Not taking risks isn't risk aversion

I think about a wide set of behaviors that I've learned to despise. There is perhaps something that describes them all and I hopefully convey some of it in this post without being too generic to eventually end up meaning nothing.

People love to be in correct and have the right opinions. The feeling of being correct incites the feeling of being safe that is one of the basic needs of people.

Unfortunately there's an easy way to make yourself feel safe while decreasing your chances of survival in difficult events. As an added bonus it's the easy way out. It bails you out from having to think about what you are looking at.

Just predict that everything fails.

The paper bears

I would like to call people who predict failure based on gut instinct with the name 'paper bear'. Deriving from the two earlier terms paper tiger and bear market. The former term means for something that seems threatening but in unable to withstand a challenge. The later means for a market that is falling down like bear's neck when it's standing on fours and the pessimism associated to that.

This is an important distinction because there are people who correctly predict failures with high accuracy. They are exactly able to tell you why did it fail and you can trust them on their predictions.

The distinction is that a paper bear is just a broken person. They have noticed that most things fail therefore they conclude that it's safe to bet that everything fails.

Risk & reward

Of courses from the paper bear there's the another side of the coin that is equivalent to trusting that everything succeeds, but paper bulls are relatively short-living phenomena whereas paper bears are common.

The paper bears are automatic losers because they never take any risks. And they never calculate the potential risks or potential rewards.

Although it is important that you calculate the risks & rewards correctly. It is not as simple as you'd think.

The Law of large numbers states that despite randomness you can accurately predict the average of the results obtained from a large number of trials.

The application of the law of large numbers can fail spectacularly if you incorrectly assume that some events occur randomly, although they do not.

But it is important to notice that taking the value of how much you can win and compare it to how much you can lose, is not a good way to calculate the outcome.

For example, in the lottery the amount of what you can win is huge compared to what you can lose, yet people participating to lottery are idiots. Their probability to win is in one-in-a-million or one-in-a-billion. The one event of victory would be enough, but the law of large numbers ensure that you lose more than what you gain over the time. "But it could be you!" Yes, but the numbers do not add up. The fact is that you can use your cash in multiple ways. Invest that cash to anything and you have far larger chances of winning in the long term than what you'd have if you took into lottery.

The background noise

I would really not care about this if I never met any paper bears. I do not have the power to change how people think and even then if I did, I do not know better than anyone else about how they should think. But I get to see this a lot. Paper bears are loud, commonplace in the online discussions and helpless losers in general.

The paper bear refrains from reading books or watching films because they've read and seen some bad ones. They refuse to study because they do not see how they can benefit from it.

These guys keep telling you that nothing ever changes because nothing happened last week. They ignore the changes and advances made in the last twenty years, sometimes they go bold and ignore the changes that have happened during the last fifty years.

They keep telling you how VR fails now because it failed 20 years ago. The IoT, cloud, steam machines, Arduino, everything gets the same treatment. They say the same thing about everything. It is safe to say that no matter which technological or cultural subject you introduce to them, they come up with the conclusion that it is a failure.

The problem is that the mantra of these people is particularly infective. I find it in my head every once and then. I do tend to write for recreation as much as for others to read. Writing it down helps me purge the crap mantra of paper bears out of my head.

Getting rid of the paper bear mantra helps in exploring and studying things right in front of you. Getting rid of it is the requirement for having original thoughts and unique insights.

A potentially bad mistake

Now that you have a name for something you hate, there is a mistake you can easily do. Do not attempt to identify which is a real bear and which is made of paper. Mistaking between the real and false bear is costly.

The cool thing you can do does not require you to identify the paper bear anyway. Ignore the things people claim and concentrate on what facts they bring on the table and how trustful those facts are. Do the conclusions yourself.

And if you have a paper bear inside your head then treat it like shit. Serve it with lukewarm leftover coffee and refrain from giving it crackers.

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