In his wonderful book 'The Psychology of Money,' Morgan Housel has a section on counting cards in blackjack.
The point of this section is to underpin how winning works over a longer-term system.
The philosophy of counting cards is fascinating; there are certain people who have a practised ability to go to a casino and sit at a blackjack table and watch the cards as they're being dealt and count.
What they then have the ability to do is to assess the odds much, much more accurately and objectively than someone who doesn't count cards. They can remove the emotion of risk and play The House at its own game.
People who are good at counting cards always win, but the point is that they always win over the long term.
Housel estimates that the odds of a card-counting guy winning at blackjack is about 2% better than The House. This means he'll win 51% of the time, and The House will win 49% of the time. It means that you lose to The House almost half the time (but not quite).
This concept is entirely at odds with how we see winning, how we see growing and how we see a return on investment in any of the things that we invest in:
- Our businesses
- Our health
- Our lives
- Our relationships
- Our marriage
- Our parenting
All of these things.
As I've mentioned here on many occasions before, I started to write a personal diary back in 2007.
I don't write in the diary regularly, every week or every day. I write it when I feel I need to when I feel I want to, but it now has more than a million words, and as I sat at Callum's football match, 'watching from the car,' I decided to fill in my diary again.
One of the joys of the diary is that I can go back exactly 10 years, more or less, to the 16th of March 2015. I can tell you that for various reasons, my life was quite dark on the 16th of March 2015; I can tell you that things weren't great at home, I was stressed, I was fat (much heavier than I am now), I was complaining that I wasn't getting my training done, I was worried about my kids. All sorts of things in that diary entry seemed to show that my life was in bad shape.
If you ask me about 2015, though, I'll tell you it was one of the best years of my life.
2015 was when I completed the Outlaw triathlon, 2015 was when I completed the Outlaw half six weeks before the Outlaw triathlon, 2015 was where various wonderful things happened in our business to push us forward, 2015 was where various wonderful things happened in our family that we always remember.
It's like counting cards, though; if you read the diary entries for 2015, and if there were entries day by day, sometimes I would win, and sometimes I would lose, and if I was lucky, I would win a little bit more than I lost and then when it got to the end of 2015 I would be able to tell you that I'd won that year.
This insight, for me at least, is fundamental and probably my biggest takeaway from Housel's book.
You have to accept the fact that you're not gonna win all the time; in fact, you're not gonna win a lot of the time.
And so, if you're sad because you're not happy all day every day, or if you're sad because you feel tired for part or even quite a lot of the day or if you're sad because you're not on holiday or you haven't bought a watch or you haven't bought a car or a new house, or any of those things, you're dreaming.
Happiness is like counting cards. It's built day by day, week by week, year by year so that when we look back, we think, 'yeah, I just about won that one'.
Blog Post Number - 4115