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Showing posts with the label $100

Ad Astra, Part II

So: what is so philosophically interesting about this movie? This: the brilliant but brittle scientist is turned mad by the realization that the human race is alone in the cosmos. Or at least in this galaxy. One key premise is that the base was established on Neptune in the first place because only there could data about the rest of the galaxy be gathered free of solar interference or something. Usual sci-fi gobbledegok but... the point is that the base was established on the fringe of our solar system with the confidence that if there is other intelligent life to be detected, it could be detected from there. Lots of data was gathered, no sign of alien life appeared. The negative result drove Tommy Lee Jones' character over the deep end and sets up the situation with which, as I said in Part I of this discussion, the plot of the movie begins. Science fiction is full of aliens. It nearly never gives serious consideration to the possibility that there aren't any. That we ...

Thoughts About Risk Aversion

Risk aversion is a straightforward name for the psychological fact that humans are often willing to pay a premium for certainly, or at least for limiting the zone of uncertainty. Suppose you, dear reader, appear on a television game show. The master of ceremonies says to you, "I can give you a nice crisp $100 bill right now!" You say, "oh, goodie." "Or!" he continues with a dramatic flourish, "I can flip a coin. If the coin comes up tails, you'll get nothing. If the coin comes up heads, you'll get $200." Let us suppose there is no element of what finance types call "counter-party risk" here. Your counter-party is the emcee. We'll assume he is entirely trustworthy and that there is nothing tricky about the coin flip itself. The expected value of the coin flip, in simple arithmetical terms, is ($200 + 0) ÷ 2 = $100. The value of the payoff if you reject the coin flip is, again, $100. So you should o...