The problem is not doing transparent high quality analysis… it’s getting that analysis believed and acted upon. And this becomes much harder when there are people with a vested interest in seeing that analysis not acted upon. As the Upton Sinclair quote says, “It is difficult to get a man to understand something when his salary depends upon his not understanding it.”
One idea is to build a track record the way most hedge funds build a track record, right? Trade assets, record your annual return, and whatnot. You could even run a regular old hedge fund and make a bunch of money. Then when you started getting some credibility, give away your insights for free.
(Personally, I’m not convinced that you’d do more good by giving your insights away for free than you would do by keeping your insights secret and donating the money you made to effective charities, but I’ll listen to anyone who wants to persuade me.)
By the way, if people on LW want to start a hedge fund, I’m interested. I’m not a mathematician, but people seem to think I’m pretty solid at programming.
True, but you don’t always need everyone. How many “greater fools” do you actually need to have an asset price bubble?
Subissue 1: You can find lots of financial analyses around, some available for free, some not. Why should this one be given any more weight than others, when you can find someone else with good credentials saying the exact opposite? And accurately assessing the quality of an analysis is almost as hard as doing the analysis yourself; it’s very easy to be fooled by bullshit. Subissue 2: When you have the appearance of equal and opposite experts, many people are going to end up believing what they want to believe, and acting accordingly.
The people in a position of influence in the housing market were primarily the homebuyers. Needless to say, they didn’t want to believe that the value of their biggest asset was about to go up in smoke.
The problem is not doing transparent high quality analysis… it’s getting that analysis believed and acted upon. And this becomes much harder when there are people with a vested interest in seeing that analysis not acted upon. As the Upton Sinclair quote says, “It is difficult to get a man to understand something when his salary depends upon his not understanding it.”
One idea is to build a track record the way most hedge funds build a track record, right? Trade assets, record your annual return, and whatnot. You could even run a regular old hedge fund and make a bunch of money. Then when you started getting some credibility, give away your insights for free.
(Personally, I’m not convinced that you’d do more good by giving your insights away for free than you would do by keeping your insights secret and donating the money you made to effective charities, but I’ll listen to anyone who wants to persuade me.)
By the way, if people on LW want to start a hedge fund, I’m interested. I’m not a mathematician, but people seem to think I’m pretty solid at programming.
Can you flesh out your thoughts here? Surely not everyone in a position of influence has a vested interest in seeing the analysis not acted on.
True, but you don’t always need everyone. How many “greater fools” do you actually need to have an asset price bubble?
Subissue 1: You can find lots of financial analyses around, some available for free, some not. Why should this one be given any more weight than others, when you can find someone else with good credentials saying the exact opposite? And accurately assessing the quality of an analysis is almost as hard as doing the analysis yourself; it’s very easy to be fooled by bullshit.
Subissue 2: When you have the appearance of equal and opposite experts, many people are going to end up believing what they want to believe, and acting accordingly.
The people in a position of influence in the housing market were primarily the homebuyers. Needless to say, they didn’t want to believe that the value of their biggest asset was about to go up in smoke.