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ovrsxdunderpaid (43.22)

Paper treatments

Recs

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July 01, 2009 – Comments (10)

trying a link again 

A key problem, suggests mathematical physicist Eric Weinstein of the Natron Group, a hedge fund in New York, is that it is too easy for scientists in the “establishment” of any field to cut down new ideas, and to do so without really putting anything at risk, thereby leading to a culture that is systematically biased toward caution. …

Weinstein suggests another idea — that we should borrow some ideas from financial engineering and make scientists back up their criticisms by taking real financial risks. You think that some new theory is utterly worthless and deserving of ridicule? In the world Weinstein envisions, you could not trash the research in an anonymous review, but would buy some sort of option giving you a financial stake in its scientific future, an instrument that would pay off if, as you expect, the work slides noiselessly into obscurity. The money would come from the theory’s proponents, who would similarly benefit if it pans out into the next big thing.

Weinstein’s point is that markets, in theory at least, work efficiently and — putting the current financial meltdown to one side — lead to the accurate valuation of products. They exploit the “wisdom of crowds”, as a popular book of the same title recently put it. Take the famous electronic prediction markets at the University of Iowa, which pool the views of thousands of diverse individuals and consistently seem to give better predictions than any expert. … 

10 Comments – Post Your Own

#1) On July 01, 2009 at 9:41 PM, ovrsxdunderpaid (43.22) wrote:

http://www.overcomingbias.com/tag/prediction-markets

 

dam macbook 

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#2) On July 02, 2009 at 9:32 AM, madcowmonkey (< 20) wrote:

So the proponents put money on the system and the nay-sayers do some type of options on the system? That makes no sense. Every system should have believers and non-believers.......that is what makes products better or improved. No system is ever perfect for individual investors or the "establishment".

Every idea can and should be scrutinized when involving real money for investors, otherwise fake systems would rule the day:)

Paper treatments? I don't get it. 

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#3) On July 02, 2009 at 9:54 AM, portefeuille (99.60) wrote:

The article (also from a macbook, hehe):

In search of the black swans

 

The problem of ignorance towards new ideas is also mentioned in the preface and introduction (and probably in the rest as well) of this book by Mandelbrot: Fractals and scaling in finance. Also have a look at this post.

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#4) On July 02, 2009 at 3:15 PM, madcowmonkey (< 20) wrote:

This raises an important question: does today’s scientific culture respect this reality? Are we doing our best to let the most important and most disruptive discoveries emerge? Or are we becoming too conservative and constrained by social pressure and the demands of rapid and easily measured returns? The latter possibility, it seems, is of growing concern to many scientists, who suggest that modern science is in danger of losing its creativity unless we can find a systematic way to build a more risk-embracing culture.

Perfect article for this post! Progressive, progressive, progressive thoughts. I always find it funny when individuals don't realize that the majority of mathematics is very simple, but it takes some hard work to get there. What's the saying? Nothing worth attaining is ever easy.

 

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#5) On July 02, 2009 at 8:05 PM, portefeuille (99.60) wrote:

I know quite a few guys that currently work on quantum gravity (and there are probably not more than 1000 of them around). One of my best friends does. They are usually really enjoyable guys. Well I am a theoretical physicist myself, but I have kept a somewhat neutral perspective on that, I belief ...

If they were hedge fund managers they would be of the Hugh Hendry kind ...

If I were to entrust a billion EUR (I won't now because I currently don't have it ...) to someone it would be the group of the quantum gravity guys I know in person. Partly because they are of the playful kind, partly because they would not care how many zeroes the amount invested has. I would only insist that they keep doing their quantum gravity research. Partly because it would be a shame if they did not and partly to keep them uncorrupted. Oh well, maybe I should really make a billion just for the fun of handing it over to them. They would not go the way of LTCM. Still not sure how I would keep them motivated ...

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#6) On July 02, 2009 at 8:13 PM, portefeuille (99.60) wrote:

--------------------

Much of the mathematical work was carried on in a way not usual
in American mathematical centers. The mathematicians in Lwów met
not only in their classrooms and offices but spent long hours every
day in two coffee houses which served as informal meeting places.
They discussed problems over coffee or beer, and marble table tops
and napkins took the place of blackboards. It was hard to outlast or
outdrink Banach during these sessions. He was always there.
The
weekly (Saturday night!) meetings of the mathematical society,
where papers were presented, provided the more formal discussions.

--------------------

(from here (pdf))

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#7) On July 03, 2009 at 10:53 AM, madcowmonkey (< 20) wrote:

Heavy social drinkers are all motivated by.......hanging out and drinking. It becomes a passion for mathematicians. Undersxd is not a mathematician, but he has a great drinking personality to be one:)

I know quite a few guys that currently work on quantum gravity (and there are probably not more than 1000 of them around). One of my best friends does. They are usually really enjoyable guys. Well I am a theoretical physicist myself, but I have kept a somewhat neutral perspective on that, I belief ...

I know you like to work on your grammar and I didn't see the OCD kick in.....it's believe....hope it helps

I still don't understand the battle completely, I just know it exists. A neutral perspective is always good on those types of matters.

Go ahead and make a billion, I would be more than happy to help with keeping them motivated with Saturday night venues. Are they working on loop or string? If I were even trying to take a stab, I would say string theory...... but I am not a physicist and I am never going to try and write to get published. I would would put myself on the the scale as a 150 with the question/blog you put up about physicits ranking themselves. I think there was some confusion on the rating scale there with other players here:)

http://caps.fool.com/Blogs/ViewPost.aspx?bpid=207706&t=01005222198512106855

If you want to classify yourself.

 

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#8) On July 03, 2009 at 11:09 AM, madcowmonkey (< 20) wrote:

okay. sounds good. see, I knew there was intelligence out there somewhere ...

exactly!

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#9) On July 03, 2009 at 11:16 AM, madcowmonkey (< 20) wrote:

Not sure if you posted anything of the sort on your site, but I know you like the random walk.....

http://www.cs.sunysb.edu/~skiena/691/lectures/lecture12.pdf

Does it or does it not make sense to wait for the upward trend if you are a buy and hold investor? I would have to say that the buy and hold would definitely have to wait, so they are not depressed from the get go:)

The paper works great for the average folks that can keep up. 

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#10) On July 03, 2009 at 11:19 AM, madcowmonkey (< 20) wrote:

I am sure you ran by this one already when I did a search I found one of the books you recommended the other day.

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