Friday, February 19, 2010

The Cause & Effect Law & Poker

Poker is a merit based system of cause and effect. Your only focus should be on making correct decisions. Your decisions should not be effected by losing or winning money, but by simply doing what is mathematically and psychologically correct. In the final analysis, you will make money if you make more correct decisions than incorrect decisions.

Life is very much the same way. Everyone has a moral compass telling us what the correct moral decision is. If we allow our emotions to persuade us to make selfish decisions that are not aligned with our moral compass - that is an incorrect decision and will count against you in the game of life.

If you do not allow your emotions to change your correct decision making, eventually the balance will return and you will reap the benefits.

For example - in poker you can have a losing session (day), losing week, losing month, even a losing quarter. That means as you ride the roller coaster of poker, winning and losing money, at the end of the day, week, month, or quarter - you can be in the negative. That is called variance in poker. But if you continue to play correctly, making positive expected value decisions - you will eventually swing into the positive and at the end of the half year or full year - you will still end up making the average income you expected to make.

Any long term professional poker player understands what it means to play near perfectly (+EV) and still loose 10% of your money at the end of 3 months of play. You have to continue playing +EV regardless of your current down swing in order for things to swing back in your favor.

Life is the same. You can do all the right things based on your moral compass and still get hit in the face by life. Your dog dies, your car is totaled in an accident, you lose half your 401K value in a stock market crash, you get robbed and beat up, etc.

Many people, even of the strongest religious faith, lose faith in the law of Karma when their lives turn to crap.

"I did the right thing and I got the shaft - WTF?!"

Then they turn to making selfish immoral decisions figuring if they are going to get the shaft anyways, might as well get "Mine" while the getting is good.

This of course changes your future Karma and begins a self-fulfilling prophecy that did not need to occur.

In poker this is synonymous of going on tilt. You start playing foolishly, leaking chips to your non-tilting opponents. You start bluffing too much with too much money and start losing big time.

In life you increase your bad luck when you go on tilt.

In reality, when things are at their worse and you have faithfully been navigating the sea of life with your moral compass - that is when things are about to change for the better. When things are at their worse is when you need to be even more vigilant in your correct decisions because the tide is about to change. The storm cannot last forever.

In poker when the tide changes from variance to hot streak - you can not only make up your losses, but you can make a lot of profit and swing in the opposite direction. A negative $1000 quarter turns into a positive $3000 half year. When averaged out, you will realize you never lost $1000 - but you always were making $1500 a quarter. Then you realize your expected poker winnings over the long term is right on par. Your extreme winnings and extreme losings have evened out and you are still profitable.

Life is the same.

If only people understood cause and effect.

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