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Comment by j_timberlake | Hacker News Reader

"Billionaire investors are more irrational than me, a social media poster."

Zuckerberg has spent over fifty billion dollars on the idea that people will want to play a Miiverse game where they can attend meetings in VR and buy virtual real estate. It's like the Spanish emptying Potosi to buy endless mercenaries.

I mean, why do you think they have any idea on how a completely new thing will turn out?

They are speculating. If they are any good, then they do it with an acceptable risk profile.

The correlation between "speculator is a billionaire" and "speculator is good at predicting things" is much higher than the correlation between "guy has a HN account" and "guy knows more about the future of the AI industry than the people directly investing in it".

And he doesn't just think he has an edge, he thinks he has superior rationality.

Past performance is not indicative of future results.

You would need ~30 years of continuously beating the market to be able to claim that you are statistically likely to be better than random chance.

Does your average speculator have 30 years of experience beating the market, or were they just lucky?

I haven’t heard that statistic before. And the formulation seems imprecise? Does continuously beating the market mean that every single minute your portfolio value gains relative to the market?

"You would need ~30 years of continuously beating the market to be able to claim that you are statistically likely to be better than random chance."

You use the word statistically as if you didn't just pull "~30 years" out of nowhere with no statistics. And people become billionaires by making longshot bets on industry changes, not by playing the market while they work a 9-5.

"Does your average speculator have 30 years of experience beating the market, or were they just lucky?"

The average speculator isn't even allowed to invest in OpenAI or these other AI companies. If they bought Google stock, they'd mostly be buying into Google's other revenue streams.

You could just cut to the chase and invoke the Efficient Market Hypothesis, but that's easily rebuked here because the AI industry is not in an efficient market with information symmetry and open investing.

"Having money is proof of intelligence"

It kinda is, at least I'd say a rich person is on average more intelligent than a poor person.

Why do you think that? Do you have data or is it just, like, your vibe?

One can apply a brief sanity check via reductio ad absurdum: it is less logical to assume that poor individuals possess greater intelligence than wealthy individuals.

Increased levels of stress, reduced consumption of healthcare, fewer education opportunities, higher likelihood of being subjected to trauma, and so forth paint a picture of correlation between wealth and cognitive functionality.

Yeah, that's not a good argument. That might be true for the very poor, sure, but not for the majority of the lower-to-middle of the middle class. There's fundamentally no difference between your average blue collar worker and a billionaire, except the billionaire almost certainly had rich parents and got lucky.

People really don't like the "they're not, they just got lucky" statement and will do a lot of things to rationalize it away lol.

> lower-to-middle of the middle class

The comparison was clearly between the rich and the poor. We can take the 99.99th wealth percentile, where billionaires reside, and contrast that to a narrow range on the opposite side of the spectrum. But, in my opinion, the argument would still hold even if it were the top 10% vs bottom 10% (or equivalent by normalised population).

Counter point - rich people would remain rich, and we would have an ossified society if this was true.

Intelligence is not a singular pre-requisite to wealth or “to be rich”.

People can specialize in being intelligent, educated, well read, and more - while still being poor.

And we know that most entrepreneurs fail, which is why VCs function the way they do.

https://www.technologyreview.com/2018/03/01/144958/if-youre-...

It does seem like common sense that they would be linked. But there is also research:

https://thesocietypages.org/socimages/2008/02/06/correlation...

Anyone who believes this hasn't spent enough time around rich people. Rich people are almost always rich because they come from other rich people. They're exactly as smart as poor people, except the rich folk have a much, much cushier landing if they fail so they can take on more risk more often. It's much easier to succeed and look smart if you can just reload your save and try over and over.

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