--- Log opened Fri Jul 28 00:00:12 2023
02:32 < hprmbridge> Eli> Interesting, but seems like capitalism would still be better. If you look at who funded theranos, for example, you can see that it wasn’t the A team funding them. Investing is hard. The good investors tend to be pretty savvy. Occasionally you have something like wework, which doesn’t make any sense at all, but usually a fool and his money are soon parted
02:37 < fenn> implicit in the whole prediction market craze is the idea that some people are just much better at predicting the future or sorting through BS, and therefore we should take more seriously people with better performance on those markets, when they talk about things that aren't quickly verifiable. but do they actually make predictions that are important or actionable?
02:38 < fenn> it's sort like nobelitis
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05:38 < hprmbridge> alonzoc> Issue is the market can remain irrational longer than you can remain solvent. Sometimes everyone knows specific market is in a bubble but there's little people can do about it, side-effect of irrational flocking behaviour.
05:38 < hprmbridge> alonzoc>
05:38 < hprmbridge> alonzoc> Now there is a chance that irrational bubbles encode the pop-time almost implicitly in their price dynamics or atleast a distribution over pop times. Sadly the market is kinda still efficient (in that you can't exploit it) even given bubbles
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05:46 < fenn> "everyone knows"
05:46 < fenn> this is like "nobody drives in new york city, due to the traffic"
05:47 < hprmbridge> Eli> thats for the unwashed masses. There are elites who seem to be nothing but profitable, consistently. There are a few funds run by super smart dudes that win more than the market
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05:50 < hprmbridge> alonzoc> Oh yeah, the market in practice is exploitable. But the funds making bank these days are exploiting subtle statistical irregularities.
05:50 < hprmbridge> alonzoc> Big hedge funds that make directional plays based on research aren't dead but they don't win *all the time* see the whole Herbalife short for example.
05:50 < hprmbridge> alonzoc>
05:50 < hprmbridge> alonzoc> But yeah if you're sophisticated you can exploit bubbles for profit but it involves a lot of maths and know how, and there's not enough capital in such strategies to prevent bubbles from forming at all
05:51 < hprmbridge> alonzoc> (actually it might be impossible for rational traders to prevent the formation of bubbles in general, as they can form even under efficiency assumptions)
05:58 < hprmbridge> kanzure> why use a market for predictions? why not just make predictions and publish them somewhere?
06:02 < fenn> because they want to give more weight to the predictions of people who have predicted better in the past
06:02 < fenn> or to people who not only have good reason to believe they have low uncertainty, but are willing to send a costly signal that they have good reason
06:02 < hprmbridge> alonzoc> Well in the ideal case the prediction market solves multiple issues such as incentives (you can earn money so experts are incentivised to give their knowledge and weighting (bigger bets carry more weight).
06:02 < hprmbridge> alonzoc> You also get a flow of external money from people who want insurance which makes the market net positive for predictors at the cost of damping price discovery.
06:02 < hprmbridge> alonzoc>
06:02 < hprmbridge> alonzoc> In principle if sufficient people are rational aggregating their personal data, the limit behaviour of the whole market system is a well calibrated predictor
06:04 < hprmbridge> alonzoc> There's actually a kinda funny idea called futarchy based on prediction markets (which interestingly shows the folly of separating beliefs and values to cleanly)
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08:35 < muurkha> kanzure: if you just make predictions and publish them somewhere, predictors have an incentive to predict things that will influence people to do things that are in their interest, without regard to whether the predictions are true
08:35 < muurkha> so for example people who are invested in coal mines have an incentive to predict that global warming will not happen
08:37 < muurkha> (in addition to the factors alonzoc and fenn mentioned, such as experts having an incentive to participate at all, weighting toward people who have predicted better in the past, weighting toward people with lower uncertainty, and hedging against harms)
08:41 < docl> yeah the idea isn't just experts buying smarter (although that's part of it), but everyone avoiding adding noise as best they can because it's in their interests to bet to the best of their knowledge. I think you can still get tulip bubbles (bets towards what you believe everyone else is going to bet even though you think it's silly because you plan to sell first and leave them holding the bag) in 
08:41 < docl> small markets though
08:41 < nsh> the corollary of people putting their money where their mouth is
08:42 < nsh> is that people will put their mouth where their money is
08:42 < docl> pretty much
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08:44 < docl> but if you can catch a bubble on a testable prediction you can just bid against the people you detect putting their mouth where their money is
08:46 < docl> and people can be more judicious about trying to pump their side if they know it's likely to be detected and bet against.
08:47 < hprmbridge> alonzoc> Also simple prediction markets are less prone to bubble issues than a equity market or something with unbounded time. Prediction markets will close at some T where the price will either be 0 or 1 so you can always wait until the end of the market, so you just need to remain solvent for a bounded time if you're right
09:26 < muurkha> Eli: the elites who are nothing but profitable consistently are market makers.  they tie up capital in inventory and use it to provide liquidity, in much the same way that your supermarket ties up capital in its inventory of Cheerios and uses it to provide liquidity for your on-demand Cheerios purchase, or a pawn shop ties up capital in their inventory of gold watches and AR-15s, thus providing 
09:26 < muurkha> liquidity until your next paycheck as well as on-demand gold-watch purchases
09:29 < hprmbridge> alonzoc> well yes and no, it is true a lot of the bias is towards sell-side market participants who provide liquidity or connectivity etc, but there are also groups that blur the line like renaissance technologies
09:30 < hprmbridge> alonzoc> their trading stratergy unfolds on the order of minuites and seconds instead of micro to nano which is necessary for successful market making operations on modern exchanges
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10:21 < docl> oh, that manifold market went down to 16%. guess I was wrong to buy yes at 20%, what will I do without my play money
10:29 < hprmbridge> nmz787> docl if only 2D works for the LK99, then maybe manufacturers can find a way to roll it up like a capacitor or battery
10:30 < hprmbridge> alonzoc> Issue is just stacking surfaces doesn't always work. See magnetic saturation
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10:43 < docl> hmm. I have an application in mind where magnetic saturation isn't an issue (I think): very large coils, like 1km wide. the field could hold a lot of energy while being so spread out that it doesn't saturate the RTSC
10:44 < hprmbridge> alonzoc> I guess, large storage coils are gonna be neat if it pans out
10:48 < docl> another complementary thing you can maybe do is balloon type structures coated in the film that reject the surrounding magnetic field, so heavier than air is possible. with a ground coil I'm thinking you can do a few orders of magnitude greater local density than earth's natural field density.
10:58 < docl> or magnetically supported towers
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16:50 < hprmbridge> Eli> Renaissance was exactly the company I was thinking of
16:52 < hprmbridge> Eli> Are you a quant @alonzoc ?
16:53 < hprmbridge> alonzoc> Nope, just had an interest in finance and did trading for a while. Had plans to start a fund and might still, a friend of mine actually did start a prop fund
18:07 < hprmbridge> Eli> so here is an interesting thought experiment that I'm not sure if any economist know the answer to. Let's imagine a world of perfect information. Every individual knows the NPV of every action they will make and the NPV of every action that every other actor will make for the rest of eternity. Every individual can see that eating that donut will take 9 minutes off their life. Every individual can
18:07 < hprmbridge> Eli> see that going to that party instead of working will cost them $1000 in NPV. It's like they have a heads up display that gives them perfect information. Now, what will be the outcome of this world?
18:07 < hprmbridge> Eli>
18:07 < hprmbridge> Eli> Will it be utopia? As there will be no malinvestment? Will it be inequality? As market makers can bully the market by having enough money and energy to invest in everything that is high ROI? Would charitable organizations still exist? As charity might be considered temporal malinvestment? Would politics be relevent? As every human can see what the end result of every political decision will be.
18:22 < muurkha> market makers aren't sell-side or buy-side; they are necessarily both
18:22 < muurkha> but sure, there is a whole range of strategies
18:24 < muurkha> (as you know)
18:27 < hprmbridge> alonzoc> When I said sell-side I wasn't referring to long or short but the way in which a participant interacts with the market. For a highly decentralised market where everyone has DMA like crypto it basically breaks down to if you are using limit orders or market orders mostly. For "real" financial markets the distinction is more entrenched. With brokers and dealers along with banks all being sell side
18:27 < hprmbridge> alonzoc> in that they provide liquidity and basic market functioning
18:29 < hprmbridge> alonzoc> https://www.investopedia.com/terms/s/sellside.asp this is the context I was using it in
18:32 < muurkha> thank you for explaining!
18:33 < muurkha> my mistake
18:34 < hprmbridge> alonzoc> Nah, it's an ambiguous and misleading term
18:34 < hprmbridge> alonzoc> But yeah back to the original discussion sell-side is where the people have the infinite money glitches
18:35 < hprmbridge> alonzoc> Buy-side is chumps, hedge funds, and pensions
18:36 < muurkha> heh
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22:36 < fenn> for weak saturation field superconductors like (possibly) graphite/graphene, i was thinking power lines simply be highly parallelized, thin, and spread out as a widely spaced bundle of wires instead of a single large wire.
22:38 < fenn> they're only constrained at the pylons, otherwise they follow the same catenary curve due to being in the same gravity field. as long as all wires are running the same current they should follow the same curve, right? or do they repel each other and bulge outward like a balloon?
22:43 < fenn> uh, so apparently wires are attracted if current is going in the same direction, and repelled if opposite. so you'd need some sort of checkerboard grid of alternating current direction, otherwise the wires will pull together and the magnetic field strength will increase past the quench limit
22:45 < fenn> bother. if the wires get perturbed, they can jump over the repulsive field and get stuck together
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--- Log closed Sat Jul 29 00:00:13 2023