Decision Making: Uncertainty versus Risk

What is the difference between risk and uncertainty and how our decision making approach should differ under each scenario. Why pandemics are highly uncertain and should be treated as such.

Topics covered include:

How the coronavirus pandemic is far worse than other pandemics this century.How humans have a difficult time accepting that things won't return to normal.What is the difference between risk and uncertainty.How we make decisions should differ if something is uncertain versus risky.What is the minimax regret approach to making decisions under uncertainty.How stories help us deal with uncertainty.How the story driving financial markets has changed.What is the duration and severity of bear markets during a recession and how large have bear market stock rallies been.What will it take for the pandemic to end and to be more confident about the future.

Thanks to Mint Mobile and Grammarly for sponsoring the episode.