1 00:00:00,000 --> 00:00:17,040 Hi everyone, and welcome back to For the Curious and Confused, a podcast for people who want 2 00:00:17,040 --> 00:00:20,560 to understand different perspectives of the world through the people who inhabit it. 3 00:00:20,560 --> 00:00:25,920 I'm your host Don McTaggart, and today's guest is Noah Healy, a professional algorithm 4 00:00:25,920 --> 00:00:28,800 developer and self-proclaimed recreational mathematician. 5 00:00:28,800 --> 00:00:33,680 Noah's interests focus on unpacking what game theory and information theory can teach us 6 00:00:33,680 --> 00:00:38,480 about financial systems and what outcomes result when these theoretical frameworks overlap 7 00:00:38,480 --> 00:00:40,280 with the legal system. 8 00:00:40,280 --> 00:00:44,640 He has pioneered a patent-pending system aimed at addressing limitations in traditional 9 00:00:44,640 --> 00:00:48,280 commodity markets and increasing widespread economic potential. 10 00:00:48,280 --> 00:00:52,560 These are topics I don't have much background in, so I'm excited to fill in some gaps of 11 00:00:52,560 --> 00:00:55,000 my personal knowledge during this conversation. 12 00:00:55,000 --> 00:00:58,440 So Noah, thank you for sharing your time and being here today. 13 00:00:58,440 --> 00:01:00,720 Well, thanks for having me here, Don. 14 00:01:00,720 --> 00:01:02,400 Sounds like it's going to be a lot of fun. 15 00:01:02,400 --> 00:01:03,800 I'm excited, yeah. 16 00:01:03,800 --> 00:01:08,120 So starting off, first, could you give us kind of a zoomed out short story of who Noah 17 00:01:08,120 --> 00:01:10,600 Healy is and what motivates him? 18 00:01:10,600 --> 00:01:14,960 Well, born and raised in Charlottesville, Virginia, as I mentioned in the pre-call, that's where 19 00:01:14,960 --> 00:01:17,480 I am right now. 20 00:01:17,480 --> 00:01:22,920 I was basically always the kid in the class that was the best at the math, and I rode 21 00:01:22,920 --> 00:01:24,880 that through school. 22 00:01:24,880 --> 00:01:32,200 Got out of college after getting a bachelor's degree, and then I got a one-year fellowship 23 00:01:32,200 --> 00:01:37,440 to take some graduate classes in a department that was shutting down. 24 00:01:37,440 --> 00:01:40,460 And then I got a job at a dot com. 25 00:01:40,460 --> 00:01:47,320 It was 2000, and that job was, you know, jobs were easy to get back in the day. 26 00:01:47,320 --> 00:01:52,720 And of course, then I got laid off after a year because jobs were also easy to lose because 27 00:01:52,720 --> 00:01:54,720 companies were going bankrupt. 28 00:01:54,720 --> 00:02:00,560 The next job lasted about a year, the job after that, you know, a little bit longer. 29 00:02:00,560 --> 00:02:06,200 Then I got another job which lasted quite a bit longer, about six, seven years, six 30 00:02:06,200 --> 00:02:09,000 and a half-ish. 31 00:02:09,000 --> 00:02:16,920 And at that job, they just had this policy that they had no career opportunities. 32 00:02:16,920 --> 00:02:19,400 You couldn't advance. 33 00:02:19,400 --> 00:02:23,840 And so I finished doing the job for which I was hired. 34 00:02:23,840 --> 00:02:28,080 I completely automated one of their core systems for them. 35 00:02:28,080 --> 00:02:43,440 And so I quit and decided to lean into my long-term interest in research on computational mathematics, 36 00:02:43,440 --> 00:02:51,200 which I had sort of started during my first tenure at my first job just in this sort of 37 00:02:51,200 --> 00:02:58,960 desire to actually have some kind of idea what I was doing. 38 00:02:58,960 --> 00:03:06,480 And working in that, this wholly new idea fell out in my lap. 39 00:03:06,480 --> 00:03:18,160 And I've had a day job on and off since then, but for most of the last decade-ish, this 40 00:03:18,160 --> 00:03:28,240 is what I've been working on, is promulgating a new way to operate a financial marketplace. 41 00:03:28,240 --> 00:03:29,600 Very exciting. 42 00:03:29,600 --> 00:03:32,280 Yeah, I'm excited to unpack some of those. 43 00:03:32,280 --> 00:03:34,000 You mentioned tenure. 44 00:03:34,000 --> 00:03:38,720 So I guess we'll get to that about where you've been through there. 45 00:03:38,720 --> 00:03:42,200 But you mentioned at the very beginning about being the kid who's good at math. 46 00:03:42,200 --> 00:03:45,520 So you identify as a recreational mathematician. 47 00:03:45,520 --> 00:03:50,200 So can you talk a little about how you actually experience math as a person? 48 00:03:50,200 --> 00:03:56,560 Is it like colors or textures, floating equations, sense of interlocking systems or something 49 00:03:56,560 --> 00:03:57,560 else? 50 00:03:57,560 --> 00:03:58,560 What does math feel like? 51 00:03:58,560 --> 00:04:01,920 So yeah, I don't have synesthesia. 52 00:04:01,920 --> 00:04:06,200 So the numbers is colors and that kind of stuff. 53 00:04:06,200 --> 00:04:07,360 That does not happen for me. 54 00:04:07,360 --> 00:04:13,080 I know that it does for some, but that's not how it works for me. 55 00:04:13,080 --> 00:04:18,840 For me, it's very different across different forms of mathematics. 56 00:04:18,840 --> 00:04:30,400 But the sort of my math superpower, I think, is that my brain just can't latch on to nonsense. 57 00:04:30,400 --> 00:04:36,800 So for example, it's very handy for me that your name is in the corner there because names 58 00:04:36,800 --> 00:04:40,200 drip through my brain like water through a sieve. 59 00:04:40,200 --> 00:04:46,600 I'm not happy about that, but it's just something I've been learning to live with for decades. 60 00:04:46,600 --> 00:04:53,120 And mathematics, because it in fact all hangs together and all makes sense, sticks. 61 00:04:53,120 --> 00:04:59,040 And so it's the subject I can actually think about and remember and comprehend. 62 00:04:59,040 --> 00:05:05,360 And I don't get distracted as I see many other people do because I just I can't remember 63 00:05:05,360 --> 00:05:07,920 any of that stuff. 64 00:05:07,920 --> 00:05:15,400 Does that relate somehow to the fact that it's all kind of rule based or like the logic 65 00:05:15,400 --> 00:05:17,080 follows from one step to another? 66 00:05:17,080 --> 00:05:20,400 Because like my name is kind of a very arbitrary piece of information. 67 00:05:20,400 --> 00:05:22,520 There's no blocking information to it. 68 00:05:22,520 --> 00:05:24,640 Yeah, exactly. 69 00:05:24,640 --> 00:05:27,240 Arbitrary information does not stick well for me. 70 00:05:27,240 --> 00:05:32,680 Of course, there's not as much arbitrary information as generally supposed. 71 00:05:32,680 --> 00:05:40,720 So I was absolutely atrocious speller as coming up through school. 72 00:05:40,720 --> 00:05:47,640 I'm still not a great speller, but I took Latin and that actually forms the basis of 73 00:05:47,640 --> 00:05:53,560 a lot of spelling and even grammar rules. 74 00:05:53,560 --> 00:06:01,320 One of the decisions of when English grammar was formalized sort of, you know, a couple 75 00:06:01,320 --> 00:06:11,240 of hundred years ago in its modern form was to try to make it act more like Latin grammar. 76 00:06:11,240 --> 00:06:18,080 In Latin grammar, things like dangling participles are impossible because they're part of the 77 00:06:18,080 --> 00:06:21,240 word. 78 00:06:21,240 --> 00:06:31,240 And so whereas we might find it somewhat unnatural or somewhat natural to just be able to say 79 00:06:31,240 --> 00:06:37,760 any English word we'd like to next in any given sentence in Latin, some of those would 80 00:06:37,760 --> 00:06:39,040 be impossible. 81 00:06:39,040 --> 00:06:45,640 And you know, looking at modern natural language processing, we now understand that the amount 82 00:06:45,640 --> 00:06:55,760 of entropy in words and sentences is significantly smaller than like, you know, the log two size 83 00:06:55,760 --> 00:06:58,200 of the dictionary of English language and so on. 84 00:06:58,200 --> 00:07:05,640 So once you start apprehending these larger understandings, you can start making sense 85 00:07:05,640 --> 00:07:11,280 out of information that's a little more on the arbitrary side. 86 00:07:11,280 --> 00:07:19,320 But yeah, mostly for me, math is a distraction free environment. 87 00:07:19,320 --> 00:07:30,760 And the some things, you know, graph structure or high complex, the grammar parsing problems 88 00:07:30,760 --> 00:07:37,400 do sort of fit together when you get them right and not otherwise. 89 00:07:37,400 --> 00:07:39,600 But computation doesn't work like that. 90 00:07:39,600 --> 00:07:48,200 For me, it is I can juggle the values in my head and sort of keep them, keep them stacked 91 00:07:48,200 --> 00:07:55,600 in ways that's useful by paying attention to relationships that exist and using the 92 00:07:55,600 --> 00:08:02,080 computation that's most convenient in a given portion. 93 00:08:02,080 --> 00:08:04,840 Whereas geometry problems, that's a visualization. 94 00:08:04,840 --> 00:08:12,520 And so when I'm working on geometry problems, then I'm working with my visual sort of manifestation. 95 00:08:12,520 --> 00:08:22,320 So it's it's I'm a little odd that I'm I have a broader interest in mathematics than 96 00:08:22,320 --> 00:08:27,000 most of the other mathematically interested people that I encounter. 97 00:08:27,000 --> 00:08:32,920 But again, to me, it's it's more of math is the thing that I can actually pay attention 98 00:08:32,920 --> 00:08:36,320 to because I can remember it. 99 00:08:36,320 --> 00:08:41,400 That's also even within math, there are silos, I guess, when you get deep enough in any topic, 100 00:08:41,400 --> 00:08:43,920 there are silos within the silo. 101 00:08:43,920 --> 00:08:49,320 One quick follow up question from that you mentioned computation and then also geometry. 102 00:08:49,320 --> 00:08:56,120 I think of maybe a combination of those two is like high dimensional space, like I guess 103 00:08:56,120 --> 00:08:58,080 left for large language models. 104 00:08:58,080 --> 00:09:04,480 If you're trying to accurately map out all the relationships between words, you may not 105 00:09:04,480 --> 00:09:07,560 have much experience in this, but I was curious. 106 00:09:07,560 --> 00:09:10,760 And if you have any thoughts on that or how you perceive those. 107 00:09:10,760 --> 00:09:12,760 That is one possibility. 108 00:09:12,760 --> 00:09:18,520 But well, for example, for me, and I will get to my thoughts on large language models. 109 00:09:18,520 --> 00:09:26,360 But one of the things that I find interesting is that as best I personally can tell, the 110 00:09:26,360 --> 00:09:36,720 Euclidean algorithm for multiplying lengths or extents might be, I think, the exact best 111 00:09:36,720 --> 00:09:38,600 English translation of Greek. 112 00:09:38,600 --> 00:09:42,960 I'm not an expert on ancient Greek by any means. 113 00:09:42,960 --> 00:09:47,680 Looks to me to be log time. 114 00:09:47,680 --> 00:09:57,720 And the proved to be fastest possible symbolic algorithm is log log log time. 115 00:09:57,720 --> 00:09:59,640 So log n times log log n. 116 00:09:59,640 --> 00:10:03,760 Did you unpack those a little bit for a general audience potentially? 117 00:10:03,760 --> 00:10:04,760 Yeah, yeah, sure. 118 00:10:04,760 --> 00:10:14,320 So in computation, there's getting the right answer, but there's also how much work you 119 00:10:14,320 --> 00:10:16,720 do to get the right answer. 120 00:10:16,720 --> 00:10:25,000 So you can add numbers by counting on your fingers, or you can learn the symbolic relationships 121 00:10:25,000 --> 00:10:33,080 that they teach everybody in grade school and do it with a lot less work. 122 00:10:33,080 --> 00:10:38,440 And if you're adding very, very large numbers, like if you're adding a couple of million 123 00:10:38,440 --> 00:10:46,040 digit numbers, which is something that a computer will do in a handful of clock cycles, if you 124 00:10:46,040 --> 00:10:52,360 were doing it by counting, you would not be able to do it within the confines of our understanding 125 00:10:52,360 --> 00:10:56,260 of our universe and neither with the computer. 126 00:10:56,260 --> 00:11:05,080 And if you do it by the symbol manipulation, a classroom full of third graders could do 127 00:11:05,080 --> 00:11:06,080 it. 128 00:11:06,080 --> 00:11:09,920 It would take them a few weeks, but they could do it. 129 00:11:09,920 --> 00:11:15,440 And the computer again can do it in tiny, tiny fractions of a second. 130 00:11:15,440 --> 00:11:21,560 And so we can characterize how much work it takes to solve problems. 131 00:11:21,560 --> 00:11:27,840 And those characterizations are themselves functions of how large the problems are. 132 00:11:27,840 --> 00:11:34,000 So adding million digit numbers is about a thousand times harder than adding thousand 133 00:11:34,000 --> 00:11:40,600 digit numbers using symbolic manipulation. 134 00:11:40,600 --> 00:11:44,040 The multiplication is worse than that. 135 00:11:44,040 --> 00:11:58,960 So multiplying thousand digit numbers, it would be around 10,000 times harder to multiply 136 00:11:58,960 --> 00:12:02,200 million digit numbers than multiply thousand digit numbers. 137 00:12:02,200 --> 00:12:04,680 Except the scaling laws really start coming in. 138 00:12:04,680 --> 00:12:05,680 Right. 139 00:12:05,680 --> 00:12:11,840 Except according to the Euclidean concept, you should be able to multiply. 140 00:12:11,840 --> 00:12:19,760 Well, in Euclidean space with some caveats I think are solid, you can do it in only a 141 00:12:19,760 --> 00:12:23,160 thousand times as much work. 142 00:12:23,160 --> 00:12:25,240 And that shouldn't be possible. 143 00:12:25,240 --> 00:12:33,920 So a problem that I'm chewing on is why does it like it have I gotten something wrong about 144 00:12:33,920 --> 00:12:37,760 the apparent complexity of Euclidean multiplication? 145 00:12:37,760 --> 00:12:43,540 Is there some different property of the Euclidean plane that's incompatible with our understanding 146 00:12:43,540 --> 00:12:46,360 of symbolic mathematics? 147 00:12:46,360 --> 00:12:54,880 Or is there some foundationally better algorithm that our present understanding of symbolic 148 00:12:54,880 --> 00:13:02,960 manipulation has not made evident to us that we could actually transfer back from Euclidean 149 00:13:02,960 --> 00:13:05,720 spaces and use? 150 00:13:05,720 --> 00:13:09,680 And I think those cover the cases. 151 00:13:09,680 --> 00:13:10,680 And so to me that's- 152 00:13:10,680 --> 00:13:14,000 So if I could try to briefly summarize what you just said just to make sure I'm on the 153 00:13:14,000 --> 00:13:15,240 same track with you. 154 00:13:15,240 --> 00:13:22,960 So this ability to do work in a way that is, well, to use these symbolic relations so that 155 00:13:22,960 --> 00:13:31,320 we don't have to do massive amounts of work, you've discovered some, maybe not discovered 156 00:13:31,320 --> 00:13:39,920 as well, but have pieced together some process where the scaling down of that amount of work 157 00:13:39,920 --> 00:13:44,840 seems to look possible, but it doesn't match with what we've been able to do previously. 158 00:13:44,840 --> 00:13:50,500 And so now you're in the back and forth thing of determining if this is actually correct 159 00:13:50,500 --> 00:13:51,500 or not. 160 00:13:51,500 --> 00:13:52,500 Am I- 161 00:13:52,500 --> 00:13:53,500 Yeah. 162 00:13:53,500 --> 00:13:54,500 Yeah. 163 00:13:54,500 --> 00:13:55,500 That's certainly fair enough. 164 00:13:55,500 --> 00:13:56,500 Okay. 165 00:13:56,500 --> 00:14:02,200 I did, yeah, I would put my contribution much smaller than that. 166 00:14:02,200 --> 00:14:08,560 I have noticed something that looks anomalous to me. 167 00:14:08,560 --> 00:14:16,880 I might've made a mistake, but it looks pretty solid and it's very anomalous. 168 00:14:16,880 --> 00:14:21,480 And so that's something that I play around with. 169 00:14:21,480 --> 00:14:32,160 But yes, you're talking about the fusion of linear algebra techniques with large language 170 00:14:32,160 --> 00:14:38,000 models and how we do computation on neural nets. 171 00:14:38,000 --> 00:14:48,120 And that allows the projection of these enormous dimensional spaces and vectors around different 172 00:14:48,120 --> 00:14:49,840 systems. 173 00:14:49,840 --> 00:14:57,000 My system itself actually isn't so much based on that specific kind of space relationship, 174 00:14:57,000 --> 00:15:03,560 but a generalization of the use of metric spaces. 175 00:15:03,560 --> 00:15:13,160 So I found that by using metric spaces, you can create a computer program that will allow 176 00:15:13,160 --> 00:15:18,920 the driving of a specific strategic situation, which might exist among people, might exist 177 00:15:18,920 --> 00:15:28,680 among machines, might exist among people and machines to become more efficient. 178 00:15:28,680 --> 00:15:39,760 And so spaces are an incredibly useful tool in my opinion, mathematically speaking. 179 00:15:39,760 --> 00:15:44,920 So to bring this back a little bit out of the abstract realm and a little more into 180 00:15:44,920 --> 00:15:50,960 the practical realm, could you please summarize your qualifications to help us understand 181 00:15:50,960 --> 00:15:56,720 why you're a credible source for talking about game theory and information theory and financial 182 00:15:56,720 --> 00:16:01,520 markets for kind of your main area of focus? 183 00:16:01,520 --> 00:16:08,240 Well primarily it's autodidact, but you're looking at about a quarter of a century of 184 00:16:08,240 --> 00:16:15,280 dedicated exploration of the mathematics of information and computation. 185 00:16:15,280 --> 00:16:25,580 Game theory is largely credited to Morgenstern and von Neumann, who von Neumann is also the 186 00:16:25,580 --> 00:16:31,520 guy that actually wrote or built the first sort of functioning computers. 187 00:16:31,520 --> 00:16:37,960 And the modern design of current computers is generally known as von Neumann architecture 188 00:16:37,960 --> 00:16:51,800 because to an arguable extent with the sort of shift towards using these graphics cards, 189 00:16:51,800 --> 00:16:58,200 we're getting slightly away from von Neumann, but primary computer architecture is still 190 00:16:58,200 --> 00:17:03,000 von Neumann architecture at its core. 191 00:17:03,000 --> 00:17:07,320 And he did a lot of contributions to a lot of studies. 192 00:17:07,320 --> 00:17:13,040 And in terms of that, economics essentially is game theory. 193 00:17:13,040 --> 00:17:21,280 It's just that they were crawling up a lesser part of the mountain, I would say. 194 00:17:21,280 --> 00:17:30,040 If you've ever seen or heard of A Beautiful Mind, that was about, and his name is Escaping 195 00:17:30,040 --> 00:17:33,440 Me, Nash. 196 00:17:33,440 --> 00:17:40,080 John Nash and his work got him an econ Nobel. 197 00:17:40,080 --> 00:17:42,760 There's a great story. 198 00:17:42,760 --> 00:17:47,080 Nash was at Princeton, which is where the Institute for Advanced Study, which is what 199 00:17:47,080 --> 00:17:52,600 employed John von Neumann doing all of his crazy stuff. 200 00:17:52,600 --> 00:17:58,920 When Nash had come up with his net, what became his Nash equilibrium ideas, he managed to 201 00:17:58,920 --> 00:18:04,040 schedule some time with the great man to sort of present his ideas. 202 00:18:04,040 --> 00:18:13,080 And when he started explaining the Nash equilibrium, von Neumann reportedly cut him off and said, 203 00:18:13,080 --> 00:18:15,120 that's just a fixed point result. 204 00:18:15,120 --> 00:18:17,600 Do you have anything interesting? 205 00:18:17,600 --> 00:18:20,560 Or words to that effect. 206 00:18:20,560 --> 00:18:29,160 So the unification of game theory with all of economics for which we handed out a Nobel 207 00:18:29,160 --> 00:18:36,360 Prize to a certified genius, he's also a certified lunatic, but a certified genius was so obvious 208 00:18:36,360 --> 00:18:39,720 to John von Neumann, he didn't really feel it was worth mentioning. 209 00:18:39,720 --> 00:18:52,120 So yeah, those are the overlap of having extremely adept mathematical understanding. 210 00:18:52,120 --> 00:18:55,840 And also you mentioned you said that we're lunatic, but also like that general direction, 211 00:18:55,840 --> 00:18:59,920 because that's a great movie, A Beautiful Mind, and his schizophrenia showing up in 212 00:18:59,920 --> 00:19:01,600 that is really cool. 213 00:19:01,600 --> 00:19:06,400 So well, not cool, but thought-provoking, a small tangent, I guess. 214 00:19:06,400 --> 00:19:11,600 Do you have any thoughts on that correlation, or like people who have really strong mathematical 215 00:19:11,600 --> 00:19:19,360 understanding, but also tend to be in the asocial kind of direction, or if that's just 216 00:19:19,360 --> 00:19:20,840 a stereotype of nerds? 217 00:19:20,840 --> 00:19:27,000 Well, I mean, it is a famous stereotype, and I think it's a famous stereotype for reasonable 218 00:19:27,000 --> 00:19:28,000 reasons. 219 00:19:28,000 --> 00:19:34,680 There are some very sad tales that are somewhat overblown. 220 00:19:34,680 --> 00:19:46,680 One famous one is the Infinity Guy, and his name is also escaping me, but I'm sure it 221 00:19:46,680 --> 00:19:50,560 will come back soon. 222 00:19:50,560 --> 00:20:00,400 But he lived to a fairly ripe old age, his wife died, and he had a certain paranoia about 223 00:20:00,400 --> 00:20:08,760 giving food from others, and he starved himself to death in elder care, basically, because 224 00:20:08,760 --> 00:20:14,520 he wouldn't eat food that his wife didn't prepare, and his wife was dead. 225 00:20:14,520 --> 00:20:16,720 There are other cases. 226 00:20:16,720 --> 00:20:26,240 Alan Turing is also becoming much more sort of popularly well-known, was a homosexual, 227 00:20:26,240 --> 00:20:28,920 it was not accepted. 228 00:20:28,920 --> 00:20:35,320 He is officially considered to have committed suicide, although he had family members, his 229 00:20:35,320 --> 00:20:42,600 mother for a long time has fought to have his death classified as accidental, and there's 230 00:20:42,600 --> 00:20:47,080 a reasonably plausible story around that as well. 231 00:20:47,080 --> 00:20:51,680 So I mean, one way or the other, but still kind of sad end. 232 00:20:51,680 --> 00:21:01,360 But Leonard Euler was the court mathematician to Cash from the Great, had by all accounts 233 00:21:01,360 --> 00:21:12,480 a pretty decent marriage and a dozen plus children. 234 00:21:12,480 --> 00:21:19,400 The field certainly does attract its share of oddballs and odd motivations. 235 00:21:19,400 --> 00:21:26,800 Isaac Newton, going back to Euclid again, is reported, we only have a single recorded 236 00:21:26,800 --> 00:21:34,480 instance of him laughing, and supposedly it was in Parliament for a brief time, he was 237 00:21:34,480 --> 00:21:45,120 a member of Parliament, and one of his colleagues asked him what value Euclid's elements had 238 00:21:45,120 --> 00:21:47,800 as a work. 239 00:21:47,800 --> 00:21:58,760 And Newton reportedly laughed at the guy, but he was a lot to take by all accounts. 240 00:21:58,760 --> 00:22:04,560 And as I've just said about myself, I think I can stick to mathematics because I can't 241 00:22:04,560 --> 00:22:10,080 get distracted by things I can't remember. 242 00:22:10,080 --> 00:22:17,800 Those things are the basis of ordinary human social interaction, which I'm not great at, 243 00:22:17,800 --> 00:22:20,280 because I can't remember any of those things. 244 00:22:20,280 --> 00:22:31,000 So I have a manner of speaking and a habitual mode of interaction, which effectively never 245 00:22:31,000 --> 00:22:33,720 uses anybody's name ever. 246 00:22:33,720 --> 00:22:39,080 Cantor, that's the infinity guy who started himself. 247 00:22:39,080 --> 00:22:51,800 But, you know, as any sales class or self-help book on ingratiating yourself will tell you, 248 00:22:51,800 --> 00:22:57,160 names have a lot of power. 249 00:22:57,160 --> 00:22:58,960 My brain doesn't work like that. 250 00:22:58,960 --> 00:22:59,960 Great. 251 00:22:59,960 --> 00:23:02,640 Thank you for indulging me in that tangent. 252 00:23:02,640 --> 00:23:04,200 So back to game theory and information theory. 253 00:23:04,200 --> 00:23:08,560 For those not familiar, you just mentioned that it's similar to economics and almost 254 00:23:08,560 --> 00:23:09,560 could be economics. 255 00:23:09,560 --> 00:23:15,000 Can you describe kind of what game theory and information theory is and how they kind 256 00:23:15,000 --> 00:23:19,200 of present in the world that normal people interact with? 257 00:23:19,200 --> 00:23:20,560 Certainly. 258 00:23:20,560 --> 00:23:25,680 So game theory is the mathematics of strategy. 259 00:23:25,680 --> 00:23:33,680 So it is the math of the interaction of decision-making agents. 260 00:23:33,680 --> 00:23:38,000 Those agents could be people, they could be animals, they could be machines, they could 261 00:23:38,000 --> 00:23:41,720 be natural processes. 262 00:23:41,720 --> 00:23:47,160 Anything you can model as decision-making agents works. 263 00:23:47,160 --> 00:23:54,600 And so you can create a game theoretic model of physics that would be somewhat Aristotelian, 264 00:23:54,600 --> 00:24:00,240 but would still match up with sort of our modern understandings of relativity and quantum 265 00:24:00,240 --> 00:24:10,920 physics if you wanted to, where you would be ascribing sort of motives to blunt matter. 266 00:24:10,920 --> 00:24:17,960 Information theory was developed by Claude Shannon and it is sort of what it says on 267 00:24:17,960 --> 00:24:18,960 the tin. 268 00:24:18,960 --> 00:24:27,480 It is the mathematics of signals and noise. 269 00:24:27,480 --> 00:24:32,400 And Shannon was working at Bell Labs at the time, I'm pretty sure. 270 00:24:32,400 --> 00:24:39,520 And the phone company was very interested in trying to figure out how to get more phone 271 00:24:39,520 --> 00:24:46,440 conversations that sounded great down its existing infrastructure and interested in 272 00:24:46,440 --> 00:24:55,440 building as little and as robust new infrastructure as possible to get the most new clear phone 273 00:24:55,440 --> 00:24:59,200 conversations that it could down it. 274 00:24:59,200 --> 00:25:07,400 And Shannon effectively created a complete set of mathematical tools that does literally 275 00:25:07,400 --> 00:25:10,880 everything that you could do in that space. 276 00:25:10,880 --> 00:25:16,280 There have been other contributions since then as people have discovered other interesting 277 00:25:16,280 --> 00:25:17,940 sort of refinements. 278 00:25:17,940 --> 00:25:23,960 Another crossover between these two would be the Kelly bet or the Kelly criterion where 279 00:25:23,960 --> 00:25:32,680 and I can't actually remember if Kelly was his first or last name, but at any rate, Kelly, 280 00:25:32,680 --> 00:25:44,320 who was also at Bell Labs and liked horse racing, developed a relationship between knowledge 281 00:25:44,320 --> 00:25:45,840 and risk. 282 00:25:45,840 --> 00:25:58,920 So if you can ascribe certain probable outcomes to a set of possible actions, how much of 283 00:25:58,920 --> 00:26:06,720 your stake should you commit to each of the possible outcomes in order to maximize your 284 00:26:06,720 --> 00:26:14,040 long term or in fact infinite term return over that set of decisions? 285 00:26:14,040 --> 00:26:19,560 And it's an implicit formula. 286 00:26:19,560 --> 00:26:27,840 So it does take a little bit of work to sort of apply in any given situation, but it just 287 00:26:27,840 --> 00:26:33,120 falls out basically. 288 00:26:33,120 --> 00:26:37,040 And for binary cases, it's quite simple. 289 00:26:37,040 --> 00:26:39,880 There's a direct form in the binary case. 290 00:26:39,880 --> 00:26:48,080 And so, yeah, that's a direct connection between sort of information theory on the one hand 291 00:26:48,080 --> 00:26:55,680 in evaluating a situation to game theory automatically giving you this sort of idealized strategy. 292 00:26:55,680 --> 00:27:03,880 So how do we start to understand how those frameworks apply to modern financial systems, 293 00:27:03,880 --> 00:27:07,360 I guess, specifically in the United States? 294 00:27:07,360 --> 00:27:17,040 Well, to do that, you actually have to create sort of hyper modern financial systems because 295 00:27:17,040 --> 00:27:22,240 the existing financial systems are literally medieval. 296 00:27:22,240 --> 00:27:29,120 We are using a financial system that was developed at the beginning of the Renaissance. 297 00:27:29,120 --> 00:27:37,320 And we didn't have explanations for how or why it worked until around a quarter of a 298 00:27:37,320 --> 00:27:39,360 century ago. 299 00:27:39,360 --> 00:27:46,840 Adam Smith's work on the wealth of nations, which includes some of the first sort of exposition 300 00:27:46,840 --> 00:27:57,200 and support of the what we erroneously call free market capitalism was written in 1776, 301 00:27:57,200 --> 00:27:58,480 which is American citizens. 302 00:27:58,480 --> 00:28:02,960 You might recognize that year for other reasons. 303 00:28:02,960 --> 00:28:12,040 But you know, that's that's it's been a little while since 1776. 304 00:28:12,040 --> 00:28:20,400 The the sort of full rigorous claim of proof about the functioning of modern markets is 305 00:28:20,400 --> 00:28:26,120 something that in economics is known as the marginal revolution and is pretty much the 306 00:28:26,120 --> 00:28:27,400 20th century. 307 00:28:27,400 --> 00:28:35,120 So it's been a hundred ish years that we have a belief that we understand how the market 308 00:28:35,120 --> 00:28:40,920 works at a theoretical level and a justification for its functioning. 309 00:28:40,920 --> 00:28:47,360 And the branch of economics that did that work is actually not the mainline branch that 310 00:28:47,360 --> 00:28:49,360 trains our economists. 311 00:28:49,360 --> 00:28:57,680 So so they accept that that work is true, but they're out of a different tradition that 312 00:28:57,680 --> 00:29:02,920 also formed in the early part of the 20th century. 313 00:29:02,920 --> 00:29:05,520 And that's that's where that stands. 314 00:29:05,520 --> 00:29:10,000 Now I have my own thoughts. 315 00:29:10,000 --> 00:29:18,560 And for me, looking at it, particularly adding information theory and the concept of noise 316 00:29:18,560 --> 00:29:26,680 to the system, I am convinced that the market design that we have had been using successfully 317 00:29:26,680 --> 00:29:35,400 for, you know, a hundred ish years actually effectively has failed and will continue to 318 00:29:35,400 --> 00:29:36,400 do so. 319 00:29:36,400 --> 00:29:44,660 And so the last third to half century, it got really egregious because historically 320 00:29:44,660 --> 00:29:55,700 it was the most powerful information network and sort of information decision machine that 321 00:29:55,700 --> 00:29:57,000 existed on earth. 322 00:29:57,000 --> 00:30:00,560 And then we invented the Internet and built something that was much, much more powerful 323 00:30:00,560 --> 00:30:01,560 than it. 324 00:30:01,560 --> 00:30:06,940 So just like you might be familiar with the concept of the 51 percent attack in something 325 00:30:06,940 --> 00:30:15,480 like a block chain where if you if you actually like, you know, spent many, many billions 326 00:30:15,480 --> 00:30:23,600 of dollars and and built an array of computers that constituted 60 percent of the chain mining 327 00:30:23,600 --> 00:30:28,080 in the block chain, then you could just rewrite the block chain and say that it says what 328 00:30:28,080 --> 00:30:35,760 you said that it says, because you would produce most of the tokens that say what the chain 329 00:30:35,760 --> 00:30:40,840 says and that would be that like it would say what you say it says, because you'd be 330 00:30:40,840 --> 00:30:42,320 freezing all the tokens. 331 00:30:42,320 --> 00:30:43,880 Now really quick question. 332 00:30:43,880 --> 00:30:46,320 What is a block chain? 333 00:30:46,320 --> 00:30:57,640 Oh, a block chain is a computational object that in theory is being affirmed as true by 334 00:30:57,640 --> 00:31:06,000 a network of anonymous players in the digital space. 335 00:31:06,000 --> 00:31:07,760 OK, OK. 336 00:31:07,760 --> 00:31:14,340 So in terms of your thoughts on this, we've been using this 800 year old market give or 337 00:31:14,340 --> 00:31:20,380 take and that is producing but has been the way to produce the most information. 338 00:31:20,380 --> 00:31:25,000 And now we're entering a new era where the Internet and other things are producing and 339 00:31:25,000 --> 00:31:28,800 can cipher through much more information. 340 00:31:28,800 --> 00:31:33,260 So how does how do your thoughts of how we can improve this come in with the limitations 341 00:31:33,260 --> 00:31:35,760 that do exist in the current system? 342 00:31:35,760 --> 00:31:43,200 Well, so I think I think we have to replace it with something that is capable of working. 343 00:31:43,200 --> 00:31:45,720 And I can only really see two options. 344 00:31:45,720 --> 00:31:50,900 One is the work that I'm doing with the baton office and now suing them for. 345 00:31:50,900 --> 00:31:58,800 And the other is a sufficient general social collapse that we lose access to computational 346 00:31:58,800 --> 00:31:59,800 technology. 347 00:31:59,800 --> 00:32:02,400 Those are both super interesting ideas. 348 00:32:02,400 --> 00:32:08,280 But can I first ask what's what what characteristics of the market are not working in terms of 349 00:32:08,280 --> 00:32:12,320 how you're ascribing the market not working? 350 00:32:12,320 --> 00:32:18,920 Well, the first and most obvious one is that it's becoming more and more costly not only 351 00:32:18,920 --> 00:32:22,360 in sort of nominal terms, but also in relative terms. 352 00:32:22,360 --> 00:32:32,400 So the market is chewing up a larger and larger percentage of the the total cost of operating 353 00:32:32,400 --> 00:32:36,400 our economies as our economies are growing. 354 00:32:36,400 --> 00:32:41,160 So think about, you know, the relationship of your brain to your body. 355 00:32:41,160 --> 00:32:45,880 Your brain is obviously directing enormous amounts of what your body does, even things 356 00:32:45,880 --> 00:32:49,960 that you're completely unconsciously aware of. 357 00:32:49,960 --> 00:32:58,480 If over the course of your life, your brain consumed larger and larger percentages of 358 00:32:58,480 --> 00:33:01,680 the energy budget of your body. 359 00:33:01,680 --> 00:33:07,720 At some point, you would starve to death because you would still only be as effective as you 360 00:33:07,720 --> 00:33:09,640 used to be. 361 00:33:09,640 --> 00:33:16,360 That you would need so much more food that you couldn't actually keep going. 362 00:33:16,360 --> 00:33:24,760 That is that is the condition that we see with the increasingly frequent and increasingly 363 00:33:24,760 --> 00:33:32,560 sort of bizarre market failures that that have been plaguing our system for decades. 364 00:33:32,560 --> 00:33:39,080 Is this a result of a small amount of large players or is this kind of an inherent property 365 00:33:39,080 --> 00:33:41,960 that now exists within all players? 366 00:33:41,960 --> 00:33:44,880 If that's a question that makes sense in this context. 367 00:33:44,880 --> 00:33:45,880 It does. 368 00:33:45,880 --> 00:33:46,880 Yeah. 369 00:33:46,880 --> 00:33:51,360 So it actually doesn't, strictly speaking, have anything to do with the players at all. 370 00:33:51,360 --> 00:34:01,920 It's a structural problem with how the market functions in that it has with with the resources 371 00:34:01,920 --> 00:34:08,480 that are available from the existence of computational technology, the mechanism that the market 372 00:34:08,480 --> 00:34:22,360 had to moderate a class of bad behavior, that is the emission of nonsense has vanished. 373 00:34:22,360 --> 00:34:32,680 And so it is now possible and profitable to emit emit noise both within the market and 374 00:34:32,680 --> 00:34:39,640 broadly, socially and politically, which will then filter into the marketplace. 375 00:34:39,640 --> 00:34:48,560 And so destabilizing systems is now directly profitable to the destabilizers. 376 00:34:48,560 --> 00:34:55,760 And that means that whether people are sort of intentional arsonists burning things down 377 00:34:55,760 --> 00:34:58,680 because they want to watch, you know, it's sort of the Joker, they want to watch the 378 00:34:58,680 --> 00:35:06,320 world burned or they're just accidental or unintentional goofuses that are doing things 379 00:35:06,320 --> 00:35:10,080 badly because they're doing things badly. 380 00:35:10,080 --> 00:35:17,840 The punishment will no longer come back to that action. 381 00:35:17,840 --> 00:35:20,920 And so that's the problem. 382 00:35:20,920 --> 00:35:23,240 What is a practical example of that? 383 00:35:23,240 --> 00:35:29,400 Because when you say noise, I guess one one reason or one example I think of is if you 384 00:35:29,400 --> 00:35:33,760 need to get some sort of funding approved for something, there's three or four levels 385 00:35:33,760 --> 00:35:36,880 of bureaucratic bureaucratic paperwork that has to happen. 386 00:35:36,880 --> 00:35:41,640 Is that the kind of noise you're talking about or is there something else that this noise 387 00:35:41,640 --> 00:35:42,640 manifests? 388 00:35:42,640 --> 00:35:46,760 Well, that's a completely different branch of failure of our present systems. 389 00:35:46,760 --> 00:35:57,840 And I would strongly encourage you in dealing with bureaucracy to look at Parkinson's Law, 390 00:35:57,840 --> 00:36:01,400 Peter principle, the Peter principle, both of which are books. 391 00:36:01,400 --> 00:36:06,840 I've got Parkinson's Law on the shelf over here, actually. 392 00:36:06,840 --> 00:36:10,200 And there's also they did make books out of this. 393 00:36:10,200 --> 00:36:17,240 But the the television show Yes, Minister and Yes, Prime Minister by the BBC. 394 00:36:17,240 --> 00:36:19,400 It's one of the greatest things they've ever produced. 395 00:36:19,400 --> 00:36:20,400 It's really hilarious. 396 00:36:20,400 --> 00:36:25,440 It's also all true in the greater sense. 397 00:36:25,440 --> 00:36:31,840 While it is fiction, it's as real as anything that's ever been produced on television. 398 00:36:31,840 --> 00:36:42,000 And so we do have overwhelming growth in our bureaucratic structures, and that is also 399 00:36:42,000 --> 00:36:44,080 a problem. 400 00:36:44,080 --> 00:36:51,840 But it is not the problem that I am addressing within the scope of the context that I'm talking 401 00:36:51,840 --> 00:36:52,840 about. 402 00:36:52,840 --> 00:36:53,840 So practical examples. 403 00:36:53,840 --> 00:37:01,120 So can you redirect my thought path to an example of what you're discussing? 404 00:37:01,120 --> 00:37:03,480 So here's a couple. 405 00:37:03,480 --> 00:37:04,480 Here's a couple of examples. 406 00:37:04,480 --> 00:37:06,720 Number one, flash crashes. 407 00:37:06,720 --> 00:37:14,840 So back in the late back in the late 80s, there's another one in 2010 that were both 408 00:37:14,840 --> 00:37:15,840 general. 409 00:37:15,840 --> 00:37:25,560 So the largest single day loss of stock value as a percentage happened back in like 89 when 410 00:37:25,560 --> 00:37:29,600 the entire stock market went down, I think it was like 38 ish percent or something like 411 00:37:29,600 --> 00:37:36,800 that, which is basically a third drop single day. 412 00:37:36,800 --> 00:37:37,800 Everyone got really unsettled. 413 00:37:37,800 --> 00:37:38,800 It came back. 414 00:37:38,800 --> 00:37:45,480 That was the first day in the history of the New York Stock Exchange that they traded a 415 00:37:45,480 --> 00:37:54,000 million units, which doesn't sound like a big number by sort of modern standards, but 416 00:37:54,000 --> 00:37:58,960 was an absolutely enormous number back in the day. 417 00:37:58,960 --> 00:38:03,600 Number one in, I think, like 2010 ish around there. 418 00:38:03,600 --> 00:38:08,440 I'm not great with dates again for the same reasons we discussed earlier, but there was 419 00:38:08,440 --> 00:38:15,400 another flash crash where the entire market went down after a year of jitteriness after 420 00:38:15,400 --> 00:38:20,720 the global financial crisis happened, which is another example, but not one I'm going 421 00:38:20,720 --> 00:38:21,920 to get into. 422 00:38:21,920 --> 00:38:30,040 Both of those crashes were purely computer driven trading phenomenon where algorithms 423 00:38:30,040 --> 00:38:38,160 that basically exist to try to keep their owners from falling into quicksand, try to 424 00:38:38,160 --> 00:38:45,520 pull rugs out of other people so that those people fall into the quicksand instead. 425 00:38:45,520 --> 00:38:51,120 Basically the stars aligned and all the rugs got pulled at the same time and everybody 426 00:38:51,120 --> 00:38:54,640 fell into the quicksand. 427 00:38:54,640 --> 00:38:59,880 While those two are famous cases of this happening across the entire marketplace, it is in fact 428 00:38:59,880 --> 00:39:08,080 a daily phenomenon that flash crashes occur in single issues across our marketplaces because 429 00:39:08,080 --> 00:39:15,720 while the stars rarely align across the entire marketplace, everybody is operating these 430 00:39:15,720 --> 00:39:21,720 rug pulling algorithms to defend themselves against other rug pulling algorithms, none 431 00:39:21,720 --> 00:39:30,200 of which are related to actual economic conditions and all of that nonsense just gets out of 432 00:39:30,200 --> 00:39:34,840 hand frequently. 433 00:39:34,840 --> 00:39:43,400 Another example of how noise can overwhelm signal, and this is one that I standard use, 434 00:39:43,400 --> 00:39:49,280 is the Russian invasion of the Ukraine or Ukraine. 435 00:39:49,280 --> 00:39:54,960 Russia is I believe the third largest wheat producing country on earth. 436 00:39:54,960 --> 00:39:56,760 It's really big. 437 00:39:56,760 --> 00:40:02,320 Ukraine is also a pretty decent sized place and is very fertile and I think it was about 438 00:40:02,320 --> 00:40:06,080 fifth. 439 00:40:06,080 --> 00:40:11,200 When that invasion happened, the wheat market went absolutely bananas as one would expect 440 00:40:11,200 --> 00:40:17,680 it to do and wheat prices spiked pretty severely and were highly jittery. 441 00:40:17,680 --> 00:40:21,840 As a result of this, Canada and the United States who are one in two, I'm pretty sure, 442 00:40:21,840 --> 00:40:26,920 I think makes more wheat than we do because northern climes is better. 443 00:40:26,920 --> 00:40:32,720 We can do more with corn and rice here. 444 00:40:32,720 --> 00:40:39,360 Our wheat farmers reacted to that news of wheat prices going through the ceiling by 445 00:40:39,360 --> 00:40:50,360 planting zero new acres of wheat because none of that price windfall got to the farmers. 446 00:40:50,360 --> 00:40:59,960 Those rug pulling machines were able to effectively absorb that entire windfall inside the marketplace 447 00:40:59,960 --> 00:41:05,720 and keep that signal from actually getting to where it would do some good. 448 00:41:05,720 --> 00:41:09,080 They made money by doing so. 449 00:41:09,080 --> 00:41:17,240 By making our economy function less efficiently and less profitably, the people who caused 450 00:41:17,240 --> 00:41:20,080 that to happen made more money. 451 00:41:20,080 --> 00:41:27,000 It's not necessarily a case of a single Machiavellian string puller that gets it all. 452 00:41:27,000 --> 00:41:35,720 It is within the structure of the capacities that exist, the natural incentives for every 453 00:41:35,720 --> 00:41:43,440 single person involved in the marketplace to cause that bad outcome to happen. 454 00:41:43,440 --> 00:41:48,240 Their collective action caused that bad outcome to happen. 455 00:41:48,240 --> 00:41:52,280 It will inevitably do so again. 456 00:41:52,280 --> 00:42:03,640 If another continental scale disaster happens, whether engineered or accidental, that was 457 00:42:03,640 --> 00:42:12,940 unanticipated, then another opportunity to cause a bad reaction will be incredibly profitable 458 00:42:12,940 --> 00:42:16,840 for whoever happens to be around when that happens too. 459 00:42:16,840 --> 00:42:25,600 That will be the case forever because this system can't function if the financial system 460 00:42:25,600 --> 00:42:28,840 has access to the internet. 461 00:42:28,840 --> 00:42:36,080 We can either not have an internet or we can have a different kind of financial system. 462 00:42:36,080 --> 00:42:39,120 That's a great segue into your ideas. 463 00:42:39,120 --> 00:42:46,360 We've got these digital systems that are the rug pulling into quicksand machines. 464 00:42:46,360 --> 00:42:54,320 Are your ideas around changing the parameter about who pulls the rug on who, or is it getting 465 00:42:54,320 --> 00:42:59,720 rid of the rug and getting rid of the quicksand, or what ideas do you have in how we address 466 00:42:59,720 --> 00:43:01,280 this? 467 00:43:01,280 --> 00:43:08,480 My ideas are around fundamentally realigning how the communication functions in order to 468 00:43:08,480 --> 00:43:13,880 emphasize and value signal exclusively. 469 00:43:13,880 --> 00:43:20,220 There simply is no role for this rug pulling machine to exist because they're offering 470 00:43:20,220 --> 00:43:27,640 nothing of value not to their current owners nor to anyone else within the system. 471 00:43:27,640 --> 00:43:35,920 The recognition is that a deal, the current concept of the deal is that there's a buyer 472 00:43:35,920 --> 00:43:36,920 and a seller. 473 00:43:36,920 --> 00:43:42,520 Let's say it's you and me, you have something you want to sell and I have some money and 474 00:43:42,520 --> 00:43:45,480 I might have some interest in whatever that is. 475 00:43:45,480 --> 00:43:52,360 Your deal is you and I coming together to agree on a price and a product. 476 00:43:52,360 --> 00:44:00,280 In a commodity market, we agree to what the product is. 477 00:44:00,280 --> 00:44:03,280 Let's say I was selling, I could pull one of these books off the shelf and sell it to 478 00:44:03,280 --> 00:44:06,720 you right now, hypothetically. 479 00:44:06,720 --> 00:44:11,400 But that's a book that I pull off my shelf. 480 00:44:11,400 --> 00:44:20,360 In a commodity market, we would completely solidify exactly what was being sold. 481 00:44:20,360 --> 00:44:30,920 Trainloads worth of corn or steel or oil that's this quality in this location at that time. 482 00:44:30,920 --> 00:44:34,560 We don't have to agree on a product in this commodity marketplace. 483 00:44:34,560 --> 00:44:37,520 All we have to do is to agree on a price. 484 00:44:37,520 --> 00:44:41,120 Again, we're not in isolation. 485 00:44:41,120 --> 00:44:48,560 Once we've fully standardized what wheat is, lots of people need to buy wheat. 486 00:44:48,560 --> 00:44:51,320 There's more than one baker in the world. 487 00:44:51,320 --> 00:44:52,800 Lots of people need to sell wheat. 488 00:44:52,800 --> 00:44:56,760 There's more than one farmer in the world. 489 00:44:56,760 --> 00:45:02,520 We can have this environment where by looking at the other deals that are happening, we 490 00:45:02,520 --> 00:45:08,280 can decide what sorts of deals we're interested in offering and taking. 491 00:45:08,280 --> 00:45:13,880 That's how the existing marketplace works, is this notion that buyers will offer deals 492 00:45:13,880 --> 00:45:18,560 where they put a price on how much they want to buy for and sellers will offer deals where 493 00:45:18,560 --> 00:45:21,160 they put a price on how much they want to sell for. 494 00:45:21,160 --> 00:45:27,080 When those prices match up, that deal gets sewn together with contract and the contract 495 00:45:27,080 --> 00:45:31,800 gets honored. 496 00:45:31,800 --> 00:45:35,000 If that's all it ever was, that would be fine. 497 00:45:35,000 --> 00:45:43,920 In order for there to be a company of people, have you ever seen penguins going into the 498 00:45:43,920 --> 00:45:44,920 water? 499 00:45:44,920 --> 00:45:49,920 I don't think so. 500 00:45:49,920 --> 00:45:58,320 So penguins, when they're getting ready to jump into the water, they operate in flocks. 501 00:45:58,320 --> 00:46:02,160 They crowd and they all waddle up to the edge. 502 00:46:02,160 --> 00:46:08,520 But when they get to the edge, they stop and they all kind of crowd up to the edge and 503 00:46:08,520 --> 00:46:12,720 sort of jostle until one or two of them gets pushed over. 504 00:46:12,720 --> 00:46:18,440 And then they go in and then everyone just kind of jumps in and dives in after them. 505 00:46:18,440 --> 00:46:23,520 Or they go in and they get ripped apart by like an orca or a leopard seal or something 506 00:46:23,520 --> 00:46:26,380 and then they all just back off. 507 00:46:26,380 --> 00:46:34,640 So if the trading environment was really just bakers and farmers, they'd do the penguin 508 00:46:34,640 --> 00:46:35,640 thing. 509 00:46:35,640 --> 00:46:40,080 They'd just be like, well, I don't want to offer the real deal. 510 00:46:40,080 --> 00:46:44,040 I want to hang back and see what the real deal is. 511 00:46:44,040 --> 00:46:49,040 So somebody that's kind of brave enough to go across needs to exist. 512 00:46:49,040 --> 00:46:51,560 And they turn out to be most of the marketplace. 513 00:46:51,560 --> 00:46:55,200 That's where the speculators come in. 514 00:46:55,200 --> 00:46:57,040 And they're providing a real value. 515 00:46:57,040 --> 00:46:59,120 They're providing information to the marketplace. 516 00:46:59,120 --> 00:47:03,040 The thing is, in the current marketplace, they do so indirectly. 517 00:47:03,040 --> 00:47:11,100 I say, OK, so the deal is about having a product you want to sell, somebody else having money 518 00:47:11,100 --> 00:47:18,640 that they want to buy with, but also information, information about what price deal should happen 519 00:47:18,640 --> 00:47:19,640 at. 520 00:47:19,640 --> 00:47:25,360 And so the proper sort of form isn't two pieces, a buyer and a seller. 521 00:47:25,360 --> 00:47:31,040 The proper form is three pieces, a producer, a consumer and a forecaster. 522 00:47:31,040 --> 00:47:34,760 And if you're a producer, you can forecast also if you want to. 523 00:47:34,760 --> 00:47:38,440 And if your forecasts are matched, you don't even have to pay. 524 00:47:38,440 --> 00:47:43,640 You don't have to trade just because you forecast and everyone agreed with you doesn't mean 525 00:47:43,640 --> 00:47:47,080 that you have to do anything about it. 526 00:47:47,080 --> 00:47:50,280 But that's it. 527 00:47:50,280 --> 00:47:56,880 If you want to play games with prices, then you have to go play games with prices as a 528 00:47:56,880 --> 00:47:57,880 forecaster. 529 00:47:57,880 --> 00:48:00,680 You can't pretend to be a producer and then pretend to be a buyer and then pretend to 530 00:48:00,680 --> 00:48:04,200 be a seller and then pretend to be a buyer, pretend to sell, sell, sell, sell, buy, buy, 531 00:48:04,200 --> 00:48:07,800 buy, buy the way they do right now. 532 00:48:07,800 --> 00:48:14,520 And by simplifying that structure, we can make each of these things much more direct 533 00:48:14,520 --> 00:48:21,680 and that eliminates an enormous fraction of the information that's going in. 534 00:48:21,680 --> 00:48:30,240 And so as an engineer, you'd be familiar with dividing energy into work and heat. 535 00:48:30,240 --> 00:48:35,160 Well in information theory, we've discovered that information is in fact at certainly the 536 00:48:35,160 --> 00:48:41,000 classical level, precisely analogous to entropy. 537 00:48:41,000 --> 00:48:48,680 And so information in general formulation can be divided into noise and signal on exactly 538 00:48:48,680 --> 00:48:50,440 the same terms. 539 00:48:50,440 --> 00:48:55,880 So information that's useful to people is signal and information that isn't useful to 540 00:48:55,880 --> 00:48:57,560 people is noise. 541 00:48:57,560 --> 00:49:04,660 And so by doing things like this, just as you can design a heat engine that will be 542 00:49:04,660 --> 00:49:16,460 more efficient than another heat engine by improving the system, we can improve the thermodynamic 543 00:49:16,460 --> 00:49:23,040 efficiency of our information systems at the financial sphere. 544 00:49:23,040 --> 00:49:26,360 Very interesting. 545 00:49:26,360 --> 00:49:31,880 So in the case of this Russia and Ukraine situation, where we have these edge scenarios, 546 00:49:31,880 --> 00:49:42,000 how what allows this producer, seller and forecaster model to be more adaptive and receptive 547 00:49:42,000 --> 00:49:47,360 to those kinds of edge cases? 548 00:49:47,360 --> 00:49:53,720 Well in the first place, my forecasters are earning money based on the profitability of 549 00:49:53,720 --> 00:49:54,720 producers. 550 00:49:54,720 --> 00:50:01,720 And so passing that price spike on to producers to encourage them to increase production in 551 00:50:01,720 --> 00:50:06,920 order to increase the value of what they're selling improves the commissions, which makes 552 00:50:06,920 --> 00:50:08,200 them more money. 553 00:50:08,200 --> 00:50:16,560 So the forecasters make money not by absorbing money on its way to the producers, but by 554 00:50:16,560 --> 00:50:23,520 ducting money to the producers and then sort of latching on to their fixed percentage on 555 00:50:23,520 --> 00:50:26,560 the back end of that. 556 00:50:26,560 --> 00:50:32,480 But in a broader sense, how unanticipated was that? 557 00:50:32,480 --> 00:50:40,120 So in the existing system, as I noted, there's a direct interest in unanticipated things 558 00:50:40,120 --> 00:50:45,700 happening, which means one, there's an interest in causing unanticipated things to happen. 559 00:50:45,700 --> 00:50:50,480 But two, there's also an interest in closing your eyes and plugging up your ears and not 560 00:50:50,480 --> 00:50:56,880 talking about boiling situations that might turn into unanticipated situations because 561 00:50:56,880 --> 00:51:02,640 the less people are aware of things that might go wrong, the more likely there will be an 562 00:51:02,640 --> 00:51:05,560 opportunity for you to make a killing. 563 00:51:05,560 --> 00:51:13,840 So if the world flips on its head, there would not be a motive to cause chaos in the first 564 00:51:13,840 --> 00:51:17,720 place, not an economic motive to do so. 565 00:51:17,720 --> 00:51:25,400 And if you see chaos coming, there would be an economic and collective motive to figure 566 00:51:25,400 --> 00:51:33,200 out how to appropriately prep for that and communicate that clearly and obviously across 567 00:51:33,200 --> 00:51:45,080 the information space in order to keep the market as facilitated and functional as possible. 568 00:51:45,080 --> 00:51:51,000 So in the case of this being a patent pending system or idea that you're talking about, 569 00:51:51,000 --> 00:51:58,040 can you talk a little bit about how that actual process has been of like doing the submitting 570 00:51:58,040 --> 00:52:02,480 and what kind of feedback you've gotten and where that area is? 571 00:52:02,480 --> 00:52:03,840 Yeah, yeah. 572 00:52:03,840 --> 00:52:10,840 Well, so I'm going to start out and say that my experience is not typical. 573 00:52:10,840 --> 00:52:12,800 It might have started out typically. 574 00:52:12,800 --> 00:52:19,840 So I put in a provisional patent. 575 00:52:19,840 --> 00:52:25,480 If you have an idea and you talk about it publicly or publish it in any other way, then 576 00:52:25,480 --> 00:52:26,740 it is not patentable. 577 00:52:26,740 --> 00:52:31,000 You cannot patent public ideas. 578 00:52:31,000 --> 00:52:40,360 So if you have an idea and you think you want to patent it, go to LegalZoom or whatever 579 00:52:40,360 --> 00:52:45,240 or just go to the patent office's website and file yourself a provisional patent. 580 00:52:45,240 --> 00:52:48,880 It doesn't have to be that detailed. 581 00:52:48,880 --> 00:52:51,920 Just get it in there and that gives you a year. 582 00:52:51,920 --> 00:52:59,120 So I did that and spent that year trying to find an attorney to work with and found one. 583 00:52:59,120 --> 00:53:08,080 And we got my full patent application in with a few days to spare on my year and that went 584 00:53:08,080 --> 00:53:09,080 in. 585 00:53:09,080 --> 00:53:11,440 You can pay for privacy, you can pay for acceleration. 586 00:53:11,440 --> 00:53:13,240 I didn't do any of those things. 587 00:53:13,240 --> 00:53:23,120 And so it was about three years, a little less than that, for, well, all in a little 588 00:53:23,120 --> 00:53:24,120 bit more than that. 589 00:53:24,120 --> 00:53:28,800 So it's six months to get it assigned to a patent examiner. 590 00:53:28,800 --> 00:53:37,080 And then it was just under three years or two and a half years-ish for them to take 591 00:53:37,080 --> 00:53:38,560 a look at it. 592 00:53:38,560 --> 00:53:47,480 So it was like three years and two months from the time of my thing that I got my first 593 00:53:47,480 --> 00:53:49,200 office action back. 594 00:53:49,200 --> 00:53:55,280 And your first office action is basically rejection unless you screw it up because you 595 00:53:55,280 --> 00:54:00,820 know, it's not their job to say yes. 596 00:54:00,820 --> 00:54:08,600 So unless you did something that is really totally useless and but is sort of novel and 597 00:54:08,600 --> 00:54:13,040 they don't care, then they're going to say no. 598 00:54:13,040 --> 00:54:18,040 And there's a few different reasons for them to say no to things. 599 00:54:18,040 --> 00:54:20,240 One of the earliest and easiest is novelty. 600 00:54:20,240 --> 00:54:25,880 You know, there's that theory that there are no new ideas under the sun. 601 00:54:25,880 --> 00:54:30,600 That's probably not true, but there certainly have been a lot of good ideas that have happened 602 00:54:30,600 --> 00:54:33,720 that the patent office has an enormous pile of them. 603 00:54:33,720 --> 00:54:36,480 Plus, there's everything that's out there in the world. 604 00:54:36,480 --> 00:54:41,840 And so they're going to pull out some stuff and say, hey, look, people already invented 605 00:54:41,840 --> 00:54:42,840 this. 606 00:54:42,840 --> 00:54:45,760 So I blew through those pretty easily. 607 00:54:45,760 --> 00:54:50,400 We had some other contention and wrangling about how to actually draft various parts 608 00:54:50,400 --> 00:54:56,160 of the patent to sort of make it not be too broad, actually talk about what I'm talking 609 00:54:56,160 --> 00:55:02,560 about, all the rest of that stuff. 610 00:55:02,560 --> 00:55:12,920 In 2020, so about five years after my provisional patent filing, I got a notice of acceptance. 611 00:55:12,920 --> 00:55:18,160 You notice acceptance, you pay a fee, they print your patent up, you get your patent, 612 00:55:18,160 --> 00:55:22,220 unless they decide they really made a big boo boo, in which case they write you a letter 613 00:55:22,220 --> 00:55:26,200 and somebody high up in the patent office has to sign this thing saying, look, we screwed 614 00:55:26,200 --> 00:55:27,240 up. 615 00:55:27,240 --> 00:55:29,480 We got something fundamental wrong here. 616 00:55:29,480 --> 00:55:32,920 This is something you're not allowed to patent at all. 617 00:55:32,920 --> 00:55:39,280 And you can dispute this with us or you can go away. 618 00:55:39,280 --> 00:55:42,600 They opted to do neither of those things. 619 00:55:42,600 --> 00:55:48,120 They didn't sign a letter and they didn't give me the patent. 620 00:55:48,120 --> 00:55:58,480 Instead, they, my examiner supervisor left my lawyers a voicemail saying, I don't think 621 00:55:58,480 --> 00:56:05,080 we're going to, you know, whatever, like rumors, I've been told this, I don't have the copy 622 00:56:05,080 --> 00:56:07,400 of the voicemail. 623 00:56:07,400 --> 00:56:14,020 She told him, this isn't going to happen. 624 00:56:14,020 --> 00:56:19,040 We went ahead and put in the fee anyway. 625 00:56:19,040 --> 00:56:25,200 And you get 90 days if like, you don't have to get a patent after notice acceptance, you 626 00:56:25,200 --> 00:56:26,320 can not pay the fee. 627 00:56:26,320 --> 00:56:29,880 And then after 90 days, it's over and then it's over. 628 00:56:29,880 --> 00:56:30,880 It's public. 629 00:56:30,880 --> 00:56:32,240 So you can't patent it anymore. 630 00:56:32,240 --> 00:56:33,680 Nobody else. 631 00:56:33,680 --> 00:56:36,760 So we paid the fee. 632 00:56:36,760 --> 00:56:39,560 The due date came and went. 633 00:56:39,560 --> 00:56:40,560 We got back. 634 00:56:40,560 --> 00:56:41,680 It was Christmas basically. 635 00:56:41,680 --> 00:56:47,800 So the, in the new year, my lawyer reached out and was like, Hey, you know, what's going 636 00:56:47,800 --> 00:56:49,360 on? 637 00:56:49,360 --> 00:56:52,960 And they said, we're going to, we, we're going to figure out why we're not doing this and 638 00:56:52,960 --> 00:56:55,200 we'll get back to you soon. 639 00:56:55,200 --> 00:56:59,280 So in April, they came up with their reason. 640 00:56:59,280 --> 00:57:03,120 They didn't sign the letter. 641 00:57:03,120 --> 00:57:05,600 And the reason they had was it was useless. 642 00:57:05,600 --> 00:57:07,160 They said, no, I'm sorry. 643 00:57:07,160 --> 00:57:11,080 You can't, this can't be patented because it's, it's not better. 644 00:57:11,080 --> 00:57:12,960 I kind of hit the ceiling. 645 00:57:12,960 --> 00:57:18,060 It took a while to sort of get it through my attorneys, but we had a few different back 646 00:57:18,060 --> 00:57:19,060 and forths. 647 00:57:19,060 --> 00:57:26,340 And finally, in January of 2022, the mathematical proof that we talked earlier about this sort 648 00:57:26,340 --> 00:57:32,000 of sort of structurally better computation, this is a structurally better computation 649 00:57:32,000 --> 00:57:37,440 than the kind that current mechanisms that markets use operate on. 650 00:57:37,440 --> 00:57:41,660 And that is a mathematically provable fact about reality. 651 00:57:41,660 --> 00:57:46,440 And so I provided one of those mathematical proofs. 652 00:57:46,440 --> 00:57:52,520 And my lawyers wrote it up in legalese and basically said, Hey, look, you have absolutely 653 00:57:52,520 --> 00:57:53,940 no leg to stand on. 654 00:57:53,940 --> 00:57:59,400 If you want to try to stand on this leg, we'll see you in court. 655 00:57:59,400 --> 00:58:01,840 What are you going to do about this? 656 00:58:01,840 --> 00:58:08,640 In February, 2022, they issued a second notice of acceptance. 657 00:58:08,640 --> 00:58:14,260 We immediately applied, you know, pay the fee, get that in there. 658 00:58:14,260 --> 00:58:18,280 Three weeks later, they withdrew that notice acceptance. 659 00:58:18,280 --> 00:58:21,640 And their excuse the second time is it's too useful. 660 00:58:21,640 --> 00:58:25,280 You would, you're, you're trying to get all of economics. 661 00:58:25,280 --> 00:58:31,000 Well, that's also ridiculous for, you know, very different reasons. 662 00:58:31,000 --> 00:58:37,760 At least of which the language that they're objecting to as being overly broad was created 663 00:58:37,760 --> 00:58:42,440 in consultation with the patent office to be narrow. 664 00:58:42,440 --> 00:58:48,680 So it's their language that they said is narrow enough to be patentable that they are now 665 00:58:48,680 --> 00:58:51,000 saying, well, you could read this any way you wanted. 666 00:58:51,000 --> 00:58:54,140 It's like, well, you could, but you already didn't. 667 00:58:54,140 --> 00:58:58,200 So like, what are we talking about here? 668 00:58:58,200 --> 00:59:06,160 At any rate, my attorneys were then told that it's, it was out of the hands. 669 00:59:06,160 --> 00:59:12,560 Like this decisions were coming down from on high that didn't make any sense that they 670 00:59:12,560 --> 00:59:15,040 didn't agree with, but they couldn't overrule. 671 00:59:15,040 --> 00:59:20,200 And so, so it didn't matter whether or not I could convince my examiner and his boss 672 00:59:20,200 --> 00:59:22,800 that we were right. 673 00:59:22,800 --> 00:59:24,200 They weren't making the decisions anymore. 674 00:59:24,200 --> 00:59:26,380 And you can't talk to anybody else. 675 00:59:26,380 --> 00:59:34,440 So my, my attorneys put in an appeal to what's known as the patent trial and appeal board, 676 00:59:34,440 --> 00:59:39,200 sometimes colloquially known as patent court. 677 00:59:39,200 --> 00:59:45,360 That appeal went very badly. 678 00:59:45,360 --> 00:59:54,500 They put in their decision in July of last year, so July, 2024, and they resurrected 679 00:59:54,500 --> 00:59:59,160 the mathematically disproved claim that it was useless. 680 00:59:59,160 --> 01:00:06,000 They reaffirmed that the ridiculous claim that it was too useful. 681 01:00:06,000 --> 01:00:11,600 And there was also a, another presidential case that the patent court themselves had 682 01:00:11,600 --> 01:00:17,860 decided in 2019 that my attorneys had brought up to them. 683 01:00:17,860 --> 01:00:27,400 And they said that that case doesn't apply because that case was making a user of computer 684 01:00:27,400 --> 01:00:29,560 in a market context better. 685 01:00:29,560 --> 01:00:36,760 And my system, you know, well, one user of computers, bad grammar, but my system, which 686 01:00:36,760 --> 01:00:41,840 is obviously and mathematically proved to be making the use of computers and markets 687 01:00:41,840 --> 01:00:51,340 better was not in fact covered under making computer use markets better. 688 01:00:51,340 --> 01:00:57,880 So that's, that's just totally pure, insane, nonsensical lies. 689 01:00:57,880 --> 01:01:00,560 And after that, you're done. 690 01:01:00,560 --> 01:01:04,380 You can't talk to the patent office anymore. 691 01:01:04,380 --> 01:01:11,760 So you know, in our, in our civil system of government, we have three branches. 692 01:01:11,760 --> 01:01:17,340 If the executive is screwing you, then you have to go talk to the judiciary. 693 01:01:17,340 --> 01:01:18,640 And so I did. 694 01:01:18,640 --> 01:01:20,400 I'm pretty much out of money. 695 01:01:20,400 --> 01:01:24,880 So I had to separate from my attorneys and sort of get things lined up that way. 696 01:01:24,880 --> 01:01:34,440 But I filed an appeal to the federal appeals court for the federal circuit. 697 01:01:34,440 --> 01:01:42,800 So this is the branch of federal court that handles disputes between citizens and the 698 01:01:42,800 --> 01:01:45,740 federal government. 699 01:01:45,740 --> 01:01:49,680 You can appeal the decisions or they could, you know, if it goes the other way and they 700 01:01:49,680 --> 01:01:52,720 could still care, they could appeal to the Supreme Court. 701 01:01:52,720 --> 01:01:56,920 But this is, this is the second highest court in the land and the precedent set here apply 702 01:01:56,920 --> 01:02:00,800 to the entire federal government. 703 01:02:00,800 --> 01:02:07,520 So this is, this is kind of crazy that I'm just kind of out here doing this now. 704 01:02:07,520 --> 01:02:11,620 I put in my case in November. 705 01:02:11,620 --> 01:02:16,280 They had 30 days to come up with a counter case. 706 01:02:16,280 --> 01:02:18,740 They asked for an extension, which they got. 707 01:02:18,740 --> 01:02:26,200 So they just put their case in on the eighth of January and I have three weeks. 708 01:02:26,200 --> 01:02:28,340 It turned out that that case actually had a typo in it. 709 01:02:28,340 --> 01:02:34,160 So the actual final form of their case just got published yesterday. 710 01:02:34,160 --> 01:02:41,520 They got their table of contents wrong in the first draft. 711 01:02:41,520 --> 01:02:46,440 And so, yeah, end of January, I get to put it by the end of January, I can optionally 712 01:02:46,440 --> 01:02:50,440 put in a rebuttal to the rebuttal if I want to. 713 01:02:50,440 --> 01:02:52,800 I'm working on that now. 714 01:02:52,800 --> 01:02:59,760 And at that point, my understanding is that some sort of selection process will pull together 715 01:02:59,760 --> 01:03:07,680 a panel of like three judges and they'll read everything and make a decision. 716 01:03:07,680 --> 01:03:08,680 That's quite the story. 717 01:03:08,680 --> 01:03:14,160 And back and forth and up and down and sideways and other ways. 718 01:03:14,160 --> 01:03:15,160 Wow. 719 01:03:15,160 --> 01:03:20,160 Yeah, I have the facts and the law and mathematics. 720 01:03:20,160 --> 01:03:26,160 And most people think that there's no chance that I will receive justice. 721 01:03:26,160 --> 01:03:28,160 And so I have hope, I guess. 722 01:03:28,160 --> 01:03:29,160 Wow. 723 01:03:29,160 --> 01:03:30,880 Well, good luck with that. 724 01:03:30,880 --> 01:03:36,520 I'm sure that is at this point, it's not quite over yet for sure. 725 01:03:36,520 --> 01:03:37,520 Not yet. 726 01:03:37,520 --> 01:03:38,520 No. 727 01:03:38,520 --> 01:03:43,840 And yeah, it's a crazy story. 728 01:03:43,840 --> 01:03:47,600 In putting the rebuttal together, I was looking back through the emails I had with my attorney 729 01:03:47,600 --> 01:03:52,160 as well as sort of reading the entire history of the case and so on. 730 01:03:52,160 --> 01:03:59,960 I've had a kind of severe medical incident on each of the occasions when the patent office 731 01:03:59,960 --> 01:04:06,240 has gone insane and made some claim that's just completely false. 732 01:04:06,240 --> 01:04:10,880 And this is not, I'm not doing well with this one either. 733 01:04:10,880 --> 01:04:12,880 So we'll see. 734 01:04:12,880 --> 01:04:14,520 Yeah, I'm sorry. 735 01:04:14,520 --> 01:04:18,760 I really wish you the best of luck with that going forward. 736 01:04:18,760 --> 01:04:19,960 I think it is some time. 737 01:04:19,960 --> 01:04:25,000 I'll probably ask one last question and then we can finish up here. 738 01:04:25,000 --> 01:04:29,840 In terms of individual people like ourselves, what actions or behaviors can people like 739 01:04:29,840 --> 01:04:35,080 you and me take to bring about the best kind of future that maybe you're thinking of with 740 01:04:35,080 --> 01:04:41,840 more fair markets or in general, a good future we could all live in? 741 01:04:41,840 --> 01:04:47,440 What actions can we take? 742 01:04:47,440 --> 01:04:55,960 Well reevaluation of the systems that surround us, I think, unfortunately, is absolutely 743 01:04:55,960 --> 01:04:59,200 necessary. 744 01:04:59,200 --> 01:05:03,160 We are living in what some people call the post-industrial age. 745 01:05:03,160 --> 01:05:06,760 I really, really dislike that sort of fourth industrial age. 746 01:05:06,760 --> 01:05:16,240 I think that those people are liars and morons, but we generally accept, historically speaking, 747 01:05:16,240 --> 01:05:23,120 that sort of the Newtonian revolution and the change in our understanding of physics 748 01:05:23,120 --> 01:05:31,160 and mechanics fundamentally altered economics, culture, and politics in ways that make it 749 01:05:31,160 --> 01:05:35,960 possible to live the way that we live and not the way that like, I think, Arthur lived, 750 01:05:35,960 --> 01:05:45,240 not that he's a real person, but that kind of thing. 751 01:05:45,240 --> 01:05:52,240 Discoveries of greater magnitude were made approximately one century ago. 752 01:05:52,240 --> 01:05:59,960 And so the common understanding that existed for the people that put together our forms 753 01:05:59,960 --> 01:06:10,480 of government, our forms of education, our religions, our forms of economics about how 754 01:06:10,480 --> 01:06:23,160 time and space and energy and matter and imagination and thought work have all been falsified. 755 01:06:23,160 --> 01:06:32,360 And we have not really inculcated the fact of these falsifications yet. 756 01:06:32,360 --> 01:06:35,240 Many, many people can recite E equals MC squared. 757 01:06:35,240 --> 01:06:39,400 Very, very few people can recite E equals H nu. 758 01:06:39,400 --> 01:06:45,280 If you toss, you know, Turing in computability at people, they will stare at you like you 759 01:06:45,280 --> 01:06:52,080 have just started speaking a different language. 760 01:06:52,080 --> 01:07:01,480 We are going to have to find systems that integrate the tools that we have surrounding 761 01:07:01,480 --> 01:07:05,600 us in ways that make us functional and happy. 762 01:07:05,600 --> 01:07:10,800 And we need to understand that that means that we aren't going to be using the systems 763 01:07:10,800 --> 01:07:14,560 that we have. 764 01:07:14,560 --> 01:07:16,520 And that's a hell of a challenge. 765 01:07:16,520 --> 01:07:17,720 It is. 766 01:07:17,720 --> 01:07:27,440 For people who have the interest and the ability, such as I hope myself, dedicating yourself 767 01:07:27,440 --> 01:07:35,080 to trying to find and solve these problems and, you know, hope that you can connect that 768 01:07:35,080 --> 01:07:45,260 back to ways in which they can come into use and value. 769 01:07:45,260 --> 01:07:57,320 For people that don't have those things, sort of understand enough not to value yourself 770 01:07:57,320 --> 01:08:06,120 above the necessity of the breakdown and not work against the fix as it comes. 771 01:08:06,120 --> 01:08:11,960 You know, keep an open mind. 772 01:08:11,960 --> 01:08:17,560 But these challenges are very foundational. 773 01:08:17,560 --> 01:08:27,600 Our philosophers have not yet done the work to reintegrate our knowledge of how logic 774 01:08:27,600 --> 01:08:34,600 itself functions into our understanding of how to live a good life. 775 01:08:34,600 --> 01:08:42,640 Neither have our theologians, and neither have our physicists, and neither have our leaders. 776 01:08:42,640 --> 01:08:49,680 Whether you're talking about politicians or CEOs or, you know, hedge fund people that 777 01:08:49,680 --> 01:08:57,040 are, you know, active investors or whatever, like, that just doesn't exist. 778 01:08:57,040 --> 01:09:03,760 And so the things that you see around you are going away. 779 01:09:03,760 --> 01:09:12,080 I don't know if you mind a current reference or not, but the LA wildfires are still ongoing 780 01:09:12,080 --> 01:09:14,040 as this happens. 781 01:09:14,040 --> 01:09:23,000 That is an obvious large scale systematic failure, no matter which way you slice it. 782 01:09:23,000 --> 01:09:27,040 A story that has been largely overshadowed by that story, and rightly so. 783 01:09:27,040 --> 01:09:32,280 I mean, this story affects maybe 1% as many people. 784 01:09:32,280 --> 01:09:40,800 Richmond, Virginia, which is the capital of my state, last week, and a bad snowstorm for 785 01:09:40,800 --> 01:09:47,600 the area, but in, you know, worse snowstorms have happened in this state in my lifetime. 786 01:09:47,600 --> 01:09:55,360 They had a cascade failure and they lost water in the city and parts of a couple of surrounding 787 01:09:55,360 --> 01:09:59,120 counties for about four days. 788 01:09:59,120 --> 01:10:08,720 And so if the world culture capital hadn't been on active fire during that exact same 789 01:10:08,720 --> 01:10:13,800 time, that would have been a pretty major story in all likelihood. 790 01:10:13,800 --> 01:10:19,600 And instead, you know, that just happened. 791 01:10:19,600 --> 01:10:31,320 We will see more cascade disasters and other kinds of general social failures because these 792 01:10:31,320 --> 01:10:39,440 systems were built without the knowledge of reality that we presently have, and they have 793 01:10:39,440 --> 01:10:42,720 not been updated to that knowledge yet. 794 01:10:42,720 --> 01:10:44,640 And we got work to do. 795 01:10:44,640 --> 01:10:47,320 There's a lot of work to do, for sure. 796 01:10:47,320 --> 01:10:54,840 Yeah, those are some great challenges, great goals, a little bit scary, but yeah, it's 797 01:10:54,840 --> 01:10:59,120 nice to be talking about how we can start thinking about them. 798 01:10:59,120 --> 01:11:04,440 Well, just one quick on the hope side. 799 01:11:04,440 --> 01:11:10,200 Very few people living today would voluntarily exchange the kinds of lifestyles they presently 800 01:11:10,200 --> 01:11:16,920 have for the median lifestyle of 500 years ago. 801 01:11:16,920 --> 01:11:27,040 And the shift in capacity that is potentiated by efficient information systems makes the 802 01:11:27,040 --> 01:11:33,960 shift in capacity of efficient energy systems look trivial by comparison. 803 01:11:33,960 --> 01:11:38,680 That is a good thing to always keep in mind. 804 01:11:38,680 --> 01:11:39,680 Yeah. 805 01:11:39,680 --> 01:11:42,400 I think most people would not want to go back to the 1400s and live. 806 01:11:42,400 --> 01:11:45,760 Well, no, this has been a really great conversation. 807 01:11:45,760 --> 01:11:50,600 I really appreciate your time and unpacking some of these ideas around financial markets 808 01:11:50,600 --> 01:11:52,320 and what insights you can have on them. 809 01:11:52,320 --> 01:11:56,760 So thank you for being here today. 810 01:11:56,760 --> 01:11:58,160 Thanks for having me here. 811 01:11:58,160 --> 01:12:21,080 This was fun.