What You See May Not Reflect Reality (It Could Be Incomplete)

Just like how much institutions predict it will do in the market doesn't directly determine whether you make money.

An old lady went to meet a banker and made a bet with him: at 12 noon the next day, witnessed by a lawyer, if he had no mole on his butt, she would lose to him $500,000. Conversely, the banker would lose $500,000 to the old lady.

After feeling all over his own butt, the banker was sure he had no mole, so he told the old lady, "Deal."

The next day at noon, the old lady indeed showed up on time with the lawyer. After the banker pulled down his pants, he generously handed over $500,000.

Baffled, the banker asked the old lady, "How did you know I definitely had a mole on my butt?"

At that moment, the lawyer burst into tears. He said, "You don't understand—this old lady bet with me too. She said she was certain she could make you pull down your pants, and we two bet $1.5 million on that."

You see, the old lady netted $1 million this way. You didn't understand the other person's entire bet.

Because you didn't understand, you thought they were betting on size, wagering on something uncertain. If you had understood, you would have known they were actually betting on a certain event—they knew they'd win before even placing the bet.

First published 2023-10-08 21:21:42