Michel Pireu Columnist

Ironing your shirts then putting them in the washing machine produces a different outcome from washing your shirts first, then ironing them. The reader can either trust me on this or try the experiment with both sequences on the next Sunday afternoon.

Now, assume that your capital is around $1m and you are involved in speculation. Apply path dependence to the reasoning. Making a million dollars first, then losing it, is markedly different from losing a million dollars first then making it. The first path (make-lose) leaves you intact; the second (lose) makes you bankrupt, insolvent, maimed, traumatised and more generally unable to stay in the game, thus unable to benefit from the second part of the sequence. There is no make after the lose. — Nassim Taleb..

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