John Reeder creates Risk of Ruin, a set of audio documentaries on risk takers. I had an awesome conversation with him on The Football Analytics Show podcast.

After recording the pod, I realized I should have asked him another question. “What have you learned from interviewing all of these risk takers? Is there a common thread that runs through all of your episodes?”

John was gracious enough to provide this enlightening answer (light editing on my part):

We have had a bunch of advantage type people on the podcast, from hedge fund managers to sports bettors to credit card hustlers. But I think what unites all of them is a two-part process:

1. Pay attention.
2. Once you find some small edge, take it to its ridiculous extreme.

The guests are observant of the world around them, so they notice when something is off. They notice positive expected value.

But then once they see it, their minds also shift immediately to – what are the assumptions that most people are making about this thing, and then which of those assumptions are artificial or imaginary? And then which of those assumptions can I dispense with, so that I can harvest this edge to its extreme?

An example is in the episode Credit Card Arbitrage. The guest figured out that he could make small deposits into a bank using his credit card, and then get cash back with those deposits. So they set up a bot to make thousands of those deposits. If you could keep doing this, it is a license to print money.

That’s just an example, but it’s emblematic of the things that every guest has done.

First observe, then don’t be constrained by convention. Also try not to break the law while being unconstrained by convention… that’s important too.

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I’m a huge fan of Risk of Ruin, and I will not be offended if you skip my conversation with John on my podcast and go straight to his audio documentaries.

His favorite episode is Life’s Too Short in which trader Marc Cohodes tells stories from a career in short selling fradulent companies. After my conversation with John, I got a great laugh from listening to this episode on a road trip to Cincinnati to watch Dortmund play.

My personal favorite is Rocket Man, as John played a pivotal role in the episode on Elon Musk’s acquisition of Twitter. There are more recommendation of Risk of Ruin episodes on the page at The Power Rank with the podcast interview.

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