The Triad Perspective

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Snow Blind on Mount Forever-Rest?

I've never had the desire to climb Mount Everest. Then again, I've never had the desire to fling myself off a high-rise building, wrestle crocodiles, or discuss politics with my wife. These are all very dangerous activities.
I've been fascinated recently with the Bataan Death March--Google it--that climbing Everest has become. The news has been full of reports of recent deaths on Everest during the oh-so-short "window" of decent weather each year during the month of May that causes otherwise rational individuals to put their beings at risk of eternal entombment at elevations normally reserved for jet airplanes.
Everest's summit, at 29,029 feet--that's 5.5 miles for you mathematicians--is the highest peak in the world. Highest is important, as I'll get to later. First reached in 1953 by Sir Edmund Hillary and Sherpa Tenzing Norgay, Everest hosted 260 climbers during the 35 years from 1953 to 1988. By 2018 over 9,000 made the climb. So far this year, over 900 people climbed Everest.
With all those climbers, it must be relatively easy, right? Well, there is that perennial bugaboo, death. Almost 300 deaths have been recorded over the years. Most of those ghostly souls are still up on the mountain. It's just too dangerous to bring them down. Some of the deceased, such as the unfortunate fellow below nicknamed Green Boots, are used by climbers as landmarks.

Everest provides plenty of ways to die. Most popular is by avalanche, although this one is unfairly popular as it can kill multiple people at once. You can also fall into a crevasse, which can be hundreds of feet deep. And your body will never, ever, be recovered. There's also plain ol' exposure, freezing to death. Or altitude sickness, cardiac arrest, exhaustion, cerebral edema--brain swelling for the non-docs--stroke, or frostbite. So, you see, a whole menu of death options available at 25,000+ feet in the sky.
There's significance to that 25,000 feet marker. Once you climb above this level, you enter what is known as the "death zone." No, I'm not making this up. Above 25,000 feet, you will enjoy--probably not the right word--about 30% as much oxygen as at sea level. That ain't enough. You will eventually die. Which means you gotta get up to the summit fast, don't stay too long taking selfies, then scamper back down before your body starts a revolution.
Unfortunately, this is a little tough because it's become so crowded up there. With hundreds of people now attempting to climb during the same short weather window--this year it was only 4 optimal days--there's barely enough time to make it. Every climber is fighting for his or her little piece of glory.

Whistling past the graveyard, so to speak--yes that's a dead climber

Fighting might too strong of a word. The affluent folks who do this stuff pay $50,000 to $100,000 or more to be guided up the mountain by Sherpas, the local folks who actually do the hard work of carrying all the gear. Gourmet meals, complete with dining tables, wine and beer, creates a party atmosphere up there. But let's face it. Without the expert guides accompanying them, these mostly-novice climbers wouldn't have a chance to reach the summit.
So why do so many people put their lives at risk like this? It can't be for the glory of saying "look at me, I made it up to the top of Everest all by myself." Because you didn't. You only made it because you had an expert guide to carry all of your stuff, and show you the ropes--pun intended--when climbing. And you achieved the same feat as hundreds of others. I guess your luck was impressive, if not your climbing skills.
Behavioral bias is at work here. Specifically, commitment bias, which is the tendency to commit to doing or finishing a task, even at the risk of harm, or in Everest's case, death. People rationalize that they've spent a lot of money, committed lots of time--up to 3 months--and personal energy, and besides they have friends to impress on Facebook, Instagram etc. How's it gonna look if I don't make it all the way up the highest mountain in the world? When ego is involved, you want to climb the tallest. Never mind that Everest isn't even considered by climbing experts as the most difficult mountain to climb. But tallest? Now that's something the ego can wrap its claws around.
We regularly confront commitment bias in our investment business. The most obvious situation is assessing whether an investment should continue to be held, or instead sold. It can be easy to stay mentally committed to your previous decision, when the right course of action might be to sell and find another investment. This applies to both winners and losers. What we try to do in both situations is to make a rational decision about the best course of action to take from here.
That's what some of these climbers need to think about doing. Clearly, going up there at all today is a somewhat questionable move. But once they have paid the guides and begun the climb, they need to find a way to stop when the environment says stop. The consequences for misbehaving at those moments are all too clear.
-John Heldman, CFA

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