There are domains in which expertise is not possible. Stock picking is a good example. And in long-term political strategic forecasting, it's been shown that experts are just not better than a dice-throwing monkey.
Interpretation
Expertise does not guarantee accurate predictions in uncertain fields like stock picking and political forecasting.
In this quote, Daniel Kahneman emphasizes the limits of human expertise in fields characterized by high uncertainty and variability. He uses the analogy of dice-throwing monkeys to illustrate that, despite their experience, experts may perform no better than random chance in predicting outcomes in these domains, thereby highlighting the unpredictability inherent in such complex systems.
In practice
This quote can be used in a discussion about the limitations of financial forecasts during a stock market seminar.
We think, each of us, that we're much more rational than we are. And we think that we make our decisions because we have good reasons to make them. Even when it's the other way around. We believe in the reasons, because we've already made the decision.
The average investor's return is significantly lower than market indices due primarily to market timing.
Banks are run by executives, and executives protect themselves, and that does not always mean that banks are going to behave rationally.
Laziness is built deep into our nature.
Through some combination of culture and biology, our minds are intuitively receptive to religion.
You are more likely to learn something by finding surprises in your own behavior than by hearing surprising facts about people in general.
O Lord, I have never been eloquent, neither in the past nor since you have spoken to your servant. I am slow of speech and tongue.
Not all of us are called to be hermits, but all of us need enough silence and solitude in our lives to enable the deeper voice of our own self to be heard at least occasionally.
And what is a man without energy? Nothing - nothing at all.
Whatever he says, let his inner resolution be not to bear whatever comes to him, but to bear it 'for a reasonable period'--and let the reasonable period be shorter than the trial is likely to last. It need not be much shorter; in attacks on patience, chastity, and fortitude, the fun is to make the man yield just when (had he but known it) relief was almost in sight.
It’s funny. I met a man once who did a lot of mountain climbing. I asked him which was harder, ascending or descending? He said without a doubt descending, because ascending you were so focused on reaching the top, you avoided mistakes. The backside of a mountain is a fight against human nature,” he said. “You have to care as much about yourself on the way down as you did on the way up.
I'm not particularly needy, and I'm not particularly anxious. I don't look for a director to tell me I'm doing a good job or that I'm great. I don't need to be stroked. It's more my own yardstick.
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