Thinking Smart About Low-Probability Events

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Welcome back to Risky Business, a show about making better decisions.

I'm Maria Konakova.

And I'm Nate Silver.

We have a very risky business cluster of topics, I would say.

We're going to talk about

an asteroid that may or may not hit Earth in a few years.

The odds are improving, or I guess declining, which is good for us.

Then we will give you a little poker drama content with one of the world series of poker and one of its most famous faces, Phil Hillmuth, and his decision not to play the main event and what this means for poker strategy, skill, mental game, and all of those fun things.

And then we'll talk about what I call rock, paper, scissors, but what snobs call Rochambeau.

Oh, I love that you label me a snob nate immediately.

So

let's get going and start with

existential risks, which we love talking about on this podcast.

And yes, we have some going on in political events, but we are going to be talking about asteroids falling from the sky.

So people who, for people who weren't aware, a few weeks ago,

there was a story that started getting bigger and bigger about an asteroid, 2024YR4,

that was on a potential collision course with the Earth.

Now, when the story first came out, the chances that it was going to hit Earth were around 2%.

And then end of last week, they had gone up to over 3%, 3.1%.

And that has changed over the weekend.

But that's when we decided that this would be an interesting story to do because, Nate, 3.1% is not zero.

I don't believe it was ever 3%.

It was.

It was.

No, NASA was wrong.

It can't have been 3% before and 0.001, 0.0017%

now.

So yes, it is.

Something is pinky.

So let's talk about the nature of uncertainty, right?

No, because I build models, right?

And like, so a model should change when you're toward the end of an event, right?

At the end of an NBA basketball game, then a player missing a free throw has a large effect on, you know, the New York Knicks win probability, right?

We are now in 2025, although it feels like we're accelerating different ways.

This pertains to an asteroid that would hit the Earth in 2032, and it's a fairly linear system, right?

It's like,

you know, it's just kind of basic physics and gravity and things like that, right?

So why did these calculations like change by because like 3% and 0.0, let's just round it to 0.002%.

They might sound similar, but that's like 1, 2, 3.

That's like four orders of magnitude, like 1000x.

Like that seems to to me like...

So there is an answer to this.

So I'm obviously not an astrophysicist.

So I looked at what some astrophysicists said about this change.

So NPR actually did a segment where they talked to Paul Chotas, who's the director of NASA's JPL Center for NEO Studies.

And

when he looked at this, he said, you know, we actually often have these changes from 1% to 3%, you know, all over the place in just a few few weeks and sometimes days, because the observations are incredibly challenging.

And they do their best, but they're not actually looking at the asteroid, right?

They're measuring the projections of the asteroid.

And so every single night, what they're doing is estimating where the asteroid is, and then they're adjust

to be able to make those observations.

And so it's incredibly difficult, even for the strongest telescopes that we have

because, you know, because it's an asteroid.

And as he said, you know, they actually need to try to build in all of these projections, all of these assumptions to try to catch it before it moves out of range, because it will move out of range, and then they won't be able to make any more observations for the next few years.

And so that's why this can change so much, not because there was something wrong with the model, but just because, unlike a basketball team where you can see the team, you can see the players, everything is here, because of the nature of the observations, it's actually incredibly difficult to get the data.

And they do their best.

But then it's like with any data analysis,

when you're sampling and then you figure out, okay, no, we need to change the parameters, we need to change it again.

And so they're doing their best in a very, very limited window of time, which is the time when they can actually make these observations.

It's a critical period.

But they have seven years.

Look, I love astrophysicists.

I had an uncle who worked at JPL that's a jet propulsion laboratory.

But I think it is the model, right?

It's not like this asteroid hit a piece of debris

and is now on a different trajectory, right?

I know.

I mean, there's like kind of intrinsic model uncertainty, right?

One of the reasons that AI existential risk is hard to measure is because it kind of is not actually a very well-precedented situation in various reasons, right?

And like, in some ways, the fact that it's unprecedented might make you mix the variance higher and therefore increases the risk of doom in some ways.

But like,

I don't know.

I think like

physical uncertainty versus model uncertainty, I think is a slippery concept, but one that I don't know.

I don't know if we need like a big press panic

where if it's necessarily even helpful to put a number on something because again, 3% versus 0.02% is a big change, right?

It's a huge change.

Right.

So 3% be worried, 0.0, whatever percent, no.

We're no longer worried at all.

As poker players, we know that 3% equals worry.

3% is a fucking more than a two-hour, right?

That shit happens.

Yeah.

Man.

When it was at 3, I was like, oh, shit.

And then when it fell, I was like, okay, we're good.

I mean, my

P doom from AI is higher than 3%.

So like, I'm kind of feel like I'm living in a...

cloud anyway, right?

And this is like not an existential risk, is it?

No, no.

So this particular, this particular asteroid was what is called a city killer category.

So that is basically if it falls over a city, right?

If it falls over New York, New York's gone.

But if it falls, you know, somewhere in the ocean,

you know, if it falls somewhere in Siberia, which is where the last asteroid that was approximately this size fell, you're relatively fine.

Of course, there's going to be a lot of impact.

And it

is projected that if this asteroid had actually hit the Earth, it would be more than 500 times the power of the Hiroshima bomb.

So it depends on where it is.

But this is not a dinosaur-level asteroid that's going to wipe out 75%.

There's a lot of Siberia, Maria.

There's a lot more Siberia than New York.

And there's, you know, what is it?

Oceans.

So bad news for the whales, right?

But like,

but even when it was at its worst, scientists were saying, you know, like, even if it's headed, you know, obviously it would be horrific if it were headed for New York or any major city,

but they would know with enough lead time that if otherwise they couldn't change the trajectory, which they probably could, by the way.

So assuming they were completely unsuccessful and the asteroid were actually going to hit.

let's just say New York, they would have enough lead time where they'd be able to evacuate everyone.

Obviously, still not ideal, but no one, you know,

presumably, presumably, it would be under control.

But let's talk a little bit, just in general,

you know, how we should think about these sorts of things.

Obviously, it does matter when we're talking about small probabilities of events with

very high potential costs.

You know,

it's an interesting just lens

to try to figure out, okay, how do we evaluate these risks?

And we've talked about this before with PDoom, with

AI.

And I think that now it's incredibly important for people to understand how to look at these small probabilities because we have a lot of them, right?

There's a lot of uncertainty, and there are a lot of things in the news, not just with AI and asteroids, where it's important to understand these numbers.

So, how do we look at it and say, okay, you know, why are we worried about 3%?

Why aren't we worried about 0.02%?

What are the thresholds?

How do you think about it?

And kind of, how should we think about it when we have an outsized potential impact, despite a small chance of something happening?

Yeah, I mean, maybe you can calculate an expected value terms.

Of course, I'd say that as a poker player, kind of the theme of this show.

Absolutely.

Let's say that there is a

5% chance that if it hits, it wipes out a

metro region of like 10 million people.

multiply that by like

three percent what's the math here let me let me bring up the old trusty google calculator let's do it that's 300 000 people right but that assumes the asteroid would always kill 10 million people let's say there's just an 0.5 percent chance of that

sorry i'm actually not very good at using a calculator apparently

Things that we learn on the risky business podcast, I had no idea that calculators were not a strength of yours.

Do you want to know how many browser windows I have open, Maria?

No, I probably don't.

I'd probably have a heart attack in the middle of day.

Okay.

So that is like, that's an expected value loss of 15,000 people.

Now, okay, we can like displace them.

We can

send some rockets up there.

We can nuke the asteroid.

Might not be a good idea, but who knows, right?

But like, that seems actually fairly rational that like a 15,000 person expected displacement, let's call it event is worth planning for, right?

Yeah, that's if you reduce that by four, then whatever, you know, whatever, whatever.

Like not that I don't care about it, like 15 people, like not that I don't care about 15 people, but like we kind of brush aside risks like that all the time.

All the time.

Yep, absolutely.

I think that's actually, that's a, an interesting way of looking at it.

And I think that that makes sense.

And by the way, that is the way that a lot of, you know, insurance companies, etc look at things right and we've talked about like cost of a human life right what's the risk premium you need to take on um to take on risky jobs um so this this type of calculation where you're looking at lives is actually one that a lot of industries um a lot of industries look at.

15,000 is huge.

And now imagine this is just the life calculation.

If we're doing a full expected value calculation, we'd also have to look at, you know, the loss of property, loss of infrastructure.

Let's assume that some major, major things are actually taken off the grid, right?

Like, what is the overall cost?

And now we are talking not just human lives, but there's a huge economic cost as well.

So it becomes very complicated, and you realize, okay, yeah, we should probably be worried about something like that and about the risk of something like that happening.

And that's when you realize that small numbers get multiplied out, right?

And

the impact becomes much larger when it's an like this.

It's also kind of very

visible, I guess you'd say.

You know what I mean?

Like, um,

like it's gonna slowly approach the earth and, you know, I mean, like, which, you know, usually these more legible tangible risks are actually things that society is better than dealing with, and it's very linear, right?

Whereas, like, if you read some scary AI scenarios,

there might be some warning signs of AI being more

becoming more adversarial or smarter or whatever else.

Um, but it could just be that AI hatches a very,

very well-kept secret plan to like destroy its human masters, right?

Um, you know, and that happens very efficiently, quote unquote, and very quickly or a nuclear war.

I mean, I remember it was my 40th birthday on January 13th, 19,

God, I'm dumb, 2018, right?

When the alert came out, I was like, wait, wait, you did not

40 and 19 something, or you look great 2018.

is that right yeah i i'm showing my age when the alert came out saying oh this is not a drill there is a nuclear icbm inbound toward hawaii i'm like you know i'm not sure if i feel greater having my birthday party on this day it turned out to be a false alarm again right but like but this is something we would have time to adjust to arguably it makes it kind of better to actually monitor these situations

i think that's actually that's a really crucial point when we're talking about risk.

It's much easier for the human mind to latch onto something that's tangible and that's easy to observe, as opposed to something that's kind of more uncertain, that can be kind of more under the radar.

And those risks are often much more dangerous.

But it's much more difficult to convince people that it's dangerous because it's not something that you can easily look and

quantify and say, oh, uh-huh, yep, we see that it has gotten gone from this to this.

An interesting example of this,

just

going a little bit back in time, you know, when you were talking about climate change versus the ozone layer, right?

When it was a hole in the ozone layer,

people banded together and were like, oh my God, hole in the ozone layer.

There was great collective action and like.

We did it, right?

Like we actually addressed that really quickly because it's, you know, hole in the ozone layer.

You can see it.

It's dramatic.

It's kind of like an asteroid.

You're like, uh-oh, I don't want a hole in my ozone layer, whatever the world that means.

So, so it actually kind of demonstrates, I think that's an easy way of demonstrating how, like, something that's dramatic and easy to observe can be much easier to communicate the risks than something that is much more difficult to visualize, to quantify, and that is more nuanced and has more factors at play.

You know what I comfort myself with about the AI stuff, right?

So, if AI accelerates to general intelligence, super intelligence, produces much more rapid economic growth, and like displaces people from useful work,

probably really good for live poker, right?

All of a sudden,

all of a sudden, you have people are really rich and they have a shitload of time on their hands, right?

It's fucking going to be some great apocalyptic poker games, Maria.

Well,

on that note, Nate, do you want to take a break

from the apocalypse and actually talk about some pre-apocalyptic poker?

Yes, Maria.

After a quick break, we're going to be back.

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The World Series of poker is still a ways away, right?

It starts at the end of May, but we have had some news in the last few weeks, and especially in the last week.

So the schedule was released, as it always is around this time of year.

And Nate, not everyone liked the schedule.

No, Phil Helmuth, one of the most accomplished poker players in world history.

He has how many World Series for

19, right?

I am reliably informed by one of our wonderful producers that it's actually 17 bracelets.

Whoa, and I had guessed 19.

So, Phil Helmuth should be thrilled when listening to our podcast that I overestimated his bracelets by two.

Not one, but two.

Phil, you know, all-time bracelet holding great.

Will he reach 20?

No.

oh my gosh oh no

i think he's a favorite to reach 20 you know and he's a somewhat polarizing figure uh he's very

i don't know how you bratty he's nicknamed the poker brat um he once threatened to burn the effing place down because of i don't know was it bad luck or like a a flaw ruling he disagreed with i i forget which exactly he has a heart of gold some would say uh

but that doesn't come through in the demeanor but one thing phil really loves is the world chair smoker in general and in particular the main event um he won the main event in 1989 one of the first kind of young whippersnapping kids to do so um

you know his style he plays kind of a small ball style, right?

So small ball means in some sense, literally playing smaller pot.

It's also tactical.

It's a patient approach.

You're letting other people make mistakes, right?

But it's meant to minimize variance to prioritize long-term survival in the tournament.

Sometimes, Nate, sometimes he plays a small ball style.

Phil Helmuth likes to mix it up, but please continue.

Yeah, but in general, this is an event that should play to his strengths, right?

There are a lot of amateurs in the event,

and those amateurs give off reeds, which Phil is,

I'm not sure you'd call him, I mean, he's very good at picking up on like physical reads.

He calls calls it like white magic, right?

His style is a little bit more

to engage in table banter that works to his advantage.

He's played out a lot of rounds where you're needling people, you see how they react, and you're trying to like, so probably more verbal than physical tells, although I'm sure he's actually excellent at the physical tells stuff too, kind of a savant.

Actually, and people can't understand why he's been so successful despite all these technical flaws, right?

However,

I guess he's running out of white magic in the tank because Phil said he's not going to play the main event because it's too long,

which it's a long tournament.

So let's talk a little bit.

So the main event, the World Series of Poker main event, single biggest poker tournament of the year, right?

And I think everyone would agree, like, this is the single most by far.

There's no other, I mean, the win 10K is good, but like this is by far

the best tournament.

Yes.

Biggest poker event of the year.

And, you know, it's a bucket list item for a lot of people, you know, lifetime dream to play in the main event.

It's a $10,000 buy-in and it has a unique structure that no other tournament has, which is two-hour long levels.

So that means that it's an incredibly, it's a slow structure where you start very deep and people, you know, people love this.

And the person who wins becomes the world champion, right?

The champion of the world and holds that title for one year.

And it was, you know, it's a really, really big deal to play.

And a lot of people just, you know, they save up

and just

want their whole lives to play this event.

And obviously to go deep in it,

to cash, to make, you know, make a deep run, to make the final table to win is just absolutely the dream.

And

this is the event that Phil Helmuth has always traditionally been the most excited about.

And he always comes in with a huge entrance.

As someone who has been playing during his entrances, I actually

am hoping that there will not be a Phil Helmuth entrance this year because this really disrupts everything, right?

He likes to come in with music and dancers and he dresses up as characters.

Anyway, he really, you know, hams it up to the greatest extent possible for the main event.

And now he says, I am not going to play because I am too old and the structure is such that we just do not have enough of a break.

I'm exhausted.

You know, this should not be happening.

This is not fair.

It makes it into an endurance contest rather than a skill contest.

And that is not fair.

So I'm not going to play.

That's the essence of the Phil Helmuth rant against the main event this year.

And I have thoughts.

I'm sure you have thoughts, Nate.

Before we get into our thoughts, what are the odds that Phil Helmuth actually will miss the main event?

I put those at not zero, but like less than 1%.

He's going to play.

Less than 1%.

Yeah.

You sound like

NASA with their asteroids, Maria.

A little, a little overconfident.

I'm very overconfident with this one.

I would say there's a

I don't know.

I mean, he said he wasn't going to play, right?

I would.

Nate, how many times has Phil said

Phil to play the main event at minus 150?

Okay.

So you still think he's going to play?

That's good.

I mean, you're at 1%.

I think you've, for 99%, you kind of fucked up Mikel.

I know I'm just trying to anchor to you a little bit.

I think we clearly have some type of bet here.

We can think about some type of bet here, but I just do not believe that Phil Helmuth will skip the main event.

It's just too much of a thing for him.

And I think that he did this to draw attention to some important points, also to draw attention to himself.

And I do I actually do agree that a lot of

structures these days

do make it very difficult to play your best game you know there there should be changes made like I think all tournaments I completely agree with this should have like a 12 hour period between playing, right?

From when you bag your chips to when you have to sit back down.

It is totally not okay to bag your chips at 3 a.m.

and to to have to restart at 11, which happens all the time.

So that I agree with.

I'm assuming you agree with that as well.

Yeah, I mean, do the, well, I think I agree with the provision I'll mention later, right?

But yeah, let's say you bag your chips at 3.

So and then you have to get back at 11, right?

So it's eight hours.

But like, let's be honest, it's going to take...

half an hour each way to get there and back.

It's an hour, right?

Probably takes a little while to wind down, right?

You're going to have whatever tea or whiskey or whatever you have, right?

You have to eat breakfast in the morning.

If you're doing any studying at all, right?

If you're trying to get a few steps in or a little quick workout or something like that.

And then if you're like me or you, Maria, then you probably also have

some non-poker work that

you also have to do.

Even if it's just kind of writing emails, postponing things because you made a deep run.

So yeah, you wind up kind of either sleeping no more than five hours or not eating or not exercising, which can take a toll over the course of the day, right?

So it's, yeah, it's, it's a, it's, it's a challenge.

Now, what I would say

is that this is a simulation of life in certain ways.

And

when I'm covering an election or other busy projects or things like that, right?

That you don't necessarily get to have a, I mean, this is kind of how real world decision making often works.

And because it's like a unique event.

Yeah, and look, by by the way i don't think the one thing that i i kind of like

disagree with is like and i'm 47 phil 60 right maybe the notion that like um

that age is necessarily all that much

a factor as you get more experienced in poker i think actually things get easier so you have like less mental strain that was a point before about like i'm not so sympathetic to like saying yeah you're physically more tired when you get older but like you have a lot more poker and life experience dealing with stress one would hope right um

Whereas the first time you play the main event, then it seems super high.

If you're not used to playing $10,000 tournaments, right?

It seems, it's very intimidating and things like that.

Yeah, totally agree.

And so for the record, while I think that

in general, I think that poker structures have gotten to the point where like we end days way too late and restart too early.

And there should just be some sort of norm about that.

So that aside, I actually think the main event doesn't have this problem usually.

The main main event, you're not bagging up chips at three in the morning.

Usually it happened to me once.

But usually in the main event, that does not happen.

And I actually think that the main event structure should not be changed.

So

I agree that this is a unique event.

And when people, you know, maybe you can add one additional rest day somewhere deep in there.

I don't know.

But that would be the only thing that I would.

potentially look at.

Maybe don't have a dinner break some days, right, so that you can end earlier.

But what I most fundamentally disagree with, with what Phil said, is he said that it changes it from a skill game to an endurance contest.

I think that the endurance is actually part of the mental game.

That is actually a skill.

That is absolutely part of the skill of life and of playing poker.

And as you know, like I've talked a lot about the fact that I think mental game is kind of one of the most important things and one of the things that truly sets the elite players apart, right?

And your ability to actually figure out how to deal with this, to deal with the stress, deal with like not sleeping enough, deal with all of this, and actually come in with a good mindset and be able to still make good decisions.

Sure, decision quality deteriorates as you get more tired, but it does for everyone.

And that is a skill.

That's not, you know, that is actually something that you can also work on.

And that is also an important part of success, both in poker and in life.

So that's where actually I fundamentally disagree with Phil.

Like it's a skill to get through these.

And it should be hard to be the world champion.

It should actually be really, really hard.

This should be.

Marathons are hard.

To give one point of context, a couple of points of context.

By the way, I agree.

By the way, part of the skill is actually learning how to budget your

mental bandwidth, right?

Absolutely.

Like one thing I'll do sometimes is like we do both of this, I think, is like write down every hand I played to review maybe with my coach mage on my own later, right?

And that's great in some ways.

It kind of forces you to be very attentive.

It also means you lack all that

downtime, right?

So sometimes I'll get to a point where it's like, okay, I just want to play in flow now, right?

I want to play in flow and focus instead on things like physical reads or thinking, you know, because now I'm at a point where the stakes are high enough where it's worth paying attention constantly.

And like, and this is just a distraction.

Two other points of content.

So for one thing, as the event gets bigger every year, it's been over 10,000 players the last two years.

um it does get longer and longer right it just takes longer to eliminate all but one player when you have more players in the tournament there's no kind of like easy way around that so you know um but also they've also made adjustments where like there are now events going on simultaneously all the way to like the very end of the world series of poker right so um if you're gonna play the main i don't think you have to assume that you're gonna go to like the second week of the event right but what you should do i strongly strongly, strongly recommend, right, is assume you're going to make it through like

day five, right?

If you don't make it to day five, and odds are strongly against you making it to day five, there are lots of other often very juicy World Series tournaments where people are a little tilty.

Those are often pretty good events.

So block out a week for it or don't play because the mentality were like,

oh,

if I make day three, I'm going to have to reschedule my expensive flight flight and cancel all these meetings and piss off my significant other.

Like that's, that, that, I think actually is very taxing and you'll kind of commit suicide.

You'll find a way to do that.

No, it's, it's, it's not good.

Once again, for your mental game, that is not a good way of doing it.

I, and I think that you makes.

your your point about day five, I think, is a good balance.

I never play a tournament at all if I can't make the final table, right?

Like I actually, but this is, this is a little bit different for the main event.

So I'm not saying if you make the final table of the main event, your boss will understand, I hope, or you will actually have enough money to quit your job.

So don't worry about it.

But everything else,

I always look at the schedule and I never ever will play an event if I have a conflict.

And you cannot go into it with the mentality of, oh, well, it's incredibly unlikely.

that I'm going to go that far, right?

It's incredibly unlikely that I'm going to make the final table

because that, you know, that's self-defeating

because you want to put yourself in the mind frame of, of course, I'm going to win, right?

Even though you know that that's not likely at all, but you still need to be there mentally and you need to plan for it because you do not want to be taking the time to rearrange your flight, to change your hotel reservations, to do this, to do that.

You want your brain to have to focus on the important things and not to distract it too much because, yes, this is exhausting.

Yes, it will take a lot out of you.

So use those precious mental resources for the good stuff.

And I think this is true of all life decisions, right?

Plan in advance so that you free up the mental bandwidth for the important things.

Bottom line, you know, I think Phil Helmuth has made a good point about structures.

Broadly speaking, I think that it's completely misapplied when it comes to the main event.

And I think that his point about what is and is not a scale is just flat out wrong.

Yeah, I mean, look, people propose cutting the tournament to 90 minutes, but like, I mean, it is like, I mean, you have whole different things that happen, you know, because it's so slow, the structure, when you get to the bubble when the last player is eliminated before the payout, which I guess is like $15,000 now or whatever, right?

Like, people have like really big stacks, right?

You never get that in any other tournament, and like, you know, there are some people that kind of specialize in the main event.

I have exactly one really deep run and no other caches and like eight tries or something, right?

So I don't know which category I fall into, but like, but like getting deep in a deep stack tournament is a very cool thing.

And, you know, self-evident by that, I mean, look at the fucking scoreboard.

10,000 people are entering this tournament.

It's insane.

And not only paying $10,000, but like, I'm sure people have busy lives.

And they're saying, I'm willing to take like two weeks of my time to blow up my schedule to play this event because I love it so much.

And so don't, don't fix what isn't broken.

Nate, will you be playing the main event this year?

I would certainly think so.

Yeah, this is a the year after the election is a year where I can do a relatively large quantity of World Series of poker.

All right.

So here's to both of us having exhaustion problems because we are running so deep in the main event.

Absolutely.

Let's take a quick break and go from poker to rock, paper, scissors.

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Hey, when is the first time you ever played rock, paper, scissors?

Do you remember?

Or at least when you found out it was a thing?

I felt like I've always, I felt like I was innately born with that knowledge.

Yeah.

Right.

That's, I think that's how we all feel.

It is something that is pretty universal.

So I was born in the Soviet Union, and I, my first rock, paper, scissors experience was in Russian, right?

Which is also called rock, paper, scissors.

And it's a game that I think kids play

all over the world.

And it's a really fun

way of looking at game theory.

So on this show, we talk about the prisoner's dilemma again.

You know, it's a very kind of, that's a very common game theoretical thing.

But rock, paper, scissors is a very different type of game.

It's a game of cyclic dominance, right?

So that means that there are multiple equilibria and they cycle.

And so there's actually no strategy that is a dominant strategy.

There's no stable strategy to this game because for people, if anyone listening to this show has not played rock, paper, scissors, right, you can throw out three things, rock, paper, or scissors.

And you should theoretically do so with one-third probability, one-third frequency for each one, because rock is beaten by paper, right?

But beats scissors.

Paper beats rock, but is beaten by scissors.

And scissors beats paper, but is beaten by rock.

In Russia, it's also rock.

It's not like potato.

No, it's not potato.

It's not potato.

Potato and vodka.

What else do they have in Russia?

It's also

potato and vodka i don't know what that is it's also rock paper scissors um or in russian kaimin norznitse bumaga so that actually goes uh

rock scissors paper is how you say it in russian that's the uh that's the order but yes it's a really interesting game theoretical challenge because you know how like how do you play right what's your optimal strategy if they're really

if there's if there is this sort of cyclic equilibrium and not a dominant strategy, how do you randomize?

How do you actually make sure you're playing with the correct frequencies?

And these are things that we think about a lot in poker.

How do you try to exploit your opponent?

Because nobody randomizes correctly.

And there are actually competitions, right?

There are world competitions of rock, paper, scissors or Rochambeau, as the World Federation calls it, where there are people who are really, really good at it.

How do you become good at rock, paper, scissors?

How do you actually become a world champion at something like this,

the game theory equilibrium is as it is?

No, there are like computers

that play against humans and win like the humans like only you're supposed to win one third of the time if you just kiss at random, right?

And like the humans only win like 25% of the time, which is like really, really bad.

You must be trying to be that bad.

I mean, yeah, look, randomization is hard.

Do you randomize when you play poker?

I do randomize sometimes, but not always,

just to be perfectly honest.

So I'm not, I'm not, I'm not the person who always randomizes, right?

There are people who like every decision, like they'll, you know, flip a cool, they'll, you know, toss their chip, look at the clock, do something like that.

I don't do it always, but in some close spots, I will randomize.

I've been more into the randomization lately, I think.

Although I don't treat it as deterministically, I treat it as like an input.

You know what I mean?

Yep.

Oh, I know exactly what you mean, Nate.

For listeners of the show who've been listeners since the beginning, we remember a segment where Nate had a list and he was going to randomize and he he didn't like what he randomized to, so then he changed his mind.

And I tried to make the point that the point of randomization is you have to do what the ransom,

what the randomizer told you to do.

So yes, Nate, we know that you only take it as

one point of input.

No, it's, I mean, look, if, if, um,

If I roll a number, a high number that says, oh, this is a time when I shouldn't bluff, right?

But then I get a bad vibe from the player I was planning on bluffing, something about the way she or he puts their chips in feels strong.

Like,

um,

that's a good adjustment, right?

Because, like, what game theory, this is the whole principle of like why you want to randomize, right?

In game theory, it's a mixed strategy, meaning you're indifferent between rock, paper, and scissors, therefore, you should make each throw one-third of the time, right?

They all have the same exact expected value.

If that's true, then like tiny, tiny, small things matter, right?

Whatever slight vibe you get, unless you actually have negative value on your tells, right?

Unless you're actually like worse when you have like a vibe or a game flow situation.

So if you're indifferent, A, it doesn't matter, but it also means that very small things lead you to like making the same decision over and over and over again.

Yeah, for sure.

So I think that

this actually

gets to my other point of how are they champions, right?

And it's the same reason why computers can beat humans at rock, paper, scissors, which is that randomization is hard, right?

And random is hard.

And when you're playing a game of rock, paper, scissors, especially in a competitive setting, you don't get to actually have a randomizer with you, right?

It's not like you get to be holding a phone with a random number generator and you know that like one to 33, I throw rock, right?

Like you don't get to do that, right?

It's all in your brain.

And it's really, really, really difficult to randomize correctly and actually do one third, one third, one third,

and to do it in a, not in a predictable right.

I can totally randomize to do two one-thirds if I do rock, paper, scissors, rock, paper, scissors.

But then, Nate, if you're playing against me, you're going to crush me, right?

Because I'm, it's not, not random.

Yes, it's one third, but it's in a predictable pattern.

So you have to be doing both of these things.

And so I think that the people who are really good at rock, paper, scissors are the ones who actually can perceive your deviations, right?

Who are are very, who are good and can do that pattern recognition and figure out how you are randomizing incorrectly.

I'm putting randomizing in quotes because it's not actually randomizing.

Right, because if you play the mixed strategy, the other thing is you can't lose and you can't win, right?

Someone can play rock every time.

And you can say, well, I want to be game theory optimal, so I'm going to mix, right?

Even against the most predictable player in the world, you only win one-third, tie one-third, and lose one-third.

And so you have to like be willing to exploit people in order to,

you know, at the risk of being exploited yourself.

So it's a perfect illustration of a basic concept in poker strategy.

Absolutely.

So just a funny aside,

I went on Twitter this morning and saw that one of the poker players in my orbit, Neil Farrell, otherwise known as Feraldo, had tweeted about rock, paper, scissors.

It was very funny and a very funny illustration at this point.

He says, taught my son rock, paper, scissors, and now it's the deciding factor for him tidying up his toys or going to bed at bedtime.

He flat out refuses to ever throw rock, however, there are going to be some tough lessons learned about balanced rangers in the feral household over the next year.

So that, I mean, that's very funny, right?

You have a little kid who sort of understands the game, but for some reason doesn't like rock and refuses to do that.

So as a parent, it becomes incredibly easy to just get your kid to do whatever

you want.

But, you know, I actually like, it is really interesting to look at how kids' brains work about work when it comes to this, because that's what, you know, that's what our human brains do as well, right?

We are not random, even though we think we are.

We can't randomize well.

And recognizing patterns and trying to like read your opponents, I think that's a huge part of the game and why it's so interesting and why it's such an interesting model for human behavior.

I don't have kids, neither do you, unless you've been hiding some children like Elon or have, you know,

half the population has, apparently.

Yeah, apparently.

They're like, but I'm not one of them.

Also, little randomizing things can like avoid these super annoying decisions about, should we get Italian food or Thai food or whatever else, right?

If you're in a relationship and trying to negotiate something, your two kids are disagreeing on something, just randomize, right?

It probably doesn't matter, but that at least kind of creates an opportunity for

resolving an unimportant thing.

Yes.

Or an indifferent thing.

You can be indifferent between two important options because they're both equally good or bad.

But yeah.

Exactly.

So I think rock, paper, scissors is a beautiful illustration of the importance of randomization and the difficulty of randomization.

We should probably do a throw, okay?

Let's do a throw.

Okay.

Ready?

Yep.

One, two, three.

I don't see what you have.

I have paper.

Scissors.

Nate, you win the championship of

rock, paper, scissors for

our show.

Woo!

What did we say about gloating?

What did we say about gloating?

Congrats.

Oh, the fist trophy.

Take it down, Champ.

And we will see you next time for the rematch of the Rochambeau Championships on Risky Business.

Let us know what you think of the show.

Reach out to us at riskybusiness at pushkin.fm.

And by the way, if you're a Pushkin Plus subscriber, we have some bonus content for you.

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Risky Business is hosted by me, Maria Konakova, and by me, Nate Silver.

The show is a co-production of Pushkin Industries and iHeartMedia.

This episode was produced by Isabel Carter.

Our associate producer is Gabriel Hunter Chang.

Sally Helm is our editor.

And our executive producer is Jacob Goldstein.

Mixing by Sarah Brueguer.

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