Friday, November 19, 2010

No room for bad deals

Bad deals are bad deals. Losing is never a good decision.

But people many times consider it differently. As if a bad deal is not bad. As if it makes the smallest reason to allow oneself to lose. This is stupid.

There are many reasons where allowing to lose makes sense.

Not counting for the small. The general approach to focus on the big and be easy about the small makes sense. (it does not make losing on the small any reasonable, it only justified not paying attention to it)

Not taking life too seriously. And similar reasons.

My issue is with the unstated foolishness opinion that making a bad decision is a possibility. This is entirely stupid. (The only possibility for it to have place is not on its own, but as a false beleif that has psychological usefulness. Because believing in certain untruths can be good for their psychological effects. (see sour grapes post)

Ultimately, no earlier mistake of whatever, justifies taking losses as a reasonable thing. A mistake is a mistake is a mistake. A loss is a loss is a loss. And in a useful life one got to be a fool to think that losing is reasonable. Only eating oneself on losses, fearing them, or guarding too much against them is a mistake. Yet any claim that a loss is not a loss, is examplary foolishness.

2 comments:

Brian Hewes said...

Are not justifying taking losses as a reasonable thing and failing to claim a loss is a loss different things?

It would be reasonable to no longer invest in a company and take the loss on the books instead of praying or falling into the sunk cost fallacy. Now it would be stupid to say the loss is not really a loss. (Though this could be useful politically)

Yechezkel Zilber said...

Sure.

Avoiding loss and fearing loss are also distinct. Not being stupid to loss is clearly good, yet can easily get into loss aversion where we stupidly fear losses more than what they truly are. It is a form of anxiety and a big barrier to life.