Rosh Hashanah is approaching and I’m feeling magnanimous, so I’m going to give you the investment opportunity of a lifetime! I take no management fees, no commissions, no 2 and 20, and no referral fee. You don’t even have to read any books with titles like Rich Dad- Poor Dad, Investing 101, or How To Become Wealthy on a Librarian’s Salary.
Here is the deal. We are going to flip a coin. If it comes up heads, I will give you a 50% return on your money. If it comes up tails, you will lose only 45%. That sounds like free money. Casinos usually only have a 2 percent advantage or less, and they make billions. You have a five-point advantage every time we flip the coin, so obviously you should play as often as possible and put as much money into every flip as possible.
Right?
Let’s start with one hundred dollars and bet the whole thing.
First flip: heads. Congratulations! Your $100 becomes $150. You’re welcome. I know, I’m just nice like that. I’ve been blessed and I try to pass on the blessings.
Second flip: tails. You lose 45% of your $150, leaving you with $82.50.
That’s odd. You won once, lost once, made 50% when you won, lost only 45% when you lost… but somehow you’re down almost 18%. Let’s keep going.
Third flip: heads. Your $82.5 grows to about $124.
Fourth flip: tails. You’re down to about 68 dollars.
Six flips? Your $100 is suddenly only about $56 Ten flips? Around $38. Maybe I’m not so nice after all…
If you flipped the coin one hundred times and got exactly fifty heads and fifty tails—which sounds like the fairest outcome imaginable—your original $100 would be worth less than a penny. You would have lost more than 99.99% of your money while winning exactly half the bets and receiving a bigger percentage gain on every win than the percentage you lost on every loss.
Welcome to one of the strangest realities in mathematics. The problem is that percentages don’t add; they compound. If you lose 50% of $100, you now have $50. To get back to $100, you don’t need a 50% gain, you need a 100% gain. A 50% gain on $50 would only get you to $75. A loss damages the base from which your next gain has to grow. If you expose your entire bankroll to large swings over and over again, volatility begins eating your lunch, your dinner, and eventually the table you were eating them on.
This problem fascinated a young scientist named John Larry Kelly Jr., who worked at Bell Laboratories in the 1950s. Bell Labs was no ordinary corporate research department. It was one of those rare places where extraordinarily smart people were given salaries, expensive equipment, research assistants, and the freedom to study almost anything they wanted. And it was wildly successful.
Researchers associated with Bell Labs helped develop the transistor, which allowed us to shrink computers from a room to a rectangle sitting on your desk, early cell phone technology, computer programming languages, laser technology, satellite communications, microphones, and all kinds of inventions that paved the way for our modern technological world.
John Larry Kelly Jr. began wondering whether mathematics could answer a question that had stumped economists and mathematicians for decades. Suppose you know that you for sure have an advantage, how much should you invest/bet? In 1956, Kelly published a paper in the Bell System Technical Journal with the spectacularly unexciting title, “A New Interpretation of Information Rate.” Buried inside was an idea that gamblers and investors would later call the Kelly Criterion.
Kelly’s insight was simple but profound: knowing that a bet is favorable is not enough. You also need to know how much of your capital to expose to the bet. Bet too little, and you fail to take advantage of your edge. Bet too much, and even a genuinely favorable opportunity can destroy you. For our coin-flip game, the mathematically optimal Kelly bet is surprisingly small: roughly 11% of your bankroll per flip.
Not 100%. Just eleven percent.
Suppose instead of putting your whole bankroll at risk each time, you risk only about one-ninth of your bankroll, 11%. When you win, your total wealth rises by about 5%. When you lose, it falls by about 4.5%. Now the volatility is small enough that the advantage gets a chance to compound instead of being overwhelmed by the swings.
Take the same one hundred coin flips, with exactly fifty wins and fifty losses. Betting everything on every flip takes $100 down to less than a penny. Betting roughly the Kelly Criterion number leaves you with about $115. Do that every day, and you can double your money in 5 days. If instead of going to work every weekday, you came to my house and did my investment offer for 100 coin flips using the Kelly Criterion, over the course of a year, your $100 would turn into a handsome $112 quadrillion dollars, even more than the US government prints in any given year.
Same coin flip, same odds, same fifty wins, same fifty losses, but completely different result. The winning strategy was not finding a better deal than the ridiculously good one I offered you, the opportunity was mighty good all along. The winning strategy was sizing the investment so that you could survive it long enough for the edge to compound.
We are approaching Rosh Hashanah, which means that Jews around the world are beginning the annual process of examining their lives and deciding what they want to change in the coming year. It is actually the ideal time to start our New Year’s commitments. We don’t want to come before G-d on Rosh Hashanah and say, “We think we’re going to be good this year, here’s what I’ll commit to hopefully doing.” We want to say, “Here’s what I will do this coming year, as I’ve been doing for the last month.
But when it comes to Rosh Hashanah commitments, most of us have become very bad gamblers, because we bet too much at once.
We sit in shul, we hear the shofar, we read the prayers about life and death, tranquility and chaos, who by fire and who by water, and we get really serious. We think about another year that disappeared far more quickly than seems legally permissible. We recognize habits we don’t like, opportunities we wasted, relationships we neglected, prayers we rushed through, Torah we didn’t learn, people we could have helped more. And we want to change.
And then we bet the whole bankroll.
“This year I’m going to learn Torah for an hour every single day.”
“I’m never going to speak badly about another person again.”
“I’m going to pray every morning with total concentration.”
“No more phone when I’m around my family.”
“I’m never going to lose my temper with the children.”
“I’m going to exercise five days a week, eat perfectly, call my parents every day, volunteer twice a week, finish the entire Chumash with Rashi commentary, and become the most emotionally healthy person in the state of Michigan.”
This usually lasts until somewhere around October 14th. The problem is not that any of those goals are bad, every one of them may be a winning bet, a place we want to go. The problem is bet sizing.
We made the commitment while sitting in synagogue on Rosh Hashanah, spiritually energized, surrounded by people acting solemn and kind, hearing the shofar, thinking deep thoughts about life and eternity. But the commitment has to be kept by the version of us who wakes up on a dark Tuesday in February after sleeping four hours, has three urgent emails waiting, one child who can’t find his shoes for the third time this week, a friend annoyed at us for something we don’t remember doing, and a phone that broadcasts seventeen new problems before breakfast. That person has to make the bet too, and he likely can’t handle the volatility of big swinging bets.
The Sages give us a fascinating principle in the Talmud (Yoma 80a): תפסת מרובה לא תפסת, תפסת מועט תפסת — “If you grasp too much, you have grasped nothing; if you grasp a smaller amount, you have grasped it.” The Talmud knew that our desire to grab everything leaves us holding nothing.
The Maharal of Prague (1524-1609) makes this point even more directly in his commentary on Pirkei Avos. The Mishnah teaches (1:15): אמור מעט ועשה הרבה — “Say little and do much.” The Maharal explains that “if a person says a lot, perhaps he will not fulfill it, and he will transgress [his commitment].” That is spiritual Kelly Criterion.
Don’t promise the entire bankroll. Make the commitment small enough that it holds up against real life, realistic enough that it survives re-entry into real life from High Holiday orbit. As one of my Rabbis used to say, take the commitment you want to make and halve it. Then halve it again. That should be your Rosh Hashanah commitment.
This does not mean that Judaism believes in spiritual mediocrity. Quite the opposite. Torah asks an enormous amount from us. Rabbi Tarfon says in Pirkei Avos (2:15), “The day is short, the work is great.” There is a tremendous amount to accomplish. But in the very next Mishnah he says: לא עליך המלאכה לגמור — “It is not upon you to complete the work.”
The Meiri (1249-1315, Catalonia) explains that a person should not look at an enormous task and say, “How can I begin something I won’t be able to finish?” You are not obligated to reach the absolute completion of it or to do beyond your ability; nevertheless, you must strive according to what you are able to do.
Rosh Hashanah is not asking us to become somebody else by next Tuesday, it is asking us to choose the direction in which we are going to compound. Because compounding small amounts consistently over time can turn you into a quadrillionaire. (Yes, you can get there before Elon Musk!)
Instead of deciding that this year we will suddenly start calling Mom and Dad every day, commit to calling every single Friday to wish them Good Shabbos. But every single Friday.
Instead of promising to learn an hour of Torah every night, perhaps commit to five minutes that you will actually protect. Five minutes is small. Five minutes will not get your picture in the paper. But five minutes a day is more than thirty hours of Torah over a year.
Keep it for five years and you have accumulated more than 150 hours.
And something else happens along the way: people who reliably learn five minutes often begin learning ten. Then fifteen. The bankroll grows, the riches compound.
Maybe your commitment is just one person you will no longer discuss negatively.
Maybe it is one blessing each day said slowly.
Maybe a thirty second prayer said in English every day.
Maybe it is giving a fixed amount of charity every week, even if the amount initially feels unimpressive.
The question is not, “What would the greatest version of me do?” The question is, “What commitment can the real version of me keep making even when life is messy?” Because that will build the greatest version of me.
It’s not important how impressive the commitment sounds on Rosh Hashanah, it is whether it is still alive in February.
Rosh Hashanah celebrates Hashem’s kingship over the world, but it also asks each of us what kind of world we are going to build under that kingship in the coming year.
Great worlds are never built in one dramatic day.
They are built through small decisions repeated until they become character.
A blessing with concentration. A few minutes of Torah every day. A restrained response. A little more charity. A call made. A phone put away. A commitment kept. Then another day. Then another. Then another.
It may feel small. Good. Small things that survive have an extraordinary habit of becoming very large things.
This Rosh Hashanah, don’t bet the whole bankroll.
Build it, one small bet at a time.
Parsha Dvar Torah
If you were to enter a yeshiva at any given moment, you would surely find people poring over pages of the Talmud dealing with obscure subjects that will never play any real role in their lives. For example, there is a tractate called Bava Kamma whose first few chapters deal almost exclusively with damages pertaining to oxen goring each other. The Talmud discusses in detail the different kinds of payments the owners of the oxen would owe to the owners of the damaged ox. This does not happen often in Oak Park, Michigan.
But what some people would find even more perplexing is the chapter in Tractate Sanhedrin called "ben sorer u'moreh," which deals with a law taught in this week's parsha, Ki Taiztei. The Torah talks about a child who at the tender age of thirteen has become involved in stealing and raucous partying, delinquent to the point that we can know for certain that he will not change, but will rather turn to violent crime to support his nefarious habits. The Torah says that he should be put to death rather than be allowed to continue to devolve, and end up being put to death guilty of homicide. The Talmud in Sanhedrin tells us that there never was such a case nor will there ever be one, and if you wonder why the Torah wrote this law, it was so that we should study it and get rewarded.
Many people are frustrated by this. Is there not enough in the vast ocean of Talmudic study that G-d had to add fictional scenarios so that we can have what to learn and get reward? And the frustration spills over to other areas of study. People constantly question: "Why are yeshiva students wasting their time learning about obscure topics that have no relevance to daily life?"
There is a beautiful answer to this question, through the following analogy. If you were staying in a stranger's home, and wanted to get to know him better, would you read a map he left for you showing how to get from his house to the closest Wal-Mart, or would you read poetry he wrote and left on his coffee table? Obviously the latter!
The Torah is the writing of G-d, and it has two important functions. The first is to serve as the map we use to navigate this world. G-d created the world using the Torah as a blueprint, so if we want to find our way through this world without bumping into any obstacles, we need to study the blueprint. The topics in the Torah which don't seem to tell us anything for the world we currently live in are not maps but the poetry of G-d. Delving into G-d's poetry for no other reason other than to trying to understand Who He is, is the greatest act of love we can show Him.
The more we do so the more we discover the sensitivities of G-d. This shapes our moral fiber. We learn the care one has to display towards the possessions of others, and the responsibility we have to ensure that none of our possessions cause damage to others. Even though we don't have oxen that gore, we do have cars that sometimes nick other cars by mistake. Studying remuneration plans for oxen that gored helps us realize that we must leave a note behind when we nick someone else. (P.S. someone nicked the back fender of my grey minivan. If you are reading this please slip $350 under my door so I can get it fixed, and you won’t have to feel shame that you ignored it for three months!)
Studying the ben sorer u'Moreh, we realize that a life of stealing from others is a life not worth living. Studying the numerous parts of a farmer's yield which have to be given to various segments of society such as the poor, widow, convert, orphan, priest, and Levite, teach us about social responsibility and caring for others that don't have what we have. The more we learn about G-d by reading the poetry that we thought had nothing to do with us, the more we realize that there can be no greater endeavor, no better discipline, no more meaningful experience than getting lost in this pursuit.
Parsha Summary
This week's parsha is made up almost entirely of laws, dozens of them. As a matter of fact, this parsha contains more mitzvos than any other parsha in the Torah - 74 to be exact. I won't be able to go into detail for all of them, and I may skip some, but I challenge you to find out which ones I skipped and email me back with the list.
The first law is quite a intriguing one. It deals with a soldier falling for the beauty of a woman captured in battle, and desiring her as a wife. The Torah knew that if it flat-out forbade the relationship, soldiers overcome by the fatigue and the challenges of war would disregard the law. Instead, the Torah allows one to take the captive lady as a wife, but only after a number of conditions are met. These conditions are designed to help disenchant the soldier. The captive woman must sit by the door of his house dressed in clothes of a mourner, with no makeup, and mourn the family that she lost in the war. (This is a great insight into marital relationships: no one wants a spouse who sits moping and mourning all the time!) If, as the Torah hopes, he decides that he doesn't want her as a wife after all, he must set her free; he can't make her a captive servant after putting her through that ordeal.
The next law discusses someone who has two wives - one he favors and one he hates. The Torah estate law dictates that a man’s firstborn son gets a double portion of the inheritance. If this person's firstborn is from the less favored wife, he cannot elect to give the double portion to his oldest son from the beloved wife, but has to leave it to the rightful heir, the firstborn. The reason this law is found immediately after the previous law is to teach us that those who marry people based on their looks, as did the soldier in the previous law, are bound to end up hating each other and trying to find ways to spite each other.
The next portion discusses the ben sorer u'moreh, the rebellious son, the kind of person who makes us tell our children, "Just give him the lunch money; I can't afford to buy new glasses every day!" This follows the previous law to teach us that if someone hates their wife and there is no shalom in the house, they are setting the stage for rebellious children. While I was living in NYC I spent many years working with delinquent children, and I saw this to be so true. Ninety percent of the children we worked with came from homes lacking shalom.
The Torah warns us about the law of Hashavas Aveida, returning a lost item. Not only does the Torah command us to not ignore any lost items we see, it even tells us that we have a responsibility to actively seek out the rightful owner, so that we can return the object to them.
We are then told that if we wish to take eggs or young birds from a nest, we must first shoo away the mother. This mitzvah is rewarded with long life, a fact which prompts Rashi to point out that if we get long life for such a simple mitzvah, imagine the reward for a difficult mitzvah, one that demands strong self-control! The Torah next prohibits cross dressing, commands us to put up a fence on our roofs to prevent any accidents, and reiterates the mitzvah of tzitzit.
One of the laws in this week's parsha shows a great deal about the sensitivity of the Torah. Before the banking industry was what it is today, personal loans were the most common form of loan. In order to guarantee that a lender would get his money back, he would often take an object belonging to the debtor as collateral. The Torah teaches that we may not take an object that will impede the debtor's ability to earn a livelihood, such as a millstone (the part of a mill used to grind grain, which would earn the debtor money). The creditor is not allowed to come into the debtor’s house to demand the collateral. Rather, he must wait outside while the debtor brings the collateral out to him. This way, the debtor is able to retain a certain level of dignity - he is the sole ruler of his house, and his debts and inadequacies need not follow him into his home and sanctuary.
In this week's parsha there is also the prohibition against usury or taking interest for a loan. The Torah both commands us to lend money to help the destitute get back on their feet, and forbids us to take interest. This helps us become more giving. The Torah understands that the only way we will become better people is by doing acts of kindness, not by simply having all the right feelings in our heart.
It is no wonder that the Jewish people are the most philanthropic race on this planet, with a higher percentage of their wealth being given to charity than any other race (According to one study, the Mormons give more. The problem is that the Mormons who don’t give tithe are expelled from the church, and the studies don’t calculate former Mormons who don’t give tithe.). In the Jerusalem phonebook, there are 96 pages listing free loan societies which lend or give away everything from medicine to power tools to chairs and tables for events to free medical referrals to mother's milk! As we say, "Mi K'amcha Yisrael- who is like your nation oh Israel"
Quote of the Week: It is what you are inside that matters, you are your only real capital. ~ Vladimir Zworykin
Random Fact of the Week: The alphabet arranged by frequency of use: ETAISONHRDLUCMFWYPGVBKJQXZ
Funny Line of the Week: Ever stop to think, and forget to start again?
Have a Stupendous Shabbos,
R’ Leiby Burnham