Conversation

random thought... unlike politics/culture topics, high-tech industries are really hard to understand from the outside in any way other than financial, because you can't even see the 90% of the iceberg within which crucial details are buried, even if you're smart enough to learn
5
78
from the outside, you're limited to: benchmark info, product releases, financial performance... this is NOT enough to form even the beginnings of a mental model of how the industry actually works, it's a "financial experience" ... FX, like UX, with a metaphoric overlay
1
26
it doesn't matter how smart you are, you won't even be aware of the existence of half the moving parts... if you dig very hard, you can increase your situation awareness from say 25% to 30% relative to insiders, but that's about it
Replying to
This is probably a good thing if all you care about is financial performance. You can tune out all the details that matter for understanding the thing as opposed to tracking its success/failure potential. But you won't understand it. The "green lumber" problem.
3
13
The main cost is time. If you understand a high-tech sector directly through access to insider knowledge, you'll be about 6-18 months ahead of the market. They'll catch up to significant developments only when it shows up in financial heat signatures.
1
19
I've been on the inside/outside of both several high-tech industries and political/cultural things. In the latter, though there is an insider/outsider distinction (emic/etic) it is largely inconsequential. Kinda like theological diffs.
2
7
I think this is why I have limited interest in pure analyst-mode sectoral intelligence. If people are not willing to dive in at least a little into the "green lumber" aspects and pierce the FX veil, I'm kinda not interested unless I own the stock or something.
1
11
I like veil-piercing analysis where somebody with insider knowledge goes beyond quarterly performance and stuff and digs into industry history, guesses at significance of public info, is able to pull out key details from behind the veil, etc.
2
15
Normally, this only happens if there is a big disaster. Even as an aerospace engineer, I'd never heard of Boeing's MCAS system and stuff till the crashes. I suspect very few chemical engineers thought about methyl isocyanate until Bhopal. Industrial disasters pierce the veil
2
18
This is not quite as bad as the Gell-Mann amnesia effect in general public reporting, but in the same family. The FX (financial-experience) of an industry sector is NOT the same as the EX (engineering-experience) of it.
1
12
When I read about sausage-making details in non-high-tech fields (like say the machinations required to pass a bill in Congress), I get a sense of a similar gap, but much narrower. You can pierce the veil much more easily from the outside if you're willing to grind.
1
14
Partly because all of politics and culture rest on a single "engineering" knowledge base: psychology/sociology. If you know how "people" work, you can pierce the vein in any purely political/social/cultural boundary separating insiders/outsiders
2
12
But with high-tech (I specify high-tech because low-tech doesn't have this problem), psychology/sociology of orgs/movements will only get you to like 20% understanding of what's going on and why.
1
13
The other 80% is just weird shit you'd simply not even know you didn't know from the outside, even if you have a degree in the field and grok basic textbook concepts and ideas
2
15
It really doesn't matter if you understand psychology etc deeply... you may need to know this One Weird Fact to make sense of something important happening. It's kinda depressing just how many such facts there are in the hidden part of all the icebergs around us
1
14
There is a fundamental asymmetry here between the high-tech and humanistic parts of social reality that we've been in denial about for over a century with lots of bad consequences... we like to think all parts of the human world are equally "deep" epistemically, they're not
2
21
It arises from a well-intentioned desire to not create/enable/legitimate deep power asymmetries, and to pretend that all humans doing all sorts of things are the same. They may be equally deserving of rights etc. but this fiction is costly.
2
11
It's easy and tempting to let this observation degenerate into "two cultures" derp or angry lashing out at "tech supremacism" etc. But it's important to acknowledge 90% hidden "specialist realities"... it's like the epistemic dark matter of civilization
2
18
"Green lumber" is a term of art in the lumber trade for young wood. Taleb cites it (approvingly iirc) in an example of a trader who successfully traded it on commodity markets without any idea what it was, and assuming it was literally green colored.
Quote Tweet
Replying to @vgr
Green lumber?
1
15