Chess Buzz for July 25, 1997

This Week's Topic: Chess and the Stock Market

"Human beings are compelled to introduce irrationality into the most logical of subjects. "
William James

Both chess and the stock market should be logical, dispassionate, even scientific pursuits. Or so argue some proponents. The real "players", however, know that any activity that defines risk and measures wins and losses in unmistakable terms brings its own emotion with it. On top of that, any activity that depends on predicting what human beings will do contains a level of uncertainty. How many times have we seen a great player make an odd move, the only explanation being, "I don't know; I felt like playing it." While the experts keep trying to apply math and computers and logic to these fields, the real winners seem to be those who mix just enough science with a healthy dose of psychology and intuition.

Several chessplayers have been important in the speculation game as well. USCF Executive Director had his own futures trading company, Cavallo Capital Management. Grandmaster Ron Henley is an active trader in New York. IM Norman Weinstein was a very successful currency trader. One major bank even placed ads in Chess Life and other games publications, looking for top gamers to recruit into their investment manager programs.

Our media buzz this week is about a new nonfiction book, THE EDUCATION OF A SPECULATOR, by Victor Niederhoffer. The cover of the book includes both a chess and checkers set--not an uncommon symbol in Wall Street publications. But Niederhoffer goes further--his book includes quotations from Znosko-borovsky, and mentions of Tal. He uses chess as an example of how psychology can rule even the most logical of games. His claims that the only newspaper he reads is The National Enquirer, and that all you really need is a good eye and common sense, sound a little like the young Arnold Schwarzenegger's discussions of his early training methods--are these real comments, or just moves in a greater game of psychology and competition? Where most financial books use chess as an icon of cool, rational thinking, and the power of cause and effect, Niederhoffer turns the tables and uses chess as a model of how human beings become emotionally invested in even the most mathematical of contests.

Perhaps these two sides of chess are where its real fascination lies, and the real reason for its survival as one of the most popular games for hundreds of years. Just as in market trading, presenting our "rational face" to the opponent is just one more move in the game. While those interested in money markets and business successes will undoubtedly find Niederhoffer's book interesting, chessplayers may find it gets them thinking about their own game as well.

Well, that's the buzz for this week.

Have a hot story for us? A trend you want us to look into? An item only chessplayers can appreciate? Write webmaster@uschess.org

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• The Buzz for July 18: After Karpov and Kasparov--Who will be the next World Champion?
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