On Fri, May 16, 2014 at 12:04 AM, Eric Walker <[email protected]> wrote:
> On Thu, May 15, 2014 at 11:42 PM, Kevin O'Malley <[email protected]>wrote: > > >> ***Does that mean you think it's a 51% probability that "Rossi is real"? >> > > I don't know if I can quantify the feeling with so much precision. > ***I understand. In inductive reasoning, when one says one thing is probably true, it implies that it is at a minimum slightly more chance of being true than false, which is that 51% figure. > I'm on the fence about the underlying premises of prediction markets. > ***That makes sense. It is all our own internal reasoning, which takes in data from sometimes unrelated sources. Blaze sure has demonstrated that. For instance, he modifies the "Rossi is real" conclusion with data from MFMP and the NANOR. Both are unrelated to Rossi. > Perhaps a feeling that there is an 80+% chance that he's got something, > with a healthy allowance for the possibility of a negative surprise in the > future. > ***Thanks for that figure. I agree that it has a healthy allowance of a negative surprise in the future. Let's say that you feel about the same way towards CYPW, that it has an 80% chance of skyrocketing if "Rossi is real". That means that you think there is a (.80 x .80 = ) 64% chance that CYPW will skyrocket some time soon. Those are your emotional odds, analogous to hand odds in poker. The table odds are perhaps $10:1 or $20:1, depending on what would happen in a breakout. With the CYPW stock, it actually experienced a spike of greater than $100:1 on merely conventional news, whereas a LENR breakout is a black swan event; so I feel comfortable using $100:1 as the table odds. So it's 64% hand odds versus 1000% table odds. That signals a strong buy. Now, of course, when someone calculates internal emotional odds of something like "Rossi has something" and then you start talking about Putting My Money Down on such internal odds, everyone tightens up. So my internal emotional odds would actually be more like 1/2 for Rossi and 1/2 for CYPW. That still brings us to 25% hand odds versus 10000% table odds. It is still a strong buy signal. With penny stocks, there's nothing like a low price to overcome paranoia. With this instance, the internal emotional odds also include the desire to put my money where my mouth is, as well as to contribute to the LENR effort with some expectation of gain. > > Eric > >
