DMac87

Yeah, this whole "a responsible asset manager has to use MPT" is completely not true. A responsible asset manager has to consider risk and return, of course, but how they measure and evaluate risk and return is an art as much as a science. MPT-driven portfolios have been shown to underperform more naive formulations, mainly due to model risk and mis-estimation of parameters.

MathNews, UW Math department's student weekly newsletter, had/has a section 'profQuotes' - just about the only part worth reading.. samples from this week:

"Tragically, we will need to prove both cases. Fortunately, I can do one in class and assign the other for homework."

"I’m sure you’re familiar with the proof technique I’ll use here... [writes 'Exercise' on the board]”

The Harry Connick Jr clip was the first thing that came to mind when I saw this thread - love it!

Not reprogramming during any game, but during the match (between games). You can argue about how much influence this has, in my mind though he was beaten by highly similar variants of a computer program (not quite a fixed concept, but not adjusted too much during the match).

It is fascinating to compare & contrast chess, Go, and backgammon, and how quite different approaches are needed to program in each. For chess, 'pure calculation' is most effective, while the author suggests MC is good for Go & others. In backgammon, TD-gammon used a rather naive neural net approach and trained itself, optimizing its own play over time! It is also interesting how computers' success in these areas feeds back into how humans play the game (at least in backgammon and chess opening strategy).

I disagree - Madoff was extremely secretive about his "strategy" (because there was none) and financial statements. He wouldn't meet with individual investors. So the transparency & access that I recommend simply weren't there with him.

(Not original poster, but some suggestions) :

- Use a local credit union as opposed to big national bank. Yes, there may be minor inconveniences in service, but in this day of online banking, they should be minimal.

- Invest with a financial advisor you know and trust, who will pick up the phone when you call and explain things to any level of detail you desire (or who will bring in experts to do so if you won't). Barring that, invest in index funds for broad asset class exposure with low fees.

- Don't believe / vote in / listen to anyone (economist, politician or otherwise) who touts "free markets" without further explanation of how that market's regulators & insiders will work.

Taking a step back, doesn't it seem strange that there aren't more concrete answers to these questions - the debate devolves pretty quickly into anecdotes / commentators' perspectives, as opposed to hard data. Sample sizes should be big enough to at least answer the economic questions (the experience of those four years is of course subjective)!

Basic statistics: just because the average in the top decile is 74, that doesn't mean everyone in the top decile drinks 74. The top 5%/1%/0.1% who drink way more than 74/week (15/day? 20/day?) can counter-balance the 5-8/day crowd.

To give another example: the average top decile Facebook employee has a net worth over $33 Million. That seems high, but that's because that net worth is highly skewed - in fact, I assumed only Mark Zuckerberg's wealth was distributed equally among FB's ~10k employees, and that everyone else has $0. The figure $33 Million is meaningless.

My guess is that PayPal et al don't particularly care - the onus is on the bitcoin user (i.e. the consumer) to calculate capital gains, report to the IRS etc. Those consumers probably don't care - they'll wait to see how/if the IRS actually has a willingness/ability to enforce their own guidelines...

Ditto for academic finance - so many sketchy results get advertised, and billions if not trillions of dollars get invested based on false or uncertain hypotheses... Sometimes I feel that 90% of my job is to be skeptical of all results, and convince managers not to do anything stupid - a sort of "first, do no harm" philosophy.

I don't understand - "More broadly, the government’s entire approach to technology was top-down and inflexible", so the solution is to hire more people at the top (White House)? It seems to me that "government IT" is such a vast concept, ranging from the physical computers at each DMV to healthcare.gov, to Medicare billing systems (not to mention the NSA)... Wouldn't it make more sense for individual agencies to re-jigger their IT policies, rather than some broad and vague White House initiative?