Sta Hungry Stay Foolish

Stay Hungry. Stay Foolish.

A blog by Leon Oudejans

The Risk-Reward trade-off

My recent blog on family-owned companies triggered the following remark from my son: “I am not really familiar with the risk-reward trade-off”. Initially, I was surprised by his remark as the risk-reward trade-off governs all aspects of our lives (eg, speeding). Each decision that we take is a consequence of considering the upside (reward) and the downside (risk) of that decision.

Ever since the coronavirus lockdown, wild animals in various countries have been roaming the streets of deserted cities. Clearly, the risk-reward trade-off has changed dramatically for these wild animals. The upside (eg, food) has become much bigger than the downside (eg, captivity, death). Hence, animals must face a similar risk-reward trade-off as humans.

Plants and trees cannot move and/or relocate. They need different strategies for adapting to (climate and/or environmental) Change. Both also seem to use a kind of risk-reward trade-off. They use very many seeds (ie, lowering risk of non-reproduction) and these (light) seeds either use the airstream (ie, wind) or animals (eg, bees) for travelling some distances through air (ie, reward).

In my 2016 blog, The Fermi paradox and some other similar questions, I wondered the following: Why are there so many stars and planets in the Universe if we are just alone on Earth?? Today, I’m tempted to argue that the immense number of planets and stars follows a similar strategy like plants and trees: you need very many “seeds” for enabling a chance on Life.

In 2019, I came close to the above conclusion when I published part 1part 2part 3 and part 4 of my blog series: Are planets evolutionary lab experiments?

The similarities between the above examples may suggest that the existence of a universal collective consciousness, a.k.a. panpsychism, which “is one of the oldest philosophical theories”.

Ultimately, the risk-reward trade-off is about minimising our chances at death (risk) and maximising our chances at life (reward). In this context, the Risk-Reward trade-off might be considered a universal law that applies to life forms and even objects, like Earth, facilitating life.

“Security is mostly a superstition. It does not exist in nature, nor do the children of men as a whole experience it. God Himself is not secure, having given man dominion over His works! Avoiding danger is no safer in the long run than outright exposure. The fearful are caught as often as the bold. Faith alone defends. Life is either a daring adventure or nothing. To keep our faces toward change and behave like free spirits in the presence of fate is strength undefeatable.” A (verifiedquote by Helen Keller (1880-1968), “an American author, political activist, and lecturer”.

Risk and Reward (2018) by Rosegold (DNK)

artists, AllMusicFacebooklyrics, video, no Wikipedia

But as time goes the risk grows 

‘Cause there is no pain without gain, I did not risk it not to change 

But you know that I know 

That you just do it for the fame, but the reward just ain’t the same,

Note: all markings (bolditalicunderlining) by LO unless stated otherwise.


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