Alex's Adventures in Numberland - Alex Bellos [147]
I was also interested in whether having such a sophisticated understanding of probability helped him avoid the subject’s many counter-intuitions. Was he ever victim, for example, of the gambler’s fallacy? ‘I think I’m very good at just saying no – but it took a while. I went through an expensive education when I first began to learn about stocks. I would make decisions based on less-than-rational decisions.’
I asked him if he ever played the lottery.
‘Do you mean make bad bets?’
I guess, I said, that he didn’t do that.
‘I can’t help it. You know once in a while you have to. Let’s suppose that your whole net worth is your house. To insure your house is a bad bet in the expected-value sense, but it is probably prudent in the long-term survival sense.’
So, I asked, have you insured your house?
He paused for a fewoments. ‘Yes.’
He had stalled because he was working out exactly how rich he was. ‘If you are wealthy enough you don’t have to insure small items,’ he explained. ‘If you were a billionaire and had a million-dollar house it wouldn’t matter whether you insured it or not, at least from the Kelly-criterion standpoint. You don’t need to pay to protect yourself against this relatively small loss. You are better off taking the money and investing it in something better.
‘Have I really insured my houses or not? Yeah, I guess I have.’
I had read an article in which it was mentioned that Thorp planned to have his body frozen when he dies. I told him it sounded like a gamble – and a very Californian one at that.
‘Well, as one of my science-fiction friends said: “It’s the only game in town.”’
CHAPTER TEN
Situation Normal
I recently bought an electronic kitchen scale. It has a glass platform and an Easy To Read Blue Backlit Display. My purchase was not symptomatic of a desire to bake elaborate desserts. Nor was I intending my flat to become the stash house for local drug gangs. I was simply interested in weighing stuff. As soon as the scale was out of its box I went to my local bakers, Greggs, and bought a baguette. It weighed 391g. The following day I returned to Greggs and bought another baguette. This one was slightly heftier at 398g. Greggs is a chain with more than a thousand shops in the UK. It specializes in cups of tea, sausage rolls and buns plastered in icing sugar. But I had eyes only for the baguettes. On the third day the baguette weighed 399g. By now I was bored with eating a whole baguette every day, but I continued with my daily weighing routine. The fourth baguette was a whopping 403g. I thought maybe I should hang it on the wall, like some kind of prize fish. Surely, I thought, the weights would not rise for ever, and I was correct. The fifth loaf was a minnow, only 384g.
In the sixteenth and seventeenth centuries Western Europe fell in love with collecting data. Measuring tools, such as the thermometer, the barometer and the perambulator – a wheel for clocking distances along a road – were all invented during this period, and using them was an exciting novelty. The fact that Arabic numerals, which provided effective notation for the results, were finally in common use among the educated classes helped. Collecting numbers was the height of modernity, and it was no passing fad; the craze marked the beginning of modern science. The ability to describe the world in quantitative, rather than qualitative, terms totally changed our relationship with our own surroundings. Numbers gave us a language for scientific investigation and with that came a new confidence that we could have a deeper understanding of how things really are.
I was finding my daily ritual of buying and weighing bread every morning surprisingly pleasurable.