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posted by Fnord666 on Monday November 18 2019, @11:49AM   Printer-friendly
from the Wait-long-enough-and-sc-fi-always-becomes-sci-fact dept.

In 1951 Isaac Asimov inflicted psychohistory on the world with the Foundation Trilogy. Now, thanks to data sets going back more than 2,500 years, scientists have discovered the rules underlying the rise and fall of civilizations, after examining more than 400 such historical societies crash and burn - or in some cases avoid crashing. More here:

https://www.theguardian.com/technology/2019/nov/12/history-as-a-giant-data-set-how-analysing-the-past-could-help-save-the-future

Turchin's approach to history, which uses software to find patterns in massive amounts of historical data, has only become possible recently, thanks to the growth in cheap computing power and the development of large historical datasets. This "big data" approach is now becoming increasingly popular in historical disciplines. Tim Kohler, an archaeologist at Washington State University, believes we are living through "the glory days" of his field, because scholars can pool their research findings with unprecedented ease and extract real knowledge from them. In the future, Turchin believes, historical theories will be tested against large databases, and the ones that do not fit – many of them long-cherished – will be discarded. Our understanding of the past will converge on something approaching an objective truth.

Discuss. Or throw rocks.


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  • (Score: 3, Interesting) by JoeMerchant on Monday November 18 2019, @10:28PM (3 children)

    by JoeMerchant (3937) on Monday November 18 2019, @10:28PM (#921713)

    I seriously doubt the guys in TFA are going to be able to swing that

    I seriously doubt that anyone is going to extract sufficient signal from the noise to get anything even remotely predictive of the future beyond next year. There might be enough "high quality" data flowing around from the last 20 years to model up some short term predictions of how things are going to go based on how they have gone, maybe, some of the time.

    What I am sure of is that the guys in TFA, and others like them, can seek, find, and secure funding to do their research, generate their (meaningless) results which will then be used as supporting fodder for various policy change propositions by those who fund the research.

    Re: interpreting the data, that brings to mind the ounce of gold I bought when I was 10 years old. Back then, Walter Cronkite (or whoever) announced the price of gold every night on the 6pm news, and... curious about it I asked my parents and they explained, and I figured out that I could make better than bank interest if I "timed the market," bought low, sold high, the pattern was pretty clear, I was pretty sure I could do it, so I took my life savings to the coin store and bought a 1 oz Krugerand, successfully near a low point. I watched the news every night, I tracked the price fluctuations up and down, I finally hit 2x bank rate ROI and I went to the coin store to sell my gold and reap my reward, and I learned about commission - seems that they sell you the gold for the price on TV, but they wanted something like a 5% commission when they bought it - mom and dad never warned me (I think honestly didn't know) about that... I went away sad, but tracked for a few months more, followed the patterns, predicted a peak, went, sold, VICTORY! Something like a 9% APR profit even after commissions when the savings account available to me only paid 5% APR. The next night I was vindicated, the price fell just like I predicted - based on my then 300 price data points and limited input from the nightly news I had successfully timed and beaten the market, financial pattern wizard - and it stayed down for almost a week. 6 days after I sold, Iran took the hostages and within 2 more weeks gold had quadrupled in price. Unprecedented event, outside the modeler's input experience, no prior warnings (that I had access to, at least), and, boom, my hard won, and significant 0.09 over 0.05 APR victory was trivialized by the 4.00x gain in 2 weeks.

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  • (Score: 2) by Phoenix666 on Tuesday November 19 2019, @06:12PM (2 children)

    by Phoenix666 (552) on Tuesday November 19 2019, @06:12PM (#922019) Journal

    Thanks for that. It's an apt depiction of market timing. I used to work in mutual funds (Morningstar) and later in hedge funds, and so investment strategies are something we studied keenly. When you look across all of them, from market timers to contrarians and such, over the long term they all underperform the market indices. Sure, they might outperform the indices for a time, but it's always negated with losses over the long run.

    So for the average person who wants to invest his money, the easiest strategy is also about the best one.

    The only other approach to investing I put any stock in is Warren Buffett's, who plays long-term trends in the fundamentals.

    Everyone else who promises or gets short term gains is running a cheat or a scam, or simply gets goddamn lucky. Every time. Either it's insider trading, front-running trades, or a ponzi scheme (see Bernie Madoff). And for every one who scores as an early round investor in Google, there are thousands of VCs or angel investors who lose their shirts. They should know it's stupid, dumb luck, but it never seems to dampen their triumphalism.

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    Washington DC delenda est.
    • (Score: 2) by JoeMerchant on Tuesday November 19 2019, @06:44PM (1 child)

      by JoeMerchant (3937) on Tuesday November 19 2019, @06:44PM (#922028)

      The VCs (at least Credit Suisse First Boston) know damn well what they are getting into - around 1999 they were dropping 5-10 million per bet on startups, and expecting 16/20 of those startups to be bankrupt within a year, hoping 1/20 would break out and make back their losses on the 16, and also expecting about 3/20 to sort of struggle along sideways with no real chance for breakout success - you can't tell which bin a particular business plan is going to fall into until after you've given them the $5-10M and 6 months to a year to see how they are trending.

      We were only looking for $2M, but I think we ended up taking 3 initially, and more later. We had private investment of about $1.9M, and a fair track record, with some potential for .com breakout action. Years later, it became evident that we were in the struggle along with no potential for breakout bin. Of course, one way CSFB maximizes their ROI is by: A) demanding control of the company they invest in, B) demanding incorporation in Delaware - the most investor friendly laws possibly in the world, certainly in the developed world and C) when those 3 companies go sideways, through your control of the board force them to take on debt (which has priority over equity) debt held by none other than CSFB, then: D) when the market takes a little dip have an audit performed which deems the net valuation of the company to be worth less than the company's debt... finally, again through control of the board E - for Exit) restructure, and buy out any outside investors for "their share" of equity.

      I think it was 2007 when I got a check for a penny (stock issued as partial compensation for employment...) Our private angel who put in over $1M of personal money got a check for a penny. A dozen other private investors with anywhere from $10K to over $200K of personal money invested each got a check for a penny. CSFB retained control and later liquidated the company for quite a bit more than the value of their debt - market fluctuations, you know.

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      • (Score: 2) by Phoenix666 on Wednesday November 20 2019, @01:57AM

        by Phoenix666 (552) on Wednesday November 20 2019, @01:57AM (#922201) Journal

        I think it was 2007 when I got a check for a penny (stock issued as partial compensation for employment...) Our private angel who put in over $1M of personal money got a check for a penny. A dozen other private investors with anywhere from $10K to over $200K of personal money invested each got a check for a penny. CSFB retained control and later liquidated the company for quite a bit more than the value of their debt - market fluctuations, you know.

        Damn, that sucks. You have my sympathy.

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        Washington DC delenda est.