716 Speaker 2: one or ten to one after Trump had already lost, right, 210 00:10:59,356 --> 00:11:03,076 Speaker 2: based on extremely implausible theories about the Supreme Court with 211 00:11:03,196 --> 00:11:07,196 Speaker 2: no real basis, like overturning the results before January twentieth. 212 00:11:08,356 --> 00:11:09,076 Speaker 3: So you know. 213 00:11:09,476 --> 00:11:12,556 Speaker 2: Bill Bill Perkins, who I don't know if you know 214 00:11:12,596 --> 00:11:16,196 Speaker 2: Bill Perkins is a consummate raverian. He runs a hedge fund, 215 00:11:16,236 --> 00:11:19,836 Speaker 2: he plays huge poker games, involved in everything, wrote a 216 00:11:19,836 --> 00:11:22,996 Speaker 2: book called Die with Zero, and he consulted like a 217 00:11:22,996 --> 00:11:25,596 Speaker 2: Supreme Court expert. He's like, what's the chance that the 218 00:11:25,596 --> 00:11:27,516 Speaker 2: Supremeport would actually take up this case? I think I 219 00:11:27,596 --> 00:11:30,396 Speaker 2: was like zero, or if you want to be very cautious, 220 00:11:30,556 --> 00:11:33,236 Speaker 2: one in five hundred and one in five thousand, and 221 00:11:33,236 --> 00:11:37,076 Speaker 2: it's selling for one in ten, right, and so yeah, 222 00:11:37,196 --> 00:11:41,396 Speaker 2: and so the markets aren't that efficient for elections. In fact, 223 00:11:41,436 --> 00:11:44,396 Speaker 2: I think like for elections they're less efficient than for 224 00:11:44,596 --> 00:11:47,516 Speaker 2: almost anything else because you have a lot of dumb 225 00:11:47,516 --> 00:11:48,676 Speaker 2: money in the pool. 226 00:11:48,756 --> 00:11:49,476 Speaker 3: You have a lot of. 227 00:11:51,196 --> 00:11:55,476 Speaker 2: Rich guys and or degenerate whales that have strong convictions 228 00:11:56,036 --> 00:11:59,516 Speaker 2: about politics and are willing to get lots of money 229 00:11:59,516 --> 00:12:02,636 Speaker 2: about a field that they don't necessarily know all that well. 230 00:12:03,116 --> 00:12:05,916 Speaker 2: Bill an election model is a fairly hard problem because 231 00:12:05,916 --> 00:12:08,316 Speaker 2: of the way that all these results are correlated and 232 00:12:08,356 --> 00:12:12,556 Speaker 2: so forth to the long term capital management problems. Now, 233 00:12:12,756 --> 00:12:17,316 Speaker 2: I do think that like polymarket has much more liquidity 234 00:12:17,356 --> 00:12:19,476 Speaker 2: and the other ones too. You know, Calshee is now 235 00:12:19,556 --> 00:12:23,156 Speaker 2: legal in the US, so you're seeing much more attention 236 00:12:23,196 --> 00:12:25,476 Speaker 2: and much more interest, and you're developing maybe more of 237 00:12:25,516 --> 00:12:30,836 Speaker 2: a professional class of betters. You're also, i know firsthand, 238 00:12:32,476 --> 00:12:37,076 Speaker 2: having more interest from Wall Street in trying to calculate 239 00:12:37,676 --> 00:12:41,076 Speaker 2: political risk, because you know, everything is politics nowadays. What 240 00:12:41,196 --> 00:12:43,836 Speaker 2: happens with the politics of the US election will affect 241 00:12:43,836 --> 00:12:46,796 Speaker 2: interest rates and will affect policy towards China, will affect 242 00:12:46,796 --> 00:12:50,596 Speaker 2: lots of sectors of the economy. So you know, some 243 00:12:50,636 --> 00:12:52,916 Speaker 2: of these firms are betting directly in markets, some are 244 00:12:52,956 --> 00:12:56,836 Speaker 2: betting through proxies, whether through cryptocurrency or just trying to say, Okay, 245 00:12:56,876 --> 00:12:59,796 Speaker 2: we think that healthcare stocks would be well with Harris Winds, 246 00:12:59,876 --> 00:13:03,276 Speaker 2: so we'll create a bundle of those. So I think 247 00:13:03,316 --> 00:13:05,196 Speaker 2: the market's getting quite a bit sharper. But there's a 248 00:13:05,196 --> 00:13:10,596 Speaker 2: lot of a lot of people with strong opinions in politics. 249 00:13:11,036 --> 00:13:13,116 Speaker 1: I mean, I want to ask you a couple of 250 00:13:13,196 --> 00:13:17,076 Speaker 1: questions that are relevant to how you teach people to 251 00:13:17,156 --> 00:13:22,236 Speaker 1: think more like Riverians. I mean, some people do do 252 00:13:22,356 --> 00:13:25,316 Speaker 1: it kind of naturally. They think probabilistically. They're kind of 253 00:13:25,316 --> 00:13:28,236 Speaker 1: they move through the world probabilistically. But a lot of 254 00:13:28,276 --> 00:13:32,156 Speaker 1: people just don't, and it's a problem for them, and 255 00:13:32,196 --> 00:13:35,116 Speaker 1: it's a bigger problem the more opportunities they have to 256 00:13:35,156 --> 00:13:39,356 Speaker 1: squander their money on in probabilistic circumstances like sports betting. 257 00:13:40,196 --> 00:13:43,236 Speaker 1: So so, if you are going to design a course, 258 00:13:44,636 --> 00:13:50,756 Speaker 1: a short course to teach people to be Riverian, at 259 00:13:50,796 --> 00:13:52,596 Speaker 1: what age would you give it and what would be 260 00:13:52,636 --> 00:13:52,916 Speaker 1: in it? 261 00:13:55,236 --> 00:13:59,996 Speaker 2: I mean, I mean poker is the like er archetypal 262 00:14:00,036 --> 00:14:03,636 Speaker 2: activity of the River in particular, and like the Riverian mindset, 263 00:14:03,716 --> 00:14:05,956 Speaker 2: and so there'd be a lot of poker. Although there 264 00:14:05,956 --> 00:14:08,516 Speaker 2: are other games, Like a lot of poker players started 265 00:14:08,516 --> 00:14:10,596 Speaker 2: playing out Matt the Gathering, which is a game that 266 00:14:10,716 --> 00:14:14,516 Speaker 2: involves elements of strategy and randomness. The deck changes from 267 00:14:14,596 --> 00:14:18,556 Speaker 2: game to game a lot. Yeah, look, you have to 268 00:14:18,596 --> 00:14:20,276 Speaker 2: have I know it's a cliche and I'm sealing another 269 00:14:20,316 --> 00:14:22,916 Speaker 2: author's term, but like, you have to have skin in 270 00:14:22,956 --> 00:14:25,476 Speaker 2: the game at some point because a lot of times, 271 00:14:25,516 --> 00:14:27,716 Speaker 2: like so, one of the criticus of the village is 272 00:14:27,756 --> 00:14:33,076 Speaker 2: that they don't actually have incentives to be accurate. 273 00:14:34,116 --> 00:14:36,476 Speaker 3: So much as having incentives to please people. You know, 274 00:14:36,516 --> 00:14:37,676 Speaker 3: in academic. 275 00:14:37,196 --> 00:14:41,516 Speaker 2: Paper, it's rigorousness or its truthfulness is only kind of 276 00:14:42,036 --> 00:14:45,076 Speaker 2: loosely correlated with its chance of being published, versus like, 277 00:14:45,796 --> 00:14:47,716 Speaker 2: is it in the hot area of the literature? Does 278 00:14:47,756 --> 00:14:49,716 Speaker 2: it come to a conclusion that's seen as the right 279 00:14:49,796 --> 00:14:51,556 Speaker 2: political conclusion in certain fields? 280 00:14:52,716 --> 00:14:53,356 Speaker 3: And there are. 281 00:14:53,276 --> 00:14:57,276 Speaker 2: People in journalism who are like just really like fixating 282 00:14:57,316 --> 00:14:58,876 Speaker 2: on I want to have the right answer, I care 283 00:14:58,916 --> 00:15:01,796 Speaker 2: a lot about the truth who aren't. But like, but 284 00:15:01,876 --> 00:15:05,996 Speaker 2: in poker and sports beenning and trading, then you're punished 285 00:15:06,516 --> 00:15:09,276 Speaker 2: for your sense of bullshit and you and you you 286 00:15:09,356 --> 00:15:13,236 Speaker 2: learn that in a very fine tune way, Like what's 287 00:15:13,236 --> 00:15:15,436 Speaker 2: the long run really looked like. I mean, a big 288 00:15:15,716 --> 00:15:20,516 Speaker 2: part of this is actually estimation. Where can you come 289 00:15:20,596 --> 00:15:24,716 Speaker 2: to like a pretty good approximation quickly before the market 290 00:15:25,076 --> 00:15:26,836 Speaker 2: catches up. That's the other thing too about the rooms. 291 00:15:26,876 --> 00:15:28,996 Speaker 2: It's a fast moving place, even sports butting. I didn't realize, 292 00:15:29,036 --> 00:15:33,396 Speaker 2: like you have to make decisions fast, right Yep. You 293 00:15:33,436 --> 00:15:36,396 Speaker 2: see some line that looks wrong and you're like, well, 294 00:15:36,476 --> 00:15:39,196 Speaker 2: is that because you know fan duel was slow to update, 295 00:15:39,276 --> 00:15:40,476 Speaker 2: or is because to the new sealing? 296 00:15:40,676 --> 00:15:40,956 Speaker 3: I don't. 297 00:15:41,036 --> 00:15:43,036 Speaker 2: Is Patrick Mahomes out for this game or something all 298 00:15:43,036 --> 00:15:45,116 Speaker 2: of a sudden like and they know that and I don't. 299 00:15:45,156 --> 00:15:47,436 Speaker 2: And so you have to make the decisions very fast. 300 00:15:47,556 --> 00:15:50,756 Speaker 2: In trading, you have to make these decisions fast. And 301 00:15:52,236 --> 00:15:55,236 Speaker 2: I think that can only be learned through experience and 302 00:15:55,236 --> 00:15:57,196 Speaker 2: not a pure academic curriculum. 303 00:15:57,956 --> 00:15:59,916 Speaker 1: So it's it isn't it isn't you put them in 304 00:15:59,956 --> 00:16:02,796 Speaker 1: the classroom when they're fourteen years old and teach them statistics. 305 00:16:03,236 --> 00:16:05,996 Speaker 1: It's you force them to be a sports better or 306 00:16:06,036 --> 00:16:08,596 Speaker 1: a poker player with their own money on the line, 307 00:16:08,716 --> 00:16:11,476 Speaker 1: and they or and and and they and they start 308 00:16:11,476 --> 00:16:15,996 Speaker 1: to associate their bullshit with the price uh and and 309 00:16:15,996 --> 00:16:18,276 Speaker 1: and the market tells them when they're wrong. 310 00:16:18,596 --> 00:16:20,396 Speaker 3: Yeah. One of the one of the sports fans I 311 00:16:20,436 --> 00:16:20,676 Speaker 3: talked to. 312 00:16:20,716 --> 00:16:24,276 Speaker 2: His name Kelly Stewart, and her her parents were kind 313 00:16:24,276 --> 00:16:26,156 Speaker 2: of part of yours, I guess a little bit, and 314 00:16:26,196 --> 00:16:28,276 Speaker 2: so they let her play in their poker game one time. 315 00:16:28,276 --> 00:16:29,756 Speaker 2: They're like, we're not going easy on you at all, 316 00:16:29,836 --> 00:16:31,676 Speaker 2: you know what I mean, We're gonna We're gonna teach 317 00:16:31,716 --> 00:16:33,116 Speaker 2: you at this early age. I don't know she was 318 00:16:33,116 --> 00:16:35,996 Speaker 2: eleven or whatever, what it's like to play poker against 319 00:16:35,996 --> 00:16:38,036 Speaker 2: people who are better than you and there's real risk 320 00:16:38,076 --> 00:16:40,556 Speaker 2: involved here. I mean, do you play poker, Michael, Do 321 00:16:40,636 --> 00:16:42,356 Speaker 2: you do any of this gambling stuff? 322 00:16:42,756 --> 00:16:45,556 Speaker 1: So I in high school, I had a poker game 323 00:16:45,836 --> 00:16:48,956 Speaker 1: and it was almost weekly. Uh. It was with the 324 00:16:49,676 --> 00:16:52,716 Speaker 1: same guys, kind of six or seven guys, each of 325 00:16:52,756 --> 00:16:56,596 Speaker 1: whom had a very particular personality, one of whom ended 326 00:16:56,676 --> 00:17:01,876 Speaker 1: up being an iron Randian and a gazillionaire hedge hedge 327 00:17:01,876 --> 00:17:06,156 Speaker 1: fund manager who was actually short uh subprime mortgages going 328 00:17:06,196 --> 00:17:10,396 Speaker 1: into the into the financial crisis. Who So I got 329 00:17:10,396 --> 00:17:17,276 Speaker 1: to watch different personalities express their risk preferences and thought 330 00:17:17,276 --> 00:17:20,356 Speaker 1: processes at a poker table, and I was interested, maybe 331 00:17:20,396 --> 00:17:23,636 Speaker 1: more interested in watching how the other people behaved as 332 00:17:23,676 --> 00:17:26,356 Speaker 1: I was in my own poker hand. But I really 333 00:17:26,436 --> 00:17:28,956 Speaker 1: like playing it, and I tended to win. I adjust 334 00:17:29,476 --> 00:17:32,036 Speaker 1: like the iin Randian won all the time, or won 335 00:17:32,116 --> 00:17:33,876 Speaker 1: most of the time, And there was someone on the 336 00:17:33,916 --> 00:17:36,516 Speaker 1: other end of the spectrum who just was full of 337 00:17:36,676 --> 00:17:41,676 Speaker 1: all the cognitive vices that Connoman Diversky cataloged, plus overconfidence, 338 00:17:41,676 --> 00:17:43,516 Speaker 1: plus a lot of other stuff, and he would lose 339 00:17:43,516 --> 00:17:48,796 Speaker 1: all the time. So I played enough to see to 340 00:17:49,076 --> 00:17:51,716 Speaker 1: kind of So yes, I have, but I haven't played 341 00:17:51,756 --> 00:17:54,436 Speaker 1: as a grown up. No, I haven't played, and I'm 342 00:17:54,436 --> 00:17:58,396 Speaker 1: not that attracted to gambling. It just doesn't do it 343 00:17:58,436 --> 00:18:00,796 Speaker 1: for me. I don't know why, and I can't. I can't. 344 00:18:00,796 --> 00:18:04,596 Speaker 1: It just doesn't. Whatever whatever trigger it triggers in your brain, 345 00:18:05,116 --> 00:18:07,916 Speaker 1: it doesn't in mind, whatever pleasure you're getting from it, 346 00:18:07,916 --> 00:18:11,276 Speaker 1: it doesn't. I don't really get the same pleasure. Partly, 347 00:18:11,356 --> 00:18:14,036 Speaker 1: I think part of it is when I won in poker, 348 00:18:14,556 --> 00:18:17,156 Speaker 1: I always felt a little badly for the person whose 349 00:18:17,196 --> 00:18:20,756 Speaker 1: money I took, so I didn't. I didn't. I didn't 350 00:18:21,036 --> 00:18:24,076 Speaker 1: get the full pleasure of victory. When I was walking 351 00:18:24,116 --> 00:18:26,236 Speaker 1: out of the house with so everybody else's money. I 352 00:18:26,276 --> 00:18:28,076 Speaker 1: always felt like I had to give some of it back. 353 00:18:29,636 --> 00:18:30,236 Speaker 3: Are you? 354 00:18:30,356 --> 00:18:32,956 Speaker 2: I mean, I think there are slightly separate things here. 355 00:18:33,156 --> 00:18:38,996 Speaker 2: It's I mean, are you like a thrill seeker in general? 356 00:18:39,156 --> 00:18:40,476 Speaker 2: Like there's the idea of like. 357 00:18:41,996 --> 00:18:42,916 Speaker 3: Sky like the idea. 358 00:18:42,996 --> 00:18:45,076 Speaker 2: I don't think i'd skydive because I would calculate that 359 00:18:45,156 --> 00:18:47,716 Speaker 2: like the risks outweigh the reward rightly. 360 00:18:48,156 --> 00:18:50,316 Speaker 1: So I did that. I did that once. Uh, I 361 00:18:50,396 --> 00:18:52,636 Speaker 1: jumped out of an airplane just because I thought I had. 362 00:18:52,676 --> 00:18:54,916 Speaker 1: I went through a phase of life in college and 363 00:18:55,036 --> 00:18:56,796 Speaker 1: just after where I thought I'm going to have every 364 00:18:56,876 --> 00:18:59,596 Speaker 1: possible experience. Well, I thought I might write about it 365 00:18:59,636 --> 00:19:01,196 Speaker 1: one day, and I thought, I just want to be 366 00:19:01,236 --> 00:19:03,036 Speaker 1: able to. I want to have all these experiences that 367 00:19:03,076 --> 00:19:05,036 Speaker 1: I know I won't have later, So i'd, you know, 368 00:19:05,236 --> 00:19:07,436 Speaker 1: scuba diving and skydiving. And it's just like I had 369 00:19:07,476 --> 00:19:10,116 Speaker 1: a long list of shit like that idea. I didn't. 370 00:19:10,196 --> 00:19:11,676 Speaker 1: Jumping out of a plane was one of the most 371 00:19:11,756 --> 00:19:14,676 Speaker 1: terrifying things I've ever done. It's the first I suppose 372 00:19:14,716 --> 00:19:17,156 Speaker 1: it gets comfortable. It's not a natural thing to do. 373 00:19:18,036 --> 00:19:22,796 Speaker 1: It's really an unnatural act. But so am I a 374 00:19:22,796 --> 00:19:29,396 Speaker 1: thrill seeker? A bit that I it's but it's more 375 00:19:29,436 --> 00:19:32,516 Speaker 1: social thrill seeking. Now I like it. I like getting 376 00:19:32,556 --> 00:19:33,316 Speaker 1: up on stage. 377 00:19:33,556 --> 00:19:36,436 Speaker 2: Okay, that seems correlated in some way. I mean, so 378 00:19:37,076 --> 00:19:38,996 Speaker 2: if you look at the Big five personality trades, the 379 00:19:38,996 --> 00:19:40,436 Speaker 2: two things that are kind of and there's no like 380 00:19:40,516 --> 00:19:44,236 Speaker 2: risk taking personality trait per se, but high openness to 381 00:19:44,396 --> 00:19:48,556 Speaker 2: experience and and low neuroticism. 382 00:19:48,796 --> 00:19:52,516 Speaker 1: So I got that. I think those two I basically have. 383 00:19:52,796 --> 00:19:56,036 Speaker 1: I mean, here's a form of thrill seeking. I loved 384 00:19:56,236 --> 00:19:58,396 Speaker 1: publishing a book about Sam Bankman Freed that I knew 385 00:19:58,516 --> 00:19:59,356 Speaker 1: was going to create a war. 386 00:19:59,876 --> 00:20:02,756 Speaker 3: Okay, okay, So I. 387 00:20:04,236 --> 00:20:06,956 Speaker 1: Love sort of like this feeling of this confederacy of 388 00:20:07,036 --> 00:20:11,636 Speaker 1: Dunce's feeling where I love. It's harder to do it 389 00:20:11,676 --> 00:20:14,316 Speaker 1: now in journalism because you get yourself in way too 390 00:20:14,396 --> 00:20:16,716 Speaker 1: it just way too much trouble. But I love I 391 00:20:16,796 --> 00:20:19,516 Speaker 1: used to love in the New Republic taking a hugely 392 00:20:19,636 --> 00:20:22,556 Speaker 1: unpopular line and pushing it as far as you could, 393 00:20:22,756 --> 00:20:25,156 Speaker 1: knowing it's unpopular, but because you thought it was right. 394 00:20:25,556 --> 00:20:28,876 Speaker 1: But like like that kind of I gotta I get it. 395 00:20:29,076 --> 00:20:32,396 Speaker 1: I get a charge out of that feeling, not not gratuitously. 396 00:20:32,436 --> 00:20:34,676 Speaker 1: It's not just do it to show you can do it. 397 00:20:34,756 --> 00:20:38,396 Speaker 1: But when I find some material that said I think 398 00:20:38,516 --> 00:20:41,476 Speaker 1: means one thing, and I know the world thinks it 399 00:20:41,556 --> 00:20:45,876 Speaker 1: means another thing. I love pushing, pushing up against the world. 400 00:20:46,036 --> 00:20:51,476 Speaker 2: That's very Riverian, that contrarian, not quite confrontational streak, but 401 00:20:51,556 --> 00:20:56,316 Speaker 2: in difference toward in difference word mild amusement with creating 402 00:20:56,316 --> 00:20:58,116 Speaker 2: a stir is very Riverian. 403 00:21:00,996 --> 00:21:17,556 Speaker 1: We'll be right back after a quick break. I'm back 404 00:21:17,636 --> 00:21:21,396 Speaker 1: with Risky Business co host Nate Silver. So this is 405 00:21:21,436 --> 00:21:24,076 Speaker 1: a strange question. But if you were to send me 406 00:21:24,156 --> 00:21:27,716 Speaker 1: off to get myself into the worst expected value, the 407 00:21:27,716 --> 00:21:33,876 Speaker 1: most negative expected value situation available in gambling markets, where 408 00:21:33,876 --> 00:21:34,516 Speaker 1: would you send it? 409 00:21:34,596 --> 00:21:37,156 Speaker 2: I mean, the state lottery is the lowest player payout 410 00:21:37,156 --> 00:21:40,236 Speaker 2: percentage in West Virginia. It's something like the government keeps 411 00:21:40,276 --> 00:21:43,076 Speaker 2: eighty percent of the money. And of course, like a 412 00:21:43,156 --> 00:21:45,236 Speaker 2: very it's a very poor play the lottery. 413 00:21:45,236 --> 00:21:47,756 Speaker 1: It would be for lottery, what comes then? What comes 414 00:21:47,756 --> 00:21:51,556 Speaker 1: after that? Horse racing is generally horse racing is horse 415 00:21:51,636 --> 00:21:56,316 Speaker 1: racing worse than betting parlays and with DraftKings. So the 416 00:21:56,356 --> 00:21:58,756 Speaker 1: parlays aren't I mean, the parlors are weird because like 417 00:21:58,796 --> 00:22:02,316 Speaker 1: the way they do the accounting gets slightly strange. But yeah, 418 00:22:02,356 --> 00:22:04,996 Speaker 1: horse racing they take like was it like fifteen or 419 00:22:04,996 --> 00:22:08,396 Speaker 1: twenty percent depending on the state. And then and by 420 00:22:08,436 --> 00:22:10,356 Speaker 1: the way, we're going in inverse order of like the 421 00:22:10,396 --> 00:22:12,996 Speaker 1: average net income of the people who do these types 422 00:22:12,996 --> 00:22:15,116 Speaker 1: of gambling. Right, So then you get to slot machines, 423 00:22:15,156 --> 00:22:19,316 Speaker 1: which is ten or eleven percent. You know, roulette is 424 00:22:19,356 --> 00:22:25,276 Speaker 1: five percent, Baccarat craps, blackjack is one ish percent depending 425 00:22:25,316 --> 00:22:29,036 Speaker 1: on the rules. Video poker is if you're playing right, 426 00:22:29,716 --> 00:22:31,796 Speaker 1: is very low, like zero point five percent. But video 427 00:22:31,836 --> 00:22:35,396 Speaker 1: poker strategy is not always very intuitive, right, and then 428 00:22:35,436 --> 00:22:38,116 Speaker 1: sports betting and poker poker where you can actually make money. 429 00:22:38,476 --> 00:22:40,396 Speaker 3: Uh, if you're a skilled better. 430 00:22:41,436 --> 00:22:43,916 Speaker 1: Right, if you're if you're an unskilled better, I mean 431 00:22:43,956 --> 00:22:47,636 Speaker 1: the shorthand version of it. If you're skilled better, you're 432 00:22:47,676 --> 00:22:49,876 Speaker 1: not allowed to bet at DraftKings. Yeah. 433 00:22:50,276 --> 00:22:52,676 Speaker 2: One of the things the sports betting houses I talk 434 00:22:52,716 --> 00:22:55,756 Speaker 2: to you would tell you is that, like, actually most betters. 435 00:22:55,436 --> 00:22:56,636 Speaker 3: Are worse than average. 436 00:22:56,756 --> 00:23:00,316 Speaker 2: Right, If you just threw darts and a dartboard at 437 00:23:00,396 --> 00:23:03,636 Speaker 2: NFL pointsprints are something you'd lose four and a half percent, 438 00:23:04,276 --> 00:23:08,836 Speaker 2: but most players lose like five percent instead, right, show 439 00:23:08,876 --> 00:23:13,476 Speaker 2: he so tanies, degenerate gambling interpreter friend like have these 440 00:23:13,996 --> 00:23:19,396 Speaker 2: horribly large losses partly because, uh, partly because he had 441 00:23:19,396 --> 00:23:21,836 Speaker 2: these parlays and the way they're accounted for, but also 442 00:23:21,876 --> 00:23:22,836 Speaker 2: because like, what. 443 00:23:23,676 --> 00:23:26,316 Speaker 1: So, why do you think it's interesting about sports betting? 444 00:23:26,516 --> 00:23:29,956 Speaker 1: You're making a point that's that to me is interesting 445 00:23:30,036 --> 00:23:33,236 Speaker 1: is that here you've got this activity where you could 446 00:23:33,316 --> 00:23:38,396 Speaker 1: have an edge, like blackjack, but unlike blackjack, you have 447 00:23:38,476 --> 00:23:42,516 Speaker 1: people who are especially it tends to attract a lot 448 00:23:42,556 --> 00:23:47,836 Speaker 1: of especially dumb bets. So what is it about sports 449 00:23:48,036 --> 00:23:48,716 Speaker 1: that does this? 450 00:23:49,796 --> 00:23:52,076 Speaker 2: I think it's partly because sports betting like a lot 451 00:23:52,076 --> 00:23:54,276 Speaker 2: of fields in the river, but like, it's partly about 452 00:23:54,356 --> 00:23:58,636 Speaker 2: men and men's egos, especially men's egos around sports and 453 00:23:58,676 --> 00:24:02,196 Speaker 2: the advantalin and the and the buddy stuff that causes 454 00:24:02,236 --> 00:24:04,756 Speaker 2: a little bit. So one problem with like draft kings, 455 00:24:04,916 --> 00:24:08,436 Speaker 2: like not allowing sharp players. As part of the allure 456 00:24:08,436 --> 00:24:11,796 Speaker 2: of sports betting should be that hey, look, hey, buddy, 457 00:24:12,156 --> 00:24:15,476 Speaker 2: you're pretty smart about sports. Why don't you try to 458 00:24:15,476 --> 00:24:16,596 Speaker 2: outsmart the system? 459 00:24:16,756 --> 00:24:16,956 Speaker 1: Right? 460 00:24:16,996 --> 00:24:19,676 Speaker 2: And now they're very careful about not quite implying that. 461 00:24:19,716 --> 00:24:22,716 Speaker 2: They say, well, we all have hunches. Sometimes it's fun 462 00:24:22,796 --> 00:24:25,276 Speaker 2: to better hunches. I heard ad recently on some podcasts 463 00:24:25,276 --> 00:24:27,316 Speaker 2: I was listening to, But it's not the same as 464 00:24:27,356 --> 00:24:29,716 Speaker 2: like the Daily Fantasy Days where they're like, hey, man, 465 00:24:29,716 --> 00:24:30,796 Speaker 2: you're sitting in your office. 466 00:24:30,596 --> 00:24:32,996 Speaker 3: Cubicle, but you really know sports really well, so. 467 00:24:32,956 --> 00:24:34,956 Speaker 2: Why don't you boot up some draft kings lineups and 468 00:24:34,956 --> 00:24:36,596 Speaker 2: then you'll be hanging out with like bikini models or 469 00:24:36,636 --> 00:24:38,556 Speaker 2: like literally what the ads were saying. 470 00:24:38,636 --> 00:24:39,676 Speaker 3: It wasn't even the subtext. 471 00:24:39,676 --> 00:24:43,676 Speaker 2: It was like text, and now they've lost that because 472 00:24:43,676 --> 00:24:46,796 Speaker 2: they're afraid of like, for every person who can beat 473 00:24:47,436 --> 00:24:51,036 Speaker 2: the system, there have to be ten egotistical guys who 474 00:24:51,036 --> 00:24:53,196 Speaker 2: think they can beat it and can't. 475 00:24:53,676 --> 00:24:56,756 Speaker 1: Right, and when they sift the population and have the 476 00:24:56,796 --> 00:25:01,316 Speaker 1: ability to sift the population so that and are able 477 00:25:01,356 --> 00:25:04,116 Speaker 1: to kick out anybody who can beat the system and 478 00:25:04,356 --> 00:25:07,276 Speaker 1: just keep in the system the people who were the 479 00:25:07,316 --> 00:25:10,916 Speaker 1: ten guys. What I think is bound to happen is 480 00:25:10,916 --> 00:25:13,476 Speaker 1: this activity is going to be stigmatized as stupid. If 481 00:25:13,476 --> 00:25:18,876 Speaker 1: you're there, you're dumb. And I was thinking, like, on 482 00:25:18,996 --> 00:25:22,836 Speaker 1: a list of questions that I would ask anybody who 483 00:25:22,956 --> 00:25:27,036 Speaker 1: was holding himself out as a financial advisor, like wanted 484 00:25:27,036 --> 00:25:29,796 Speaker 1: to manage my money, one would be do you have 485 00:25:29,796 --> 00:25:33,596 Speaker 1: an account of DraftKings and do they let you bet 486 00:25:33,636 --> 00:25:36,836 Speaker 1: as much as you want? Are you a VIP? And 487 00:25:36,836 --> 00:25:39,116 Speaker 1: that if you are, you have no business doing this. 488 00:25:39,196 --> 00:25:41,516 Speaker 2: Well, it's like what so like credit rating agencies will 489 00:25:42,196 --> 00:25:46,356 Speaker 2: look for people who whose phone batteries go out a lot, 490 00:25:46,396 --> 00:25:49,436 Speaker 2: because this is seen as a sign of poor planning, right, 491 00:25:49,796 --> 00:25:51,876 Speaker 2: that you're not a long term planner if you routinely 492 00:25:51,996 --> 00:25:55,236 Speaker 2: more than once or twice a month, right, can't make 493 00:25:55,276 --> 00:25:55,996 Speaker 2: it through the day. 494 00:25:55,956 --> 00:25:58,356 Speaker 3: With your cell phone on the whole day? Yeah? 495 00:25:58,356 --> 00:26:01,596 Speaker 2: Absolutely, I mean, yep, people need to understand. And this 496 00:26:01,636 --> 00:26:04,756 Speaker 2: is where like having spent time in on Wall Street, 497 00:26:04,796 --> 00:26:07,756 Speaker 2: you probably understand adverse selection a little bit more. If 498 00:26:07,796 --> 00:26:10,556 Speaker 2: if Sound's offering you a tree, why are they offering 499 00:26:10,556 --> 00:26:14,556 Speaker 2: you this trade? And if you know that if they 500 00:26:14,596 --> 00:26:18,356 Speaker 2: think you're sharp, you won't get this trade, then then 501 00:26:18,396 --> 00:26:21,836 Speaker 2: that should be a big red flag. However, you you do, 502 00:26:21,916 --> 00:26:25,596 Speaker 2: I guess kind of get this reverse adverse selection problem 503 00:26:25,676 --> 00:26:30,196 Speaker 2: where you know, why is someone betting with you if 504 00:26:30,236 --> 00:26:32,076 Speaker 2: they know that you know they think you're dumb. And 505 00:26:32,116 --> 00:26:35,596 Speaker 2: so what happens is that you have proxies or beards 506 00:26:35,636 --> 00:26:42,076 Speaker 2: they're called, where you befriend the degenerate gambler in your 507 00:26:42,076 --> 00:26:44,676 Speaker 2: pokeber game with very high limits on DraftKings. You say, 508 00:26:44,716 --> 00:26:48,316 Speaker 2: I'm gonna give you sharp picks, no strings attached, right, 509 00:26:49,396 --> 00:26:52,756 Speaker 2: and you give me half your action. Like it's very 510 00:26:52,836 --> 00:26:54,756 Speaker 2: hard to prevent that. It's against their terms of service, 511 00:26:54,836 --> 00:27:00,556 Speaker 2: of course, but like it's probably not illegal, although the 512 00:27:00,676 --> 00:27:04,556 Speaker 2: courts are unsympathetic toward gamblers and gambling related stuff. 513 00:27:04,596 --> 00:27:07,556 Speaker 3: But like, but it's it's not a it's not a 514 00:27:07,636 --> 00:27:09,876 Speaker 3: very robust industry. 515 00:27:10,916 --> 00:27:14,396 Speaker 2: They have good product and good marketing and good customer acquisition, 516 00:27:14,436 --> 00:27:18,996 Speaker 2: and they do certain fundamental things pretty right. But the 517 00:27:19,036 --> 00:27:21,836 Speaker 2: old school approach to book making is that, look, we 518 00:27:21,916 --> 00:27:25,396 Speaker 2: let a few sharp people bet because most people aren't sharp, 519 00:27:25,516 --> 00:27:28,636 Speaker 2: and the sharp betters help us set better lines and 520 00:27:28,636 --> 00:27:31,756 Speaker 2: and create a sense of like fairness and kind of 521 00:27:31,796 --> 00:27:34,596 Speaker 2: old school Veggas camaraderie is well, I don't know, there's 522 00:27:34,596 --> 00:27:37,076 Speaker 2: are a lot of cheating back in old school Vegas, so 523 00:27:37,076 --> 00:27:39,716 Speaker 2: I think one should be careful about calling it the 524 00:27:39,716 --> 00:27:40,676 Speaker 2: good old days too much. 525 00:27:40,756 --> 00:27:42,636 Speaker 3: But but it is, but but it is. 526 00:27:43,196 --> 00:27:45,716 Speaker 1: It is about letting information into a market and using 527 00:27:45,716 --> 00:27:48,316 Speaker 1: the information rather than just trying to keep the information out. 528 00:27:48,556 --> 00:27:50,396 Speaker 2: Yeah, and they take their four and a half percent 529 00:27:51,316 --> 00:27:53,476 Speaker 2: tax and get like a lot of dumb betters and 530 00:27:53,476 --> 00:27:55,876 Speaker 2: and you know, I don't know, maybe they should have 531 00:27:55,916 --> 00:27:59,316 Speaker 2: a higher vague and but say we'll take everybody's bet 532 00:27:59,356 --> 00:28:00,916 Speaker 2: and have a higher vegue and said what happens is 533 00:28:00,956 --> 00:28:04,636 Speaker 2: like you know, some of these sites like Circa actually 534 00:28:05,196 --> 00:28:07,596 Speaker 2: let everyone bet and have better odds instead, and there 535 00:28:07,636 --> 00:28:09,756 Speaker 2: and there have been these sites said it are very 536 00:28:10,596 --> 00:28:15,556 Speaker 2: committed to a a fair experience for the gambler where 537 00:28:15,556 --> 00:28:18,636 Speaker 2: they set like rational limits for every player. The limits 538 00:28:18,676 --> 00:28:21,196 Speaker 2: are the same for every player. But they're smart about things, right. 539 00:28:21,236 --> 00:28:23,396 Speaker 2: They don't let you bet on some of the derivative 540 00:28:23,436 --> 00:28:27,076 Speaker 2: bets that like are easy to beat. They don't offer 541 00:28:27,156 --> 00:28:29,716 Speaker 2: the in game betting in the middle of the game 542 00:28:29,756 --> 00:28:31,556 Speaker 2: where if you're I mean, you know, there's issues like 543 00:28:31,596 --> 00:28:35,156 Speaker 2: if you are at a tennis tournament and you're watching 544 00:28:35,236 --> 00:28:37,076 Speaker 2: us up a match, then sometimes you can make bets 545 00:28:37,076 --> 00:28:39,996 Speaker 2: called court siding before before the lines change. They've gotten 546 00:28:40,036 --> 00:28:42,276 Speaker 2: pretty fast. But like, but there's all types of edges 547 00:28:42,316 --> 00:28:45,516 Speaker 2: like that that people can have that that say you 548 00:28:45,516 --> 00:28:47,436 Speaker 2: have to beat us fair and square. We're gonna set 549 00:28:47,516 --> 00:28:50,596 Speaker 2: good informed lines, a limited selection of good lines, but 550 00:28:50,596 --> 00:28:52,996 Speaker 2: We're not gonna limit anybody from betting, and people have 551 00:28:53,036 --> 00:28:54,356 Speaker 2: moved away from that, from that model. 552 00:28:54,436 --> 00:29:14,796 Speaker 1: Unfortunately, hold that thought. We'll be right back. Nate Silver 553 00:29:14,836 --> 00:29:18,196 Speaker 1: and I are back to discuss all things risky. I 554 00:29:18,196 --> 00:29:19,996 Speaker 1: have a couple of other questions for you. One is, 555 00:29:20,556 --> 00:29:23,196 Speaker 1: I'm going to Vegas this weekend give a talk. If 556 00:29:23,236 --> 00:29:25,636 Speaker 1: I wanted to see Nate Silver's Vegas? Where would I go? 557 00:29:27,276 --> 00:29:29,276 Speaker 1: Where your What are the places that make your socks 558 00:29:29,316 --> 00:29:29,916 Speaker 1: go up and down? 559 00:29:29,956 --> 00:29:33,116 Speaker 2: I mean, the wind uh and the Aria are probably 560 00:29:33,156 --> 00:29:35,356 Speaker 2: my favorite properties in Las Vegas. 561 00:29:35,436 --> 00:29:37,196 Speaker 1: And you walk it, you walk it, you walk in, 562 00:29:37,236 --> 00:29:40,156 Speaker 1: and you go right to the poker tables in Vegas. 563 00:29:40,236 --> 00:29:45,156 Speaker 2: I basically, uh, play poker and eat nice food. Yeah, 564 00:29:45,196 --> 00:29:46,876 Speaker 2: and that's really what I do, right. I mean, maybe 565 00:29:46,876 --> 00:29:49,076 Speaker 2: I'll maybe I'll hit hopefully you hit the gym in 566 00:29:49,116 --> 00:29:50,676 Speaker 2: the morning some of the time. Maybe you hit the 567 00:29:50,716 --> 00:29:55,516 Speaker 2: pool once. You know, once a year, I'll get dragged 568 00:29:55,516 --> 00:29:57,796 Speaker 2: out to the club. It's about the It's about the 569 00:29:57,796 --> 00:29:59,276 Speaker 2: tolerance I have for that experience. 570 00:29:59,316 --> 00:30:01,076 Speaker 3: Once a year, it's fine. More than that, it gets old. 571 00:30:01,196 --> 00:30:02,916 Speaker 2: On top of that, I will almost ever be able 572 00:30:02,956 --> 00:30:05,876 Speaker 2: to completely put away my real life work. Right, So 573 00:30:05,956 --> 00:30:08,836 Speaker 2: I'll like get up at eight, take a call with 574 00:30:08,876 --> 00:30:11,636 Speaker 2: some consulting client, write a new layer post at ten, 575 00:30:11,916 --> 00:30:13,556 Speaker 2: and then play poker for twelve hours. And they're like 576 00:30:13,676 --> 00:30:16,396 Speaker 2: very and they're very long days. You come home just exhausted. 577 00:30:16,436 --> 00:30:17,116 Speaker 3: Some of the time. 578 00:30:17,516 --> 00:30:20,036 Speaker 1: When you go into these tournaments. Are you nervous? 579 00:30:23,356 --> 00:30:26,156 Speaker 3: It comes and goes. I mean one of the things 580 00:30:26,236 --> 00:30:28,076 Speaker 3: where it's interesting. 581 00:30:28,076 --> 00:30:30,356 Speaker 2: It's also true with like doing like live public appearances 582 00:30:30,396 --> 00:30:31,636 Speaker 2: where you're in front of a bunch of people, like 583 00:30:31,676 --> 00:30:34,596 Speaker 2: you were talking about earlier, you know, trying to figure 584 00:30:34,636 --> 00:30:38,436 Speaker 2: out kind of where those butterflies come from and why 585 00:30:38,516 --> 00:30:41,036 Speaker 2: sometimes you have them and why sometimes you don't. I'm 586 00:30:41,036 --> 00:30:43,956 Speaker 2: trying to, you know, you gratually learn a few things, 587 00:30:43,996 --> 00:30:47,476 Speaker 2: like doing things on an empty stomach is probably a 588 00:30:47,516 --> 00:30:49,396 Speaker 2: bad idea because your heart rate is going up and 589 00:30:49,436 --> 00:30:54,796 Speaker 2: if you're having a little blood sugar and so forth. Basically, No, 590 00:30:54,876 --> 00:30:57,676 Speaker 2: I actually kind of almost had opposite problem where you're 591 00:30:57,716 --> 00:30:59,476 Speaker 2: really excited, like I haven't played a poker tournament in 592 00:30:59,476 --> 00:31:01,836 Speaker 2: three months, and I flew to the wind and I 593 00:31:01,916 --> 00:31:04,156 Speaker 2: checked in and finally I'm played my first tournament of 594 00:31:04,196 --> 00:31:05,836 Speaker 2: this series, and I have this whole week to play poker. 595 00:31:06,196 --> 00:31:07,676 Speaker 3: And then you play and there's no. 596 00:31:07,676 --> 00:31:11,676 Speaker 2: Interesting hands for for three hours, and it becomes like 597 00:31:12,516 --> 00:31:14,636 Speaker 2: a little bit of a letdown because the big moments 598 00:31:14,636 --> 00:31:18,556 Speaker 2: in poker come unexpectedly. They come toward the end of tournaments, 599 00:31:18,676 --> 00:31:21,516 Speaker 2: not toward the beginning, and so it can be kind 600 00:31:21,516 --> 00:31:24,396 Speaker 2: of kind of quite a grind. Now a big high 601 00:31:24,436 --> 00:31:27,876 Speaker 2: sticks cash game, then immediately you're feeling the adrenaline. But 602 00:31:27,916 --> 00:31:31,716 Speaker 2: I try to like enjoy that feeling. 603 00:31:31,876 --> 00:31:35,156 Speaker 1: What's the most you've ever won and lost in. 604 00:31:36,436 --> 00:31:37,516 Speaker 3: A cash game? 605 00:31:37,676 --> 00:31:41,156 Speaker 2: The most I've won is probably seventy seventy five K, 606 00:31:41,316 --> 00:31:43,876 Speaker 2: and the most I've lost is probably forty five K 607 00:31:44,156 --> 00:31:47,716 Speaker 2: or something. In a turn of the top cars I've 608 00:31:47,716 --> 00:31:50,596 Speaker 2: had is like one fifty or one seventy or something. Okay, 609 00:31:50,916 --> 00:31:55,596 Speaker 2: So yeah, I yeah, yeah, that feels fun, man, the 610 00:31:55,636 --> 00:31:59,196 Speaker 2: feeling where you have a big winning cash session, because 611 00:31:59,236 --> 00:32:01,236 Speaker 2: I like, I'm started to like cash poker better than 612 00:32:01,276 --> 00:32:04,116 Speaker 2: tournaments where you have, like where you have a fixed 613 00:32:04,116 --> 00:32:05,916 Speaker 2: player pool, because that's what you were talking about before 614 00:32:05,956 --> 00:32:08,076 Speaker 2: in your game in high school or college. For what 615 00:32:08,116 --> 00:32:12,436 Speaker 2: it was to play against the same people repeatedly is 616 00:32:12,476 --> 00:32:16,156 Speaker 2: what I think pokers is really about more than the 617 00:32:16,196 --> 00:32:19,036 Speaker 2: computer solvers, more than the game theory. It's about like 618 00:32:19,676 --> 00:32:23,076 Speaker 2: the cat and mouse games of who's gonna win up 619 00:32:23,476 --> 00:32:25,516 Speaker 2: one another today? Like that I find to be like 620 00:32:26,116 --> 00:32:28,476 Speaker 2: really fun to have this same playerpool people who come 621 00:32:28,476 --> 00:32:31,676 Speaker 2: friends with and people that might be might be very rational, 622 00:32:31,676 --> 00:32:33,556 Speaker 2: and some walks their life and are just like artly 623 00:32:33,636 --> 00:32:35,676 Speaker 2: terrible poker players or vice versa. 624 00:32:35,756 --> 00:32:37,756 Speaker 3: Sometimes is enjoyable. 625 00:32:37,796 --> 00:32:40,396 Speaker 1: It's a it's a it's a really useful window into 626 00:32:40,516 --> 00:32:44,916 Speaker 1: character watching someone gamble. Uh that that that was the 627 00:32:44,916 --> 00:32:47,036 Speaker 1: fun to me was seeing that you could It was 628 00:32:47,076 --> 00:32:50,476 Speaker 1: just like they become characters in a novel when they're 629 00:32:50,476 --> 00:32:55,036 Speaker 1: sitting around a poker table. There's something very distinctive about 630 00:32:55,036 --> 00:32:57,156 Speaker 1: the way people it's like a fingerprint or the way 631 00:32:57,196 --> 00:32:58,116 Speaker 1: they approach risk. 632 00:32:58,316 --> 00:33:00,556 Speaker 2: Yeah, I know you're still in the process of writing this, 633 00:33:00,636 --> 00:33:02,756 Speaker 2: but how has your approach to what's changed? And making 634 00:33:02,756 --> 00:33:05,756 Speaker 2: the new season and learning more about about the sports 635 00:33:05,796 --> 00:33:06,316 Speaker 2: betting world. 636 00:33:07,036 --> 00:33:09,916 Speaker 1: So I'm not sure my own approach to risk is 637 00:33:10,076 --> 00:33:15,116 Speaker 1: changing it all. However, one of the shocking things to 638 00:33:15,196 --> 00:33:17,996 Speaker 1: me as I dive into the world sports betting is 639 00:33:18,876 --> 00:33:21,596 Speaker 1: how these companies have sprung up and become multi billion 640 00:33:21,636 --> 00:33:24,676 Speaker 1: dollar companies on the back of just dumb sports betting, 641 00:33:25,116 --> 00:33:27,836 Speaker 1: Like like, we have a machine in place that's out 642 00:33:27,876 --> 00:33:30,476 Speaker 1: there to maximize the number of stupid sports bets that 643 00:33:30,476 --> 00:33:34,356 Speaker 1: people that Americans will make, and Americans are just shockingly 644 00:33:34,396 --> 00:33:38,116 Speaker 1: good at making dumb sports bets. And so it's made 645 00:33:38,156 --> 00:33:42,436 Speaker 1: me and especially young male Americans, And what the light 646 00:33:42,436 --> 00:33:44,196 Speaker 1: bulb that went off in my head is I need 647 00:33:44,236 --> 00:33:48,436 Speaker 1: to educate my seventeen year old son that he's walking 648 00:33:48,476 --> 00:33:51,796 Speaker 1: into a world. It's not just sports betting, but he's 649 00:33:51,836 --> 00:33:54,156 Speaker 1: not walking into a world that's going to ask him 650 00:33:54,436 --> 00:33:59,316 Speaker 1: to make lots of calculations or whether he's aware of 651 00:33:59,316 --> 00:34:01,796 Speaker 1: it or not, it's taking advantage of his ability to 652 00:34:01,796 --> 00:34:04,396 Speaker 1: make certain calculations and if he can't make them, he's 653 00:34:04,396 --> 00:34:08,556 Speaker 1: in trouble. And so he got me thinking like, like 654 00:34:09,276 --> 00:34:12,156 Speaker 1: not so much about my own risk profile, but about 655 00:34:12,516 --> 00:34:17,556 Speaker 1: about about sort of like the population's risk taking behavior, 656 00:34:17,796 --> 00:34:20,076 Speaker 1: which which is just you know, I didn't expect the 657 00:34:20,116 --> 00:34:22,396 Speaker 1: average American to be a really smart sports gambler. I 658 00:34:22,436 --> 00:34:23,796 Speaker 1: was just surprised by how bad they. 659 00:34:23,796 --> 00:34:25,956 Speaker 2: No just a notion that like they are explicitly saying 660 00:34:25,996 --> 00:34:28,356 Speaker 2: that you can't have winning players and that we're expecting 661 00:34:28,396 --> 00:34:31,036 Speaker 2: you to lose money. I mean even the casino industry 662 00:34:31,156 --> 00:34:35,756 Speaker 2: offers some pretense of, oh, we're an entertainment product and 663 00:34:35,756 --> 00:34:37,996 Speaker 2: you'll come and get a nice take dinner and see 664 00:34:38,036 --> 00:34:40,196 Speaker 2: a show and hang out with your buddies, right whereas 665 00:34:40,476 --> 00:34:45,676 Speaker 2: is this is just more cynical and. 666 00:34:45,476 --> 00:34:49,596 Speaker 1: It's an explicit It's just it's an explicitly dumb transaction 667 00:34:49,996 --> 00:34:52,516 Speaker 1: without a whole lot of side benefits. There are some, 668 00:34:52,636 --> 00:34:54,436 Speaker 1: I get it. It makes you it's more exciting to 669 00:34:54,436 --> 00:34:56,036 Speaker 1: watch the games if you have money on it, et cetera, 670 00:34:56,036 --> 00:34:59,956 Speaker 1: et cetera, But it is it is really just targeting 671 00:35:00,476 --> 00:35:05,116 Speaker 1: bad decision making. And and it hasn't the fine point 672 00:35:05,116 --> 00:35:08,676 Speaker 1: has not been put on that. Uh, and it's it's 673 00:35:08,796 --> 00:35:11,196 Speaker 1: and once the fine point is put on it, it'll 674 00:35:11,196 --> 00:35:13,396 Speaker 1: be interesting to see how people think about these these 675 00:35:13,436 --> 00:35:16,876 Speaker 1: companies that are the sort of the new sports bookies. 676 00:35:17,036 --> 00:35:20,156 Speaker 1: It's like, is it a bad is it saying something 677 00:35:20,236 --> 00:35:21,996 Speaker 1: bad about you that they want you? There? 678 00:35:22,676 --> 00:35:25,436 Speaker 2: I see some perceptual shifts. I mean, you see kind 679 00:35:25,476 --> 00:35:28,396 Speaker 2: of in the political circles I follow. You see people 680 00:35:28,396 --> 00:35:31,476 Speaker 2: who are growing more concerned as there are more studies 681 00:35:31,516 --> 00:35:34,436 Speaker 2: that come out about the effect on young men. Look, 682 00:35:34,476 --> 00:35:36,756 Speaker 2: it's a lot like the guy who goes and bets 683 00:35:36,756 --> 00:35:39,076 Speaker 2: fifty dollars in the Yankees at the Yankees game and 684 00:35:39,276 --> 00:35:41,636 Speaker 2: is giving away if he's making just like a moneyline 685 00:35:41,676 --> 00:35:44,156 Speaker 2: bet expected value of two and a half bucks. Like, 686 00:35:44,196 --> 00:35:45,916 Speaker 2: I'm not worried about him. He probably gets his two 687 00:35:45,916 --> 00:35:49,156 Speaker 2: and a half bucks worth of entertainment. But the five 688 00:35:49,196 --> 00:35:52,636 Speaker 2: percent of people or whatever else who are who fall 689 00:35:52,636 --> 00:35:54,796 Speaker 2: into the trap here and the lack of friction where 690 00:35:54,796 --> 00:35:56,996 Speaker 2: it's just like you want ten thousand dollars in your 691 00:35:57,036 --> 00:35:59,716 Speaker 2: draft account their draftings account, Like it's that's not that hard. 692 00:35:59,916 --> 00:36:01,596 Speaker 2: That's not that hard to do. If you're in a 693 00:36:01,596 --> 00:36:05,396 Speaker 2: physical casino and you didn't bring money or tips with you, 694 00:36:05,436 --> 00:36:08,356 Speaker 2: then like, actually there's friction there. You got I've had 695 00:36:08,396 --> 00:36:11,716 Speaker 2: at Popwerk, at the World Chairs Poker, drive out to 696 00:36:11,756 --> 00:36:14,796 Speaker 2: the Chase Bank on Trafficana Avenue or whatever, right I 697 00:36:14,796 --> 00:36:16,636 Speaker 2: would like to make a bank withdraw because I ran 698 00:36:16,676 --> 00:36:18,756 Speaker 2: out of money, and like, at least creates like a 699 00:36:18,756 --> 00:36:19,716 Speaker 2: little bit of a deterrent. 700 00:36:20,316 --> 00:36:22,076 Speaker 1: Yet one of the things that runs through our whole 701 00:36:22,116 --> 00:36:25,556 Speaker 1: season is how people's behavior changes and the decision making 702 00:36:25,676 --> 00:36:30,076 Speaker 1: changes when you remove the friction. It's not a trivial thing. 703 00:36:30,356 --> 00:36:32,636 Speaker 1: It's not that you make it a little bit harder 704 00:36:32,676 --> 00:36:34,636 Speaker 1: for people to do things that are self destructive, and 705 00:36:34,636 --> 00:36:40,396 Speaker 1: they're a lot less likely to do them. All right, Nate, 706 00:36:40,396 --> 00:36:41,556 Speaker 1: thanks for doing this absolutely. 707 00:36:41,596 --> 00:36:43,996 Speaker 3: I'll talk to you soon, Michael, all right, bye bye. 708 00:36:44,916 --> 00:36:46,836 Speaker 1: Nate Silver is the author of the book On the 709 00:36:46,996 --> 00:36:50,476 Speaker 1: Edge and co host of the Pushkin podcast Risky Business. 710 00:36:52,036 --> 00:36:54,516 Speaker 1: Against the Rules is written and hosted by me Michael 711 00:36:54,556 --> 00:36:58,796 Speaker 1: Lewis and produced by Lydia gene Kott, Catherine Gerardeau, and 712 00:36:58,876 --> 00:37:04,116 Speaker 1: Ariella Markowitz. Our editor is Julia Barton. Our engineer is 713 00:37:04,116 --> 00:37:08,596 Speaker 1: Sarah Bruguier. Against the Rules is a production of Pushkin Industries. 714 00:37:09,156 --> 00:37:12,836 Speaker 1: To find more Pushkin podcasts, listen on the iHeartRadio app, 715 00:37:13,196 --> 00:37:17,436 Speaker 1: Apple Podcasts, or wherever you listen to podcasts. And if 716 00:37:17,476 --> 00:37:19,916 Speaker 1: you'd like to listen to ad free and learn about 717 00:37:19,916 --> 00:37:23,076 Speaker 1: other exclusive offerings, don't forget to sign up for a 718 00:37:23,196 --> 00:37:28,236 Speaker 1: Pushkin Plus subscription at pushkin dot fm, slash Plus, or 719 00:37:28,236 --> 00:37:31,916 Speaker 1: on our Apple show page.