Sunday, July 25, 2010
Tzodek means that he is right. Falkenstein maintains that people does not optimize their profits, that is, they are not motivated by pure self interest or greed, but they are watching what others do at the sides and are trying to harm their neighbors, that is, their motivation is jealousy or some feeling of spite. I was just driving back from Dr Rasputin's clinic when I noticed once and again that the other cars in the street were taking idiotic risks and doing incredible maneuvers such as suddenly accelerating at full gas and then changing directions, just as if they were in some kind of competition with me. What the other drivers do seems to me crazy and purposeless, since the next traffic light is in view and it is changing to red, so in twenty or so meters we will have to stop. At end of their effort, I arrive at the red light and the other fellow is at my left, not even one centimeter ahead of me. He risked a lot and "won" nothing at all. There are a few drivers like myself who calculate the distance ahead and the tempo of the changing lights, and try to drive the car maintaining a steady momentum. I have a pendant (a light-reflecting object that I received in a Koln trade fair) and I always try to minimize its oscillations. Other drivers are motivated by "road rage" and furiously try to get ahead of the other fellow near them. Their behaviour is pointless, meaningless, profitless (as well as risky) to me. Now, the insight that most people drive to feel better or superior to the other fellow is important. Falken is working on some kind of equation based on this insight, that eventually will help him to optimize fund management, but how can I translate the same insight into money for J? That people behaves irrationally is no news for stock speculators.