Attack and defence: Difference between revisions

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 Strikes us that this metaphor: of ''defence'' being judged by by consistent perfection, and ''attack'' being judged by momentary inspiration, translates. We wonder how closely this translates to finite and infinite games.
+===Investing===
+It strikes us that betting on the consensus — in most times, that the market will rise, is defensive. Betting against it is attacking.
+Thus, those who bet on consensus are collecting pennies in front of the steamroller: returns are accretive, require patience, exposure and take ''time'': the risk of being “caught in possession” is a function of time exposure. The longer you must play, the greater your exposure. To benefit from the  consensus you must play a long game. You are dependent on someone else scoring goals at the far end more quickly than you concede then at this end.
+Those who buy crash puts — or, as in the [[Redditors]]’ case, calls — are attackers. They cost a lot and, in ordinary times (against a competent defence), return nothing. They are paying their blind to be in the game, and expect in most cases to lose the small investment it represents. They are throwing pennies in front of a steamroller for others to pick up: they don't stand themselves to be run over, to the contrary, on those rare occasions when the defence fails and the steamroller flattens the rest of the market, they get to collect everyone else’s pennies. This will happen rarely: the key is to net more pennies in this haul than you have paid out in the mean time while things where hoopy.
+===Villainy===
 A criminal defendant will be severely prejudiced if there are is a ''single'' lapse in her story. The prosecutor, however, needs just one moment of inspiration, to breakdown that story, and find that lapse, and the prosecutions case can hold.
-A regulated financial services institution, likewise, must be ''flawless'' in its conduct of its regulatory compliance program. That it may be unfailingly virtuous, altruistic, and motivated towards public good in 99% of its affairs will count for nothing if a single [[bad apple]] is laundering money for a single in an unregarded branch office in Murmansk. By contrast, its supervising regulator, less so. What regulatory oversights it misses do not, generally form part of the public record: “[[what the eye don’t see, the chef gets away with]]”. It is not so closely monitored, nor held to account, and — to  great extent — it does not matter how ineffectual its regulatory coverage or investigation was in any other regard: if it finds that one regulatory breach it can extract a fine and [[knee slide]] to the gallery.
+===Compliance===
+A regulated financial services institution, likewise, must be ''flawless'' in its regulatory compliance.
+That it may be unfailingly virtuous, altruistic, and motivated towards public good in 99% of its affairs will count for nothing if a single [[bad apple]] launders money for a single in an unregarded branch office in Murmansk.
+By contrast, its supervising regulator, less so. What regulatory oversights it misses do not, generally form part of the public record: “[[what the eye don’t see, the chef gets away with]]”. It is not so closely monitored, nor held to account, and — to  great extent — it does not matter how ineffectual its regulatory coverage or investigation was in any other regard: if it finds that one regulatory breach it can extract a fine and [[knee slide]] to the gallery.
-But, but, but — this is all true as long as you are in defence mode and not attack mode. For — but for an apex predator — ''everyone'' spends some time on attack — punching down — and some on defence — avoiding ''being'' punched down. Client mode is attack; adviser mode is defence. The [[Securities and Exchange Commission|SEC]], when investigating [[Bernie Madoff|Madoff]], is in attack mode and, sure it didn’t land one but the expectation is a clear round; when explaining its failure to find anything to a Congressional Committee, it is in ''defence'' mode.
+===When the hunter becomes prey===
+But, but, but — this is all true as long as you are in defence mode and not attack mode. For — but for an apex predator — ''everyone'' spends some time on attack — punching down — and some on defence — avoiding ''being'' punched down. Client mode is attack; adviser mode is defence. The [[Securities and Exchange Commission|SEC]], when investigating [[Bernie Madoff|Madoff]], is in attack mode and, sure, it didn’t land one but the expectation is a clear round; when explaining its failure to find anything to a Congressional Committee, it is in ''defence'' mode.
 There are notable exceptions, of course but these prove the rule by their relative absence the excoriation hand out to the [[Securities and Exchange Commission]] over [[Madoff]], and the public criticism of [[BaFin]] over the [[Wirecard]] affair — but even here the relative punishments are in no way comparable.