Fooled By Randomness (June 04 2005)

Looking back I think I actually underrated this book. I come back s to this book and the later Black Swans frequently and they have had a definite impact on my thinking.

Reading a quite interesting book at the moment called "Fooled by Randomness: The Hidden Role of Chance in Life and in the markets"
Its written by a guy called Nassim Nicholas Taleb a deeply eccentric and highly intelligent Options Trader...
In it he discusses the fact that we judge traders (and people in general) almost exclusively by outcomes not on how intelligent their decisions were given the information they had available to them at the time. Essenitally its a treatise on the universilty of the monday morning quarterback problem. We dramtically downplay the element of chance... He argues that successful traders are often just lucky traders and what we assign to skill is primarily due to a random distribution of success and failure... "Of course this ground has been wellcovered in books like "A Random Walk Down Wall Street" BUT Taleb isnt arguing for efficiency of markets... He believes that markets are actually inefficient in key ways particularly in their response to unexpected events... This isnt a how to book designed to help you increase the size of your portfolio. Its more of a general survey of life as Taleb sees it. In it he touches on classical literature, neuroscience, behavioral psychology and a host of other areas, bringing in Homer, Karl Popper, Richard Feynman Georgre Soros and a host of of other characters. The whole thing is written in a rambling but elegant stream of consciosuness style that I found very enjoyable. What I find particularly amusing is the authors extreme arrogance about his own humility.
The book is a little bloated BUT I enjoyed the intelligent rambling and frequent autobiographical digressions

War Of The Worlds (July 05 2005)

The latest apocalyptic alien invasion movie to hit hollywood. This is actually only the second time HG Wells novel has been oficially adapted for the screen. (The first time was in the 1950s)It just feels like the 20th. The aliens out to conquer the earth thing has been done so many times that for me the idea really needs to be allowed to rest for a couple of decades or so.
Apart from the wellworn premise however, the execution here simply didnt grab me. It is an essentially silly movie with a ludicrous alien invasion plan.... Tripod killer vehicles are buried under the earth for thouands of years until the aliens decide to invade... then little alien pilots are inserted to steer them via lightning bolts. The alien tripods run amok causing lots of havoc and destruction. It seems a VERY inelegant invasion method for such presumably advanced aliens.. I think part of the problem is that Spielberg has kept the most dated elements of the original war of the world story but updated the setting. By transposing the story from its original turn-of-the-century setting into the modern day he has highlighted that datedness still further, regardless of heavy heanded september 11 alegories.
A final problem for me is the lack of fun. Silly material is no obstacle to a great movie... Speilbergs own Raiders of the Lost Ark and Jurassic Park are wondeful in this respect... But here the silliness is handled with such gravitas and sobriety that the whole thing becomes dull.

Forming opinions as a non-expert

An issue that has interested me for some time is the following. On many issues, from the economy, to the environment, from foreign policy, to scienctific research there are highly intelligent, highly informed experts who disagree. How do I form opinions on subjects in which there is stark disagreement between experts? Do I read all their books? Where will the time come from? Often the arguments will be of a subtlety and complexity that is impossible for someone without a very thorough understanding of the subject matter to grasp. Equally there will be times when I am intellectually outgunned. The experts whose opinions differ are simplky smarter than I am.

From buying a home to purchasing stock to planning for the future intelligent decision making is impossible without at some point deferring to authority. The difference between an open society and a totalitarian one is that in an open society there are many- a market place- of authorities. The question is how do I from my position of relative ignorance and stupidity decide which authority to defer to? My only choices seem to be an evaluation of the expert and/or the opinion of other experts about the same claim.

Some ideas...
The popularity of the claim. On the whole, ideas which enjoy popular support in their field are probably true more often than those which enjoy less support. But how often is this the case. To what degree should the popularity of a claim bias us toward accepting its truth?

The personal desirability of a claim: Do I or the expert have a personal stake in whether the claim is true or not? If there is a lot of incentive to believe that a claim is true, wishful thinking may bias us in this direction.

The popularity of the expert. How much extra weight should be given to the opinions of an expert who enjoys a high standing and reputation in his field?

The age of the expert. What difference does the age of an individual play in evaluating the probabilistic likelihood that a given claim is correct? I have no idea but it is something I intend to research and think about in the future.

Evidence of flexibility of thought: Has the expert shown an ability to change his mind in the past on other issues.? To me an individual whose track record shows little change in his opinions over a lengthy timeframe must have ALL his claims viewed with an extra dose of caution.

The personal attractiveness of the expert. Given our preference for the beautiful the articulate and the charismatic, it seems to me that many opinions expressed by experts strong in such qualities are probably overpriced in the ideas market. Should we consciously discount the probability that the claims of charismatic experts are true? If so by how much?

All of us already factor a lot of this stuff in when making gut level judgements about whether something is true or not....
But I think it important to think about this stuff explictly rather than implictly. In evaluating experts intuitively our evolutionary biases are likely to impair our judgemnt considerably. We will be overly swayed by the experts personal charisma for example.

Pop Culture Literacy

First published on October 17 2005

When I was young, old shows and movies on rerun were a staple of TV as they had been for the previous decades. At random and in no chronological order I can recall Tarzan movies, Donald Duck, Tom and Cherry, Tweety and Sylvester, lousy Elvis Presley vehicles, Laurel and Hardy, the three stooges, Abott and Costello. It was pretty much impossible to grow up and not be exposed to Marilyn Monroe, Audrey Hepburn James Dean, John Wayne, Cary Grant Erol Flynn and all the other classic hollywood icons because their work was on such heavy rotation. So were TV shows such as Sgt Bilko, Jackie Gleason and the Honeymooners, Happy Days, The Twilight Zone.

That was then and this is now... Without anyone really noticing it seems to me that these movies and shows have almost entirely disappeared from the pop culture landscape.
Can a black and white movie even be considered mainstream entertainment anymore these days? I dont know... When I was a kid I watched old movies on their own terms. The oldness was not intrusive and rarely even occured to me. Im not sure if that is still the case for kids today.

My generation may be the last that is reasonably wellversed in the whole panorama of 20th century pop culture.. Why? Old stuff is quietly disappearing from main TV and being confined to media ghettos such as the Classic movie channel. Without anyone really noticing all these things have quietly slinked off TV screens around the western world I guess this really got into high gear in the early 90s. There is something creepy recognising the mortality of these icons.
How and why did it happen? In Hollywood I would have to go back to Jaws, and Star Wars, which pretty much begin the modern era of cinematic storytelling. driven primarily by dynamic visuals and RAPID storytelling. Narrative on steroids.... I think a consequence of this is that pre-star wars movies are left looking as creaky and anachronistic to modern teen audiences as old footage of skinny white basketball players in the 1960s NBA.

It could be argued that the beginning of the blockbuster era in the late 70s marks as abrupt a breaking point in the history of popular movies as the birth of rocknroll was to the music.. and I think that as time progresses what came before it will appear as less and less relevant. If I think of my own knowledge of popular music, I am pretty familiar with famous popular music starting from the 1950s. But If I try to go back further back... boom... Its like I run into a black hole. My mental filing cabinet not only thins out but is almost entirely empty. A famous blues or Jazz musician here and there is probably all that it contains.
With the rise of hip-hop culture eclipsing rocknroll in the mid 90s I wonder if we have come to a smiliar rupture. Will The Beatles, Bob Dylan, and Jim Morrison remain part of our shared tribal vocabulary or will they simply vanish into thin air like the pop icons of the 1930s and 40s?
I guess the thing that has really hit me is that this process is not as organic as I had always assumed. At times the curtain comes swiftly down, and for suceeding generations what existed previously becomes almost completely invisible.

culturally sensitive police work

first published on November 9, 2005

This sickens me


I wonder WHAT it will take for western civilisation to wake out of its crisis of moral confidence and its appeasement of barbarism and evil.
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The Australasian Police Multicultural Advisory Bureau has published and distributed 50,000 copies of an 82-page handbook for Australian police officers, directing them on how to deal with people from all the unfamiliar cultures that an Australian policeman may encounter. A Sikh, for example, may receive a three-day reprieve from arrest if the arresting officer happens upon him while he is reading his holy scriptures — a practice that takes fifty hours, and must not be interrupted. And Muslim husbands who beat their wives must be treated differently from other domestic violence cases, as a matter of cultural sensitivity: “In incidents such as domestic violence,” says the handbook, “police need to have an understanding of the traditions, ways of life and habits of Muslims.”
..........................................

I prefer the cultural sensitivity expressed by General Napier of British India. He was asked to refrain from interfering in sati, the Hindu practise of ritual widow burning...

"You say that it is your custom to burn widows. Very well. We also have a custom: when men burn a woman alive, we tie a rope around their necks and we hang them. Build your funeral pyre; beside it, my carpenters will build a gallows. You may follow your custom. And then we will follow ours. "

Identification With Beliefs

First published on my old blog on April 21 2006

We dont change our minds very much....

One of the most damaging things to human discourse is the fossilisation of ideas. Ideas often become so entrenched within individuals or cultures that an open debate of their merits is impossible. At the root of this problem, it seems to me is the fact that ideas and beliefs serve two purposes often fundamantally at odds with each other. The first purpose is that of a model of reality and a guide for actions.

Correct ideas generally produce results superior to incorrect ones.
The individual or group which holds correct views in a given field is far more able to make useful predictions concerning it than one who doesnt. The weather service in London is more effective at making predictions concerning the future weather than an African witch doctor because its ideas concerning this subject are orders of magnitude more true and useful.

Cultures also hold beliefs and ideas. The truth and usefulness of those ideas which are dominant within them are an excellent predictor of cultural success

This fact remains incredibly problematic for multiculturalists who want to reframe the terms of debate in traditionally marxist terms of oppressor/opressed. Multiculturalism is a classically academic idea. In academia beliefs are abstract things with no real consequences. In the outside world they have consequences.

It is the second purpose of ideas which is the most problematic. It results in the otherwise inexplicably long shelflife of ideas which are false useless or harmful to the individual or group concerned. w
Ideas serve to distinguish the individual or group from others and serve as a marker for personal or group identity.
If my selfhood is inextricably bound up with what I believe to be true then a criticism of my beliefs becomes a criticism of me. The only solution is to thro up the trade barriers and limit the exchange of ideas this is exactly wha happens. The consequences of intellectual trade barriers is exactly the same as that of trade barriers in the exchange of goods and services... Stunted growth...

There are areas where the use of ideas for the purpose of identity is generally harmless and even beneficial to human happiness. Fashion, allegiance to sports teams, many traditional cultural festivals and celebrations all give a sense of identity and belonging. It doesnt really matter if a belief in Chicago Cubs baseball, for example is an irrationally entrenched one. Indeed it may even give the believer pleasure. Believing in the Chicago Cubs is utterly different to believing in the Democratic party. A belief in the Chicago Cubs is irreleavnt to being able to form useful ideas about Economics, Law, family life and a whole host of other issues. An entrenched belief in a political party seriously inhibits my ability in this regard.
It is vital that we as a society recognise the difference between the two categories of belief.


While entrenched cultural attitudes such as preference for soccer over baseball or brown bread over white are harmless and enjoyable ways for individuals and groups to distinguish themselves attitudes such as a belief in a rigidly gender stratified society or in socialism are not.

A faith based adherence to ideas with practical consequences is dangerous. The more consequential an idea the more vital is a free flow of ideas in the debate surrounding it. The academic ideas market is not very efficient. The ideas market for correct supply chain management in industry is FAR more efficient becasue the holder of incorrect ideas will be more directly exposed to the consequences of them. Financial markets, the ultimate ideas markets are INCREDIBLY competitive. So are the odds Vegas sets for the outcome of sporting events.

The bible's Leviticus, Platos Republic, Karl Marx's Communist manifesto and the Q'uran ALL advance theories about the optimal organisation of society. The theories advanced in these works are largely incorrect at least in regard to the 21st century. By any measure, societies that follow the blueprints advanced in these works will be less successful than those which are based on free markets...