Incompetent, rich people are more likely to get ahead than smart people with no money

[ronburgundy]

We can plot the results. A bell curve with one that's multiple standard deviations beyond any other data point. Bell curves strongly suggest random (saying that the success/failure of typical mutual fund stock pickers has a large luck component), radical outliers do not.

Not at all. Small numbers of people have the ability to excel at sports, but we can nevertheless define what specific traits are beneficial.

If you want to excel at basketball, be tall. At weightlifting, be strong. At being a cricket batsman, be short. We can readily identify the beneficial traits, and identify which are mostly accidents of birth, and which are acquired by effort (and what kind of effort is necessary). Top athletes are rare. But we know what it takes to become one, despite that rarity.

We know some of the traits. Not every last one. We can't measure a prospective sportsman and say whether he will succeed or not.

2) That the authors of such books actually know the solution and can communicate it effectively in the context of a book. Since the authors of such books aren't wealthy this condition is almost certainly not true.

If there's a strategy that works, it can be taught. I don't need to be a weightlifter to know what exercises, diet, and training are necessary to become one. And some of the authors of such books ARE wealthy - and if any of them detailed an actually effective strategy, rather than being guides to how to buy lottery tickets, natural selection would have kicked in. Success is highly sought after, and of there was a secret to achieving it, it couldn't stay secret for long. Humans are shit at keeping secrets.

The strategy must be known to enough people that the authors can figure it out. We know at least part of what is behind Buffet's success (value investing, looking at long term results, not short term), we don't know it all.

Look again at the logic - examination of the winners isn't informative. You need to look at both winners and equally qualified losers. Otherwise there's no way to separate luck from strategy.

We have no way to identify the losers to compare. You're trying to solve this as if you have perfect data, while in reality our data is shit.

Disagree. The number of spectacular successes is obviously very limited, but that doesn't mean it's luck. Rather, it's a matter of identifying the way to change the game and then doing the best job of actually doing so.

And winning the lottery is a matter of identifying the winning numbers, and then making sure to buy a ticket before the draw.

Has any major lottery winner claimed a strategy for identifying the winning numbers? No, they just pick numbers. The people I'm referring to identified a way to change the game and set out to do so.

And 99% of them with a similar plan to "change the game" failed, b/c random luck matters way more than efforts to "change the game". You only count those who won with that strategy b/c the far more numerous losers are nobody's b/c they lost.

A very limited number of spectacular sucesses is the hallmark of an environment in which strategy is not decisive.

Luck is by far the most likely explanation for rare spectacular success. Where it isn't, it stands out like a dog's balls. And it's repeatable and teachable.

In other words, it's luck who wins each race at the Olympics. A huge number of people try (I'm looking at the number who are seeking gold, even if they don't make the teams at all), very few win. We can't identify what makes person A a tenth of a second faster than B, but A gets the gold and the promotional contracts, B gets silver and not much else.

Success at game-changer things is like this--there usually is only one winner but what sets the winner apart from the others can be tiny differences.

First, who wins gold at the Olympics is mostly luck. There is not only the random luck of the genetic lottery, but then the random luck of encountering the right people at the right time who see your potential, train you, give you opportunities, etc. Most of the fastest people in the world never even entered a major race, and random luck is the primary reason for that. And most of the fastest people who have run a major race didn't go onto higher and higher levels of it b/c of random luck factors that impeded their opportunity to do so.

Second, once a race begins, it occurs within a highly controlled environment that eliminates lots of random factors. Everyone is racing in the same environment at the same time, with all environmental conditions like wind, rain, etc. being identical, and with all obstacles and the nature of the track they are running on controlled to be identical. And every person starts at the same distance from the finish line.
None of that applies to market competitions and wealth acquisition, where distance from the finish is highly variable, and millions of factors related to the conditions one is operating in and what random uncontrolled events happen on "the course" is unique to each person. IOW, your analogy is a total failure.

 

[TSwizzle]

Sometimes you have to make your own luck.

 

[PyramidHead]

The last time we had this exact thread on this exact article I asked this exact question and didn't get any replies, so I'll ask it again:

Since you need money to live, and the more money you have the easier your life is, why should only talented people get to have enough money to make their lives easy? In other words, even if the article is wrong and rich people are all just smarter than everybody else, isn't that a huge problem given the enormous influence of money on every aspect of human life in the 21st century? Don't we all know people who are stupid or lacking in talent, and don't we all still love them and want them to have an easy life instead of a hard one?

 

[Worldtraveller]

The last time we had this exact thread on this exact article I asked this exact question and didn't get any replies, so I'll ask it again:

Since you need money to live, and the more money you have the easier your life is, why should only talented people get to have enough money to make their lives easy? In other words, even if the article is wrong and rich people are all just smarter than everybody else, isn't that a huge problem given the enormous influence of money on every aspect of human life in the 21st century? Don't we all know people who are stupid or lacking in talent, and don't we all still love them and want them to have an easy life instead of a hard one?

Because capitalism. Don't need anymore reasons than that. :/