Friday, November 30, 2012

The Zurich Axioms

This may have more applicability now than ever, worth a read

Major Axiom 5 :- On Patterns - The Emperor Axiom

Chaos is not dangerous until it begins to look orderly.
Do not look for order where order does not exist. Do not overlook the large role chance takes in any speculation. Study information in whatever speculative medium to improve chances and take your best shot. Stay light on your feet ready to jump this way or that. You are dealing with chaos, as long as you are alert to that fact you can keep yourself from getting hurt.

Internal Monolog goes:

“OK. I’ve done my homework as well as I know how. I think this bet can pay off for me. But since I cannot see or control all the random events that will affect what happens to my money. I know the chance of me being wrong is large. Therefore I will stay light on my feet, ready to jump this way or that when whatever is going to happen happens."
Minor Axiom V

Beware the historians trap.

The Historian’s trap is a particular kind of orderly illusion. It is based on the age-old but entirely unwarranted belief that history repeats itself. People who hold this belief - which is to say perhaps ninety-nine out of every hundred people on earth - believe as a corollary proposition that the orderly repetition of history allows for accurate forecasting in certain situations.... Don’t fall into this trap. It is true that history repeats itself sometimes, but most often it doesn’t, and in any case it never does so in a reliable enough way that you can prudently bet money on it.
Minor Axiom Vl

Beware the Chartist’s illusion.
Minor Axiom Vll
Beware the correlation and causality delusions.
Minor Axiom Vlll

Beware the Gambler’s Fallacy. ( This is my lucky day.)

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Insightful and Useful Comment!