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Jiro comments on Rationality Quotes June 2014 - Less Wrong
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But it's an equilibrium, right? Lumifer's joke may be funny, but as an empirical matter, you don't see a lot of $20 bills lying on the ground. There's no easy pickings to be had in that manner. So the only people who can "outguess" the market (and I think that framing is seriously misleading, but let's put that aside for now) are individuals and organizations with hard-to-reproduce advantages in doing so - in the same way that Microsoft is profitable, but it doesn't follow that just anyone can make a profit through an arbitrage of buying developer time and selling software.
Whether it's worth picking up a $20 bill depends on
The odds for #2 and #3 are pretty high compared to the odds of similar activities when playing the market. The odds of #1 vary depending on how well travelled the place is but are generally a lot higher than for whether you're the first person to notice an opportunity in the market.
Of course, #1 is also affected by how many people use this entire chain of reasoning and conclude it;'s not worth picking up the bill, but the other factors are so important that this hardly matters.
The way I see it, in practical terms, it's always worth picking up. I've picked up a number of fake bills. I keep them. It's better than leaving them to torment each successive person who picks it up until someone else does it instead.