this is a kind of inequality. when ppl have access to different growth rates, the gap becomes bigger and bigger over time.pic.twitter.com/xIQyNt9BSy
Show this thread
-
inequality is an intrinsic aspect of systems that compound. "fair" systems tend to be fair by eliminating the compounding and thus killing the system. (or being ridiculously uncompetitive to external systems that DO compound)
Show this thread
real "inequality" is access to different rates of growth. e.g. the rich getting access to lower fee funds and better financial products can have access to 15% growth vs 10% respect for time-advantage allows discernment of actual inequality.
-
-
in a K shaped recovery this is even worse. instead of getting a worse deal of 10% you get 0% or even NEGATIVE compounding as you take on debt to survive.
Show this thread -
this is when high volatility but low expected return plays start to become rational.https://twitter.com/a_yawning_cat/status/1363742123443380225?s=20 …
Show this thread -
"respect for elders" is a heuristic that respects the time advantage. the old master isn't challenged because anything that DOES "win" is considered a high volatility "hack" that kills the long term compounding.https://twitter.com/a_yawning_cat/status/1366533837010821120 …
Show this thread -
the thing is systems don't compound forever. they eventually die. the old master IS eventually senile and self-contradictory and probably wrong about many things. especially with regards to new possibility in the world.
Show this thread -
however, aside from lottery-ticket low-expected-return hacks there are also hacks that work by reducing the time horizon. e.g. something that returns 50% year over year for 5 years but then -10% for 99 years.
Show this thread -
these strategies are useful for mimetic envious hoomans who don't maintain friendships or relationships for time horizons longer than 5 years. as long as you are the sexy sexy winner alpha amongst w/e group of friends you're in at the time. who cares.https://twitter.com/a_yawning_cat/status/1362677135291207680 …
Show this thread -
financial products is a good example here because everything is so measurable but these effects apply to almost anything. (natural growth IS exponential growth and is well... natural....)
Show this thread -
something fun to think about is what kind of high-volatility low-expected-return strategies exist in domains like: personal growth, knowledge systems, networking, relationships, etc....
Show this thread -
these strategies aren't necessarily bad btw. if they are exactly like lotteries with a clearly calculated expected return then they are. many can have unknown unknowns that are infinitely positive.
Show this thread -
it's just difficult to tell....it's up to "God"https://www.thoughtco.com/chinese-proverbs-sai-weng-lost-his-horse-2278437 …
Show this thread
End of conversation
New conversation -
Loading seems to be taking a while.
Twitter may be over capacity or experiencing a momentary hiccup. Try again or visit Twitter Status for more information.