John von Neumann’s work on game theory sparked Konnikova’s interest towards poker, which she describes as a way to examine the mind’s responses to conditions that include both skill and chance. Konnikova is not a fan of casinos and gambling.
The Decision-Making Process Is Key
In her newest book, The Biggest Bluff, New Yorker writer, and psychologist Maria Konnikova writes about her journey from a complete beginner in poker to an award-winning professional player. One of the biggest lessons that Konnikova wants to teach her readers is to focus on the decision-making process, rather than putting the emphasis on losses or missed opportunities.
The Biggest Bluff is not only a book about poker, although it depicts in detail the subculture of professional players, it is also a book on the process of thinking. Thinking about one’s thinking is the essence of poker, the book reveals.
According to Konnikova, poker is a combination of luck and skills. While you can win with the worst hand and lose with the best hand, the opposite can happen as well. One should put their best effort and knowledge into the game but must keep in mind that poker is a game of incomplete information, there are surprises and things are in constant movement. The player should make the best decision knowing that it does not guarantee them a win.
Investing During the Uncertainty of Covid-19
In an interview for Barron’s magazine, Konnikova talks about the current uncertain environment and the behavior of investors on the stock market. Covid-19 has caused a lot of instability and ambiguity, which affects people’s capacity to make decisions in a negative way. However, the number of traders of stocks and options is rising and according to Konnikova, one of the reasons for this trend is extreme confidence and in some cases ignorance.
Konnikova, who says she is not a fan of casinos, compares the behavior of non-professional investors to gambling since one cannot predict future gains on the basis of previous outcomes. Konnikova highlights that in some cases, being passive is a good decision, contrary to the belief that taking any action is always the better choice.
Regarding the process of decision-making, she says that people should always question their choices and provide arguments both in favor or against them. In case of fear, one should analyse the source of it and whether it is irrational or based on a similar experience in the past.
“If you’re pretty sure that you’re going to raise this particular hand, first, in your head, do a quick argument for why you would not raise, why you would call, or why you would fold.”
Maria Konnikova, best-selling author, psychologist and poker player
For Konnikova, the focus should be on the process, since it is the only thing one can control.