“Always Free and Worth Every Penny”

Thank you for all the encouraging messages from last week’s Friday Thoughts

“best Friday Thoughts ever !!”,   “keep it up!” ,  “ You should do this more often”

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“Of those men back there, Val, Sonnenberg is the toughest and the meanest. Tensleep is the best with a gun, and by far the most cunning, but Tom is the most dangerous.”

“Why?”

Because he is not right in his mind. He looks all right, and most of the time he acts all right, but you can’t count on what he will do under the strain when it comes to a tight spot. He could very easily go wild and kill everybody.

                                                                                     Reilly’s Luck   by Louis L’Amour

 

I am not a big fan of Western novels or movies…..but a few of L’ Amour’s are just classics – wait – you know Louis L’Amour  right?  He wrote dozens of western fiction books that have been best sellers for years – The Quick and the Dead  is a classic.  I was inspired and humbled by his autobiography Education of a Wandering Man (great title!).

Reilly’s Luck was not one of his best stories – young boy abandoned by his mother (Val), raised by an incredibly lucky gambler (Reilly), justice served in the end…… but that one passage has always stuck with me        “….but Tom is the most dangerous…..”

This budget/debt/deficit saga in Washington is really something to behold – a great drama if there ever was one ….. maybe if they televised the negotiations on Pay per View they could cut the deficit in half right away. Or they could get Ryan Seacrest to host it and have the American viewers text in their votes to the best budget solution …..

Or they could turn it over to the NFL – they seem to have worked out their differences – if you can figure out what to pay a rookie tight end then solving for the stability of global reserve currency cannot be that hard….

I have to say the warnings from Moody’s and S&P were ominous …. But even more ironic… aren’t these same geniuses that AAA rated the rotten mortgage debt – why are we listening to them now? (Why aren’t they in jail??)

If I can suspend for just a moment any passing concerns of what might actually happen in a default,  observing the  bargaining tactics of the Democrats and Republicans is not only entertaining, but highly, highly instructive…..

Business leaders are trained to be logical….. rational…..sequential….

We have sophisticated tools to guide us to the best decisions….issue trees……probability weighting….Ghnant charts….with critical paths… Discounted cash flow with a leveraged beta…. Risk management plans…

But the random, irrational and unpredictable are incredibly disruptive…. 9/11, Japan earthquake/tsunami, DC sniper, Greek debt, HIV…….

As Reilly cleverly observed, having an unpredictable opponent is unnerving……  an irrational opponent upsets the traditional approach to competitive position and gaming theory.

Most of the time in business…. and life ….. we are working to mitigate the random and unpredictable … we fight to make things rational and logical….in general, game theory (and the famous  Nash Equilibrium  theory)  guides us to create and seek out stable situations and opponents ….And that makes sense…..

Iceman: You two really are cowboys

Maverick: What’s your problem Kazanski?

Iceman: You’re everyone’s problem. That’s because every time you go up in the air, you’re unsafe. I don’t like you because you are dangerous

Maverick: That’s right ! Ice…man. I am dangerous.

                                                                                                      Top Gun (1986)

But as we watch the high stakes game unfold in DC…. and observe how difficult it is for opponents to cope with irrational behavior…… it begs the question… should we always be so logical? ….so rational? …..so predictable?  

Are there times when being  “not right in the mind” could be a very clever strategy ?

Of course our representatives in DC have brought a whole new meaning to “not right in the mind”  Can you spell Weiner?  Don’t forget William “what’s in your freezer?” Jefferson !!

I suspect that most irrational behavior we see in DC… or in the market…. Or in our competitors… is an accident or mistake….  But I am thinking that sometimes it is very rational irrationality….. perhaps thoughtful randomness…..

So I am wondering if there might be times when it is quite beneficial to us if our opponent is thinking:

   “He looks all right, and most of the time he acts all right, but you can’t count on what he will do under the strain when it comes to a tight spot.

He could very easily go wild and kill everybody”

 

Have a fantastic weekend!

Editor

Related Posts:

• Disruption, Demise and Destruction?
• I am sure it is all under control….

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