YOYO English Club

Dear YoYo members,

After several meaningful gatherings discussing about self-improvement and life, I am going to discuss a shallow, but pragmatic, topic about “Money”. In Tashi’s last hosting about the applications of statistics, on session two, inevitably, many groups discussed about stock market and their strategies of investments. It reminds me the statement that Harari ever mentioned in his book Sapiens that money is about the most successfully frictional story in human history and every one subscribes it. Since the whole capital market is constructed based on our imagination (as the speaker, Dr. Daniel Corsby, of the second video emphasized, the financial markets don’t exist in nature), we people eventually come out with different psychological mechanisms to cope with it and are hoping we can outsmart the others to gain profits, however, these mechanisms could in the end lead to behavioral traps.

Please take some time to watch the video clips below.

Bananas in heaven | Yuval Noah Harari | Behavioral Finance Speaker - Dr. Daniel Crosby QUESTIONS:

SESSION I

1. Are you convinced by the dual reality theory? Is yoyo real to you, why is it real? Or is yoyo fictional, why is yoyo fictional?

2. Human rights were also generated by our imagination (as they don't exist in the nature). By this fact, would it shake your stands for what you are believing in (i.e., gender equality, gay rights….)? If not, what are your reasons to defend the fictional rights ?

3. In Dr. Cosby’s speech, he mentioned, among lottery winners, 43% didn’t sense positive effect on happiness and 44% were eventually broke within 5 years.
a. What are your explanations to above data?
b. If you will be a lottery winner, are you confident that you will live a different life with happiness and content? What will you do to ensure so?
c. If the crystal ball tells you that, being a lottery winner may bring you to bankrupt within 5 years and the chance is 50%, decided by fate (meaning you can not do anything to prevent from the other 50%), are you still willing to take the bet to be a lottery winner? Why? Or Why not?

SESSION II

4. Warren Buffett said “to be fearful when others are greedy and greedy when others are fearful”. Similar to buy low sell high, is this an easy principal to practice? If not, why is it not? What are the psychological/behavioral obstacles to practice it?

5. Let’s discuss about “Prince Charming Bias”.
a. Have you ever studied or tried to get whatever insider’s information hoping to invest on the stocks which would in the end skyrocket to bring you ten-fold profit? If you did successfully manage to get one (or two), how did the tremendous profit change your life (i.e. retired early, bought a new house…)?
b. If the luck never happens on you so you still come to yoyo meetings as usual, what are the purposes of your investments? What are the returns you are expecting from your investments?

6. Let’s discuss about “this time is different” bias.
a. Did you ever invest on any stocks, assets or commodity because you also had the similar thought “this time is different”?
b. Financial bubbles will never stop as long as we have imagination. Based on your personal experiences or observation, what could be the subject of next financial bubble? (either in Taiwan, or anywhere else) why?

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Agenda:
6:45 ~ 7:00pm Greetings & Free Talk / Ordering Beverage or Meal / Getting Newcomer’s Information
7:00 ~ 7:10pm Opening Remarks / Newcomer’s Self-introduction / Grouping
(Session I)
7:10 ~ 7:45pm Discussion Session (35 mins)
7:45 ~ 8:00pm Summarization (15 mins)
8:00 ~ 8:05pm Regrouping / Instruction Giving / Taking a 5 Minutes Break (Intermission)
(Session II)
8:05 ~ 8:40pm Discussion Session (35 mins)
8:40 ~ 8:55pm Summarization (15 mins)
8:55 ~ 9:00pm Concluding Remarks / Announcements

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Meeting Date: As shown on the Subject Line
Meeting Time: 7:00pm – 9:00pm
Meeting Venue: 丹堤咖啡 Dante Coffee (Minimum Order $85)
Address: 台北市濟南路三段25號[MAP]-捷運忠孝新生站3號出口步行3分鐘

Important Notes:
1. We suggest that participants read the articles and think about the questions in advance.
2. Newcomers should prepare a two-to-three-minute self-introduction in English to deliver when called upon by the host before the start of the discussion.
3. We welcome newcomers and other guests to attend the meetings and join the discussion freely for three times. After that, we hope you will consider becoming a YoYo English Club member. We charge a NT$1000 lifetime membership fee, or NT$500 for students.

As an enthusiastic sports fan, I am hard-wired for activities that are more brawn than brains. I must say, it limits my ability to grapple with those well-designed, but fictional-entailed questions by the host; to me, they demand a philosophical mindset, which is missing from my genes. Here are my answers to the money-related questions.

3) The lottery question boils down to another profound question–can money buy happiness? It is a matter of opinion. I am more than thrilled to go after such a veritable whirlwind of imaginary fortune. Who knows the best or worst is yet to come over winning a lottery! It is truly a once-in-a-lifetime experience if it even happens once.

4) The golden investment rule of Warren Buffett is easier said than done! It does not apply to an impatient, greedy, or overthinking investor. Every investor needs to pay some level of tuition before knowing the ropes. Perhaps the more money we cough up, the more we learn.

5) There is no such thing as an insider’s information in terms of investment. One has to take it with a grain of salt and do one’s homework. Sometimes, it is hard not to be tempted into such investments, there may be legal concerns involved, or it may be nothing but smoke and mirrors to bail out someone or something. Don’t be the last one to smell a rat.

6a) I am a faithful follower to “this time is different," the best testament to learning from yesterday, living for today, and hoping for tomorrow. Besides, it represents a refreshing change and a renewed confidence to prepare for another shot. In the investment arena, “this time is different” shows that one successfully managed to keep one’s head above water, and has replenished one’s ammunition for the next round of the battle.

Market cycles boom and bust all the time. Everyone should view their investments as a house of cards and play it safe!

I'll answer the question 3c first:
"3. In Dr. Crosby’s speech, he mentioned, among lottery winners, 43% didn’t sense positive effect on happiness and 44% were eventually broke within 5 years.
c. If the crystal ball tells you that, being a lottery winner may bring you to bankrupt within 5 years and the chance is 50%, decided by fate (meaning you can not do anything to prevent from the other 50%), are you still willing to take the bet to be a lottery winner? Why? Or Why not?"

My short answer is "YES", because I would totally believe that "This time is different!"

Before looking into the contents, I thought we are going to talk about the “stock-picking monkey”. I mean the famous story that if we give a monkey enough darts and it can outperform all the stock market traders or fund managers!

It turns out that our host has a much more eclectic mix of interests, “From Monkey to Market”, what an all-embracing topic!

I’ve totally bought into the theory of dual reality since we read “Homo Sapiens” two years ago. Professor Harari elaborated the definition of “dual reality” very well, which is an objective world and a layer of subjective reality on top of the objective reality.

To me, same as nation and corporation, YoYo is a fictional entity. According to Harari, a “fictional” entity doesn’t mean it is “untrue”, instead the word “fictions” connotes “abstractions that groups of people agree on and which drive their behavior.” Similarly, a fictional right is not untruthful. The connotation of fictional rights should be certain constructs that a certain group of people imagine and believe in at certain period of time in human history.

Once we realize the truth of these fictional rights, we can probably be more open-minded. When we defend the “fictional rights” that we believe in, we should be aware that none of our fictional rights, political ideology, sets of values are more real or superior than anyone else’s, as Professor Harari pointed out.

Dear All,

Thanks for attending this meeting. It turned out the first two questions were arising with most of the heated discussions. As Iris remarked in the meeting, and her statement above as well, the fundamental message delivered by dual reality is "none of our fictional rights, political ideology, sets of values are more real or superior than anyone else’s".

For the similar challenges to our mindset, which I also briefed in the meeting, could be the dual reality v.s. moral codes and justice. But this could be a bombshell to shock our members so I stopped at human rights.

Attendees: Chris, Edward, Shirley, Sherry, Liwen, Iris, Steve, LuLu, Andrea(new comer), Amy, David, Kat, Wenhan, Sabrina, Chi, and Julian.