Posts filed under “Mathematics”

Fact, Hypothesis, Theory, and Law In Science

It’s time we learn the difference between a fact, a theory, a hypothesis, and a scientific law.




Hat tip Lifehacker

Category: Mathematics, Philosophy, Science, Video

Jim Simons: The Mathematician Who Cracked Wall Street

Jim Simons was a mathematician and cryptographer who realized: the complex math he used to break codes could help explain patterns in the world of finance. Billions later, he’s working to support the next generation of math teachers and scholars. TED’s Chris Anderson sits down with Simons to talk about his extraordinary life in numbers.

Category: Hedge Funds, Mathematics, Video

Simons: Mathematics, Common Sense, and Good Luck

James Simons – Mathematics, Common Sense, and Good Luck: My Life and Careers

Hat tip theirrelevantinvestor

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Category: Mathematics, Quantitative, Trading, Video

Interview with Richard Thaler

University of Chicago behavioral economist on stock markets, NFL drafts and the importance of trust Douglas Clement | Editor, The Region Published October 3, 2013   |  September 2013 issue Interview conducted July 17, 2013 We are rational, self-interested optimizers: Homo economicus. So the neoclassical model of economics has held for over a century. It has been a fruitful…Read More

Category: Bad Math, Cognitive Foibles, Psychology

Market Forecasters Are Like Blind Squirrels…

Earlier this summer, I tweeted a wonderful line from Brett Arends column, 25 things I wish I knew when I graduated from high school:



That led to a delightful column last week from Michael Johnston’s A Visual History of Market Crash Predictions.

Here are some of the more egregious calls, but the entire article is well worth your time to read:



Source: Fund Reference



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Category: Analysts, Mathematics, Really, really bad calls

Red State, Blue State: Kansas & Washington

@TBPInvictus here. We have interesting experiments going on in the state of Kansas and the city of Seattle. Herewith a brief update on both. Thanks to the following Tweet, I was made aware of the fact that – as you can see – the state of Kansas, under Sam Brownback’s awesome tax cuts, recorded the…Read More

Category: Bad Math, Cognitive Foibles, Current Affairs, Data Analysis, Really, really bad calls

Buffett on Stock Prices

Its early in this potential correction, but let me remind you of Buffett’s interesting (1997) comments: “If you plan to eat hamburgers throughout your life and are not a cattle producer, should you wish for higher or lower prices for beef? Likewise, if you are going to buy a car from time to time but…Read More

Category: Bad Math, Investing, Philosophy

The NY Post’s Financial Innumeracy

@TBPInvictus here: The New York Post ran a piece on Netflix (NFLX), written by Claire Atkinson, that was, to put it charitably, interesting. And by interesting I mean that it painfully misstated the very simple mathematics of stock splits. The piece implied that NFLX is wildly overvalued. I have no problem with that. Not that…Read More

Category: Bad Math, Cognitive Foibles, Data Analysis, Financial Press, Really, really bad calls

Fine, when you ignore history

This must be the “new normal” everyone​’s talking about​. Where a cyclical low ​in the ​unemployment rate​, to the the low 5 percent range​,​ is met with a courtly high stock market and talks of an impending rise in rates. Sure there is a feeling in some pockets ​of the economy ​that “things” are much…Read More

Category: Bad Math, Economy, Think Tank

More Fun With Useless Correlations: American Pharoah

About a year ago, we discussed what happens “When Correlations Lie.” Delving into the classic logical fallacy that correlation implies causation, we looked at equities and a variety of supposedly related factors, including gross domestic product, rising interest rates, earnings surprises, new financial products and the “death cross” involving daily moving averages. All were classic coincidences of…Read More

Category: Bad Math, Cognitive Foibles, Investing