Aug
22
Briefly Speaking, from Victor Niederhoffer
August 22, 2010 |
As many have commented it is amazing to see the fixed incomes going up up up in conjunction with the stocks going down down down. Indeed the amazingness is such that putting a littling quantification on it on a four week basis with maxima and mimina respectively, one notes that it's only happened like this on 15% of all Fridays the last 4 years. What happens in the future on this amazingly frequent 1 in 7 event? In general the fixed incomes have deferred back to their old normal with about 2 to 1 odds.
One can only guess that the reason for this unusual consilience has something to do with point 32 of a conservative diatribe I received which could have been sent by the other list itself: "when he took a huge spending bill under the guise of stimulus and used it to pay off orgs, unions, and indivdis that got him elected, people said…" Yes. crowding out, and lack of incentives, and demoralization, create a revulsion to invest and hire. Perhaps Keynes would have done better to have noted this then to conclude that expectations of further increases in bonds tend to be self reinforcing et al in creating the lm.
Alston Mabry adds:
And one must consider the whims of the flexionic organizations who can borrow from peter at zero and then lend to paul "risk free" and skim a few hundred basis points for their trouble.
Ken Drees adds:
A hint of Japanese style negative interest rates rear view mirror double play USA helps the reinforcement of trend on a "believable story basis".
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[NOT FOR PUBLICATION: V, see email that I just sent to you as to this article submission for my friend, a Chinese Phd in Robotics Department here at Shanghai University. Thank you. dr]
Invitation for Insights and Commentary
What follows is my edited email by a Chinese PhD here at the Robotics Department of Shanghai University. Given the ether of daspec, it would seem natural to conclude that Rachel’s best hope for guidance may be found with youall…
Thank you.
dr
The request for help…
How to find both (a) the relationship between large numbers of data and (b) changing trends with data under different conditions?
About my research, I want to find a way to deal with data. There are two objects.
(a) One is to find the relationship between large numbers of data, so that we can make some decision (like the first example). Previously, we used technology called data mining.
(b) The other is to find the changing trends with data under different conditions; previously we use formula to foretell the trend.
The following are three examples.
1. Wal-Mart (one of the biggest supermarkets) records all sales data to find the relationship between beer and napkins. When men go to the supermarket to buy napkins, as their wives ask them to do, they will buy beer. So if the supermarket arranges the beer and napkins together, more beer and napkins can be sold.
My problem: can quantum mechanics help the analysis of this relationship between the large numbers of data, which seems to have no relationship with each other?
2. Company logistics management: every company has storage. If the storage is too large, it wastes too much money. But if there is not enough storage, it will not meet the custom’s order immediately. The market is always changing. How can the company foretell the stock correctly? I find this problem similar with the stock market.
How can quantum mechanics foretell the stock market?
What can it foretell — the whole stock market trend or the trend of every stock?
3. The manufacturing process parameter: if we use machine to manufacture a product, we will decide the process parameter: the temperature of process, the pressure, the speed of cutting, etc. When we manufacture different products, we need to set different process parameters to guarantee the quality. We have done a lot of experiments, manufactured a lot of products; there is no definite formulary between input and output.
I know the concept of quantum theory is uncertainty. Is it useful to solve this problem?
If possible, can you introduce some short paper about quantum theory? I have read a few, but I am confused. At first, I think my problem is similar with the problem of how to foretell the trend of stock markets, so I think maybe quantum theory can be used to solve my problem. Now after I read some introduction about quantum theory, I am not sure whether it is helpful.
Thank you,
Rachel