Motley Fool Money - Is Investing a Game?

Episode Date: March 11, 2023

In everyday life, your value system is complicated and rich. Games make that system simple, and you know exactly how well you’ve done.  C. Thi Nguyen is a philosophy professor at University of Utah and author of the book Games: Agency As Art. Motley Fool co-founder David Gardner caught up with Nguyen to discuss:  - The bright and dark sides of gamification  - How Twitter changed the way we communicate  - Good, bad, and evil games Today’s conversation comes from a recent episode of David's weekly podcast, Rule Breaker Investing. To hear the entire show, click here: https://www.fool.com/podcasts/rule-breaker-investing/2023-02-15-from-twister-to-twitter-games-and-c Host: David Gardner Guest: C. Thi Nguyen Producer: Ricky Mulvey Engineer: Rick Engdahl Learn more about your ad choices. Visit megaphone.fm/adchoices

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which makes it so much easier to stay on track. And you can get unlimited expert help at no extra cost, even on nights and weekends during tax season. Visit turbotax.com to get matched with an expert today, only available with TurboTax full service experts. In the investment space and in the Twitter space, the people that I find most worrying are those who self-consciously think of it as a game. Like, I'm just trying to win. These are my points. Like, I'm just playing the game. And not thinking about the fact that the things that they're calling points are attached to incredibly consequential material reality.

I'm Chris Hill, and that's C.T. Nguyen, professor of philosophy at the University of Utah. An author of the book, Games, Agency as Art. David Gardner, co-founder and chief rule breaker here at The Motley Fool, caught up with Nguyen to talk about the games you may not know you're playing and the consequences of racking up points on Twitter. They also debate whether investing counts as a game. Today's episode comes from David's weekly podcast, Rule Breaker Investing. In the show notes of today's episode, you will find a link to the full copy.

conversation. So let's talk a little bit about abstraction because that's sort of happening with games. After all, a game designer decides to create along a theme some kind of a rule set, which if you and I read the rules, and I'm always the one in my gaming group who does, I buy games sometimes just to read the 32-page rulebook. It doesn't even make sense because these days they're all on PDF, but I still buy the game. Still in shrink wrap in many cases, but I'm going to open it. I at least want to read the rulebook. So you have somebody who's thought through a system. And if it's published, if it's a good game, it's not a breakable system. You don't obviously always choose four or always pick wheat.

You're actually going to think through each time you play the game, how you're going to maybe play the game differently, maybe based on the conditions. But anyway, what's being done is we're abstracting reality. We are simplifying in the same way that comics, in a lot of ways, abstract the visual world around us. That's what game designers are doing. And then they say, along with Kenetia, hey, here's how we're scoring. Here's the goal. Here are the points for this particular game.

And so that's why in some ways we're given agency within a simplified, abstracted world. And as I know you're somebody who loves hundreds of different games, and I am also that geeky. And most people listening to us are not anywhere near that geeky, so let's not geek out too much. But I think part of what I love about games so much is that there are so many different ones. And in my mind, there was like Monopoly. I'm making up 1933, Charles Darrow. I'm even making up that name. I don't think I have that right. But then, you know, five years later, I'm making this

up again. Parchesey shows up. But there were no games in between 1933 and 1938. And then all of a sudden, we reach the 1980s and 90s. This is post-Avalon Hill War Games, which was sort of an efflorescence. But in the last 20 years, it has absolutely exploded. The choices that we have, the abstractions we can seek. And T, this is where we're headed now. And I know you want to say something to that and you can, but I'm even going to push us forward to social media platforms, which are also abstracted forms of experience that a lot of people far more than play Katan are opting into. And those have their own rules as well when you start to really think about it like you have. So thank you for giving the lead. He knows that I've written a paper called

how Twitter gamifies communication and that he can just prod me and I'll rant. Well, and a lot of people listening use Twitter. A lot of people on this podcast use Twitter actively, so this is very relevant to us. Yeah. So here's, this is, I think, a really good place to see

the difference being games and game-like systems in the world. So games, I think, give you one of the crucial abstractions is the value system. Games give you, abstracted simplified value systems, right? In ordinary life, your values are super complicated.

They're super rich. Like, it's hard, you know, I care about research. I care about my family. I care about health. I care about fun. And it's like, it's hard to quantify them and measure them off against each other, right? What's your, what's your score as a dad? I just, have your score last month. And it's also like, I mean, it's not just that they're hard to compare against each other, even a single one. Like, it's, if you're being careful and thoughtful about it, it's actually really hard to tell, right? Like, I mean, I think about this parenting, right? You let your kid off the hook some night. They're screaming and they're telling stories and it's too late and they should have gone to bed, but they're having a great time.

And you're like, was that good? Am I succeeding or failing? What's going on? And in games, you get something very different. So in scored games, you get a clear. mechanistic decision procedure that tells you exactly how to apply the value system to know exactly how well you've done. And everyone's on the same one. So what you get is value clarity. So one of the things that I think happens in games, one of the things that makes them so appealing

is that in life, we have these rich in Kuwait, nauseating, complex value decisions, and then we get a break from them, right? Games are just like existential dessert. where you get to be soothed by the experience of knowing for once in your life exactly where you're going. So this is part of why I'm really worried about gamification. So there are a lot of people who are very pro like, oh, let's make life like a game. Games are awesome, so let's make life more awesome. But to do that, you have to offer a simplified, mechanically applicable scoring system.

and in real life, values are much more complicated. So Twitter for me is this remarkable example where there are all these possible values for communication, empathy, connection, information. And then Twitter gives you the scoring system that measures one thing, which is popularity. And if you let it in, and if you get thrilled by it,

then what's going to happen is that you will have gotten game-like pleasures in exchange for simplifying your communicative value system to get into line with something that can be measured by a simple mechanism at mass scale. So the next book I'm writing right now is about this. I'm worried about this thing that I'm calling value capture, about when your values get captured by clear institutional metrics.

And the best way of putting the worry for me is that you're outsourcing your values. Instead of being engaged in something and figuring out whether it's worthwhile for you, whether it matches with your value, with your place, with your personality. You're just like, okay,

you're literally buying your values off the rack, right? Here's what I'm going to do with Twitter. I'm going to aim at what it measures. Here's what I'm going to do with fitness, right? I don't think you don't have to be like this. You're not instantly captured the moment you put on a Fitbit or start using Twitter, but I think it just beckons.

And I experience this all the time. Like, I'm very vulnerable to this. So I constantly have to fight. Like a few times I've gone viral on Twitter. And each time I've had to delete Twitter from my phone because my brain gets so infected with the desire to like score more points, right, that I just start trying to re-ame my thoughts for the kinds of things that will score well. And I think when you're oriented that way towards Twitter,

you have been captured by the simplified value system. It's really so compelling and I think so important for our self-awareness. And one of the things I appreciate about your work, other than you're often talking about games and game designers I know or games that I love, is that you're helping us get above the game. And I kind of led off this week by talking about that. And met a game level. I mean, are we in some games that we don't even realize we're playing as individuals

and also as a society? Do you have other examples in mind to scare us with or provoke us with? Oh, yeah. Let's do it. Okay. Let me take a step back. There's a crucial bit from my book that I need to talk about that is going to be important for going on. So in a game, the goal is something that's constituted by the constraints where you get this struggle, right?

So why are you doing it? So one of the things that I think Bernard Soots makes clear is there, least two different motivations for playing a game. And this is, this is for this, he didn't spell this out. And I think this is the most, for me, the, I feel like the most important thing I figured out thinking about suits. So the two motivations I call achievement play and striving play. So achievement play is playing a game because winning is valuable to you. And striving play is temporarily taking on an interest in winning because the struggle is valuable to you. Right. So does that make sense?

So striving play in particular, you might think of this. In normal life, we're engaging instrumentally. We're taking the means for the sake of the ends. In striving play, our motivations are inverted. We're taking the ends for the sake of the means, right? We're taking on a goal because the activity of pursuing that goal is valuable. So one of the things I think that happens with games, I think a lot, by the way, I should give the argument. So some people have doubted that striving play is real.

And here's my argument. Consider the category of stupid games. A stupid game is a game where the fun part is failing, but it's only fun if you are trying to win, like Twister, right? Or telephone, or a lot of drinking games. So there's a case where actually what you want is to fail. That's the fun part. But in order to get it, you actually have to try.

Like if you fall over on purpose, it's not funny, right? Because what's funny is failure. So here's a way that you can engage in games well. You play a game and then if you're a striving player, you step back and you ask, was the activity worth it? Was the struggle fun? Was the struggle interesting? And kind of the bad way to play games is to play a game and just get sucked into the

win, even if the struggle sucks. And this is actually my worry about a lot of real world systems. Because with games, at least, there's a natural built-in moment where you step away from the game and you decide whether you're going to play it again. Think with a lot of real-world systems. And the ones I'm worried about things are like GPA, the ranking of what college you got into. Your Twitter likes, right? We're not even just talking about like kids' mobile games, make you wait 15 minutes to take your next shot or you can pay a buck now. You're talking about real-world systems that have been around for a long time.

GPA? Yeah. I think one of the worries is that you can get sucked into a game like that as a game that is just pursuing those points and not realize that the actual process sucks, that it's empty of life, that it is boring or awful. And part of it is because my suspicion is that a lot of the times we don't have the opportunity to step back and ask the question that I think games make prominent, which is, was the pursuit of these points actually a worthwhile way of living? Should we play something else? One of the things that makes it easier in games is you get a, as you said, there's massive choice. You get to engage in a kind of rich aesthetic personal decision. Did I play that game? Do I like, I like, I hate Caton. I think it's

really boring compared to other games of that stripe from that world, like all of Kinzias games. Wolfgang Kramer's El Grande, which is one of the most interesting board games Evermade. Right. Rich, juicy, thick decisions all the time. Right. But then I think when large-scale systems in the world become like games, like GPA,

there aren't alternatives or ways to step back and so you can just get sucked into this bad game. Yeah. It's systemic. There are two problems. One is that there's this pervasive instrumentality. Sorry, I sound like such a philosopher.

Like, you can't, okay, every student is stuck with, every student is stuck with GPA as something that employers will look at. So that's pervasive. But I think there's something even worse you can do that the perversive that the perversive must encourages, which is to take GPA as the only purpose of your education.

Right. One of the things that games encourage is just kind of like, so I wish I had a better term for this. In the book, I call it all-out instrumentality. You take out, you look at a goal, and that's all that matters, and you just throw yourself at that goal. And in a game, that's okay because games are thinned, artificial, temporary environments. But if you approach your entire educational life where the only goal is GPA, and you don't think about anything else, then you're thinning out a much richer activity. P.S. I have the same worry about money.

And we're real near getting there. I want to talk some about investing in business. And this is going to be a podcast that runs longer than my normal podcast. and yet we're not even getting to have the stuff I'd like to. So that's a sign that I need to have you back, which I certainly will. This has been so much fun. Let me just talk some about new games that we're playing. And it's because of the world of big data.

And I know that you've written a recent paper entitled, I believe, transparency is surveillance. And if you'd like to speak about that, some, please do. But for me, anyway, I am actively opting into all kinds of scoring systems that I really do love. And I think they make me a better me. So I'll give two quick examples that come to mind. One is my hydrate Spark Pro smart water bottle. Every time I take a sip from it, it lets me know, oh, that's 1.2 ounces.

Oh, good job. You're on your way to 71.2 ounces. Your daily goal, oh, wait, it's actually now 73.2 today because you just took a short walk, which means you need to hydrate a little bit more. And the humidity is lower than usual. so we're going to need you to have a little bit more water than that. And from one day to the next, I am hydrating. And I'm not just doing that tea.

I don't know if you have one of these, but I've invited my friends and family. We have a water league. We all see how we're doing toward our goal. There's not really a race. And you can get, I think it's called something like hyponatremia, where you can overwater yourself and create dangerous conditions. They're not trying to do that.

But I have actively opted in. And I am driven by a gamification tool that I know you know well, and that is streaks. I have a long streak where I've nailed my water goal from one day and the next. That example took a little while to explain. There's more to that. We could unpack that or skip it. But I also have my sleep. I actively measure my sleep. I wake up. Each morning I'm like, oh, I was an 801 last night out of 1,000. That means basically I was 80th percentile of gentlemen around my age and weight and how we slept last night. And I really enjoy these things. I'm inviting them in.

So I feel as if gamification is obviously like any powerful tool can be used for good or for evil. Yeah, I mean, I'm certainly not going to block the, resist the good of a fully controlled gamification. I mean, my worry is about not only imposed systems, but systems that sneak up on you without you realizing it that discourage reflectiveness. in some sense when you decide because it makes your life better that this gamification is good for you that's in some sense

very similar to playing any other game you've made a decision about an experience that you find worthwhile I still have a worry though and the worry is about what kinds of activities in the current environment are easily gamifiable and which ones are not and my worry is something

like, look, water intake and sleep is easy to measure. Enjoying poetry is less easy to measure. Having an interesting conversation with your family is less easy to measure. And my worry is that if you're the kind of person that reacts to gamifications, then, I mean, you're choosing them, but you're also choosing from a limited supply of possible gamifications. There are kinds of things that gamify more easily. Let me try this. So one of the worries I have in this transparency paper you were talking about is that there's a drift between what we actually care about

and what's easy to measure at scale in an institution. And part of that drift is particularly because in transparency cases, the kind of metrics you use are constrained, further constrained by the need to be legible to the public. So Anar O'Neill, who got a philosopher, a bioethicist and Kantian ethicist, who got me really interested in this, she has this moment that inspired this whole paper where she says, people think trust and transparency go together, but they're actually intention because transparency asks experts to explain themselves to non-experts, but their real reasons aren't explicable to non-experts, so they have to lie. My worry is even worse that experts might only start doing the kinds of things that they can explain to non-experts, which actually constrains the kinds of reasons they can use and minimizes their expertise. So there are a lot of cases where I think the actual expert, like the art expert or the educational expert, has a sensitivity to an area that won't survive the demand for metrification. So one of the other worries I have about the gamification cases is that even if it's under-refering,

your choice, given the fact that the gamification's available range over activities that are easier to quickly metrify, then your attention is going to go to things like sleep and hydration and not to things like poetry and conversation. I really appreciate that point. There's just measurability constraint that I think it's really important. You know, I'm reminded briefly of one of my probably 20 favorite movies, The Truman Show, because no spoilers, but I mean, we all should have watched the Truman Show at this point. So I think it's fair to spoil this movie. But there's Truman Burbank, the protagonist played by Jim Carrey,

and he's living his life, not realizing that he's actually a reality TV show for the rest of the world. And the hilarity of, and also the troubling nature of the discovery that that is actually the case is in large part the movie, the Truman Show. But I guess I'm thinking about it because in a way, he's sort of a microcosm of what we're talking about. Are we living a life not conscious of, well, being watched in the case of the Truman Show and maybe of big data today? But more importantly, well, actually, T. Have you seen this movie? Yeah, of course. Are we in the Truman Show today?

There are two worries I have about runaway gamification. And one of them, the answer is something like, you're in the Truman Show. show and you don't know it. And the other, it's something like, oh, it's actually worse if you think about, if you know that you're in a game. So let me try, let me try this. So I think there are a lot of these targets that we have out there. And it might be Twitter likes. It might be money and investing in your investment, like how much you made. It might be in my world, in academics, it's funny, because academics will often be like, oh, I'm above money. But then they're targeting things like citation rates and impact factors for their publication.

or like page views for journalists, right? So one worry, let me, let me try, I just thought about this this morning. Let me try this distinction between bad games and evil games. Let's do it. See if this makes sense. I think a bad game is the thing we were talking about before, where the game sucks for you if you play it. Like, it's boring, it's annoying, it makes your life worse, it makes you unhappy. But you're stuck in it because you don't realize it's a game, right?

You don't realize that you have choice about what you're pursuing. and if you think I have to be pursuing this, I have to be getting GPA, I have to getting more money, I have to be getting into the good college, even though it's making my life miserable. That, I think, that's the problem of being stuck in a bad game. And that, I think, realizing that you're in a game and where that means you have choice, right? That's really powerful. You can be like, look, I've been pursuing this metric for a very long time. And my life sucks.

And what that looks like is I know people who got really excited about having a lot of Instagram followers. At some point, they realized their lives had gotten hollowed. it out and they tried to get out of that game. So that's one work. You know, that's such a good example. And just to throw out one other older movie that I'm thinking of that you just maybe think, Logan's run. I'm sure you've seen Logan's run, T.

Yeah. Yes. And that's kind of like you're living in a world that's a dystopia and all of a sudden, you realize you can break out of it. No spoilers. So the flip worry, and I think this is a very different worry, is, okay. What makes real games morally okay is that they're separated from ordinary life. So because the points in a game are artificial and not directly connected to real life in most circumstances,

then there's a safety mechanism, right? So one of the first things I wrote about games is this account that looks like, look, if you're engaged in striving play and both of you are only trying to win for the pleasure of a struggle, Right? Then in some sense, blocking somebody else's attempt to score, that's not evil. That's good because you're helping them get what they want, which is the struggle. And part of what makes that okay is the points aren't valuable of themselves. They're just these temporary construct that you get into to have this interesting struggle. They're disattached from the rest of material reality. But investing isn't like that, right? Like one of the things that I worry about, about people that do anything for more Twitter likes or anything for more money, right? Is that if you treat it like a game, the game-like attitude is it's okay to pay attention to nothing else and just max out my points. And that's okay in the secluded environment of real games. But insofar as the point that you're pursuing have real world effects, like on Twitter, like with money and investing,

then you don't have the same ethical, free, get out of being evil card that you have with Settlers of Paton or Monopoly. Right. So my worry is actually in the investment space and in the Twitter space, the people that I find most worrying are those who self-consciously think of it as a game. Like, I'm just trying to win. These are my points. Like, I'm just playing the game. And not thinking about the fact that the things that they're. calling points are attached to incredibly consequential material reality.

Yeah. Well, I hear you. And at least listeners of this podcast and anybody who's followed my work with Rule Breaker investing for 30 years know that my guiding watchwords are make your portfolio reflect your best vision for our future. So I certainly, and I'm on the board of conscious capitalism, I think that it's integral. Everything is connected. And so what you invest in says so much, not just about who you are, though it does, but it also says so much about our future, because we're shaping the future every day with our dollars. And by the way, that's true of investing. It's also true, of course, of our spending. Choosing to buy from this vendor, not that one, to pay this price, not that, to have this different experience.

All of these are all about agency in many cases. There are places in the world where you only have one choice or you have no choices, which is really sad. but at least in America, we're blessed with so many choices, maybe too many choices sometimes. It can be overwhelming, but everything is connected. So to the extent that I think of investing as a game, which by the way, I do, and business is a game. It's partly but what rules have I designed into the game that I'm playing as an entrepreneur at the Motley Fool or as somebody who's making his own portfolio.

And I self-regulate against things that I think are evil or bad, or at least I'm doing my best, not just at my own level, but to anybody who listens to me to counsel us to realize that, you know, buying fair trade coffee, where you pay up a little bit more beyond what you could have had that cup of coffee for, actually gives a developing world farmer direct foreign aid, which is much more efficient than the U.S. trying to give the dictator of his or her country that aid, or even in many cases the NGOs on the ground in that country, not all of which are particularly effective or always well-motivated. So as an example, Fair Trade Coffee, that is playing the game as a consumer differently than how

other consumers do it. And at least a lot of my optimism, and you're joined today by an optimist, is rooted in the belief that along with Jefferson's great line, I can light your taper, you can light mine, and neither one of us loses anything as we let the light shine and we hit higher levels of consciousness and conscious doing. Yeah, I mean, let me, I want to probe what you mean by a game when you say that investing is a game. So let me say why I'm worried about treating investment like a game. And you can, maybe we're picking up on different parts of the phenomena because the phenomenon

is really rich and complicated. So the part of the pleasure of a game for me is it's detached because it's detached from ordinary life and because we're in this consensual space, you can just go all. all in on the point system. Games are a situation where you can... Min-max. Right. You can be a pure min-maxing monster.

You don't have to worry about anything else. And you don't have to get involved in the complicated thing of, oh, what are the later downstream effects on other people? You can just be this pure instrumentalizing, optimizing simple beast. And I think that's the attitude. that I would be worried about in investing. And the thing that you're talking about doesn't seem game-like to me in that respect. Like, it is, I mean, I can see what you mean in the sense that there are aspects that you've put on

to increase the striving pleasure, but you're also, the thing you're describing to me involves not just settling on money as pure points and pure victory and nothing else matters, but opening yourself to the consequential downstream consequences. And that, I mean, that seems great to me, but that attitude is the thing that makes me think, you should be like that and not treat this as a pure game in the sense that I was talking about. I really appreciate that.

And, you know, I almost feel like we're going into another podcast, like the one you should be hosting having me on at some point, because I'd love to talk about that at a deeper level than we probably have time to. But I do want to say a few things back. First of all, for me anyway, When I think about games, I almost start inside out with business first, and then investing is one concentric circle outside of it. So as an entrepreneur, I think of business is a tremendous game.

It has Kinesia-like beauty in terms of some of the scoring mechanisms, balance sheets, income statements, statements of cash flow, accounting, accountants who actually force you to publish your numbers on a regular, transparent basis. Now, outside of like the accounting and the numbers of racking up, not just profit, but a lot of other measures you can be playing toward, there's also the, well, but what are we doing in the real world? What are the effects of teaching more people about the stock market for good and for bad? Because it's not just all good or all bad. And so I guess there's such richness in my own experience helping to create and helping to run an organization where I feel like I see so much of the game. I have almost a 360-degree view, whereas one concentric circle away, I start having a narrower

view. I can't see as much of the elephant now. And so the game there for me doesn't as clearly connect with real-world effects, hiring and firing, making your numbers or not, going public and having an incredible IPO or not. All of those things are much clearer and much more grounded in the world when you're running an organization or a university, then if you're just their mom-and-pop armchair investor, which is also part of how I roll. And there, T, I would just say that I have formed up the game in this way. I am trying to beat the index funds. We live in a world where so much of academia, even still today, thinks it's a random walk down Wall Street and monkeys throwing darts. And so the game of it for me, the game is on, games afoot, when I know that there is

average and the vast majority of the world, even at the highest academic levels, think it is not possible sustainably to beat that. And that is incredibly motivating for me. And that's why I encourage everybody listening to always score how you're doing, et cetera. And what are the ways to play to win in that? But it's not necessarily, I don't know this is helpful or not, or if I'm speaking to you or away from you. But for me, I guess a lot of it are the constraints that you said. It's the game that you put in place as an entrepreneur. You could be a jerk or not. You could think about all your stakeholders. You could just think about yourself. Same thing with your portfolio, what it does in the world, and even more than your portfolio, perhaps passing the ball back to you, how each of us is

spending our money every day. Those things have real world effects, and they're intimate, and they're all about agency to me. The transcript will read, long pause. is a problematic way to think about investing as a game when you get this all-out instrumental attitude. And I think you're pushing on another side of this. And what you're pushing on looks something like this. You can keep reflectively redesigning a game to get the kind of effects out of it you want. I think a lot of us engage in movement between fitness games.

And there are real world consequences for that, right? There are some things I find incredibly fun that actually trash my body. And I have to think at some point, I'm like, oh, I can't, right? I have to think about that other effects. And there's some things that are very rich. And there are some things that are really, like, healthy and are going to help me, but they suck so much that I'm never going to try to do them. And so what I'm trying to do is fine and then kind of push around the design for me

for something that is both rich and engaging and then has the right downstream. effects. And so I can just throw myself into it. Right. So I think what you're saying, which is the hopeful side of this, is that you are imagining that it's possible to create an investment game and keep pushing it around. So it's both fun and interesting for you and also where the downstream consequences are better for the world. Like I would like to be optimistic enough to think that that's possible. I am worried, given the history I know, about whether that's possible or not. But maybe, maybe you're the, you know, economic moral saint we need to make things less

horrific. Check out David Gardner's weekly podcast, Rule Breaker Investing. You'll find it wherever you find podcasts. As always, people on the program may have interest in the stocks they talk about, and the Motley Fool may have formal recommendations for or against, so don't buy yourself stocks based solely on what you hear. I'm Chris Hill. Thanks for listening. We'll see you tomorrow.