Unfortunately, in our globalized, modern investment world personal observation is about as useful a survival trait as poking a sleeping cobra with your bare foot. It’s just that the poison is a lot slower acting.
Showing posts with label observer bias. Show all posts
Showing posts with label observer bias. Show all posts
Thursday, 26 July 2012
Things Investors Should Hate 4/5: Observation
No human being can resist trying to draw general conclusions from personal observation. It’s not purely a matter of wilful ignorance, but is an in-built evolutionary trait necessary for our ancestors' survival. After all, on the primeval savannah if you didn’t learn rapidly from experience you were likely to end up as a lion's dinner.
Saturday, 29 May 2010
Laplace’s Hammer: The End of Economics
Clever Man, Stupid Idea
Simon-Pierre Laplace was a Very Clever Man who did many Very Clever Things. Unfortunately, like many clever men, having got hold of a Brilliant Idea he was rather inclined to go off and use it on everything in sight, which led to a number of Very Odd Conclusions. In fact as far as science goes, he may well have been the original man with a hammer; taking aim at every problem as though it was a nail.
As is the way of these things economists got hold of Laplace’s ideas, converted them to their own and started developing delicate and intricate webs of theories and practices. Unfortunately, over the succeeding three hundred years they’ve failed to keep up with advances in physics and biology, rather leaving economists as the only believers in an approach that suggests we have no free will, a position from which they’re having to be dug out and defused, one unexploded theorist at a time.
Simon-Pierre Laplace was a Very Clever Man who did many Very Clever Things. Unfortunately, like many clever men, having got hold of a Brilliant Idea he was rather inclined to go off and use it on everything in sight, which led to a number of Very Odd Conclusions. In fact as far as science goes, he may well have been the original man with a hammer; taking aim at every problem as though it was a nail.
As is the way of these things economists got hold of Laplace’s ideas, converted them to their own and started developing delicate and intricate webs of theories and practices. Unfortunately, over the succeeding three hundred years they’ve failed to keep up with advances in physics and biology, rather leaving economists as the only believers in an approach that suggests we have no free will, a position from which they’re having to be dug out and defused, one unexploded theorist at a time.
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