I went to college with his late son, Nick. Nick was a good guy and their family was really welcoming and friendly. I remember speaking with Jim during the .com crash as I was getting my CS degree and he mentioned a CS degree is a great thing to have if you love it - keep at it. Solid advice at the time.
But make no mistake - when he says he wasn't as fast as some of the others, it's a whole different ballgame. He's a world class genius with creativity and personality to boot. He's also a good guy who is quite generous.
Yeah - It seems strange that the early parts of the article try to paint him as one who has failed but still overcome adversity. It is challenging to argue that at any point he wasn't very, very successful.
It would seem more appropriate to point out that despite his tremendous capabilities, he still has faults and has experienced awful tragedy. The article veers that way towards the end.
Sounds like good people; glad to read about someone with substantial means helping drive education and science.
Good point. I suspect that the author is accustomed to a certain narrative - triumph over adversity - or, believes news readers are more keen to that kind of story.
I think it could be a question of who he compares himself against. For example, if he's comparing himself to Field's medalists, then he might feel that he comes up short.
Not mentioned in the article, but probably familiar to others on HN, the Simons Foundation also supports Quanta Magazine (e.g. see their recent article about pilot wave theory [1]) and arXiv.org (an archive of pre-publication papers, mostly in physics and mathematics).
FYI http://www.nsi.edu.np/?option=com_content&func=details&id=36. This is the story about Nick. How he went to Nepal, worked there, grew fonder and after his death - still lives with the organization that helps train and support healthcare workers in rural Nepal. I am from Nepal, I love mathematics, computing and sustainable development and good to know about his father, today.
Where do you get your information that it's "not that difficult to get in" to the SEALs? In my personal experience it was fairly difficult to get into the US Navy in an advanced technical field, period. I worked with many great men that were very intelligent, extremely fit, and had been aspiring to join the SEALs their whole lives. About 12 guys I was deployed with attempted BUDs multiple times (throughout a span of multiple years) and I can recall 1 that made it, on his second attempt nonetheless.
I think you really underestimate the barrier to entry into the SEALs, and how that correlates to what the OC was trying to portray with his comparison.
You clearly do not understand physical and mental capacity required to complete BUD/S and SQT nor have you ever meet a current or former Tier 1 operator. Navy SEALs are not only some of the most physically talent people on Earth, but also some of the smartest. 100-110 of the most physically fit, determined folks you'll ever meet start BUD/S every quarter, and only 10-20 graduate -- easily more difficult to land a position as an operator than almost any job you can imagine.
The requirements look steep but also are attainable for high level athletes in most sports. I think the difficulty is in a young candidate not having the idea of what he's getting into, let alone having a proper training program. If one barely passes the basic test, the initial bootcamp phase will only break him further and not give him enough recovery for Hell Week. On the other hand, if the person has already built to that level beforehand it should be attainable. The catch is that most young candidates have not.
The hardest part of training is building up your level, but once you're there you keep it. I'm a sedentary 31 year old now, but I bet I could still pass the basic test at optimum levels, with a couple months training. I certainly won't be motivated to do the next stages though.
That asshat who hosts 'Future Weapons' on the Discovery channel claims to be a former Navy SEAL. I am not sure whether he would fit the bill of 'some of the smartest' on Earth though..
If you're doing it, you're probably not in it for the money. Just as most people who work for a non-profit are also not in it for the money. Do you assume that everyone who works for a non-profit because they believe in the cause can't actually be very bright? You might not agree with their motivations, but that doesn't mean they can't be every bit as smart as someone who decides to go off and make as much money as possible.
"Such a thing," in this case being the military, encapsulates multiple industries including computer science and information technology. In the United States it could also mean the benefit of a full ride education along with highly technical military training. Complete health care, job security, global travel opportunities... Since you seem to be fixated on the notion that if there isn't and tangible reward than it is less smart than the choice you'd make.
Not to mention that such a choice most likely satisfies passion and honor within a person.
>Not to mention that such a choice most likely satisfies passion and honor within a person.
If you are saying that any person that satisfies his passions and honor is considered smart, or that a person that works in something that gives him satisfaction is considered smart, then you are just twisting the definition of smart.
FYI The Physics of Wall Street gives a lot of reference to what type of trading James does, and chronicles a lot of James's history! The book also goes into a lot of the history of these types of traders! It is an insanely interesting read!
I thoroughly enjoyed /The Physics of Wall Street/, but I found that it was heavier on the "physics" than on the "Wall Street". It depends on what you're looking for. If you want accessible, non-mathematical descriptions of the analytical tools that have been imported into finance from physics, or even an insightful look at the culture of physics and how how physicists tend to approach problems, Weatherall's your man---though I wonder how intelligible those descriptions really would be to someone who hasn't already seen the material in a more formal way. (I'm reminded of the description of the Feynman lectures from the introduction to that big red boxed set, IIRC: "Rereading the books, one sometimes seems to catch Feynman looking over his shoulder, not at his young audience, but directly at his colleagues, saying 'Look at that! Look how I finessed that point! Wasn’t that clever?'".)
Thing is, my background is in physics, so I'm more interested in what physicists call "sociology": how institutions are put together, what the incentive structures are, how individual personalities affect outcomes, etc., and I found Weatherall's descriptions of such things lacking. His analysis tends towards hagiography of individual scientists, with less attention for context. This intensely biographical approach to the history of science is a common-enough failing in books that focus on the science, not the history---it reminded me a bit of those boxes about the lives of prominent scientists that dot some introductory textbooks---but it's still frustrating.
I actually found Roger Lowenstein's /When Genius Failed/ much more illuminating---he gives more attention to institutions, incentives, and personalities, and how they interact.
I met the man a few years ago. He was touring one of his many academic endeavors and he wanted a full day of seminars to see how the research he was financing was advancing. I was really impressed by the scope of his questions, which were about things completely outside his previous research (computational/quantitative biology mostly).
Speculating (never actually been involved in hedge fund or super advanced math): what are some potential ideas that RenTec could be working on? Please state your speculation in terms of the mathematical / investment problem to be solved.
My super simple experience here relates to optimizing portfolios along the efficient frontier (http://en.wikipedia.org/wiki/Efficient_frontier) which is a relatively simple problem, but I am interested in knowing what I don't know.
There's a very long multi-year thread at a website called Nuclear Phynance about this. Nobody seemed to have the faintest clue although amusingly some of the more outlandish suggestions were later (laughingly) cited by an insider in an interview.
One decent general idea was that RenTec was willing to entertain purely statistical signals with no intuition to back them up (or, alternatively, unintuitive signals which you can explain in plain language but sound stupid).
There was an intesting quote from Simons about how astronomers are the best suited hires because they are used to making measurements/hypotheses purely from observation, without the chance to do controlled experiments. It was also noted that they seemed to employ a lot of NLP specialists, although consensus was that this was down to pattern recognition rather than anything to do with language.
The best suggestion (or at least the best sounding one) was that they were doing hidden-markov models which took into accound second and third order effects. And then there's always just the 'best execution' argument (doing basic market making but engineering better systems than anyone else).
However information on them is so scarce I sometimes wonder if most of what we hear is pure myth.
Haha, aggressive indeed. What are people's opinions on regulating this kind of sidestepping?
Seems to me the status quo of regulation means a constant game of catch-up. No governing body has the ability to say 'You can't do that' until it's too late.
He says "if I can do it, so can you" - he had a doctorate at age 23, which is not something most people can do, even if they have the intelligence and drive. Very interesting person for sure.
Can anybody make an attempt at explaining the content of "Axiomatic Characterization of Ordinary Differential Cohomology" further than the article did?
It builds not just on algebraic topology, but algebraic geometry, differential manifolds, and category theory (which underlies all three of these). If you don't have at least passing familiarity with the core content of these fields, you're probably not going to find an explanation worth spending any time on.
We can formally add and subtract simplices. Homology is (very roughly) counting holes using the modulus (%) operator with respect to this addition and subtraction.
It's all fascinating all right in many respects, but doesn't the noble business of fast trades and hedge funds give anyone on HN creeps anymore? After all it's moneymaking in a form of taxing the society as a whole (if you think that this money comes out of nowhere or somehow is a newly created value, think again).
Of course he used some of this money for good purposes, but still.
This is a curious argument. If a car mechanic changes oil in your car and charges you 20 bucks, does he tax society $20? no, in this case value is being created, which is a fixed car. In the case of Rentec and other firms, the value is more liquid markets with different assets priced fairly with respect to each other. You may think that value is small, and it probably is, compared to say, saving lives, etc. - but it is no less real
From Wikipedia "In business, economics or investment, market liquidity is a market's ability to facilitate an asset being sold quickly without having to reduce its price very much (or even at all)." That's as much as I know about liquidity, so I am prepared to be enlightened.
If you are an investor (as opposed to an HFT trader), what problem of yours does it solve if you can buy/sell in 1min or 10s or 1s, as opposed to in 0.001s or 0.0012s? If not your problem, then maybe of the society as a whole, or some group within it, excluding those who benefit from HFT trading as such?
I have no issue with a window. The institution cares more about liquidity being reasonably deep than executing in a nanosecond.
There's always going to be a situation where a market maker on a 'floor' has an edge in analyzing short-term flow and setting a market-clearing price second by second, and a big upstairs institution has an edge in size and longer-term analysis, and the upstairs guy is paying something for liquidity.
I don't think the market-maker is providing 0 value, but probably better if less energy gets spent on guessing what everyone else is doing and spy vs. spy gaming the system, and the more level and transparent the playing field is the better.
In symbolic modal logic, it would be along the lines of... if an action is done to you, then accept the belief of the imperative of doing that action to another. So, it would be a command for you to intend to do that action to another.
Axu -> _u_: A_u_y
(those are supposed to be underlines indicating imperatives.) This is the same sort of convention that Harry Gensler uses to prove the Golden Rule using his Formal Ethics system. (I should note I am not a logician and this is probably only a rough approximation - not sure whether it's appropriate to use A instead of a, etc.)
Is it clear to everybody from the context whether he meant "pass it on" in the sense of "pay it forward" or "pass it on" in the sense of "repeat this message"?
I was thinking first of the game of Telephone. "James Simons is a mathematician, pass it on!"
Well, I'm not going to have a compact answer for you, but to do so you need to develop some kind of self-reference. (Like Godel!) If you like thinking about this sort of thing, Raymond Smullyan has a lot of great writing - I'd recommend eg Forever Undecided or To Mock a Mockingbird for a more informal treatment, or First-Order Logic for a formal one.
Strange how I never heard of him before. While being both rich and an extremely accomplished individual, he seems to defy the stereotype of the mad genius.
I only know about him because of Renaissance Technologies, which is renowned in some circles as being extraordinarily hard to get a job at. They're known for snagging repeat Putnam Fellows. Last I heard Reid Barton ended up there.
And of course -- Colin's tarsnap is still essentially the same as it ever was (a brilliant technical solution with awful marketing) - and Dropbox is one of the jewel's in YC's crown.
I know him because my independent study professor for analysis canceled his meeting with me because Simons took half of the math department for a cruise vacation.
Well, I was happy. I didn't finish my hw that week. :)
That does not appear to be the case, at least according to anything I've been able to find with a bit of searching. I think you are thinking of Axcom, which RenTec acquired. Axcom was associated with Berlekamp (he was either founder, co-founder, or purchased a majority interest after it was founded...the internet is unclear on this).
There was a Bloomberg article about this some years ago.
Axcom was run by James Ax, and jointly owned by Ax & Simons. (Axcom was a 'trading advisor'. They made recommendations to Renaissance, which managed a fund based on these recommendations.) Ax was in essence hired by Simons to explore & develop quantitative trading ideas Simons & Baum had come up with while they were making more traditional trades.
Berlekamp came along several years later, as a consultant. One can find claims that he developed a lot of RenTech's IP, but as far as I can tell these claims are sourced from Berlekamp himself. Since Berlekamp's own fund went out of business after a few years of operation, I'm inclined to dismiss these claims as marketing.
Generally, it just applies to understanding how certain genes underlie the genetic basis of certain genetic diseases.
I believe Simons in particular funds areas of computational biology that strive to gain insight into the cascade effect. This occurs in many diseases, which make them seem nearly incurable, like sepsis or cancer. For example, when TNF (tumor necrosis factor0 activates inappropriately on the periphery of a cell it, to dramatically simplify, leads to growth during inappropriate stages of your life (adulthood), and triggers a cascade of thousands of events. When one event is altered, the cascade goes through a different direction, to the same goal. So understanding the pathway, and how everything interacts, is something I know the Simons foundation has funded in the past. With the hope that one day medications that properly fight the cascade can be achieved.
I see sentences like this one in more and more articles these days:
> Dr. Simons now runs a tidy universe of science endeavors, financing not only math teachers but hundreds of the world’s best investigators, even as Washington has reduced its support for scientific research.
A predictable consequence of reducing government spending is that the population becomes dependent on, and concentrates power in the hands of, a few wealthy citizens. For example, I've read that if you need funding for research, you should seriously consider networking with the very wealthy. If you run a charity, probably you need to focus on the same. Will these patrons support academic freedom? An organization that challenges the social order? What if your research upsets someone; is your career/organization at risk? Will their ideas and whims serve the nation and world?
(I'm not criticizing of Simons' philanthropy; I'm against shrinking government investment in research and other social goods.)
A predictable consequence of reducing government spending is that the population becomes dependent on, and concentrates power in the hands of, a few wealthy citizens.
It's worth noting in this context that the current system of government-funded science, which seems normal, in fact was invented more or less single-handedly by Vannevar Bush shortly after World War II. [1] The scenario that worries you was the norm for approximately the previous history of humanity. (This isn't to say governments never funded science, just that they didn't dominate it as the US Government does today.)
Will these patrons support academic freedom? An organization that challenges the social order? What if your research upsets someone; is your career/organization at risk? Will their ideas and whims serve the nation and world?
Every one of these questions applies with equal or greater force to government-funded science. Anyone worried that a private patron of science might, e.g., put his career at risk, should be a thousand times more afraid of the Feds.
> the current system of government-funded science, which seems normal, in fact was invented more or less single-handedly by Vannevar Bush shortly after World War II. [1] The scenario that worries you was the norm for approximately the previous history of humanity.
The previous history of humanity isn't a standard that I think we should aspire to. It means no democracy, short lives, widespread brutality, open discrimination against most people, and not much investment in or success in the sciences.
> Anyone worried that a private patron of science might, e.g., put his career at risk, should be a thousand times more afraid of the Feds.
That's a strong claim. I don't agree subjectively; is there anything that backs it up? My impression from talking to people who apply for federal research grants is that it's tedious, time-consuming, but apolitical and based on merit.
The previous history of humanity isn't a standard that I think we should aspire to. It means no democracy, short lives, widespread brutality, open discrimination against most people, and not much investment in or success in the sciences.
It looks like you may be conflating several separate issues here. My point is that science seemed to work fine in, say, the period 1550–1950 without the NSF, NIH, etc., and it's not necessarily a disaster if we return to that model. We don't, at the same time, have to shorten lives, increase brutality, etc. (Democracy is a mixed bag at best, though; for example, in 1783 France was a troubled but basically functional absolute monarchy, and by 1793 it was a universal suffrage democracy that guillotined tens of thousands in the streets of Paris and bound books in leather made from human skin. [1])
[grant writing is] tedious, time-consuming, but apolitical and based on merit.
Getting federal research grants is apolitical only if your subject is apolitical, and the list of apolitical scientific subjects gets shorter every year. There are whole fields of inquiry—exploring heritable cognitive differences (if any) as a function of ancestry, for example—that are essentially verboten, while others (e.g., stem-cell research and climate science) are impossible to separate from politics. Moreover, even apolitical fields are notoriously subject to the whims of (democratically elected) Congress.
Perhaps the takeaway here is that the research is getting done despite reduced funding from government.
Also, all of your questions regarding the motives of the wealthy should be asked of the government with equal scrutiny. After all, government is made up of individuals, each with his/her own level of bias and ideology.
This is a good point, one that I myself make in this type of situations. But… there is a difference in that democratically elected government officials or administrations are, at least in theory, obliged and answerable to the electorate. I think that is a good argument for keeping certain things in the public hand.
> democratically elected government officials ... answerable to the electorate
The heads of the government agencies are appointed by the administration, and most (all?) other employees of the agencies are not. Thus, the only accountability of, say, the research funding administrators at NIH or NSF is to their immediate superiors. That is, they are far removed from the scrutiny of the electorate.
As a rule, government is more transparent and accountable than even publicly traded corporations. FOIA requests, meetings, hearings, transcripts, budgets, expenditures, rosters, etc.
Of course, we should never stop criticizing government (aka democracy). But don't take it for granted either.
At some point or on some level, there's someone whose immediate superior Congress ... who controls the purse strings, I believe. Thus, in a very indirect way, accountable to the electorate (or, keeping appearances when they succeed at avoiding any accountability).
>As a rule, government is more transparent and accountable than even publicly traded corporations. FOIA requests, meetings, hearings, transcripts, budgets, expenditures, rosters, etc.
What might make governments even more accountable are the threats of loss of tax revenue (people and companies doing business elsewhere) and loss of campaign contributions. This is similar to how corporations are held accountable by shareholders (CEO compensation), employees (take their talents elsewhere) and customers
The difference is that the gov't is a bureaucracy and there is a diffusion of responsibility. They make sure no one person is responsible for any financial decisions. So that if the funding doesn't pay off or bring the results they want, they can blame the process/procedures
Newsflash for you: in the fields I know (medical research), nearly every important early stage research project is funded by philanthropy. Government research dollars are only available to groups that have already done that early stage research and proven that the next step is incremental and low-risk.
If medical research relied on government dollars, nothing much would happen except for wheel spinning at vast cost. It would be even more of a full employment program for connected research institutes than is already the case.
That is not even to start on the fact that the existence of big government funding comes with the existence of the FDA, an entity that enormously increases the cost of research and development, outright blocks many lines of work, makes others so unprofitable as to scare away for-profit funding at all levels, and so on.
Also, you'll probably get just as much or more money from patrons for fringe science than for actual science, and the patrons will have little ability to evaluate the quality of the results - putting more money in if the results align with their preconceived notions or business interests, and withdrawing funding otherwise. Basically, like the pharmaceutical and (petro)chemical industries currently are.
We are just reverting to the historical mean society: oligarchy.
Just a few years back I was very optimistic that we would correct our course back to democracy, but a cursory review of history shows incontrovertible proof of our destination.
Humans are primates, and primates fight viciously to form status hierarchies using any mechanism available to them. In the 21st century, that mechanism is capital. And its power and influence know no bounds.
The brief democratic blip we witnessed was a result of three massive wars (WWI, WWII, Cold War) which forced cooperation from the oligarchs due to the threat of existential annihilation. The world is quite peaceful now, and with technology and globalization the average citizen has a severely reduced utility to the oligarchy. Hence, capital buys policy, and votes are meaningless.
Capitalism dictates that one optimize one's own desires above all others ("Greed is good"). Economists are only now noticing the bitter aftertaste from the fruits of their labor.
EDIT: I post this a lot, but just in case you've missed it, most of my conclusions come from Thomas Piketty's new book, Capital in the 21st Century.
I'd argue that your argument about capital is correct, except it's not just the 21st century ... it's every century before that. Even in societies that aren't capitalist / democratic / free-market per se, it's the golden rule: the one with gold makes the rules (or, gets what they want). It's not always like that; just most of the time.
I'm not saying that's good or bad; I'm just saying it's like gravity.
I see no reason that just because I run "a charity" that I should not have to work hard to justify to individual people with money that they should give that to me to continue my charitable works.
Whether it's academia, government organs, charities, or other ... if you want funding for your research, you have to find someone who:
a) has money, and
b) is willing to finance your research.
If research is done with tax money, it's understandable taxpayers will want a say in it, and their ever-changing whims will be reflected in what they choose to fund. Since this involves politicians, you can expect consequences in that direction (i.e. a political angle even when there needn't be one, involvement of K Street either for or against you, etc).
If research is done with other resources, again, it's a matter of finding someone who has money and is willing to let you use it. So networking, and getting to know generous wealthy people, or wealthy people with a motive to give for a certain kind of research, is a smart way for someone in your org to spend time.
This doesn't necessarily sound so bad; it sounds like it's simply the way the world works.
Even Columbus - who financed his exploration with European monarch's money - had to justify it as financially worthwhile for them to do so.
An open question.... Are the scientific and philanthropic directions of wealthy individuals that much worse than our government? Remember - the US government doesn't fund stem cell research.
In a recent article from The Guardian titled, 'Scientists threaten to boycott €1.2bn Human Brain Project', there's the following:
'The world's largest project to unravel the mysteries of the human brain has been thrown into crisis with more than 100 leading researchers threatening to boycott the effort amid accusations of mismanagement and fears that it is doomed to failure.'
And.
'But it proved controversial from the start. Many researchers refused to join on the grounds that it was far too premature to attempt a simulation of the entire human brain in a computer. Now some claim the project is taking the wrong approach, wastes money and risks a backlash against neuroscience if it fails to deliver.'
€1.2bn could solve any number of problems. And in a free market that's how the resources would be put to use. Solving human problems. Instead, there's a grand spectacle.
Many wealthy individuals got that way via judicious resource allocation. The same can't be said of the monumental leaders of our fine countries. They got that way via looking good in public. To expect them to excel at speech giving and resource allocation is quite the ask!
I'm not sure what one project demonstrates, even if we take a news report at face value. There also are many successes; we're using one now to discuss this.
> €1.2bn could solve any number of problems. And in a free market that's how the resources would be put to use. Solving human problems. Instead, there's a grand spectacle.
I think this argument idealizes the "free market".
* There is plenty of waste and spectacle there too -- look at other news headlines, or just remember our recent financial crisis
* The 'free market' doesn't exist. First, it's an amalgam of an incredible number and diversity of people and organizations. Second, it's not free; I was trying to think of examples of social goods not funded at all by taxpayers (for the point below), but it's hard to name any. And many 'free market' companies get tax breaks and other support from government (EDIT: including laws and regulations made in their favor).
* The marketplace does not care prioritize solving human problems; it prioritizes money and power. Sometimes that happens to solve problems (discovering a new vaccine, clean energy), sometimes it happens to cause them (increasing the cost of vaccines, climate change), sometimes it's just money for money's sake (slashing a ms off response time in computerized securities trading).
It's an example. It's the cost of the success that's the issue.
Financial crisis == moral hazard. And, come on! There's an economic theory that predicted the crisis, and explains it. I.e. ABCT (Austrian business cycle theory). My point being, it's not as clear cut when there's 'crony capitalism' and other market distortions.
'Free', as in freedom!
Everyone knows the 'free market' is made up of individuals. Or groups of individuals, such as a firm, which is formed to reduce transaction costs -- as per Coase's description in his Nobel winning (1991) The Nature of the Firm (1937).
Money is a medium of exchange. We use it to trade. And by definition: when people trade freely, they are both better off (otherwise they wouldn't trade!).
Money also has the functions of 1) store of wealth 2) unit of account. But that's by the by.
Problems are always going to occur, but because humans are motivated to solve the problems, solutions are found. And a profound way to facilitate such solutions is a market-based economy.
> There's an economic theory that predicted the crisis, and explains it. I.e. ABCT
No. People who like the theory saw real world events that kind of sort of looks like ABCT could explain them, and then made a post facto observation.
Unless Mises et al. made some sort of prediction based upon at the time non-existent financial instruments, ABCT did not predict the 2008 sub-prime financial collapse. Period.
To the extent that ABCT predicted anything, it was a "something bad will happen; not sure when!" with the preconditions in play since about 1980. Color me unimpressed; I bet some random fortune teller got more accurate than that on accident.
Now, maybe some economic philosophers who likes the model applied it, which provided the basis their prediction of actual real world events. I don't know.
But then, proponents of regulation predicted the collapse as well. In fact, a lot of people accurately predicted the (actual) collapse, and to various degrees the cascade effects.
> it's not as clear cut when there's 'crony capitalism' and other market distortions.
"Oh yes, if only the world met all of our Axioms. Then everything would be grand!" said every failed political economic project ever.
> Problems are always going to occur, but because humans are motivated to solve the problems, solutions are found.
And as it turns out, lots of times those people are working in government funded research labs and universities, or applying research funded in those labs and universities.
You'll excuse us mere mortals for drawing such wildly wrong conclusions from something as banal as observation! You see, it's just that we've lost our list Axioms and now our only reference point is reality... perhaps you could lend us your map to drill on?
> No. People who like the theory saw real world events that kind of sort of looks like ABCT could explain them, and then made a post facto observation.
Like Mark Spitznagel, who took a billion dollar derivatives position on the 2008 stock market crash!
>Unless Mises et al. made some sort of prediction based upon at the time non-existent financial instruments, ABCT did not predict the 2008 sub-prime financial collapse. Period.
> "Oh yes, if only the world met all of our Axioms. Then everything would be grand!" said every failed political economic project ever.
Politicians must come up with excuses of some sort.
> And as it turns out, lots of times those people are working in government funded research labs and universities, or applying research funded in those labs and universities.
And those resources may be more effective in an alternate configuration.
> You see, it's just that we've lost our list Axioms and now our only reference point is reality... perhaps you could lend us your map to drill on?
My map (in reference to the Alfred Korzybski quote 'the map is not the territory') consists of any economic school, or any other information I happen across. Empirical is fine with me. But it depends on the circle I'm talking to. If one was to mention vanilla observation to a group interested in medicine, then there'd be a combination of recoil and disgust (in most cases), for example.
The article to you link to is much more clear headed about the role of the model. It's a useful tool, not a glass ball.
There's a hell of a huge difference between a model predicting something, and people applying/adopting the model -- together with a LOT of other tools and insights -- to predict something.
It's as stark as the difference between executing a program and getting an exact output, and using a programming language, together with some bits of math, to write a program which computes a result for you.
Back to the point: since lots and lots others made similar predictions about the housing market (and beyond), I'm much more inclined to believe that it was a strong focus on data and observation -- not any particular model per say -- that allowed smart people to accurate predictions.
That wasn't my central claim. You picked up on a fairly irrelevant aside. My claim was:
'My point being, it's not as clear cut when there's 'crony capitalism' and other market distortions.'
I don't believe the Austrian school has any such formal models.
"when people trade freely, they are both better off (otherwise they wouldn't trade!)" isn't true. Instead, it's that both people think that they are better off when they make the trade. A subtle distinction but also the most important criticism of a purely free market.
I'm not talking about the subjectivity of value at all, though I can see how that might be unclear. I'm talking about the assumption of perfect information that is inherent in your statement.
In a free market €1.2bn can't even buy a messaging app.
A free market would be perfectly OK spending that money on dating apps, more ads for "alternative medicines" that sell well but never shown to work, or disinformation campaign against (government-funded) scientists pointing out that your product causes cancer. Free market sometimes works, but it's no silver bullet.
The government is the dominant funder of stem cell research post-Bush (In addition to state funding of stem cell research like inNY, TX, & CA). For example, see http://stemcells.nih.gov/Pages/Default.aspx
I think the bigger issue is that private philanthropy of science is at least ~2 orders of magnitude smaller than yearly philanthropic donations. The US spends ~$100B/year, while I would be surprised if private philanthropy totals $1B/year to R&D. Commercial R&D expenditures on the other hand are probably higher in aggregate. Thus the role of private philanthropy on a lot of research has been catalytic funding for new ideas.
This kinda makes sense. If you don't want to be subject to the whims of the US taxpayer, or the corrupting influence of Congresscritters / K Street, then you need to go elsewhere (charities, individuals, businesses) to get funding for your research.
Of course, educating taxpayers would be helpful, so they can make better decisions. Along with educating Congress critters, and as far as K Street goes, either finding sympathy (unlikely) or planning to send some of your money there (more likely to work).
Compared to those 3 challenges, finding a benefactor sounds a whole lot easier!
The decisions are made by scientists, but they're subject to hard restrictions (e.g. no funding for stem cell research) and behind the scenes political pressure.
Do governments support academic freedom? An organization that challenges the social order? What if your research upsets someone; is your career/organization at risk? Will their ideas and whims serve their citizens and world?
Look at that, asking pointed rhetorical questions is easy!
Amazing how people simply make up facts to support their ideology. Both penicillin and smallpox vaccine were discovered with little if any government support. But you know, whatever...
Not being a historian, I actually read Wikipedia before posting that. I guess I was confused on the smallpox vaccines creation which seems to involve a lot of actors. What's certain however, is that the vaccine's dissemination and the eventual eradication of smallpox was pushed by the World Health Organization (part of the UN) and so was a government initiative. [1]
Penicillin was discovered by Alexander Fleming as part of research in a public institution (St. Mary's Hospital). [2]
I guess my larger point (which you deftly avoided addressing) is that the government is not a boogeyman creating evil technologies nor does it have a monopoly on evil shit. I also have a hard time imagining a motive for a for-profit organization to eradicate a disease world-wide. Something that government organizations have achieved almost twice (polio is nearly wiped out).
St Mary's Hospital was not government controlled or funded when Fleming was working there. It was one of the 'voluntary hospitals' supported by philanthropy and private donors. Furthermore, if you read the history of penicillin [1] you can see a long history of tinkering (meaning the discovery was somewhat inevitable) and that Pfizer, Inc. worked out how to mass produce it.
Yeah, in the process of killing millions and all imaginable crimes against humanity, they did a few good things, no one denies that. But if you use those good things as your argument, that's known as the broken window fallacy.
Actually it's very common. Try arguing with a soldier. Those guys are brainwashed into believing that the military helped humanity move forward technologically, as if spending that money directly in research (without the bombings, the deaths of millions, etc.) couldn't possibly have achieved the same, let alone much more (which is in fact more likely).
Every WMD program in existence? The apparatus of our surveillance states? Private companies and wealthy individuals would not pusure these things because it would be illegal and also pointless. Only governments want and pursue stuff like this. Of course, plenty of government directed research and government funded research is positive, but the private sector is intertwined with all that (funding and execution) and it's not true to say just because the government funded something it wouldn't have happened otherwise. At the extreme you have states like USSR and North Korea that spend almost everything on ghastly projects.
Did you think my argument was that when the government directs and funds research, they disproportionately waste it on WMDs? No, my argument was that big government research spending leads to monstrosities that would otherwise not even exist.
The reason you're being downvoted is that your point (as read) seems to be "Well, .gov funds research that kills babies!"
This is rubbish, because it also funds research that leads to medicine, better roads and health, the Internet, and all number of other things that are absolutely positive things. The balance is by far on the good, not the bad.
Private research brought us things like the Maxim gun, the Gatling gun, most of the shitty food you can buy today, lots of unhealthy chemicals, and all sorts of other things.
It's a comparison that, even if executed properly, is hard to make--and you failed to execute.
No, they are collecting data because that is how they make money. And I rather suspect that if you compare what the NSA knows about you, personally, with what th' Goog' knows, the NSA will come up well behind.
I'm not trying to minimize what the NSA has done; what they do is supposedly done in our name, which is offensive, and they have more power than any company to do harm with what they collect, which is frightening. And I'm not trying to attack the companies; they have every right to what I give them, most of which is not private even if I would wish it to be, and they do provide useful services with that information.
But if you are upset about an organization collecting information to use in some way that may be other than your best interest, the two are pretty equal.
But if you are upset about an organization collecting information to use in some way that may be other than your best interest, the two are pretty equal.
Private companies have incentive to pursue whatever the fuck they want to pursue. Public companies have a nominal responsibility to shareholders, but as long as they can justify it they can do whatever so long as it makes money eventually. Governments have a nominal responsibility to their citizens, but can do other stuff if they are allowed to do so.
WMD is such a stupid thing to bandy about, anyways--how many more are killed with cigarettes and cars than have died from these superweapons that rot in silos and labs?
PRISM, as somebody else has pointed out, is a stupid example because massive data mining is literally the business model for vast swathes of industry.
This does bring up a fair point, the military industrial complex is a massive funder of university grants. The creates a lot of ethical issue that are worth considering.
The original comment listed some issues with free-market financing but gov backing is not suddenly more altruistic/fair because it's not coordinated by 'free-market' billionaires. There are many many billionaires (and billion-dollar companies) who influence what the gov invests in and a significant number of them come from the DoD side.
> The original comment listed some issues with free-market financing but gov backing is not suddenly more altruistic/fair because it's not coordinated by 'free-market' billionaires.
I agree (though I don't think it's a 'free market' in sense of the economic term of art), however the issue is political power and control. Do we want a few citizens to have that much influence over our society, such as deciding which good works get funded, and who gets the funding? What happens when a donor threatens to reduce funding for the local hospital if the city council passes a law that impacts the donor's business?
Also, I tend to think the NSF will do a better (if not perfect) job of evaluating grant proposals than the random philanthropist.
You are right that the wealthy already have outsized influence; that's not a reason to give them more.
I have a few friends who worked at RenTech, and the one thing that bothers me is the secrecy. It's the one company I know of (outside of security-clearance jobs) where you're not allowed to say that you worked there. I feel like that probably makes it harder for people to resume their careers if they leave. Given that the best way to get a decent startup/VC job is to come out of a hedge fund, I can imagine it hurting people if they can't say where they worked.
I've heard that there's PhD bigotry there, too, and that's it's nearly impossible to get in if you don't have a PhD; but I don't know enough to confirm or deny that. It could be completely untrue, or it could just be that most people who make the cut and know about RenTech happen to have PhDs.
He sounds like a stand-up guy, though, and compared to the ethical dirt on an average Silicon Valley CEO, this stuff (which isn't even ethical dirt so much as practical disagreement) is negligible.
>'Given that the best way to get a decent startup/VC job is to come out of a hedge fund, I can imagine it hurting people if they can't say where they worked.'
Well, for cleared positions there's a pretty standard lingo that allows people to say without saying by referring to a particular address or bit of geography. The restrictions seem mostly about preventing people from making their history trivially searchable by the uninitiated.
I would expect there to be something similar for these people? Just say "I was in Suffolk County" or whatever.
It is not impossible to get a RenTech job offer without a PhD. Yes, they will batter you down during interviews if you don't have one. Taking a job at Renaissance Technologies is a commitment, on both sides. The culture of secrecy and non-competes is designed to filter away, even before the interview, candidates (a) unsure about their willingness to commit and (b) looking for a short-term career booster.
The culture of secrecy and non-competes is designed to filter away, even before the interview, candidates (a) unsure about their willingness to commit
What are the benefits of working at RenTech? They seem to be asking candidates to take a huge risk to their careers, due to the legally-mandated secrecy. That suggests there's a proportionally huge payoff in working there. What is it?
Apart from the great pay you get to invest in RenTech funds. I might be wrong but I think at this point theyre just working to manage their own money and not taking any money from investors. Above all else - working with smart people is its own reward.
> Above all else - working with smart people is its own reward
Of course, there's also the reward of building, creating, and contributing to something that extends beyond yourself. It's hard to believe that a career at a secretive hedge fund that invests its own funds would provide much along that axis of career satisfaction.
Some individuals are motivated by their interaction with smart colleagues, but others by the process of the work itself, others by financial incentive, others by prestige, others by societal impact, etc. There is no one-size-fits-all metric that guarantees satisfaction.
Would anyone speculate about what mathematics and methods they use to achieve a 50%/yr return? I wonder if there's a way to reverse engineer their model by e.g. looking up which research papers their employees published prior to joining RenTech.
If anyone knew they wouldn't certainly wouldn't share it. No one seemingly knows because no other fund has a comparable return, which is surprising because typically ideas diffuse as employees go work for other firms.
I suspect they use the ability to continue to invest in Medallion as an incentive to prevent people from going to work elsewhere.
It should be possible to figure out their methods. Besides, it'll be a lot of fun.
Is there a data dump somewhere of Medallion's trades over time? Since the stock market is public, that means we could treat their investment engine as a black box, and try to reverse engineer their engine by looking at the decisions it makes over time. We should pay careful attention to how it performed leading up to the 2008 crash, since that reveals how their engine performs in adverse conditions, which might indicate what underlying metrics their engine is using.
I don't know why I can't reply to the below comment.
The volume traded on any exchange is absolutely massive, especially on the products where funds might be putting in millions of dollars. There's also an enormous number of prop firms, banks, institutions, hedge funds, mutual funds, and whoever else constantly buying an selling. It would be near impossible to be able to say "Firm X traded at these specific times."
Furthermore, any worthwhile firm moving that much money knows to break up its trades. If they immediately dump $10 million into the market, its going to cause a large market impact, and they're going to leak information they probably don't want to give away (since that's their edge). (See the whole Flash Boys nonsense.)
Lastly, if you could identify a set of trades that were owned by a single firm, it would be a massive benefit to anybody opposing them (ie: everybody else).
My own guess of their method is that it's built upon a philosophy of very short lifetimes for any given strategy. I'd guess they've optimized their ability to track the life cycle of a strategy, and perhaps generalized to different classes of approaches for generating new strategies. They probably have rules of thumb they follow and a culture and that promotes the group's ability to find new signals and temporary inefficiencies.
Hence they'd be just about as non-stationary as the market itself. If you were dead set on doing an almost impossible finance project, then instead of reverse engineering you'd probably be better served by figuring out how to do life cycle management of signals yourself.
Given a dump of all stock market trades over a month, I wonder if it's possible to algorithmically group those trades into cohorts to identify the source of the trades. In other words, Medallion fund presumably manages a large amount of money; therefore, when they move that money into different investments (on a daily basis?) then we should see large trades (or many small trades that add up to a large amount).
I wonder what the daily trade volume of the NYSE is? It seems like if someone is moving around a billion dollars via thousands of trades, it should be possible to detect and categorize those seemingly-disparate trades as "these trades originated from the same owner".
If it's possible to trace the flow of money in that way, then it may be possible to generate a list of probable Medallion trades: search for a cohort that achieved >40% return on billions in volume.
Another way of figuring out Medallion's methods is to examine its interaction with academia. Presumably they search for candidates from fields related to their trade engine. If we can generate a list of research papers which resulted in its authors being hired by Medallion, then those research papers may reveal some of the techniques used by their trade engine.
I used to work for a financial software startup. One of our products was all about analyzing the NYSE TAQ (Trade-And-Quote) data to find such patterns. Another of our products was an execution engine that would take a large block order and automatically slice it up into individual trade executions so that nobody could a.) identify the source of the large order and b.) trade against it. The software would automatically compensate for the amount of liquidity in the market at a given time and execute trades only when there was sufficient order depth to avoid moving the market.
Basically, people have thought of these strategies before. And they've thought of countermeasures to those strategies. And they probably have countermeasures to the countermeasures - for all I know, maybe RennTech's secret is that they've figured out how to statistically identify everyone in the market and trade ahead of them.
The financial industry is a massive arms race which draws some of the smartest people in the world. It's very unlikely that you (or any individual investor) can compete unless you've worked at one of the big hedge funds.
The reverse engineering is near impossible. My guess is that their execution algorithms will be as complex as their strategies themselves, so finding out their trades and figuring out the underlying strategies (which constantly evolve with the market) is really hard. Moreover, if one had so much quant ability, they'd be better off making some money for themselves and beating RenTec at their own game.
I will speculate. They mine asset returns for predictable statistical patterns without making prior assumptions about what these patterns are. Once they find the patterns and confirm that overfitting is not responsible for generating them, they trade on these patterns.
It's the one company I know of (outside of security-clearance jobs) where you're not allowed to say that you worked there.
Are you sure about this? There are plenty of people on LinkedIn who identify themselves as working at/having workd at RenTech. Furthermore, you can also find on LinkedIn people who identify themselves as having been employed by the various non-profits which carry out govt crypto research.
Why don't they want their ex employees to disclose that they worked there? I can understand a government intelligence unit demanding that, but why would a hedge fund put such a restriction?
Plus they way you describe, any body who can get in there- Putnam winners, top Math PhD's probably already have better offers.
Mind if I ask what his degree was in? Would imagine it was something like computer science, as I've only ever heard of those in maths/stats/physics getting in with a PhD.
Everyone makes it seem like Rentech is head and shoulders above everyone else and being able to invest in Medallion with a %50/yr return is probably one of the best bonuses anywhere. Bad work conditions?
Another "if i can do it, so can you" story. Fuck that message
, I am never going to be a billionaire and you won't be either. And it isn't for a lack of talent, or effort.
That was a throwaway sentence by the article's author, one that perplexes me, because it has nothing to do with the article or Dr. Simon. It is a complex combination of usually disparate skills, all at a very high level, that allows him to do what he does.
I think Dr. Simon's point is not "if I can do it, so can you", but instead that the things we normally value, quickness in thought (see: whiteboard coding) really aren't the best or only measures of a person. The ability to organize talent in others, for example, or the willingness and curiosity to endless ponder on a question for a very long time, have payoffs. For example, Oppenheimer produced almost no new science after his early career, but his absolute brilliance at running research had an enormous impact on science, probably greater than his research.
For some reason we don't seek out that kind of brain. I don't know why. Is it because they are rare? I don't think they are. I see 'clever' people, and then smart people. The clever people dominate the meetings, make decisions, but often times it is the person brooding over a problem that sees how to better advance efforts. Can't implement a smart pointer off the top of your head, under pressure, in a interview? No hire. (this is something the friggin' C++ committee got wrong, for years, with auto_ptr). I see Ph.Ds chasing stupid ideas that will never be practical. Smart is good, but so is pragmatic, and seeing the 'right' thing to do, and doing that. They are different kinds of intelligence; we need both, but often only shop for the former.
I ponder this very question daily. I don't believe there are different types of intelligence. Instead, there are intelligent people who optimize single variables, and those who optimize multiple variables.
The stupid interview questions about pointers involve just one variable, whereas a multi-variable (and higher order) analysis would consider what your company's business needs are and how software can help achieve them. The truth is, higher-order multi-variable thinking (also known as strategy) is far more critical to success than low level single variable thinking. However, due to the financial structuring of companies, there are very few positions for strategic thinkers.
What it boils down to, is how many times you ask "Why". If you stop at one iteration, you won't get a very optimized solution. But if you keep going until you're questioning the definition of reality, you're at about the right place.
There are literally more billionaires on HN than people in the US who could write "Axiomatic Characterization of Ordinary Differential Cohomology."
Apparently some folks are motivated to strive towards those statuses. Not quite my cup of tea, but I wouldn't discourage them or say those goals are flatly impossible.
Or do you mean just maybe understand the general essence of the paper's title, and understand major contributions after spending some time reading the paper?
If the former, well... yes. That's probably true for almost all significant research, especially in mathematics.
If the latter, I think you're probably wrong. And that's not to trivialize the work presented in the paper; if anything, the contrary -- the paper's actually quite well-written.
Counting up the number of people who could've written a given non-anonymous paper is pretty unheard of in academia afaik. The answer is usually politely assumed to be "exactly the number of authors". I've certainly never seen this behavior. So I'm not sure your answer is actually at all clarifying.
Probably, and this is just a guess, neither Simons or Sullivan claim they could've written the paper alone. And it's certainly impossible to write essentially the same paper without plagiarizing. So probably there are either zero or two people who meet the "could've written this paper" criteria.
So, why didn't you just say "there are more than zero/two billionaires who read HN"? Seems less round-about.
Nothing is impossible, but it comes down to probability. The probability that you will become a billionaire is quite slim. However, the probability that you can retire early or make close to a million or so is exponentially higher.
While he's 'wrong' in the strictest sense that there might be someone reading who'll go on to make billions, anyone reading that comment and thinking "I will be!" is much more likely to be wrong. The chance of one person in a pool of thousands becoming a billionaire is a great deal more likely than any individual making it happen, even though both are very unlikely.
You can't win Tour de France if you don't start cycling. With his attitude there is no point in getting on the bike in the first place, because probabilistically it's unlikely you will ever win, right?
If your only positive payoff point from cycling is "win the Tour de France", yes, you are almost certainly better off doing something else.
OTOH, if more modest acheivements would justify the investment of time and money and winning the Tour de France would be a crowning, but not necessary to justify the effort, acheivement, sure, start cycling...
I think the rational is more like "You can't win the Tour De France, so stop worrying about that goal because it's essentially unattainable, and do something ambitious-but-achievable instead."
"Dr. Simons received his doctorate at 23; advanced code breaking for the National Security Agency at 26; led a university math department at 30; won geometry’s top prize at 37; founded Renaissance Technologies, one of the world’s most successful hedge funds, at 44; and began setting up charitable foundations at 56."
I agree with other comment authors that this attitude is unnecessarily negative.
But at the same time, I'm always surprised when people claim these sorts of comments are self-defeatist.
Unrealistic expectations can be just as psychologically and socially damaging as viewing the world through a billionaire-or-powerless-prole lens. Witness the periodic comments from founders whose failed start-ups ruin their marriages as well; if anything, unrealistic expectations for one's self can be even more damaging than self-re-enforced feelings of powerlessness.
So it's not that this comment is healthy. It's just that many responses here are almost hilariously as unhealthy. It's like an alcoholic criticizing a chain smoker.
(Okay, so now I'm the most unhealthy, most negative person in the thread :-( )
A bit off topic, but he made his money managing hedge funds. There are lots of "quant" type people that could do as well as he has, but almost no one has access to tens or hundreds of millions of dollars of others' money to deploy. While some attempts have been made, I haven't yet seen a decent solution to bring the best forecasting together with large amounts of capital. Somebody please work on that.
But make no mistake - when he says he wasn't as fast as some of the others, it's a whole different ballgame. He's a world class genius with creativity and personality to boot. He's also a good guy who is quite generous.