A lot of this boils down to having a better understanding of uncertainty and probability, especially in terms of being non-naive when it comes to extreme volatility and risk. If you find ways to bet on this in a rigorous manner, the payoff is disproportionally larger. For the lay investor, the hard part is that this essentially means losing money 95% of the time [in those positions], something most people aren't comfortable with. That and some technical difficulties, like liquidity, etc.
Of course, the bets needs to be sized correctly. This is not something you'd put all your money into, and this is part of the design from the beginning. See Kelly Criterion https://www.amazon.com/KELLY-CAPITAL-GROWTH-INVESTMENT-CRITE... for how these people think about it in a rigorous way.
> A lot of this boils down to having a better understanding of uncertainty and probability, especially in terms of being non-naive when it comes to extreme volatility and risk.
After the statistical basics (don't confuse power-law distributed phenomena for normally distributed phenomena), a lot of what Taleb seems to prescribe boils down to simple skepticism of modeling the real world with games, which he describes as the Ludic Fallacy [1]
The most entertaining narrative he conjures is the contrast between "Dr John", a mathematically oriented scientist, and "Fat Tony", a clever everyman, and how Dr John gets fooled about the odds of a game of coin-flip that has so far come up with 99 heads and no tails, asserting each flip must be IID at 50-50, but Fat Tony sees the reality: that the coin is rigged.
You don't even have to be a genius -- everyone expected the market to collapse, ~10 years of a low not-QE-but-definitely-actually-QE federal funds rate means a lot of companies and banks with access to that credit were over extending themselves.
The financial system is cyclical -- funds like Berkshire Hathaway were starting to sit on more and more cash since last year. Even if you did nothing but follow their movements you would have been tipped off to the upcoming downturn. The consensus was that a crash was overdue, the question was just what was going to cause/trigger it.
Also, disregard when pundits, government figures and central bankers say that this crash happened to an economy that was "doing great just a few months ago" -- it's just like 2008, the problems were there, they were just uncovered by COVID-19. Years of cheap loans, lax regulation, and lack of financial prudence means over-leveraged companies were taking risks they shouldn't have been, and all it took was one or two months of projected lost revenues for liquidity to implode. We're not even talking about restaurants who might run super tight margins here, we're talking about huge banks, institutions and large companies. Take the airlines for example, years of record profit and a clear view of what 9-11/H1N1/Ebola did to travel, yet no rainy day fund.
And the risk COVID-19 caused was absolutely not unknown. We've had SARS, MERS, H1N1, Ebola all come through, businesses have had plenty of chances to consider insuring themselves or making themselves resilient -- there's just less and less incentive to be fiscally responsible with free-flowing credit.
As Taleb has said many times: Don't tell me your predictions, show me your portfolio.
What did you do with this "obvious" information?
Did you go all in beforehand to make a killing and set yourself up for life? Did you make smaller bets and build an awesome rainy day fund? Did you sit on the sidelines and call the plays afterwards?
The beautiful thing about trading is that you're either right or you're wrong. It's unforgiving in a way that punditry isn't. When you trade you have skin in the game, since past failures leave a permanent record on your portfolio, and people quickly learn that overconfidence is a liability.
The idea that lots of companies and banks were over extending themselves seems unsupported, I think that large corporations were sitting on record cash stockpiles when this hit, no? Also there is no talk of a bank bailout, the banks are solvent in spite of this crisis right now.
Seem like the "cheap money is good" argument is actually stronger here, the real wage gains over the cheap money period insulated a lot of people against the slow roll out of support because they were in better financial positions than they would be otherwise.
Airlines are a good example of underlying issues exposed by the crisis, but airlines are a quite small part of the economy and are notoriously poorly run, it certainly has exposed them!
> The idea that lots of companies and banks were over extending themselves seems unsupported, I think that large corporations were sitting on record cash stockpiles when this hit, no? Also there is no talk of a bank bailout, the banks are solvent in spite of this crisis right now.
Have you followed what the federal reserve has been doing in the last few months?
- 1% federal rate cut (the maximum cut during 2008 was 0.5%)
- UNLIMITED QE (this has never happened before)
- Purchasing of fallen angels (companies which recently had bonds downgraded to junk)
- Purchasing junk bond ETFs
Also, have you been following the amount of downgrades on corporate debt? Did you know that the airlines that are now asking for bailouts did leveraged (IIRC) stock buybacks with most their profits over the last decade? Buybacks are similar to dividends, but doing them with borrowed money or without sound cash reserves is fiscally irresponsible.
It is a fact that companies and banks were extending themselves, the proof is in the evaporation of bond yields and the collapse of the credit market, which is what the fed is responding to.
Despite all this, there are banks that are seeing 45%+ profit losses -- JPM is one of the biggest (definitely too-big-to-fail) banks and saw a 69% profit loss.
> Seem like the "cheap money is good" argument is actually stronger here, the real wage gains over the cheap money period insulated a lot of people against the slow roll out of support because they were in better financial positions than they would be otherwise.
What are you talking about? I don't think I understand this argument, are you implying that real wages have grown significantly enough to protect the regular house hold? I can't read this any other way so I'll assume you are, and leave you some numbers on inflation-adjusted hourly wage growth versus productivity growth[1]. Real wage growth has not grown enough to keep families afloat, otherwise we wouldn't need helicopter money[2] except for the most fiscally irresponsible households.
> Airlines are a good example of underlying issues exposed by the crisis, but airlines are a quite small part of the economy and are notoriously poorly run, it certainly has exposed them!
Commercial aviation accounts for 5% of the US's GDP[3]. This is not a small amount.
The proof is in the fact that a once in 100 year event has caused some stress? Of course it has!
"are you implying that real wages have grown significantly enough to protect the regular house hold?"
The alternative appears at this point to have been contraction.. so growth is better than contraction! I agree that it is not enough, but wage stagnation only started to finally reverse course after years of low rates.
Citing "profit loss" is beyond parody, profit loss! Not even citing actual losses! Like, they are still profitable? ROTFL!
5% is a small amount, and it is not as if there is a scenario where air travel is a robust business right now! There are not, at this point, widespread bankruptcies of large companies. I rest my case.
Wow I’m typing on my phone and I can’t see anything. I suppose if I don’t keep typing this will be all read I mean deleted. Oh well. Such is life. It reminds me of free writing. It is a form of free writing that is enforced I guess that’s useful. For things like writers block and what not.
But what am I to say? Nice product? I guess it’s a cool proof of concept. But I don’t see myself using it. It is more like a neat little toy, almost like performance art.
It is a new form of medium, where the rules are enforced onyoi. I suppose there are other such forms of modes. Does this bring with it anything u inquest and of lasting value? Or is it mostly single player entertainment?
I wonder if something similar can be done for multiplayer chat. Text that mimics actual social interaction in a new way is interesting. Such as IRC and twitter. Maybe even communicating with gifs.
Only time will tell what will last. Normal text yes, movies sure.
I find myself speeding up more for the 3’ deadline
It would be useful to see the comments and get an idea of the quality of each title. This site does a good job of conveying what is good enough while still providing a summary of the contents and submitting an opinion.
> offer incentives to FE (finalize early, ie release funds from the arbitrage) for months
Not too familiar with DNMs, but why would someone agree to this? Just to save a buck? Seems clear it is against your interest, good or bad reputation. What's the stated rational from seller for this, just "I want more liquidity"?
That was some of it, but often it was just because cash could be tied up in shipped product for a week or two if you didn't FE. It kept "good" vendors from being able to grow because they weren't able to increase their supply to list new product on the sites.
Would be really interesting to read a write up on your experience. What do you program in now? How do you look at other PLs now? What do you miss and what are you happy "just works"? What do you think other PLs (especially languages like Lisp, which are very high in terseness) can learn from Q?
I would compare Q (and other APL-related languages) to Vim editor. There you have some carefully chosen operations which are easy to perform. They don't take much efforts. They are also easy to compose in useful ways - because the corresponding properties support that. Since the basis of editing operations is fairly large, you have many operations; but when you know many of them, you can work powerful edits.
Lisp on the other hand is more like Emacs - naturally. Here we have a small, carefully chosen orthogonal basis of abstract operations - not domain-specific, but "theoretically-foundational" small basis. Then you have a library of macros on top of that, and ability, of course, to extend.
In other words, basis for APL is "classical" math, made executable and expanded with mechanisms required to put in one line programming constructs (logic, control flow, ordering...). It's harder to expand, but you don't often need that. Lisp is a specific branch of math, lambda calculus, which is provably enough to solve arbitrary programming problem. The "inner core" of Lisp is also hard to expand, but what you expand for your task is "the usage" of the language, which is made to be straightforwardly expandable.
> This is only software I have ever seen that actually got smaller over time.
I agree, this is admirable!
Even if it is under different names (which I think is a far better approach), Sustrik does this too: http://250bpm.com/blog:50 He went from AMPQ (not his own creation) -> ZeroMQ -> nanomsg -> Libmill (essentially Go in C/UNIX style)
Also, OpenBSD comes to mind (LibreSSL for example).
Libmill/Libdill (go coroutines) are not on the AMPQ->ZeroMQ->Crossroads->Nanomsg (socket abstraction) path ; in fact, they have essentially nothing in common except sustrik.
I wish you'd actually read the article before shooting your mouth off with a Well Actually. FTA:
> Next one: nanomsg. An alternative to ZeroMQ.
In comments:
> How would you split nanomsg, then?
> [...] 2. coroutine library, e.g. libtask, libmill [...]
Not to mention that this is obvious if you understand what the core of each thing is in terms of capabilities. If you are gonna be the "technically..." guy, at least do it right.
It's about decomposing things, which is the essence of good design, and - supposedly - the UNIX philosophy at its heart.
As an actual user of ZeroMQ, nanomsg and dabbler of libdill, I assure you I know what I am talking about. Libdill/libmill is NOT on the same arch. It could be used to implement the next generation of zeromq/nanomsg, but it does not, in fact, provide any functionality that these provide today - it would be an internal implementation detail if sustrik followed through on that comment. But it would not be a nanomsg rewrite, likely something completely new - nanomsg has been rewritten, several times in several ways, by Garret D'amore who has taken over. D'amore explicitly rejected using e.g. libuv (mentioned in that comment) as a basis for a nanomsg rewrite. There's an "uncertainty" principle at work here - separating of concerns generates dependencies which in the grand scheme of things are not necessarily good.
In fact, one of D'amore's rewrites used native OS threads in lieu of a co-routine library, which worked perfectly well on FreeBSD and Solaris, and abysmally on all other OSses. The main reason to use a coroutine library in a messaging library is actually that the underlying OS threads implementations scale so badly on most modern systems.
Commenting like this will get you banned on HN regardless of how much you know or how right you are. Please reread the site guidelines (linked at bottom of every HN page) and take them to heart from now on.
Enjoyed the blog post from Sustrik. I also found Hintjens' work in line with my own sensibilities, e.g., his libero code generator. That is perhaps a good example of "finished" software.
Whenever I have suggested on HN that there is such a thing as "finished" software that is free of serious bugs, I get some resistance. There is a consistent knee-jerk reaction citing the same tired, old meme, "All software has bugs", and "Software is never finished."
Sustrik's post proves I am not the only one perplexed by this strange belief that no software is ever finished.
IMO, it is not a question of being infallibile or being available to fix bugs. The point is that there are programs that are not continuously growing in size and complexity. They are not "dead". They are "finished".
As for OpenBSD, certainly some programs I would consider "finished" but overall the size of the kernel and base distribution are in fact growing. Not only new drivers, but new programs and new libraries continue to be added. More code means more probability for bugs and vulnerabilties.
Anyway, less code, more terse syntax means it can be easier to find problems. Not everyone will agree with this of course. But I agree with Whitney and others. Less code makes it easier for me.
> There is a consistent knee-jerk reaction citing the same tired, old meme, "All software has bugs", and "Software is never finished."
It's not as much of a meme as fairly good heuristics. Most software has bugs, or depend on other pieces of software who have bugs. Most software can be improved or integrate with new technologies that weren't prevalent a few years ago. If software is good, it generally has a solid user base (relative to its target audience), and people will ask for tweaks and features--author can rightfully reject most of them, but it's a rare thing that absolutely none of them merits to be accepted.
So, when you discover a project that might be useful to you but you never heard of it and it's been inactive for years, I still believe it's quite a good rule of thumb to be leery before committing serious time and efforts to using it in anger. Which doesn't mean that counter-examples don't exist, naturally.
I tend to think it's more about people using languages that fail to correctly provide enough assurances about how they function in all cases that assumptions have to be made in practical use, and those assumptions end up being wrong in odd, minute ways, or on new platforms with slightly different behaviors, or after compiler writers decide they want to take advantage of some ambiguity for the sake of performance.
When someone trying your software with a newer compiler or a newer CPU or a slightly different architecture than you wrote it on and it doesn't work right, it's easy to come away thinking programs are never "done".
Interestingly, cash would seem to be a security under this definition. Except it is explicitly exempted:
> The term ‘‘security’’ means any note, stock, treasury stock, security future, security-based swap, bond, debenture, certificate of interest or participation in any profit-sharing agreement or in any oil, gas, or other mineral royalty or lease, any collateral-trust certificate, preorganization certificate or subscription, transferable share, investment contract, voting-trust certificate, certificate of deposit for a security, any put, call, straddle, option, or privilege on any security, certificate of deposit, or group or index of securities (including any interest therein or based on the value thereof), or any put, call, straddle, option, or privilege entered into on a national securities exchange relating to foreign currency, or in general, any instrument commonly known as a ‘‘security’’; or any certificate of interest or participation in, temporary or interim certificate for, receipt for, or warrant or right to subscribe to or purchase, any of the foregoing; but shall not include currency or any note, draft, bill of exchange, or banker’s acceptance which has a maturity at the time of issuance of not exceeding nine months, exclusive of days of grace, or any renewal thereof the maturity of which is likewise limited.
From The Securities Exchange Act of 1934 (N.B. IANAL).
So, will cryptocurrencies, possibly including ICOs, be exempted? Only history will tell.
I wonder if you were to declare an intent to establish a new nation in the Antarctic (say by purchasing some of Chile's land) and to fund raise for fees associated with this new nation you offered to sell people dollars of your soon-to-be currency at some fixed price below the expected value, would the SEC disapprove of such an action?
(assuming it was actually done in good faith and not discernibly a scam)
To clarify, yes, this is with the assumption you're actively fundraising in the US. And even if your entity is not based in the US, the question would be for the US related portion of your entity.
