Academics From The United States

"Why do [people] confuse probability and expectation, that is, probability [vs.] probability times payoff? Mainly because much... schooling comes from examples in symmetric environments... the... bell curve... is entirely symmetric."

"Just as an animal could have survived because its sample path was lucky... free of the evolutionary rare event, the "best" operators in a given business can... One vicious attribute is that the longer these... can go without encountering the rare event, the more vulnerable they will be to it. ...[S]hould one extend time to infinity, then by , that event will happen with certainty—the species will be wiped out! For evolution means fitness to... only one time series, not the average of all possible environments."

"There is a saying that bad traders divorce their spouse sooner than abandon their positions. Loyalty to ideas is not a good thing for traders, scientists - or anyone."

"[T]hey share the traits of the acute successful randomness fool who, in addition, operates in the most random of environments. ...[T]heir bosses and employers shared the same trait. They, too, are permanently out of the market."

"[A]t any point in time, the richest traders are often the worst traders. This I will call the cross-sectional problem: At a given time... the most successful traders are likely to be those fit for the latest cycle."

"Veteran trader Marty O'Connell calls this the firehouse effect. ...[F]iremen ...who talk to each other for too long come to agree on many things that an outside, impartial observer would find ludicrous..."

"A trader's mental construction should direct him to do precisely what other people do not do."

"[N]ews... is full of noise and... history is largely stripped of it."

"Over a short time increment, one observes the variability of the portfolio, not the returns. ...[O]ne sees the variance, little else. ...Our emotions are not designed to understand the point. ...I deal with it by having no access to information. ...I prefer to read poetry."

"I... found a significant advantage in selecting aged traders, using as a selection criterion their cumulative years of experience rather than their absolute success... [O]lder people have been exposed longer to the rare event and can be, convincingly, more resistant to it."

"There are hordes of thoughtful journalists... [I]t is just that prominent media journalism is a thoughtless process of providing the noise that captures people's attention and there exists no mechanism for separating the two."

"[A]ge is beauty. ...[M]y instinct is to value distilled thought over newer thinking, regardless of its apparent sophistication—another reason to accumulate the hoary volumes by my bedside... For an idea to have survived so many cycles is indicative of its relative fitness. Noise, at least some noise, was filtered out. ...[P]rogress means that some new information is better than past information, not that the average of new information will supplant past information..."

"[H]istory cannot lend itself to experimentation. But... is potent enough... to eventually bury the bad guy. Bad trades catch up with you... Mathematicians of probability give that a... name: '. [R]oughly... properties of a very... long sample path would be similar to the Monte Carlo properties of an average of shorter ones. ...Those unlucky... in spite of their skills would eventually rise. The lucky fool... would slowly converge to the state of a less-lucky idiot. Each ...would revert to his long-term properties."

"A... vicious effect of... is that those that are good at predicting the past... think of themselves as good at predicting the future... [W]e live in a world where important events are not predictable..."

"I have two ways of learning from history: from the past, by reading the elders; and from the future, thanks to my Monte Carlo toy."

"My models showed that ultimately almost nobody really survived; bears dropped like flies in the rally and bulls ended up being slaughtered... But there was one exception... option buyers... could buy the insurance against blowup..."

"In the early 1990s... I became addicted to the various Monte Carlo engines, which I taught myself to build... The dividend of the computer revolution... did not come in... e-mail messages and... chat rooms; it was in the sudden availability of fast processors capable of generating a million sample paths per minute."

"From the standpoint of an institution, the existence of a risk manager has less to do with actual risk reduction than it has to do with the impression of risk reduction."

"[T]he mental probabilistic map in one's mind is so geared toward the sensational that one would realize informational gains by dispensing with the news."

"I do not dispute that arguments should be simplified to their maximum... but people often confuse complex ideas that cannot be simplified into a media-friendly statement as symptomatic of a confused mind. ...MBAs tend to blow up in financial markets, as they are trained to simplify... beyond... requirement. (...I am myself the unhappy holder of the degree.)"

"Mixing forecast and prophecy is symptomatic of randomness-foolishness..."

"[T]he epic poet did not judge heroes by the result... their fate depended on totally external forces... Heroes are heroes because they are heroic in behavior, not because they won or lost."

"Unlike a well-defined, precise game like Russian roulette, where the risks are visible to anyone capable of multiplying and dividing by six, one does not observe the barrel of reality."

"Lucky fools do not bear the slightest suspicion that they may be lucky fools - by definition, they do not know that they belong to such a category."

"Mild success can be explainable by skills and labor. Wild success is attributable to variance."

"Trading forces someone to think hard; those who merely work hard generally lose their focus and intellectual energy. In addition, they end up drowning in randomness; work ethics draw people to focus on noise rather than the signal."

"It does not matter how frequently something succeeds if failure is too costly to bear."

"Delivering advice assumes that our cognitive apparatus rather than our emotional machinery exerts some meaningful control over our actions."

"We should reward people, not ridicule them, for thinking the impossible."

"Much of the research into humans' risk-avoidance machinery shows that it is antiquated and unfit for the modern world; it is made to counter repeatable attacks and learn from specifics. If someone narrowly escapes being eaten by a tiger in a certain cave, then he learns to avoid that cave."

"It is now the scientific consensus that our risk-avoidance mechanism is not mediated by the cognitive modules of our brain, but rather by the emotional ones. This may have made us fit for the Pleistocene era. Our risk machinery is designed to run away from tigers; it is not designed for the information-laden modern world."

"You may not be able to change the world but can at least get some entertainment and make a living out of the epistemic arrogance of the human race."

"My major hobby is teasing people who take themselves and the quality of their knowledge too seriously and those who don’t have the guts to sometimes say: I don’t know...."

"In mainstream academia, formal models of mind and a priori philosophising have triumphed over the experimental method in the investigation of consciousness. Daniel Dennett ... , for instance, would scarcely be earning a good living on the American academic-philosophy gravy-train if he'd ever dropped some acid; but he'd know a great deal more about the philosophy of mind."

"Only a zombie like Dennett could write a book called "Consciousness Explained" that doesn't address consciousness at all. Only zombies could respond with a book called "Dennett and His Critics" which doesn't criticize Dennett at all."

"The disagreement between Dan and myself is essentially this. We're living in a world where most people believe in Atlantis and they believe in the underwater kingdom and they read Plato closely, trying to figure out where it was. And I want to say Atlantis doesn't exist, it didn't exist, people are confused about Atlantis. Dan wants to say that Atlantis is really Sicily, and he'll give a whole argument about why Sicily answers to many of the claims that people are making about Atlantis. And I want to say, "No, they're still talking about being underwater. Sicily doesn't do that." And he says, "But Sicily is a great place and there's reasons to visit, and let's talk about Sicily." And when he and I argue about this, he begins to respond to me as though I'm saying Sicily doesn't exist. And so there's a fair amount of talking past one another in these kinds of debates. Of course Sicily exists, but the people who are talking about an underwater kingdom are, at the very least, confused, and that's the situation we're in with free will."

"Here we encounter what the atheist and philosopher Daniel Dennet calls the "universal solvent" of natural selection. With its reductionist acids it breaks down all larger systems into components and elements and blends, removing purpose, structure, teleology, and creativity."

"There’s simply no polite way to tell people they’ve dedicated their lives to an illusion."

"What you are is that rolling sum of experience and talent, solemn intention and daydreaming fantasy, bound together in one brain and body and called by a given name. The idea that there is, in addition, a special indissoluble nugget of you, or ego, or spirit, or soul, is an attractive fantasy, but nothing that we need in order to make sense of people, their dreams and hopes, their heroism and their sins."

"The utility of a thought experiment is inversely proportional to the size of its departures from reality."

"Philosophy — in every field of inquiry — is what you have to do until you figure out what questions you should have been asking in the first place."

"The middle ground, roughly halfway between poetry and mathematics, is where philosophers can make their best contributions, I believe, yielding genuine clarifications of deeply puzzling problems."

"The earth has grown a nervous system, and it's us."

"Goodness comes in many forms, not just medicine and science. Thank goodness for the music of, say, Randy Newman, which could not exist without all those wonderful pianos and recording studios, to say nothing of the musical contributions of every great composer from Bach through Wagner to Scott Joplin and the Beatles. Thank goodness for fresh drinking water in the tap, and food on our table. Thank goodness for fair elections and truthful journalism. If you want to express your gratitude to goodness, you can plant a tree, feed an orphan, buy books for schoolgirls in the Islamic world, or contribute in thousands of other ways to the manifest improvement of life on this planet now and in the near future. Or you can thank God — but the very idea of repaying God is ludicrous. What could an omniscient, omnipotent Being (the Man Who has Everything?) do with any paltry repayments from you? (And besides, according to the Christian tradition God has already redeemed the debt for all time, by sacrificing his own son. Try to repay that loan!) Yes, I know, those themes are not to be understood literally; they are symbolic. I grant it, but then the idea that by thanking God you are actually doing some good has got to be understood to be just symbolic, too. I prefer real good to symbolic good. Still, I excuse those who pray for me. I see them as like tenacious scientists who resist the evidence for theories they don't like long after a graceful concession would have been the appropriate response. I applaud you for your loyalty to your own position — but remember: loyalty to tradition is not enough. You've got to keep asking yourself: What if I'm wrong? In the long run, I think religious people can be asked to live up to the same moral standards as secular people in science and medicine."

"One thing in particular struck me when I compared the medical world on which my life now depended with the religious institutions I have been studying so intensively in recent years. One of the gentler, more supportive themes to be found in every religion (so far as I know) is the idea that what really matters is what is in your heart: if you have good intentions, and are trying to do what (God says) is right, that is all anyone can ask. Not so in medicine! If you are wrong —especially if you should have known better — your good intentions count for almost nothing. And whereas taking a leap of faith and acting without further scrutiny of one's options is often celebrated by religions, it is considered a grave sin in medicine. A doctor whose devout faith in his personal revelations about how to treat aortic aneurysm led him to engage in untested trials with human patients would be severely reprimanded if not driven out of medicine altogether. There are exceptions, of course. A few swashbuckling, risk-taking pioneers are tolerated and (if they prove to be right) eventually honored, but they can exist only as rare exceptions to the ideal of the methodical investigator who scrupulously rules out alternative theories before putting his own into practice. Good intentions and inspiration are simply not enough.In other words, whereas religions may serve a benign purpose by letting many people feel comfortable with the level of morality they themselves can attain, no religion holds its members to the high standards of moral responsibility that the secular world of science and medicine does! And I'm not just talking about the standards 'at the top' — among the surgeons and doctors who make life or death decisions every day. I'm talking about the standards of conscientiousness endorsed by the lab technicians and meal preparers, too. This tradition puts its faith in the unlimited application of reason and empirical inquiry, checking and re-checking, and getting in the habit of asking "What if I'm wrong?" Appeals to faith or membership are never tolerated. Imagine the reception a scientist would get if he tried to suggest that others couldn't replicate his results because they just didn't share the faith of the people in his lab! And, to return to my main point, it is the goodness of this tradition of reason and open inquiry that I thank for my being alive today."

"Do I worship modern medicine? Is science my religion? Not at all; there is no aspect of modern medicine or science that I would exempt from the most rigorous scrutiny, and I can readily identify a host of serious problems that still need to be fixed. That's easy to do, of course, because the worlds of medicine and science are already engaged in the most obsessive, intensive, and humble self-assessments yet known to human institutions, and they regularly make public the results of their self-examinations. Moreover, this open-ended rational criticism, imperfect as it is, is the secret of the astounding success of these human enterprises. There are measurable improvements every day."

"Friends were anxious to learn if I had had a near-death experience, and if so, what effect it had had on my longstanding public atheism. Had I had an epiphany? Was I going to follow in the footsteps of Ayer (who recovered his aplomb and insisted a few days later "what I should have said is that my experiences have weakened, not my belief that there is no life after death, but my inflexible attitude towards that belief"), or was my atheism still intact and unchanged? Yes, I did have an epiphany. I saw with greater clarity than ever before in my life that when I say "Thank goodness!" this is not merely a euphemism for "Thank God!" (We atheists don't believe that there is any God to thank.) I really do mean thank goodness! There is a lot of goodness in this world, and more goodness every day, and this fantastic human-made fabric of excellence is genuinely responsible for the fact that I am alive today. It is a worthy recipient of the gratitude I feel today, and I want to celebrate that fact here and now."

"In spite of ferocious differences of opinion about other moral issues, there seems to be something approaching consensus that it is cruel and malicious to interfere with the life-enhancing illusions of others —unless those illusions are themselves the cause of even greater ills. The disagreements come over what these greater ills might be- and this has led to the break down of the whole rationale. Keeping secrets from people for their own good can often be wise, but it takes only one person to give away a secret, and since there are disagreements about which cases warrant discretion, the result is an unsavory miasma of hypocrisy, lies, and frantic but fruitless attempts at distraction."

"Surely just about everybody has faced a moral dilemma and secretly wished, "If only somebody — somebody I trusted — could just tell me what to do!" Wouldn't this be morally inauthentic? Aren't we responsible for making our own moral decisions? Yes, but the virtues of "do it yourself" moral reasoning have their limits, and if you decide, after conscientious consideration, that your moral decision is to delegate further moral decisions in your life to a trusted expert, then you have made your own moral decision. You have decided to take advantage of the division of labor that civilization makes possible and get the help of expert specialists.We applaud the wisdom of this course in all other important areas of decision-making (don't try to be your own doctor, the lawyer who represents himself has a fool for a client, and so forth). Even in the case of political decisions, like which way to vote, the policy of delegation can be defended. … Is the a dereliction of [one's] dut[y] as a citizen? I don't think so, but it does depend on my having good grounds for trusting [the delegate's] judgment. … That why those who have an unquestioning faith in the correctness of the moral teachings of their religion are a problem: if they themselves haven't conscientiously considered, on their own, whether their pastors or priests or rabbis or imams are worthy of this delegated authority over their own lives, then they are in fact taking a personally immoral stand.This is perhaps the most shocking implication of my inquiry, and I do not shrink from it, even though it may offend many who think of themselves as deeply moral. It is commonly supposed that it is entirely exemplary to adopt the moral teachings of one's own religion without question, because -- to put it simply — it is the word of God (as interpreted, always, by the specialists to whom one has delegated authority). I am urging, on the contrary, that anybody who professes that a particular point of moral conviction is not discussable, not debatable, not negotiable, simply because it is the word of God, or because the Bible says so, or because "that is what all Muslims [Hindus, Sikhs ...] [sic] believe, and I am a Muslim [Hindu, Sikh ...]" [sic], should be seen to be making it impossible for the rest of us to take their views seriously, excusing themselves from the moral conversation, inadvertently acknowledging that their own views are not conscientiously maintained and deserve no further hearing."

"Thanks to technology, what almost anybody can do has been multiplied a thousandfold, and our moral understanding about what we ought to do hasn't kept pace. … You can have a test-tube baby or take a morning-after pill to keep from having a baby; you can satisfy your sexual urges in the privacy of your room by downloading Internet pornography, and you can keep your favorite music for free instead of buying it; you can keep your money in secret offshore bank accounts and purchase stock in cigarette companies that are exploiting impoverished Third World countries; and you can lay minefields, smuggle nuclear weapons in suitcases, make nerve gas, and drop "smart bombs" with pinpoint accuracy. Also, you can arrange to have a hundred dollars a month automatically sent from your bank account to provide education for ten girls in an Islamic country who otherwise would not learn to read and write, or to benefit a hundred malnourished people, or provide medical care for AIDS sufferers in Africa. You can use the Internet to organize citizen monitoring of environmental hazards, or to check the honesty and performance of government officials — or to spy on your neighbors. Now, what ought we to do?"