Where Do Regrets Come from?

Yesterday, my wife and I took our kid to an amusement park. We were with two other families who are more impulsive and happy-go-lucky than I am. They wanted to play on the beach first and then go to the amusement park later. I was concerned that it might start raining later. And if so, I figured, it would be better for us to go to the amusement park first, and then to the beach. I’m a control-freak, so I used my hyper-local weather app to check the probability of rain. It looked almost certain that it will rain later. As soon as I made my prediction, the weather became a lingering thought in my head. After the beach, the other families went on enjoying the amusement park despite the fact that ominous clouds were forming above us. I kept looking up and sure enough, it started raining. But fortunately, it drizzled for a while, so our kids were able to enjoy most of the rides. Towards the end, however, the rain became heavier. My wife and I had umbrellas, but the other families did not. They were getting soaked, but it didn’t seem to stop them from having fun. We decided to go home. They went off to get hot dogs with their clothes drenched in the rain.

This is a rather common story. A control-freak watches a happy-go-lucky person about to fall into a hole. And, the control-freak predicts that the happy-go-lucky person would regret the fact that he did not think more carefully about the future. But what often happens in this scenario is that he falls but gets up and moves on. He doesn’t regret anything. The control-freak is only projecting how he would feel if the same were to happen to him. He would regret precisely because he is trying hard to predict the future. In other words, regret is caused by predicting.

When we predict the future and prepare for it, we end up doing something we would rather not do (repression) because what logic tells us to do isn’t necessarily what we want to do. So, when our predictions do not come true, we regret. I find that the more we invest in our predictions, the more we regret, which is ironic because control-freaks are mainly driven by their fear of regrets.

Perhaps an extreme example would illustrate my point better. If you were convinced that there would be a nuclear war in a few years, you might invest your time and money into building an underground shelter. But this does not mean that you’d enjoy building it. You would have to sacrifice other things you would rather do or spend money on. Once you make these investments, you would naturally hope that you are right; that is, you would now need to hope that there would be a nuclear war. You have now created a double-bind situation for yourself: Damned if you do, damned if you don’t.

But if we don’t predict the future, how can we cope with the uncertainties of life? You might ask. You let the shit hit the fan, so you become better at cleaning it up. Eventually, you wouldn’t need to worry about the shit hitting the fan, because you become so good at cleaning up the mess. In my example of the amusement park, my friends are so used to getting rained on that it doesn’t stop them from enjoying what they are doing. They are used to it. In contrast, if you are a control-freak, you become so good at avoiding problems that you never learn how to clean up the mess; so you become dependent on and preoccupied with avoiding them. In other words, you have no choice but to be controlled by your own fears.

I think happy-go-lucky people use a different part of their brains to make decisions. It’s not the logical part. It’s like the scene from Star Wars where Luke is told to “use the Force” and pushes aside his targeting computer to hit the tiny vulnerable point of Death Star. Or, Han Solo telling C-3PO, “Never tell me the odds.” For sure, it sounds scary but the scariest part, I think, is letting go of our automatic urge to control the future.

“Knowing what you know now, what would you have done differently in life?” This is a popular thought experiment for control-freaks to engage in. The problem with it is that it assumes we can explain life in terms of cause and effect. But where there is no possibility of repetition, there cannot be a causal relationship we can ever verify. It must always remain a speculation or theory. Economics is called “dismal science” because we can never repeat the same situation to see what would have happened otherwise.

In the fall of 2008, I called my investment advisor and told him to cash everything out. He didn’t think it was a good idea but I told him that I was serious; so he did. Then a week later, the market crashed. In terms of timing the market, it could not have been more perfect. My advisor emailed me a few months later and told me that he regretted not cashing out as I did. My ego exploded. My theory at the time was that the world economy would collapse, so I planned on sitting on cash for many years. As a matter of fact, despite the multiple emails from my advisor urging me to re-invest, I sat on cash. If you look at the chart of S&P 500 since then, you can see exactly what I missed. I would have made a significant amount of money if I didn’t cash out in 2008. For me to have a happy ending in this example, I would have had to time the market re-entry correctly also. Once we start to go down this path, we realize that this is no longer a serious thought, but a fantasy. The lesson I learned from my experience was not, “I wish I had gone back into the market during the first quarter of 2009.” What I learned was the futility of predicting the market.

In real life, we cannot isolate or control for specific variables as we do in scientific experiments. For this reason, use of cause-and-effect in our explanations about life is fundamentally flawed. It may sound convincing but it will never be testable or verifiable. It must always remain a speculation.

Even Wall Street traders cannot make money consistently by predicting the market. Wall Street makes money primarily by finding arbitrage opportunities; that is, they are always exploiting some kind of market inaccuracies. Because these arbitrage opportunities are not accessible by the outsiders, they can make a lot of money. It’s not because they somehow figured out the cause and effect of the price movements. Even if they did, their understanding of this cause and effect would impact the market and nullify its effectiveness. Cause-and-effect, even on Wall Street, is applied only after the fact to rationalize what they did.

We use cause-and-effect to construct convenient narratives for ourselves. We tend to consider only what we gained from our positive experiences and lost from the negative ones, and ignore what we gained from our negative experiences and lost from the positive ones. It is an unscientific way to isolate or control for certain inconvenient variables. This way, our calculations would have definite net positives or net negatives. We cherry-pick the facts as we see fit to enlarge or protect our egos.

This, however, does not mean that predictors can never succeed in life. I think predictors would do well in predictable careers whose futures can be mapped out well in advance. (Although there are now very few careers like that.) In contrast, in highly unpredictable fields, I think “use the Force” works better. Here are the words of Steve Jobs who pursued a highly unpredictable career:

“Again, you can’t connect the dots looking forward; you can only connect them looking backwards. So you have to trust that the dots will somehow connect in your future. You have to trust in something - your gut, destiny, life, karma, whatever. This approach has never let me down, and it has made all the difference in my life.”

But make no mistake; he was lucky. His approach never let him down but it doesn’t mean that the rest of us can succeed also. After all, if we were to go down an unpredictable path, our success will have to be unpredictable. Steve Jobs could have been a spectacular failure. He could have died from food poisoning while seeking his enlightenment in the dubious places in Asia. But one thing I think we can count on with this approach is that we would have no regrets because we would not be betting on anything. If we are not trying to win, we can’t lose.

There are two conflicting sides within me, and the “use the Force” part of me told me to study fine arts in college. It’s a good example of a decision that you would not make if you were to diligently calculate how it’s going to pay off in the future, if ever. There is a difference between planning and predicting. You can, for instance, plan to study computer science in college because you love computers, or you can do so because you predict that computer science majors will be in demand in the future.

Like one lie leads to another, one prediction or bet leads to another. Life is a gamble only if you start betting. And, once you start, it’s hard to stop. In that path, the value of your life would be calculated by netting the positive and negative outcomes in life. It’s black and white; you are either a winner or a loser. By predicting and betting, you are setting yourself up for that way of evaluating your life.

In the Stanford marshmallow experiment, “a child was offered a choice between one small reward provided immediately or two small rewards if they waited for a short period, approximately 15 minutes, during which the tester left the room and then returned.” They found that children who were able to wait had a higher rate of success in life. I’m sure I would have done very well in this experiment as a child. As soon as someone explained the premise to me, I would have calculated how to maximize my benefit. After 15 minutes, I would have compared myself to others who didn’t wait, and felt good about myself. But in this process, I would have turned the whole experience into a competition, not about enjoying the sweetness of the marshmallow. Likewise, as soon as I predicted the weather at the amusement park, it turned into an occasion to prove my ability to control the future; it was no longer about enjoying the moment with my child.