Tail event: Difference between revisions

Tail event (view source)

Revision as of 09:07, 16 January 2024

2,650 bytes added , 16 January

no edit summary

Amwelladmin

Bureaucrats, Interface administrators, Administrators

82,968

edits

@@ Line 31: / Line 31: @@
 Boy, did I get side-tracked.
-For events in the real world to confirm to normal distributions, standard deviations, and confident probabilities they must meet the criteria of a nomological machine. All potential events must known, and be independent of each other and our observation of them. If a motivated agent intervenes it can upset the observed behaviour of the system. If you have all that all risks can be calculated and probabilities assigned.
+But hold map and territory — model and reality — as an immutable dualism. We live in the territory, and to abstract from territory to map is to cross the mythical threshold from ordinary world to magical ''model'' kingdom. Unlike its fictional archetype<ref>Most famously outlined in [[Joseph Campbell]]’s {{br|The Hero with a Thousand Faces}}</ref> the model kingdom cannot change the real world. The less correspondence there is between the two, the greater the peril.
+So the relationship between map and territory is fraught. Map, territory. Model, reality. Online, offline. Formal, informal. Narnia, the real world. The longer the stay in Narnia, the more we are persuaded by it: the more we build it out by reference to its own terms, its own logical imperatives. As we flesh out the theoretical and logical implications of our models without checking them back to the territory they originally meant to map, we are in danger of amplifying inadvertent implications of the buried ''differences'' between our maps and our models. The map of theoretical physics has long since parted from the point where practical comparison is even theoretically possible. There is ''no possible real world evidence'' for string theories, multiverses, dark energy or the cosmological constant. For some of these things, we are told, ''the very act of looking for evidence'' would destroy it. This is a skeptic-defeat device as powerful as anything found in religion. These are all pure functions of extrapolation from the model. If the model is wrong, all this fantastical superstructure, also, is wrong. Yet the whole superstructure the investment in it, the careers, the billion-dollar particle accelerators, the industrial academic complex behind it — these exist in the real world. These are, seemingly, reason enough to believe, notwithstanding the apparently, unfalsifiably bonkers things these things, with a straight face, tell us must be true.
+This is not to say any of this higher order theoretical physics is not true or correct. We laypeople have no reason to doubt the maths . But mathematics is the business of internal logical consistency. It is a closed logical system; a linguistic game. It is the language in which we articulate the model. It has nothing to say about its relationship to the territory. Maths is a language: it is not science.
+First, be sure you know which domain is which. Are you trying to fit the world to a model — as you do when flipping a coin or rolling dice — or a model to the world? Volatility calculations, Black-Scholes formulae, You can abstract fit real world to the model a normal distribution is a For events in the real world to confirm to normal distributions, standard deviations, and confident probabilities they must meet the criteria of a nomological machine. All potential events must known, and be independent of each other and our observation of them. If a motivated agent intervenes it can upset the observed behaviour of the system. If you have all that all risks can be calculated and probabilities assigned.
 Markets, in the abstract, look just like such a machine. There is a bounded environment, a finite trading day and a limited number of market participants and financial instruments which one can buy or sell. In the modern days of computerised trading everything is very clean, tidy observable, unitary and discrete.