The T-Report: Going for 2

Posted by on Feb 4, 2013 in The T-Report | No Comments

Go For 2

Since I sent out the Stepford Wives T-Report on Saturday and the Weekly Fixed Income ETF Review and Outlook on Sunday I don’t have much new to add.

I will point out that Spain and Italy are leading us wider and lower and that was something the market deliberately chose to ignore last week. But away from that, let’s talk some football.

I will spend the few minutes on football today because it was a great super bowl game and I think this will also give you some insight into how I think and look at the world, which will help you evaluate my research better

Down by 22

San Francisco was down by 22 points in the 3rd quarter. That could be 3 touchdowns with 1 two point conversion, otherwise it is 4 scores. The fact that you are already in the 3rd quarter is a big factor here, as even with everything going right, 4 scores in a half is tough, and 5 is extremely unlikely, so you have to maximize what you have.

Let’s assume a single point conversion has 100% success rate (close enough) and that a 2 point conversion has a 50% success rate (seems like people argue that it is between 40% and 60% in actuality).

The actual coach seemed to decide to go for 1, go for 1, and then go for 2. That creates a 50% probability of being tied, and a 50% probability of being down by 2 after the unlikely event of three unanswered touchdowns.

Mathematically, and given how hard it is to score in such a short time, I think going for 2 is the most logical.

If instead you go for 2 on that first touchdown you have a 50% chance of making it, and then you can go and kick two 1 point conversions and be tied.

If you miss, then on the second touchdown you have the option of going for 2 again. If you miss, then on the next touchdown, you have to go for 1 to be certain to be down only 3 points. If you make it, then you go again, if you make it, you are tied, if you miss, you are down by 2 points.

So by going for 2 early you have a 62.5% chance of being tied by scoring 3 touchdowns. You have a 12.5% chance of being down by 2, and a 25% chance of being down by 3.

Given how hard it is to score, reducing the scenarios where you need 4 scores is the best outcome. Each score is less and less likely, so take the route that eliminates the need.

My path also reduces the uncertainty. You know what you need to do. Had you missed, then you certainly don’t kick a field goal in the 3rd quarter as you know by then that isn’t enough.

By making the two, maybe it affects how Baltimore plays the rest of the game. Missing the first two point try doesn’t really change the number of scores you need, so doesn’t impact Baltimore’s thinking.

Had San Francisco scored 2 points on their very first touchdown of the 3rd quarter, it turns out they could have kicked a field goal on the last drive to win the game!

I am not saying the game was determined by the decision to go for 1 early, but it certainly looks like it.

Why Didn’t They Go For 2?

It is against conventional wisdom. As far as I can tell, that was the biggest roadblock. You don’t go for 2 until late in the game or down by less than 11. Who made up that rule? Why follow rules?

Isn’t each team, each situation unique? I think the probability of scoring 4 times in a half is low, 5 is very low, and yet they chose a strategy that made it likely that they would need to do just that. The complexion of the game changes in their favor if they go for it and make it. If they miss, they are basically in the same boat they were otherwise (the complex nature of scoring points by 3’s and 6’s in football makes the possible paths different than in a more linear scoring system).

So they didn’t go for it because that isn’t how it is done, and yet, you could argue, not going for it probably cost the game.

This is neither the time, nor the place, to go into the problems both teams had with time management, but as far as I can see, the coaches in many ways let down their players, on the most basic of things. If football is a game of “blocking and tackling” which really means doing the simple things right, then there were many instances where the coaches just dropped the ball, and it really is the little things that win or lose games.

Which may be a good time to remind everyone that the ECB’s open market transactions program, or OMT, has not yet been implemented, and the accusations of wrong doing in Spain and Italy won’t make it easier for them to actually apply for a program, or receive one.


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