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17th March 2012, 04:15 PM | #1 |
New Blood
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Why NOT one BILLION?
Dear group,
I only joined this "Mob" 'cos I have always respected Randie and am a Sceptic. And I had to join to comment :-( Well, I have been aware of the 1 Million Dollar challenge for some time now. In a "psychic" or was it more likely a "drunk" moment, I realized that one Mill. was almost nothing nowerdays. I am not sure what the insurance industry might charge, but may I recommend that the prize be bumped up to "A BILLION DOLLARS". Still a sure bet! That will surely get the worlds attention (for a few seconds at least) and I am prepared to donate 100 Dollars to the cause, when and if my idea is implimented. Guido. |
17th March 2012, 04:25 PM | #2 |
Illuminator
Join Date: Oct 2009
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Welcome!
They need to have the money, and collecting one billion dollars wouldn't be easy. Also, the odds of success from chance might need to be changed, possibly? A lot more people would probably want to "try their luck", and because of that the challenge would need to be harder to make up for that increased likelihood of somebody getting a false positive based on chance. |
17th March 2012, 04:26 PM | #3 |
Master Poster
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Why not one billion?
Because Randi did not have one billion. If you do, feel free to start your own challenge. |
17th March 2012, 04:30 PM | #4 |
Muse
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Give bill gates a call, maybe he will put it up.
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17th March 2012, 04:37 PM | #5 |
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17th March 2012, 05:30 PM | #7 |
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17th March 2012, 05:59 PM | #8 |
Gentleman of leisure
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Would not change anything. The frauds would still say the money was not there or some other excuse.
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17th March 2012, 06:26 PM | #9 |
New Blood
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Thanks for all your quick responses,
Even if some were a bit "catty". Why does the million dollar challenge have to be in 'cash'? What's wrong with a '...hole in one insurance..." approach. Yes, Bill Gates does have better things to do with his money, which he does do! and "...I tips me hat to the man..." Sure 'false positives' are always a problem. That's why we have Statisticians. (like my late Dad) Surely that (science & mathematics) is why we do believe in what we do. Guido. |
17th March 2012, 06:55 PM | #10 |
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17th March 2012, 08:53 PM | #11 |
Thinker
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If it was insurance, the JREF would have to pay premiums. I can't even imagine how high they would be on a 1 billion dollar prize.
The way the 1 million is structured probably earns intrest. The insurance path would be a constant cost on a prize that is unlikely to be paid out. |
17th March 2012, 09:05 PM | #12 |
Illuminator
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19th March 2012, 08:36 AM | #13 |
Penultimate Amazing
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An insurance bet for a billion would be hugely expensive. Even if some insurer would be very idealistic, the cost could not be lower than the current interest rate (because at the end of the day, insurance money are deposited in some form, somewhere) which would be 2-3% per annum (and that is just currently).
2-3% of a billion is 20-30 million, per year. Does that answer your question, Guido47? Hans |
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19th March 2012, 08:39 AM | #14 |
Penultimate Amazing
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19th March 2012, 08:44 AM | #15 |
Illuminator
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Not sure this is how it would work in reality but another issue would be that if the prize was an insured risk rather than the JREF's actual money then it would be the insurance company who would be responsible for agreeing a protocol and accepting the risk of any challenge applicant, which I think would impact on the credibility and accessibility of the challenge.
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19th March 2012, 08:47 AM | #16 |
Penultimate Amazing
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Experience is an excellent teacher, but she sends large bills. |
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19th March 2012, 08:55 AM | #17 |
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19th March 2012, 09:19 AM | #18 |
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19th March 2012, 09:34 AM | #19 |
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Some day Randi won't be with us, and, though his choices to continue things are solid, I can't help but worry about competency, or lack thereof, creep. A bigger pot will also draw more concerted efforts at fraud, both from applicants (which goes without saying) but also internally, either due to the seductiveness of the amounts or in a 5th column sort of way.
Randi got into this because of the incompetency of scientists testing psychics, pointing out how you need good magicians to watch for known methods of trickery. Will this always be the case? |
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19th March 2012, 12:06 PM | #20 |
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19th March 2012, 02:58 PM | #21 |
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In the past, the JREF has considered increasing the size of the fund (though not to one billion!) and covering it via insurance.
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19th March 2012, 05:28 PM | #22 |
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19th March 2012, 11:48 PM | #23 |
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I think, given the comparatively small number of people who even get as far as the pre-test and the vanishingly small chance that anyone would actually win, the challenge prize could be increased to $5 million or $10 million and insured. I'm sure they've priced coverage for that. Maybe in a few more years, if inflation kicks up again, they'll take another look at it.
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20th March 2012, 12:08 AM | #24 |
Penultimate Amazing
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20th March 2012, 12:16 AM | #25 |
Penultimate Amazing
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I know there is no direct link to the interest rate. However, short of acually negotiating with an insurance company, this is probably the best way to get a ball-park figure of the cost.
My point is, if you lend a billion$, you get at least the general interest rate (if you have a billion to invest, you can far do better than that, actually), and in the end you'll get your billion back. It is common sense that you would not risk a billion for less, even if it is a small risk. Plus, an insurance company has to buy backing for its liabilities, the price of which will also reflect the interest rate, somehow. Hans |
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20th March 2012, 07:00 AM | #26 |
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I'm pretty sure this is wrong (I agree with your other points). Think of it this way. The insurance company has to borrow the billion dollars to post and it has to pay interest on it. But it doesn't leave the billion sitting in a bank vault. As with the real million, the money is invested in something safe and liquid. The interest on that investment offsets the cost of borrowing the money, so it's a wash.
Suppose the donor of the MDC prize instead of generously letting JREF keep all the earnings had said I'll post a prize, but you have to send me the interest. Then the prize wouldn't have cost the donor anything. It would have just been another investment vehicle. |
20th March 2012, 07:27 AM | #27 |
Penultimate Amazing
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My point was that even at a very low premium, it would still be very costly.
Quite another point is that one million should be more than enough. After all, if you really have supernatural powers that are useful for anything, one million bucks is pocket money. Anyway, for most, the fame and recognition should be worth more than money. So the purpose of the MDC is simply that, whenever someone says, "I can [whatever]", the JREF can say, "a million bucks says you can't!" - And if you can, there is really no sensible excuse not to take the challenge. For all that, a million is quite enough. Hans |
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20th March 2012, 07:38 AM | #28 |
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A billion dollars is a lot of money, much more than one million. One million seconds in 10 days. One billion seconds in 32 years. I doubt the JREF can easily cough that up.
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20th March 2012, 08:10 AM | #29 |
Penultimate Amazing
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Experience is an excellent teacher, but she sends large bills. |
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20th March 2012, 09:17 AM | #30 |
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20th March 2012, 09:57 AM | #31 |
Penultimate Amazing
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Experience is an excellent teacher, but she sends large bills. |
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21st March 2012, 11:09 AM | #32 |
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As John Astor said, the first million is the hardest. Randi's just offering to help people over the hump.
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21st March 2012, 09:48 PM | #33 |
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Plus the marginal benefit would be very small compared to the marginal cost. Even if you get twice as much publicity for the JREF, at 1000 times the cost, it's not worth it. People find it very hard to intuitively grasp the scale of numbers this large. Hence "a billion" sounds only marginally more impressive than "a million," not 1000 times more impressive.
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22nd March 2012, 04:06 AM | #34 |
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Experience is an excellent teacher, but she sends large bills. |
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