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Newsletter:🏈 A Headline You Won’t See: Chiefs Coach Andy Reid DOESN’T Make the Worst Call in NFL Playoff History

Happy Friday!
I’m coming to you today with some thoughts on the *not* worst call in NFL history, a recent interview I did for Forbes CryptoAsset & Blockchain Advisor, as well as some updates from Renew Democracy Initiative, the Alliance for Decision Education, and other odds and ends I’ve been up to.

I hope you enjoy. Looking forward to a great year ahead.
Headline You Won’t See: 
Chiefs Coach Andy Reid DOESN’T Make the Worst Call in NFL Playoff History
Subhead you won’t see: Everybody apologizes to Pete Carroll

Football fans saw a thrilling ending to last Sunday’s NFL divisional playoff game between the Kansas City Chiefs and the Cleveland Browns. The Chiefs held on to win 22-17 and advance to the AFC Championship game. 

The game was also a great show for behavioral science fans. On the game’s decisive play, with the Chiefs leading by 5 and facing 4th-and-inches near midfield with 1:30 left in the game, Chiefs coach Andy Reid called for a pass play. 

Obviously, if backup quarterback Chad Henne completes the pass, Kansas City makes the first down and runs out the clock to win. But if he fails, the Browns get the ball with time to potentially score a winning touchdown. Even worse (for the Chiefs), if Henne is sacked or intercepted, they could score on that very play.

Reid had many more “conventional” options on 4th down: He could have Henne try to draw Cleveland offsides. If that didn’t work, Kansas City could run the clock down further, call timeout, and do something else. (Tony Romo, providing color commentary, insisted that’s what Kansas City was about to do.)He could have punted. That would have pinned Cleveland deep in its own zone with no timeouts and barely a minute to go. He could have run the ball.Henne rolled out to the right and passed to Tyreek Hill, who caught the ball for a 5-yard gain and a 1st down, ending the game. That play made Chad Henne an unlikely hero, especially because he had already thrown an interception earlier in the 4th quarter.

The play call also made Andy Reid a hero. On the TV broadcast, analyst Tony Romo immediately yelled, “Only Andy Reid gets in shotgun on fourth and an inch and throws the ball with his backup quarterback! There’s no way. He shocked everybody. Never seen it!”

Andy Nesbitt, in’s ForTheWin, said the call “solidified Reid’s status as one of the greats in the game …. Reid’s decision was a thing of beauty.” Skip Bayless of Fox Sports tweeted, “Great gutsy call by Andy Reid.”

The primary reason the world went nuts (in a positive, celebratory way) over Andy Reid’s call was because it worked. It’s a classic case of resulting.

In fact, it’s an interesting contrast to the resulting that took place after Pete Carroll made a similar choice at the end of the 2015 Super Bowl, but with a different outcome. (I led Thinking in Bets off with this story.) Carroll called for a pass late in the 4th quarter on 4th-and-inches that, if completed, would have won the game for the Seattle Seahawks. Instead, it was intercepted, the New England Patriots won, and the headlines skewered Carroll the next day.

Look at the contrasting reaction to Carroll’s call from similar sources. NBC’s analyst, Cris Collinsworth was, in the words of’s ForTheWin columnist, “apoplectic.” That headline, by the way, was “What on earth was Seattle thinking with worst play call in NFL history?” The headline was “Dumbest call in Super Bowl history could be the beginning of the end for Seattle Seahawks.”

In Thinking in Bets, I asked readers to speculate on the headlines had Russell Wilson completed that pass in Super Bowl XLIX: “Wouldn’t the headlines change to ‘Brilliant Call’ or ‘Seahawks Win Super Bowl on Surprise Play’ or ‘Carroll Outsmarts Belichick’?”

I think we have a pretty good idea, based on the reaction to Reid’s call, of how the headlines would have looked if Carroll’s call had worked. That’s not a commentary on football strategy or the media. That’s just resulting.H/T to Thomas Kretchmar for pointing this out practically as it was happening.
Forbes Interview: 
Bitcoin And Crypto Trading Tips From Poker World Champion Annie Duke

Excerpted from 
Forbes CryptoAsset & Blockchain Advisor.
By: Steven Ehrlich, Forbes Staff Crypto & Blockchain
Forbes: Welcome Annie. Most people know you as being one of the most famous poker champions of all time. However, many are unaware of your prestigious academic background or years of experience as an advisor to some of the most successful investors in the world. Could you please share with us how you got into this industry?
Annie Duke: I started off my adult life at the University of Pennsylvania, doing five years of Ph.D. work in cognitive science. The only reason I didn’t end up becoming a professor is because I got sick, right at the end of that. I needed to take a year off from school, and it was during that year off that I started playing poker. I fell in love with the game and did that pretty exclusively for about eight years. But then in 2002, I got asked by a hedge fund to speak to their traders about how poker might inform the way that they think about risk. I had been thinking about this connection implicitly, but this was the first time that I thought explicitly about the connection between cognitive science, behavioral psychology, behavioral economics and poker, which is a very real world, fast-paced, high stakes instantiation of the problems that these disciplines are trying to tackle. I ended up getting referred out from that original engagement in 2002 and started to give lots of talks, began consulting, and wrote several books on poker, behavioral economics and decision making. Ultimately in 2012, I rolled out of poker and made the consultant work much more full time and continued writing. Today, I’m back at Penn doing research, so I’ve kind of come full circle back into academics. 

Forbes: How accurately do you think people assess their investing prowess? What are some of the biggest mental traps you’ve seen in the course of your career and research?
Duke: Many people do not assess themselves accurately, and when you look at most of the main cognitive biases, they mostly fall into the overoptimism category. As soon as you get into something that people feel like they know how to do and obviously, that would be true for investors, most people become overconfident. There’s something called a better than average effect. For example, if you ask people how good of a driver do they think they are in comparison to the population, something like 90% of people put themselves in the top half. It is the same thing with investors, most of whom are going to rate themselves more highly than they should. You also get the illusion where people think they have more control over their outcomes than they do. The problem in both investing and poker is that there’s a lot of uncertainty. The world is stochastic, that’s one problem—that there’s luck. And the other is that there’s hidden information. Information can also reveal itself after the fact, too. Sometimes there’s information that never reveals itself. That allows an untethering of the results from the actual skill that went into the decision. The point is that I can win, even though I do everything wrong. And I can lose, even though I do everything right. This creates a really huge problem, at least in the short run. It can become especially dangerous when we ascribe our good fortune entirely to skill, without accounting for luck. 

Forbes: What are some of the best practices you recommend so that investors can structure the decision making process in a way that is regimented? Can you share anything that is particularly relevant for investors in crypto, which can be especially volatile?
Duke: That’s really such a great question. Essentially, you want to do the advance work. Say I’ve got someone who is interested in bitcoin. When I’m making that investment, I want to understand why I think the investment is good and actually make that explicit. When it comes to something like investing in something that’s highly volatile, such as crypto, this becomes really, really important. You need to be able to separate out what was due to luck and the assumptions that you went in with so you can circle back to them later. You also need to take a second step, which is to determine the conditions under which you would sell. Meaning, what would need to happen to tell you that your assumptions were wrong or this is no longer a good investment.

Forbes: Turning more directly to crypto, regardless of the models we build and metrics we use there will always be a degree of uncertainty. As much as we try, it is impossible to know everything. What is your advice for finding ways to feel comfortable in that position?
Duke: Right now we know less about crypto than something like tech stocks. But just to be clear, we also know less about tech stocks than we think we do. That’s the first thing you need to understand. The second thing you need to realize is that the higher degree of uncertainty, the less likely it is that your model is going to be perfectly accurate. Under those circumstances you need to think about mitigating downside outcomes. This is critical because when you have less accuracy in your prediction models there is a higher probability of receiving an unpleasant outcome. This first way is to make sure you have a really good quitting strategy. So what do I mean by that? The higher the uncertainty, the more you should value liquidity. Stop-losses are another valuable tool. On the flip side, you might want to change your mind in both directions, meaning under different circumstances you could want to press your position. Another useful strategy is spreading your bets, so that you’re mitigating the chance that you are wrong about any single investment. 

Forbes: As a way of grounding this discussion for the readers, can you walk us through the process of setting up and testing an investment assumption regarding crypto?
Duke: Sure. There are things happening at the Fed regarding interest rates that could cause you to change what you want to do. If I’m buying bitcoin as a hedge against inflation, what I need to make explicit is that I believe inflation is imminent. What that does is make you look to see if inflation is actually on the near-term horizon or within the time period that I’m saying it would have to occur. Additionally, once I make this assumption explicit, I can also ask, what would have to be occurring in the world in the future that would make me want to change that assumption? Putting it all together, if you believe that inflation is going to rise in the next eight years to a level making it worthwhile to invest in bitcoin as a hedge, then you should also ask yourself what are the signals that could make me change my mind and not think that inflation was imminent or occur at a high enough level to justify investing in bitcoin for that reason alone? By challenging your assumptions, it makes you look for signs in the future. And if bitcoin goes through the roof and inflation stays low, it stops you from taking credit for it. You should want to do it because it means that bitcoin won for a different reason than you thought it would.

Forbes: Since the pandemic hit there has been an explosion of online trading in the retail sector, which can be very addictive. While it is important to stay aware of what is happening in the market, everyone must find a balance so they do not become overwhelmed and make emotional trading decisions that could prove to be erroneous. Do you have any suggestions for the readers?
Duke: The best investors actually are reducing the attention they’re paying in the short run, and the reason is that the way we make decisions is quite past-dependent. So when you’re ticker watching, which is what you would call checking the price all the time, you’re going to feel those momentary ups and downs. They’re going to distort decisions you make in quite a bad way. In poker we call this a tilt. Now, obviously, in poker, you cannot not see your chips go down. But in investing, you can because you can just not check it. This is important because we know that there’s going to be natural variances, and people tend to make better decisions when they aren’t checking it every single day. A better plan would be to decide what you will do if certain things happen in the world, such as a development at the Fed or reaching an up or down price barrier. If those things are not happening, do not even look at the price. Because it’s going to screw your decision making up, there’s nothing good that will come from it. I promise you.

Forbes: Any final thoughts for the readers?
Duke: I would say just generally, sort of back to the beginning of the conversation, it’s really easy to fool ourselves into thinking that we know something more than we do. You should also be actively seeking information that proves you are wrong. It is easy to find people who agree with investing in bitcoin as a hedge against future inflation. What you should be doing is finding the smartest people you can find who say that’s not true. That doesn’t mean that investing in crypto isn’t a good idea, even if an assumption isn’t true. But you should want to find that out because that’s what’s going to help you be a better decision maker. The more that you’re approaching your ideas about investment decisions from the standpoint of asking why this is wrong, the better off you’re going to be. 

Forbes: Thank you.
January 6th’s attack on the Capitol was a wake up call.
Please consider signing The Renew Democracy’s Initiative’s anti-Authoritarian Pledge to show that we will never support an authoritarian leader.

Sign here:

Watch my video as I participated in the #RenewDemocracy Challenge and shared what democracy means to me.
Speaking of the Alliance for Decision Education …
I am excited to share that the Alliance For Decision Education is launching a podcast! 

Dr. Joe Sweeney, executive director of the Alliance, will be speaking to experts and share tips on all things related to decision making. Through these conversations you will be entertained, gain new insights, and discover practical ways to improve your decision skills. Imagine what a difference it would make in your life, and the lives of those you love, if we were all even a little better at making decisions.

Listen to the trailer to get a sneak peek of what’s in store. Subscribe to the podcast so you don’t miss Episodes 1 and 2 coming at the end of January! 

Please enjoy some recent podcasts and talks I’ve joined where I talk about, How to Decide:
Creative on Purpose: (Video)
Facebook Live conversation with Scott Perry

The Twenty Minute VC Podcast
Venture Capital, Startup Funding, The Pitch with Harry Stebbings

Recruit Rockstars Podcast
What Poker Can Teach Us About Recruiting

Lawyerist Podcast
Better, Faster, Smarter Decision Making, with Annie Duke and Laura Briggs