26 April 2006

Cut losses

What a rational concept. One that has been imbued in me since my first economics lesson. Darn, I myself have often echoed it. When making a decision, don't consider sunk cost; just cut losses.

But when doing as mundane a thing as watching Korean drama serial with my mum two days ago, I realized for the first time how frightening the concept of cut losses is when applied to human beings. When in an epidemic, cut losses. Forget about the people who are sick. Forget about the few accidentally left behind. Cut losses. Don't create more losses.

How easy it is, for the slogan of cut losses to becomes an excuse for cowardice, for an easy way out.

So what of those who are left behind? Those unfortunate remnants of a very rational economic strategy?

(Un?)fortunately, human beings are not widgets. That is probably why it is so hard for people to cut losses in bad relationships, especially where inertia and hope feed on each other. Cutting losses is all very well when you rebalance your investment portfolio*, but when you can put a face to inanimate decision trees, cut losses just doesn't quite cut it.

Better for people to remain widgets huh?

*Yet, to take this one step deeper, rebalancing a portoflio is not so harmless a decision if you consider that you are cutting off a poor startup of fresh funds, possibly causing the young idealist boss to sink into despair.

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