Sep
22
Galton’s “Memories of My Life,” Reviewed by Victor Niederhoffer
September 22, 2007 |
By reading the biographies of great people, I learn much about how our world has been shaped, gain insights into how they thought, and through this find avenues for self-improvement.
My favoritie biography is Memories of My Life by Francis Galton, and no matter how many times I read it, I always come away more thoughtful, amused, and creative. Above all, there is a feeling of calmness and awe that comes from knowing that a person of his genius, wisdom and versatility actually existed. Galton wrote this biography at the age of 86 and it is as fresh to me as Tom Sawyer.
In broad outline, it shows the development of his contributions in the fields of geography, medicine, meteorology, photography, electricity, anthropology, psychology, statistics, heredity, and forensics. Some of his most notable contributions include the invention of correlation and regression, weather map composite photography, fingerprinting techniques, twin studies (in eugenics and genetics), and a handheld heliostat for signalling over long distances.
Almost every page of Galton's book has an example of one of his ingenious inventions, contributions, or observations on life. His insights are so great and his interests so broad that almost anyone who reads the biography will come away wanting to follow up and re-examine some insights that Galton gave that are applicable to his or her field.
I will concentrate on some insights I gained into the markets:
1) The influence of rhythm. Galton writes about the influence of rhythmic gestures in creating mass behavior, after noting how famous preachers and politicians of his day were able to influence people by personal (vocal) ascendancy. He offers the story of a college classmate who with the mere movement of a glass was able to drive assembled students into an ecstasy of enthusiam. He concludes that:
"Human senses when rhythimically stimulated by certain exact cadences are capable of eliciting overwhelming emotions not yet sufficiently investigated."
I find that market practicioners when stimulated by certain opinion leaders can fall into similar overwhelming emotions. The stimulation is heightened by the rhythmic movement in prices that accompanies the gestures. Since there are innumerable influences on markets, and an emotional reaction to one opinion leader or another is likely to lead to excess, the job of the market practicioner is to find when the rhythmic movements have run their course, and then profit by the excess of enthusiasm.
2) Positions of stability. Galton was the first to systematize the use of finger prints, as a note in the book from Bertillon confirms. Galton writes that there are quantum differences in the patterns that fingerprints show, that are similar to the different genera in nature. He notes that these patterns could not have come from natural selection but must have come from internal conditions of the structures in the hand. He generalizes the finding as such:
"The number of positions of stability in each genus must be limited, There are limits which if they can be overpassed without disaster would require a new position of stability."
He points out the analogy of the quantum leaps in fingerprints between leaps and whorls and relates it to the question of the importance of mutations versus small improvments in the theory of evolution, and he points out that these questions also arise in the fieldd of glaciers, which are formed by a succession of refreezing and crunches… in other words by successive conditions of stability of state.
What are the levels of stability in markets that correspond to these refreezings and crunches? Laurel and I have often proposed that round numbers often are positions of stability to which markets tend to move with inordinate frequency. I beleve this holds true for the 100s in the Dow Jones, the 10s in the S&P, and the previous close in any market. By testing the paths that markets take when near these numbers, we can develop insights into when disaster or equilibrium is more likely.
3) The influence of Visionaries. Galton notes that there are always visionaries subjected to fantasies that have no place in the real world. Usually the visionaries are laughed at or subjected to reality checks that discredit them:
"When popular opinion is of a matter of fact kind, the seers keep quiet as they dont want to be thought mad. But let the tide of opinion change, and grow favorable to supernaturalism, then the seers of vision come to the fore."
Most of the market visionaries in ordinary times are subject to a similar process of reality and discredit. Those who constantly posit a big decline in stocks, are subjected to the reality of the 10% a year drift over the last 100 years, but let a month or two come along with a decline, and these visionaries come out of their lairs with all reasonable safeguards broken.
No discussion of anything written by Galton is complete without remarks on the ingenuity and sagacity that leaps out of everything that Galton touches. On one page you can find his index of boredom, measured by counting the number of fidgets, and on another a contrivance for sending telegraphic signals through the use of needles mounted on each other. Other pages include a discussion of how to divide prizes among the top three contestants in a competition, how to cut a round cake on scientific principals, or a way of measuring how horses gallop. The appendix of the book enumerates 192 of Galton's inventions and papers and offers an overview of how he developed most of them.
Memories of My Life has a freshness and decency of spirit, and is an illustration of how amazing and creative the human mind can be. It has insights into most scholarly fields, and advice and examples of living a good life on almost every page. I highly recommend it as a source of rejuvenation and growth, and as a reminder of how far the human mind can travel.
Pitt T. Maner III adds:
The collected published works by Galton are available at Galton.org. Also, according to Wikipedia, Terman estimated Galton had an I.Q. near 200, or about as high as it gets. How would he have fared in today's academic environment? A free thinker such as he would be quite controversial nowadays, Victorian England's somehow being more accepting of individual genius and eccentricities.
Vitaliy N. Katsenelson notes:
Google allows you to download the book for free. Here is why: "It has survived long enough for the copyright to expire and the book to enter the public domain. A public domain book is one that was never subject to copyright or whose legal copyright term has expired." On the top right-hand side click "Download PDF" ( 8.5mb) and you are ready to go. Thank you, Google!
Sam Humbert notices:
Nass#m Tal#b discusses Galton, The Bl#ck Sw#n, pg. 244 –
Sir Francis Galton, Charles Darwin's first cousin and Erasmus Darwin's grandson, was perhaps, along with his cousin, the one of the last independent gentlemen scientists — a category that also included Lord Cavendish, Lord Kelvin, Ludwig Wittgenstein (in his own way), and to some extent, our uberphilosopher Bertrand Russell. Although John Maynard Keynes was not quite in that category, his thinking epitomizes it. Galton lived in the Victorian era when heirs and persons of leisure could, among other choices, such as horseback riding or hunting, become thinkers, scientists, or (for those less gifted) politicians. There is much to be wistful about in that era: the authenticity of someone doing science for science's sake, without direct career motivations.
Unfortunately, doing science for the love of knowledge does not necessarily mean you will head in the right direction. Upon encountering and absorbing the "normal" distribution, Galton fell in love with it. He was said to have exclaimed that if the Greeks had known about it, they would have deified it. His enthusiasm may have contributed to the prevalence of the use of the Gaussian.
Galton was blessed with no mathematical baggage, but he had a rare obsession with measurement. He did not know about the law of large numbers, but rediscovered it from the the data itself. He built the quincunx, a pinball machine that shows the development of the bell curve. True, Galton applied the bell curve to areas like genetics and heredity, in which its use was justified. But his enthusiasm helped thrust nascent statistical methods into social issues.
Denis Vako extends:
Another confirmation of the positive linear growth rate in economic activities of civilizations can be found in the works of Fomenko, whose main conclusion was that there never was such a thing as the dark ages, lost civilizations, abrupt destruction of technological and material achievements and there never existed an age of barbarians or renaissance. The history of human civilization, Fomenko indicates, is the positive linear growth from one invention to another, with one discovery on top of another, it is an almost evolutionary process, always onwards and upwards.
Hence I propose that the 10% drift was not only for the last 200 years, but rather at least for the last 800 years as covered by Fomenko.
Steve Ellison adds:
I am not familiar with Fomenko's books, but I just started reading The Renaissance by Paul Johnson. Mr. Johnson says that much more innovation occurred in the Middle Ages than in the Roman Empire. The Romans had many slaves and resisted labor-saving advancements because they feared unemployment and social unrest would result. Conversely, medieval Europe had a shortage of manpower as Christianity phased out slavery. The Black Death made the labor shortage more acute. There was great incentive to develop and deploy labor-saving technology. Many watermills and windmills were built. Medieval mariners, lacking Roman galley slaves, greatly improved sail designs, making possible larger ships that could sail much greater distances.
"Thus in the later Middle Ages, wealth was being produced in greater quantities than ever before in history" (p. 13).
Denis Vako comments:
I have never read Mr. Johnson, but at a first glance this paragraph looks a little too smooth and ideal. Renaissance, black death, middle ages these are interesting titles … but on my second thought may be they relate to real history as much as bear or bull markets labels relate to the market?
Does one really know at the time if there is a bull or bear market?
Presumably we now have better decision making tools than throughout history — databases and computing power to process and categorize knowledge — and yet the only answer we can give to the above question is no, one does not know for sure! But we can say what it was after the fact, right? — July and August was a bear market in stocks.
but then someone may justly ask: a bear market for whom?
Isn't it strange that now, in the present, after the fact, with all those great tools, it is not easy to define what really happened in the market in July and August, yet when it comes to history it is all so clear?
Suppose the market goes up 100% over the next 5 years, then July-August will be called "a minor interruption of galloping bull market"; if the market goes sideways perhaps it will be named "the beginning of maturing top formation"; and yet if it falls 50% it will be named "the start of the vicious bear market."
Anatoliy Fomenko concentrates first on time: he shows the difficulties and limits, and the proofs by calculation, based on planetary movements, then instead of 'feel good' story telling and emotions, he goes for logistics of language, weapons, fighting methods, writing style, coinage, prices and taxes, dress, burials, transport, communications, food and food supplies, buildings and building tools, climate, terrain.
He said that essencially all history is re-written from original chronicles … many of which have vital parts missing.
On mass infectious diseases he says that
"Once it was determined that people were dying from an epidemic, they were entirely exterminated in their localities by the army — all killed to save the healthy, as medical preventive injections and quarantine as we know it now was not known back then, the decision was made simply to kill."
Why the hoax, why the fake and cuo bono of historians? He indicates that too.
Comments
WordPress database error: [Table './dailyspeculations_com_@002d_dailywordpress/wp_comments' is marked as crashed and last (automatic?) repair failed]
SELECT * FROM wp_comments WHERE comment_post_ID = '2200' AND comment_approved = '1' ORDER BY comment_date
Archives
- April 2021
- March 2021
- February 2021
- January 2021
- December 2020
- November 2020
- October 2020
- September 2020
- August 2020
- July 2020
- June 2020
- May 2020
- April 2020
- March 2020
- February 2020
- January 2020
- December 2019
- November 2019
- October 2019
- September 2019
- August 2019
- July 2019
- June 2019
- May 2019
- April 2019
- March 2019
- February 2019
- January 2019
- December 2018
- November 2018
- October 2018
- September 2018
- August 2018
- July 2018
- June 2018
- May 2018
- April 2018
- March 2018
- February 2018
- January 2018
- December 2017
- November 2017
- October 2017
- September 2017
- August 2017
- July 2017
- June 2017
- May 2017
- April 2017
- March 2017
- February 2017
- January 2017
- December 2016
- November 2016
- October 2016
- September 2016
- August 2016
- July 2016
- June 2016
- May 2016
- April 2016
- March 2016
- February 2016
- January 2016
- December 2015
- November 2015
- October 2015
- September 2015
- August 2015
- July 2015
- June 2015
- May 2015
- April 2015
- March 2015
- February 2015
- January 2015
- December 2014
- November 2014
- October 2014
- September 2014
- August 2014
- July 2014
- June 2014
- May 2014
- April 2014
- March 2014
- February 2014
- January 2014
- December 2013
- November 2013
- October 2013
- September 2013
- August 2013
- July 2013
- June 2013
- May 2013
- April 2013
- March 2013
- February 2013
- January 2013
- December 2012
- November 2012
- October 2012
- September 2012
- August 2012
- July 2012
- June 2012
- May 2012
- April 2012
- March 2012
- February 2012
- January 2012
- December 2011
- November 2011
- October 2011
- September 2011
- August 2011
- July 2011
- June 2011
- May 2011
- April 2011
- March 2011
- February 2011
- January 2011
- December 2010
- November 2010
- October 2010
- September 2010
- August 2010
- July 2010
- June 2010
- May 2010
- April 2010
- March 2010
- February 2010
- January 2010
- December 2009
- November 2009
- October 2009
- September 2009
- August 2009
- July 2009
- June 2009
- May 2009
- April 2009
- March 2009
- February 2009
- January 2009
- December 2008
- November 2008
- October 2008
- September 2008
- August 2008
- July 2008
- June 2008
- May 2008
- April 2008
- March 2008
- February 2008
- January 2008
- December 2007
- November 2007
- October 2007
- September 2007
- August 2007
- July 2007
- June 2007
- May 2007
- April 2007
- March 2007
- February 2007
- January 2007
- December 2006
- November 2006
- October 2006
- September 2006
- August 2006
- Older Archives
Resources & Links
- The Letters Prize
- Pre-2007 Victor Niederhoffer Posts
- Vic’s NYC Junto
- Reading List
- Programming in 60 Seconds
- The Objectivist Center
- Foundation for Economic Education
- Tigerchess
- Dick Sears' G.T. Index
- Pre-2007 Daily Speculations
- Laurel & Vics' Worldly Investor Articles