Another Lottery Thought
Your chances of a significant win are next-to-nil. But suppose you win, and suppose you manage to not have your life destroyed by your 'good fortune.' The winnings are arguably ill-gotten gains. The money was extracted via false advertising from ignorant rubes and is being transferred via a chance mechanism to someone who has done nothing to deserve it.
Related Posts (on one page):
- Lotteries and Merit
- A Tax Day Observation
- Another Lottery Thought
- The Lottery Player
Posted by William F. Vallicella on
Wednesday April 11, 2007 at 8:17pm
When I first started work some years ago, the guy who ran the business was respected by everyone for his judgment, his sense, his skill in the markets. He had a huge house in the country, gold cutlery, and the family supermarket was the Harrods food hall.
The key to his success? He was German, and never, ever shorted the Deutschmark against the dollar. This was during the period leading up to German unification in the 1980's, when the Mark went up, up up. If by contrast he had started his career at a different point in time, he would have lost, lost, lost.
Luck is indeed a very significant factor in most successes. You've probably heard of Peter Lynch. He ran the Fidelity Magellan fund years ago when it happened to be spectacularly successful. No doubt he was and is a very bright guy. But some funds have to be on top, just as someone has to win the lottery. Amazing to me is how popular that now lousy fund still is, a fund that, the last time I checked, charges a front-end load of around 3%.
I like your insight. I always had a low opinion of state lotteries, but it hadn't occurred to me to think of their winnings as ill-gotten gains, especially by those who know how the lottery exploits fools.
As for how much a measure of luck there is in great success, I don't think "luck" is quite the right word. That's because it isn't luck that makes the success, but the frame of mind to seize an opportunity when it arises. It may be luck that puts me in the right place at the right time, but I will have no success unless I act upon the opportunity.
Regards, Bill T
I have no objection to legalized gambling, but that the State should promote gambling is unconscionable. And it doesn't matter the purposes for which the revenues are used.
My point was that luck is often necessary, not that it is ever sufficient. Successful people tend to credit their own initiative and talent and downplay luck; the unsuccessful tend to do the opposite. I always liked the saying, 'The harder I work, the luckier I get.'
I love his telling, vivid and slightly oddball metaphors about the market. In one book he talks about people wearing hats in the 1920's. Watch any crowd scenes from that era, and everyone wears a hat. Now, hardly anyone. And in this interview he says " Back in the late 1990s, you kept hearing that you had to stake your claim on the Internet or you'd miss out on the future. No one cared about the present. Then something happened around March 2000. There was an acceleration of public talk about doubts. You could no longer declare at a cocktail party that Internet stocks were going up. Such statements had become embarrassing - and just like that, word of mouth changed."
Russell also talks about hats. In History of Western Philosophy (a book that everyone read when they were 15, but should certainly read again when they are 50) he compares the schoolmen's 'accidental properties' to – wearing hats.
On the comments about seizing opportunities above, yes. Someone I know put this in terms of 'free options'. All options have a value, however slight. So if you see a free one lurking about, take it - and there are plenty around. Most times they turn out worthless. But it only takes one ...
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