Andymatic

jingc:

The lesson of slot machines is that our brain is not good at dealing with randomness, which leads us to search for patterns where there is only accidental chance. Look, for instance, at the the stock market. Economists refer to the stock market as a “random walk” since the past movement of any particular stock cannot be used to predict its future movement. In this sense, Wall Street is like a slot machine.

The lesson, and it’s a lesson that I’ve learnt the hard way, is that it’s silly to try to beat the market with our brains. Dopamine neurons weren’t designed to deal with the oscillations of Wall Street. When we spend lots of money on investment management fees, or sink our savings into some hot hedge fund, or buy shares in companies because everybody else is buying them, we are slavishly following our primitive reward circuits, just like a gambler losing a fortune in a casino.

(via TMN)