Daily Speculations
 |
James Sogi
Philosopher, Juris Doctor, surfer, trader, investor, musician, black belt, sailor, semi-centenarian. He lives on the mountain in Kona, Hawaii, with his family. |
11/22/2005
Where Do Probabilities Come From? by
James Sogi
The frequentist believes the numbers come from experiments. If the probability is 0.1, if infinite samples were taken, 0.1 is the fraction that would be observed. The objectivist believes that the probabilities are a real aspect of the universe, not just a description of the observer's belief. Physicists are objectivists. Subjectivists believe probabilities reflect the agent's belief. The frequentist ultimately ends up being a subjectivist in order to act in the real world.
From uncertainty can come certainty through the scientific method. It is tempting to use fixed patterns . The danger of the fixed system is to try fit the observation to the system, which may, or may not be appropriate. The mind sees patterns where none exist - this is the danger of subjectivism. The old fixed system may miss a new element in the current situation that may be overlooked when the fixed system is set in the mind. This is where when the new cycles come in, use of fixed systems may miss new elements. This is the danger of objectivism. Life is historical, something is always different. What is new? What will the effect be? What is the historical curve, the new trend, the break from the old? These are critical questions to ask. This is the same problem as the black swan and the problem of induction. We simply cannot know the future except dimly reflected by extrapolating the past. Those that do not know history, that do not observe, are condemned to repeat it.
Dave Whitesel Replies:
I would posit that history contains the secrets of forward demand precisely because of our need to part with it. Now that surmise does not mean we are always successful in said pursuit, it simply means that in free market economies history provides the clues as to forward actions of entrepreneurs seeking solutions.
Entrepreneurs can be way ahead of the systems they exist within, timing is critical, but history is the entrepreneurs starting point. By way of example, automobile economy has extensive cause and effect issues which extrapolate onto our present, providing entrepreneurs with the guidance they need for action.
Without knowledge of history the entrepreneur loses connection to forward demand, as opportunity to correct the problems cast off as effects. Inertia, is another obstacle, the entrepreneur must face, inertia layers additional risk on his endeavor, as systems interested in preserving the status quo might be formidable enemies of entrepreneurial action.
Inertia breaks down; if cause is real. Inertia is a masquerade designed to preserve vested interests, its a state of intransigence built with a high coefficient of fiction. Forward demand persists, its telegraphing need by the greater cosmic conscious, a state of mind which the sensitive entrepreneur cannot ignore.
Forward demand is the entrepreneurs edge, the knowing of that which the past has given unto them, whose minds seek the promise of satisfaction of human need, progress and potential.
History itself is a commodity of the present, its in the now that we decide what to do next.
Rod Fitzsimmons Frey adds
To the list I would add numerologists, who may be a subset of objectivists, although they are not empiricist. A numerologist believes that numbers come from a real aspect of the universe; but the numbers are not a reflection, hint or indication of that aspect: they are the aspect. The numbers are what is real, and the universe we see and experience is a shadow of the number, not vice-versa.
Smart numerologists include Plato, Socrates if he's real, and Nietzsche. Dim numerologists include followers of Elliot waves and Fibonacci retracements.
c
Jim Sogi, May 2005
(address is not clickable)