A conversation between Nassim Nicholas Taleb and Stephen Wolfram at the Wolfram Summer School 2021

[@Jason-dx8eb]

the stuff I wake up to after falling asleep on youtube is funny as hell

[@Ario2601]

🤣🤣🤣

[@katelynnehansen8115]

That’s what just happened to me 😂

[@X-boomer]

Me too!

[@basslinedan2]

Same 😅

[@RobotronSage]

Dude i'm on acid and i didn't realize the music stopped Now we're talking about what i can only assume is some sort of time travel algorithm or something?

[@nntalebproba]

2:10:50 I meant psychology not statistics.

[@Marcos10PT]

This made me realize just how good Stephen Wolfram is at explaining things

[@ai_serf]

He's up there with the greats.

[@Vbrokaz]

Cc ccccccj

[@martinsazar]

Summary: Stephen Wolfram: "Let's make a physical theory of economics!" Nassim Taleb: "That's precisely the mistake people make" For what it's worth, I agree with both: Yes, let's make one; and no, don't ever bet all your savings on any theory. What a wonderful experience to see two of my heroes together! Please, guys, do more conversations!

[@MohammedAli-xv6es]

41:44 - 43:58 - I think this sums up Nassim Taleb's point on the first hour or so of this video. Two reasons why above can't happen: 1) 44:11-44:52 2)44:53-46:42 you need more data points in order to get something deterministic, but obtaining more data points causes spuriousness more quickly than the law of averages to take effect. It's good that someone is attempting to put an equation to economics...but I don't think it's the first time that's happened (I'm not a historian, and have barely a layman's understanding of statistics). I also think Nassim Taleb's arguments are more valid, than the questions.

[@KaiTheAndragogist]

I think a decent common ground would be, "let's develop a New Kind of Physics to deal with economics." I feel like, "anti-fragility" is in many ways an expression of, "A New Kind Of Science" but in, "practical" terms. Cheers.

[@KaiTheAndragogist]

In regard to economic numerators and home currencies-- it's kind of like the Speed of Light in General Relatively. Just a thought.

[@simonmassey8850]

To me, this is a false dichotomy. Taleb AFAIK is pointing out where the standard models of finance fail. Wolfram AFAIK has come up with a computational theory that explains the how/why of the fundamentals of physics. The shallow conclusion is “Wolfram thinks he can solve finance with a predictable model to make traders millions and Taleb says that can never happen”. The more nuanced conclusion is that Wolfram IMHO may be able to explain why the standard models of finance are failing and possibly why the old “high-level rules” are bad approximations of more fundamental quanta that have some transiently stable states or dynamic local minima that they stand models predict. Or something. YMMV 😂 Certainly Wolfram isn't trying to disprove Taleb he is more likely IMHO to vindicate Talab by showing why outliers and black swans are more probably than believed and that only with a perfect simulation of everyones behaviours could you predict them (his theory of computational irreducibility).

[@robindehde7957]

Holy fucking shit, that was the best demonstration of the central limit theorem I have ever seen

[@StreamlineCarry]

Time stamp? If you point out a single thing in a 3.5 hour convo then it is kinda useless without a TS.

[@laggan]

17:00 I think

[@ehhhhhhhhhh]

@@laggan 15:25 "Let me explain the central limit using Mathematica..." For future reference, KZbin added the ability to control+F the subtitles on some videos now--super cool feature. It's in the hamburger menu next to the save button, click "Open Transcript", and cntrl+F central limit and you'll find he also mentions it later in the video at 26:20, 43:00, 1:44:36

[@HopDubstep]

@@ehhhhhhhhhh you son of a bitch... Thank you holy whoa this is bigs

[@zekerandolph1397]

@@HopDubstep When you add two uncorrelated random variables, the distribution of the result is the *convolution* of the two variables' distributions. You might also say their characteristic functions are multiplied, and that multiplication in the frequency domain corresponds to convolution in the spatial domain.

[@Michallote]

I love how it feel Stephen cares for us the audience so we don't loose track and explains it fast enough and simple enough for me to understand and go along.

[@valdomero738]

he is a 180 IQ wunderkind and I appreciate him lowering his IQ to our level so we can try to grasp what it's being discussed

[@TheXV22]

it's really just the opposite, Nassim doesn't give a fuck about making himself understandable, he says things quickly without explaining much and just assumes you should do your homework or read his mind or something.

[@v1kt0u5]

@@TheXV22 He didn't write that Stephen wasn't clear or articulate enough. And about Nassim, well, even if he's behind him intellectually and as a verbal communicator, he isn't talking about complex/difficult stuff for people knowing/understanding the minimum about the topics of their conversation.

[@iamswain25]

1:53 "a parameter is right on average, but not as a variable. a function of average is not average of function" 42:57 "law of large number is aggregation, what is central limit theorem is aggregation. something aggregates very well, you don't need to know the detail very well, because the overall is going to work out very well. you build portfolio that works very well on the Gaussian world. the problem is that we don't live in that world." 54:51 "our explanation of time dilation in modern times is the universe is computational. you can either use your computation to compute what happens next in time or you can use their computation to move in space. if you use your computation to move in space, then you will have less computation to use to evolve in time, so time will effectively run slower for you. 1:17:18 "if a currency is just there for illegal activities, in other words the currency for fraudsters ransomware and pariah, cannot be a currency. it needs to have a bunch of suckers around them to trade their currency for it to have a value."

[@robmarks6800]

31:20 ”The problem with economics is that we don’t have anything bounding a number”

[@anoushehs]

Tnx for highlights

[@jaimes7966]

intuitively, options pricing is similar to time dilation computations

[@nichobarton]

Such a gift to be able to listen to these two. Thank you both

[@bernoulli9047]

This conversation is what I envisioned about the future of the internet. I love seeing experts pairing off with other experts, sharing ideas, and actually working through things. We're able to witness the actual process of discovery and the generation of new ideas.

[@kevinolson1102]

@ 2:03:30 "N of 1 is a clinical consideration... N of 100 becomes a statistical problem. N of humanity - a pandemic - is a tail risk problem. And the three are three different disciplines" Pure, classic Taleb.

[@robbie_]

Fantastic watching Mr Taleb tinkering in Mathematica.... such a great way to learn.

[@wirion]

Taleb and Wolfram flexing their libraries on each other

[@thamalones]

That’s a very small sample of their libraries

[@scoreprinceton]

What a waste of time!! The guy maybe knows options trading/pricing but has no clue about physics, economics or statistical mechanics and doesn’t answer any of the questions but confusing everything with his simple example

[@JeremX17]

@@scoreprinceton I've watched this video about five times over and I agree with you on the fact that he is poor at teaching. After watching this video many times I see the genius though

[@scoreprinceton]

@@JeremX17 I stopped watching after the first 45 minutes!! Maybe there is something worthwhile - thanks for speaking out

[@shakeelabdal-karim6488]

Hahahaha

[@GTMarmot]

Excellent. Science is a hypothesis under constant revision. Very good discussion and rigorous questioning.

[@maneeshdangi4401]

Absolutely phenomenal conversation! Meeting of Math & Markets!

[@thebeautifulones5436]

Respect Wolfram, despite your great wealth you still patrioticly show British dentistry.

[@radonsmith4386]

LMAOOOOOO

[@traderambitious3321]

British humour at its finest. Literally made my day.

[@Senecamarcus]

Golden comment

[@musicalfringe]

I find it very reassuring to hear mild-mannered, careful Stephen Wolfram talking about religious scientism in public. Fantastic.

[@theoneed2051]

What timestamp do they talk religion?

[@Syntax753]

Best video on KZbin - been waiting over a decade for something decent to arrive on the internet. Just 2 years late :)

[@shailajadsharma3516]

Two of my favourite thinkers, what a find!

[@chorehunter4125]

Thank you for posting this! It was delightful!

[@everettwitt9464]

Please do one of these with Ed Thorpe if possible, I wish there were more videos of his talks. He seems very easy to talk to, his pedigree is second to none, and his ability to articulate thoughts is incredible...

[@artieboy24]

The complete opposite of Mr. Taleb! Though it is fair to say, as someone else pointed out, Mr. Taleb is more comfortably speaking in a more technical format.

[@mcengizaydin]

I understand only some parts of talks here by two great thinkers I admire. However, I understand at least the importance of their conversation. Good to see such creative and intelligent argumentations.

[@muzzletov]

Dude, sadly, you have to be bald to understand it in it's entirety. I guess it finally payed off to lose all that hair ... .

[@MrEo89]

@@muzzletov uh what? What they’re referring to isn’t even that complicated. It’s a lot of philosophizing and expression of opinion.

[@muzzletov]

​@@MrEo89 uh, what? a lot of philosophizing and expression of opinion? Is that your summary? "They used words to describe intent and meaning". What is the rest about then? If you can't summarize it well, or at all, I suppose, you don't understand it in it's "entirety". Also, why would you not be able to understand it without being bald? If it clearly can be seen as a joke, why do you then get offended?

[@ichtube]

How do you know it's great if you don't understand most of it?

[@JuanRomero-uc9dg]

I can feel the energy from the fusion of these two heads

[@HardikBhakhar]

We need one more such conversation between these two.. it’s been a while

[@johnhammer8668]

I realized i feel something when i read Wolfram's writings and I feel something else when I read Nassim's. The same is true when I listen to them. Both are stimulating but in a different way, hard to put in words. Wolfram's thought is linear and at first it feels it easy but i soon realize the point he tries to make has depth which i don't fully understand. Nassim switches b/w examples to make a point and when he finally restates the point("you see"...), I kinda find it hard to associate it with the several examples and lost. I think i need to study more math to understand both.

[@skc909887u]

NNT is a practioner . So ,so much examples

[@waldiniman]

I have a similar experience... and while watching this I had a realization that when I read or listen to Nassim, I rarely if ever have an "Aha!" moment. The times there is an "Aha!" - it tends to be insignificant, like an "Aha - I figured out which concept I am already familiar with he is applying here." Its as if the core concept is never elucidated in conceptual terms. Or perhaps, it's as if he lacks awareness of what a naive-to-his-views listener actually requires in order to no longer be naive to his views. Perhaps its a difference of learning and communication styles, but at the same time I know I'm not the only person to find him.. cryptic is perhaps a fitting word? At worst, I could imagine this being obfuscation - but I don't level that claim at him and truly don't think that's what's being done. A final thought - I guess my hangup could also simply be outsized expectations of the profundity of the things he shares, so that I'm always looking for some nugget of insight that is more novel or enlightening than what actually exists to be found. This is not to disparage his work or thoughts. Amongst his books and writings online, I almost invariably enjoy them on net, and certainly also find thought provoking angles. Just nothing ever truly paradigm shifting in terms of how I see things. Idk. I like to think I'm simply lacking the scaffolding to appreciate, and that one day when I've got all the tools, I'll see the powerful insights that his bravado implies.

[@kevalan1042]

@@waldiniman the only "aha" moment he provided me with is that 99% of statistical methods are useless or even harmful when heavy tails are involved - which to be fair is a pretty big "aha". I agree with you that he rarely distills something into a principle, but rather waffles on a lot. I'm also trying to glean some nuggets from his numerous examples, but often he also talks about things he has no clue about, so I'm close to "unfollowing"

[@ReddSpark]

Sounds like neither are good at explaining things?

[@Arkanj3l]

@@ReddSpark Yeah they're better writers both.

[@HBrown-cc6wv]

I’ll probably understand 10% of this.

[@juancarmonazavala3280]

That’s generous for me 🥴🥴

[@osman01003]

If they understood it, they would not be talking about it. It's not a "science."

[@tensevo]

Slow down the video, stop at words you do not understand and look them up. That should get you to 80%, and that's good.

[@Nucleus09]

I'm here listening to you mr.Nassim because of my love of my life adores your trinkile of thoughts. and know i'm sleepless, thanx

Thank you so much

[@layyah0905]

This talk was like attending a course,such was the depth and breadth of topics and concepts.

[@susanfinkelstein1176]

I cannot believe Wolfram has only 85K subscribers. 😮 and this interview only 152K views.

[@mindfulawareness1]

At around 3.23.20, Taleb: "I have to be in a restaurant at 7pm", lol.

[@RiffRaff34]

You two are amazing , well received.

[@hackerjynx]

I pretty much didn't understand much but it was really fun to listen to.

[@MightyDrunken]

Random trip to KZbin and what do I find. Two most interesting people whom I follow and admire. Hopefully their intelligence will rub off on me.

[@JakovRudi]

I'm disappointed Taleb didn't greet us with his usual "Hello Friends" ;) (great conversation btw)

[@MusixPro4u]

Commenting for the algorithm. Show me more of this in the future.

[@testoptions]

Amazing long form Education. Paying it forward.

[@bigbluebraintrust3194]

I'm from KY USA & understand him well..

[@weinerdog137]

Could listen to these two for a while.

[@behrad9712]

brilliant topic! wonderful, thank you so much, I was wondering why almost nobody in risk management and even in statistics! never talked about these math backgrounds of statistics and the effects on the real complex world!?

[@ajenduoludare8672]

Basically, the behavior of unbounded sets is computationally irreducible.

[@tgenov]

What that Taleb is saying Mathematically reduces to this: f(g(X)) != g(f(X)) The order in which you apply functions/operations to X matters.

[@quicktripgas]

Exactly, thats the TLDW

[@Acid31337]

"order matters" is actually shorter than that ))

[@tgenov]

@@Acid31337 And a link to wikipedia is a better indexer than mere platitudes. en.wikipedia.org/wiki/Order_theory

[@oraz.]

Composition of functions is usually not commutative. I'm not sure what that relating to volatility was so important though.

[@migerra]

Very nice, really interesting! I have two questions maybe some of you can answer them :) : - So what do you do if you need to use p-values at 2:02:36 they kind of conclude what to do, but it is difficult to understand/hear what they say.. My take is, just like physics (5-sigma) and check assumptions ofc. - Anyone has the link on what Taleb discusses around 2:30:55 here he says Wolfram, his son and Diego computed a model in an afternoon which is fastly more robut compared to traditional epidemiological models. Is there a link of what he refers to? Thanks!

[@ANGER2077]

this played while I slept and made my phone die

[@anshuman7113]

Please, can you guys do this every ones in a while? Such a good chemistry between the two greatest of the greatest. May god keep you both safe and happy

[@kid-vf4lu]

Their chemistry is amazing and surprising! Particularly because a lot of people /"experts" find both of them to be difficult personalities lol

[@frobnitzem]

Nicholas Taleb was spot-on with expected future value, but it's surprising nobody mentioned labor costs. It's why a hand-crafted item costs 100x more, and defines a price basis for everything traded.

[@cyberft]

Cost and price aren’t necessarily equal.

[@frobnitzem]

@@cyberft but they can't remain unequal for very long. Their difference comes from forecasting error (or hidden costs / prices).

[@cyberft]

@@frobnitzem forecasting error is one explanation. You also have other effects like seen in luxury goods, where price far exceeds costs, this can persist through time and may actually become more entrenched due to prestige and branding.

[@frobnitzem]

@@cyberft that's just the hidden cost of researching item quality. When you get a brand name item you expect it to have a higher standard (whether its true or not...).

[@sifta7]

Instead of cost, he brought up the concept of “value” as a subjective quantity and “price” as a public quantity, and presumably there could be value upstream of the end-user. To someone that paid the cost of production, maybe these are highly correlated.

[@LevelofClarity]

When I'm thinking statistically (terms of probabilities) I translate my thoughts in terms puts, calls and the accompanying greeks, so I'm right there will Taleb on his first example. Great stuff.

[@quant2011]

Biggest Taleb intellectual contribution beyond his unique expertise in risk, is his Fragility spectrum concept. All things can be put into these categories: Fragile, Antifragile, Robust. Fragile things are usually made by man, like communism. Antifragile by evolution or huge number of co-creators. Example: society. Robust - are eternal, designed by existence itself, like gold, space, time, gravity. I can expand fragility spectrum into theory of everything which is more universal than any other, incl CTMU by Chris Langan.

[@DerekKite]

Wolfram said most of the economy is simply people buying and selling things like lettuce. The complexities of that simple transaction, the risk, the risk mitigation strategies from the farmer to the transportation to the retailer is extraordinarily complex, and you would run into the situation that Taleb describes where there isn't enough data or time to calculate a mean. Taleb's basic point is that you can't model this stuff, and that is where economists fall short. They can observe, see patterns. But they cannot understand the minute workings to build a model that is predictive.

[@deansundquist9601]

And that there might be a complex explanation or estimate, for lettuce, but you’re now a lettuce expert, not a market expert, and it doesn’t generalize.

[@jms974]

Well said. Many financial economists are just pseudo statisticians who dont understand that the applied prob and stat methods they are trying to use dont apply at all to their questions and problems, especially when it comes to modeling, forecasting, and pricing. They try so hard to justify the use of complicated forecasting and modeling techniques when the real issue is that such a task is in and of itself impossible. I think the Austrian school is closest to reality simply by understanding the inherent limits of the economics field itself.

[@jms974]

Also, I find it perplexing why so many people, Including wolfram here himself, seem to inadvertently associate taleb and his ideas as some sort of collection of revolutionary "economic" ideas when in reality, like he has said so many times himself, one of his many claims to fame is exposing the academic economics profession for incorrectly using and applying a set of tools from a completely different domain of expertise(statistics), to problems which in reality, may not even be answerable in any closed, elegant form constituting any sort of rigorous theory (derivative pricing and financial forecasting). He is not an economist so why would he be suited to ask for creating any sort of new economic theory. He is a statistician and practicing trader. He thus would be the first to caution against any sort of grandiose economic theory that steps way out of line with reality

[@andrewcoyle6703]

At approx 39 mins Stephen Wolfram indicates that there is no axiomatic theory of economics. Unfortunately, this is mistaken. Around the first five chapters of every advanced microeconomics textbook are devoted to proving these axioms. Whether the axiomatic approach is a sound approach to economic behaviour is sound, is another topic. But it exists.

[@groebestie5594]

I don’t have economic background but axioms are per definition unproven.

[@tensevo]

Wolfram is good at channelling the unfiltered raw Taleb, into a more accessible format.

[@sprgeorge333]

This was awesome :)

[@timthompson468]

This is a fascinating conversation. I was looking for motivation to learn statistics, and I think I’ve found it. Most of the examples in basic courses are not very interesting, but it’s encouraging to hear the wide range of applications discussed here. Some of the comments on misapplication remind me of Richard Feynman’s speech on Cargo Cult Science, where people use the language of science, but are not actually applying the science. In my previous jobs, I’ve often been called upon to apply statistics incorrectly when I only new enough about it to know the application was incorrect (such as analyzing results on a sample of ten or less units).

[@prabhatprasad141]

I agree, same with me

[@uku4171]

The thing with NFTs is that people don't actually buy them because they're fun. They buy them because they want to make a profit.

[@noobvsprominecraftbuild]

this is not necessarily true. look at tradable items in video games (basically NFTs but centralized). There are lots of people who buy scarce digital goods for fun.

[@ty_vorhies]

This is amazing to watch and listen to, in real time. Wow

[@mildlyacidic]

Professor Taleb's analogy about value discrepancies in pricing for particular items is essentially an analogy about energy. In this analogy, one currency has more 'potential' than the other, and the potential equilibrates gradually which is an entropic process. The issue is: we wonder if we ever reach equilibrium in this process. That is the flaw with modern economics: which assumes economic systems are in equilibrium. This is used to justify the use of a gaussian as a starting point for analysis. However, the fact that power law or fat-tailed distributions are so prevalent are strong evidence that the economy does not operate at equilibrium.

[@SithLurker]

In the economy people's desires/preferences create potential differences and desires can change arbitrarily. Not only that but people are averse to uniformity.

[@nagilum]

I feel like after a certain point these guys were having separate conversations with each other.

[@tensevo]

This is effing epic. My brain is hurting, but in a good way.

[@YamahaC7SRG]

Feynman: "There are 10^11 stars in the galaxy. That used to be a huge number. But it’s only a hundred billion. It’s less than the national deficit! We used to call them astronomical numbers. Now we should call them economical numbers." I think Feynman was saying, 'if you think numbers from the science of astronomy are large, try numbers from economics.' Economics is composed of the aggregated actions of IRRATIONAL PEOPLE (with no constraint) while physics is not. There are limits in physics that do not exist in economics. Physics exists in Mediocristan while economics (and most social matters) exists in Extremistan. They are different worlds with different rules.

[@mohammedzeeshan7277]

I fell asleep and woke up to this video

[@Not_Aran8276]

Same here

[@lucash4887]

This is absolutely wonderful. I would love to see the next episode. One comment around 30 minutes: there is an analogy between atoms and currency in which energy is suggested but Professor Wolfram correlates it with observability. From the economics side, would information make the most sense, since we are talking price?

[@sandworm9528]

No

[@gijslimonard6583]

Awesome 👌🏻 especially the discussion on medicine 👍🏻

[@i.m.gurney]

"....the theory of miracles.....", lol. The edge of the jigsaw puzzles is all but complete.

[@i.m.gurney]

The last corner piece causing an issue because we can not touch it with anything but logic.

[@i.m.gurney]

Since the birth of the first neuron, life has been developing this method we now call science.

[@Tesla_dd]

This is pure gold!

[@tensevo]

Digital Gold

[@stuartnettleton2280]

If we have Yes/No hypotheses or likelihood estimates about something ... and recognise we have a "don't know" component akin to second order variance or computational irreducibly ... and say the likelihoods of Yes + No + Don't Know = 1, then would it be possible to start to estimate the "don't know" component from a computational irreducibility perspective?

[@kallehallden4855]

Confused by your comment. Explain your idea in terms of an example of estimating a parameter from a sample... By the way likelihoods don't have to sum up to 1 if that's what you mean.

[@stuartnettleton2280]

@@kallehallden4855 thanks

[@jpdiegidio]

​@@stuartnettleton2280 "Uncertainty" is already captured by the probability distribution: for a coin flip, "don't know" corresponds to a 50%/50% expectation.

[@skc909887u]

2 great thinkers . One straight as a straight line . Other connecting dots

[@PinkBlueNinjaStar]

Just found out he worked on the movie "Arrival". That's so cool!

[@BogdanManciu]

On the intrinsic value of Gold, it's industrial utility is the same as silver and as jewelery taste has changed silver use is has increased with new generations, so by that metric gold should be valued around $25 not $2500.

[@quant2011]

Or silver should be at $2000 ;)

[@SimonJackson13]

Control plus right bracket steps through the close bracket terminals ? For fast typing.

[@SimonJackson13]

Perhaps with a few free commas and some oft used ->.

[@johnanderson2654]

Take the average option. That is how it's done correctly! Thank you Nassim Taleb!

[@sandworm9528]

No, take two options whose average is 0 but with high upside and low downside

[@Achrononmaster]

@50:00 Taleb gives a fair account here. But the fundamental reason for the "one-nation one-currency" rule is just human history and the anthropology involved in the emergence of the _unit of account._ Most normies think money came from barter, but there is zero archaeological evidence for this. Money arose in every case from social relations, namely _credit and debt obligations._ The authorities _chose_ the unit of account, and since it is a record of debt/credit it is scalar. There is no mystery to this. The earliest known formalized system of debt obligations was German wiergild which arose out of blood-feuds, for making them less violent! The earliest known writing we know of is cuneiform records of credit and debt. (Writing might have been invented to record credit and debts.) Temples and early state authorities had systems of tithes and fines, and whatever unit the temples/kings/etc accepted as a redemption became the regional unit of account. How was it standardized? By grain weights mostly (like today's BIPM used to standardized the kilogram as platinum --- no one needs the platinum to measure a kilogram), that is why the etymology of most currencies derives from a grain weight (dinar, lira, pound, peso, ...) but the grain itself was just the numeraire, the unit of account "money-thing" merchants carried with them was a token, not actual sacks of grain! Today, taxes drive money, not tithes. The imposition of a tax liability creates people needing the tokens, allowing the sate to hire them or buy their wares to provision the state with the social services people want (hopefully democratically, but maybe feudally). The currency-issuing state is thus *not* _tax-funded._ It's the exact opposite, they _issue the currency_ from inception, and the tax liability system _drives_ the demand for the worthless tokens: so we have in almost all countries *tax-driven* systems _not_ *tax-funded*. These are exact opposites, little do any "professional" modern economists know it (except the MMT people). They (the mainstream orthodoxy) all suffer from massive century long groupthink (it is the single biggest scandal in all of academia for as long as I can recall, and it kills people, with all the fraudulent austerity advice these idiot economists lay on naive politicians --- they think governments (the issuers) can run out of money, bu that's impossible, the state unit of account is the state's IOU, issued by fiat (digital keystrokes marking up bank accounts these days, rather than paper ledger books entries), you cannot run out of your own IOU's). In the past it is pretty clear people _did_ know that tax drove the currency, not the other way around, but that knowledge was (inexiplicably?) lost around World War I. We know this in many ways, but one simple way to know people knew where the currency came from is what they called the process of paying your taxes: _revenue_ comes from the French _"revenir"_ meaning "to return back". You return the currency back to the issuer as tax redemption. You are giving them back their own IOU which they issued, which you accepted because you had tax liabilities (or sometimes fees and fines) to redeem. All modern forms of state currency are essentially tax credits: accounting records, nothing more, unless there is a promise to convert to gold (which means you'd have to hoard gold) or a fixed exchange rate (which means you'd have to sell stuff you might need domestically to get foreign currency), but most sophisticated nations have abandoned that idiocy for good reason. Exceptions are rare, one such exception is the Eurozone, which now does have _tax-funded_ member states, because they cannot issue the euro, their banks can only issue debt, and only the undemocratic ECB can actually, by law, issue the euro without taxing or borrowing, so they have all lost their sovereignty and _are_ tax-funded ---- unlike the USA, AUS, CND, JPON, NZ, UK,... --- who all wisely retain sovereignty. This, for the euroland, means they will never have full employment (so they'll be wasting their best resources, their people) unless they drive wages right down to subsistence. It's a criminal system if you ask me. Europeans think they have nice open borders and freedom, but they're all fools (except Germany who is the big mercantilist and essentially sucks up euros from the debts of the others, nevertheless, because Germany needs to keep wages low to be the eurozone mercantilists they are still in austerity because they cannot issue euros to raise wages, if they did they'd have a debt crisis and ensuing inflation, which cannot occur if they were like Canada, USA, Australia or the UK). The Swiss, Norwegians and the Brits were so much wiser, retaining their own currencies, hence sovereignty. Note the barter origins story Adam Smith told is pure fantasy (read David Graeber, he lays it all out, all the anthropology, and the only instances of primitive barter occurred in rarely interacting tribal ritual). In social communities where buyers and sellers mix all the time the money of account was always a record keeping system, and the same is true today (how else do you explain the US Fed's infinite capacity for QE (the trillion dollars limits are purely political) without raising a single dime in taxes?: it's just spreadsheet point scoring, they credit bank reserves whenever they want, or drain them by selling bonds, whenever they want, the purpose is not to get money the Treasury alone can issue without taxing or borrowing, it's to fix interest rates). Commodity currencies are very rare in history, and never end well, because they incentivize plunder and hoarding, hence catastrophic deflation unless people spend (waste!) their time gold mining. Modern currencies are thus almost universally a simple ledger book maintained by "trusted" (ahem!) authorities, and this was they money system practically preferred throughout history for 4000 years or more --- tally sticks etc., were far more common than coingae. And when there was coinage, the currency unit was the face value stamped on the coin, not the much lower social use-value of the metal (otherwise people would melt it down and sell it, which did happen under coinage systems if the King let inflation occur by stamping too much, making the metal more use-precious by scarcity).

[@wwkk4964]

I was an atheist until I found about about Stephen Wolfram.

[@shadowshadow2724]

?

[@simonmassey8850]

This has to be a joke to say he is a god....? 😂

[@wwkk4964]

@@simonmassey8850 I mean, I now believe in Goddess Namagiri who supposedly gave Ramanujan the correct mathematical results he claimed came from her. Stephen just made me appreciate this fact. 😉

[@dprophecyguy]

What should I study to understand what they are talking about?

[@lambertronix]

stephen wolfram is maybe the ideal conversation partner for nassim

[@tensevo]

Was thinking the exact thing.

[@plantraco]

Wolfram shows great patience. He listens for 30 minutes as Taleb explains “the mean” and Wolfram is like “ok” every few minutes. Only three more hours of listening to go on this I’m hoping there’s something good. Where’s the beef? I was hoping they would get on to the subjective nature of “implied volatility” I was hoping Wolfram could tear it apart. Anyways unfortunately I can barely understand this stuff I wish someone would summarize it in a few paragraphs.

[@galepooley7535]

Because people have different values, they can create value for one another through a trade in a market. Markets are where people go to "value-up."

[@piotrwokowski1539]

More content like that please 🙏

[@TheEtrepreneur]

from great complexity, it becomes simple all of a sudden. Well done.

[@richardsantomauro6947]

A physicist, virologist and quant go into a bar and each want to get the best cocktail for the best price. The physicist tries every cocktail and says Manhattan is best. The quant looks at all the sales books and goes with the Mojito. The MD, says “You guys are morons. The scientific method is supreme. Hey, bartender, what do you think I should get?”

[@bigfactsbroski]

I don’t get it

[@GodGuy8]

It means they all think they are the right and competing over the options when each option has merits

[@richardsantomauro6947]

His idea of the scientific method is to ask an authority. @@GodGuy8

[@brendawilliams8062]

@@GodGuy8well, I suppose your best bet on this one is the bartender

[@dundoderdumme3044]

Who is portrayed in the black statue in the back?

[@KarimTraderFutures]

Merci pour le partage !!!

[@Kolmir]

Great, very, very informative and eye-opening :) BTW 3:22:00 Can we say that Valuation - Price relation may be similar to Mass - Weight?

[@MrLonelyrager]

One of last points they discussed is about automated investments or algorithmic trading , Nassim states that he is only seem them work in short term brokerages that do HF trading , anybody can argue why? I didn't fully get it. Is it because high frequency transactions allow for new realm that humans didn't generate?

[@AbgezocktXD]

At very high frequencies or rather very low latency you can sometimes frontrun (which means sliding your order in before somebody elses big, market moving block trade). From afar HF firms are really just abusing the plumbing of the financial system.

[@synthclub]

Great discussion. I suspect that Stephen and the team might unpick the rules that govern the economy by interviewing James Harris Simons the founder of Renaissance Technologies. Having all three polymaths in one meeting would be a dream.

[@quant2011]

Darryl Anka exceeds all three of these gents in spectrum of understanding

[@rv706]

Wolfram was trying to make an analogy between arbitrage and curvature. Even if I don't really know what arbitrage is, it made me think that the analogy could be with nontrivial (Cech) cohomology instead...

[@rv706]

Looking in google, it turns out my intuition was right! Apparently, there's even a thing called Geometric Arbitrage Theory that deals precisely with this kind of stuff.

[@johnanderson2654]

The irony of him saying to Taleb, "Every electron is the same"......like all swans are white!...... 2:35:35

[@paulpierce1001]

Science seems to be a commonly misunderstood concept because people have such a polarized view of it and it should be the most neutral in substance. For the most part, what I get a lot these days is "just cause 'science' says it's true, doesn't mean it is". On the other hand, you get those people who religiously follow "science" and if it goes against what "science" says, it must be false. It is odd that people refer to it as "science says". Science is not a person or group of people. Science is not a place or a thing. Science is merely discovery. The discovery of what is. Learning how to understand our reality. Those answers change all the time but there are also many things that remain constant. Science is not in the theory. It is in the discovery. Discovery can only ever hold the value of true. If "discovery" holds false, it was not a discovery. Science is perceived and theory is conveyed. As we know already, translations are not always correct. So, it is weird to see how many people view it in such a polarizing light of good or bad, right or wrong. It only ever just 'is'. Science is abstract. It cannot 'say' anything. It only 'does'. Scientists can convey their theory based on their discoveries but, theories are ever changing based on new discoveries. No use in putting an umbrella term on "science" like it is some union of like-minded people. It is quite the opposite.

[@gaulindidier5995]

That was pretty damn good.

[@luisfernandoojedavarrasso1288]

This is pure gold.

[@KALLAN8]

Such an important conversation...

[@pie3566]

One basic problem with this conversación is that Taleb is not an economist and Wolfram wants to talks about the very basic axioms of económics that I presume Taleb does not know (and also does not care)

[@HopDubstep]

Great conversation hitting on several ideas that became relevant to me recently, awesome! Also 1:00:05 made me lol

[@Secretname951]

I just read Wolfram’s biography and I feel like giving up all my studies and living a simple life.

[@naxim4778]

which is his biography?

[@sillyfarmerbilly8872]

When he described this computational model for space-time... Mind blown.

[@faizikramulla1210]

🤯 same here !

[@ilirsheraj2092]

Very very good discussion! I didnt understand it all but its awesome

[@sillyfarmerbilly8872]

Holy crap I was 2 hours in and it really starts to cook, and I thought, "aww I hope this isn't going to end soon"... Nope, over an hour to go

[@hernaneche]

It feels like reading Leibniz to Bernoulli correspondence, but in real time.

[@ettoremariotti4280]

Can't wait for SW digestion of Nassim's scattered ideas

[@SS-kg8rj]

This is great stuff.

[@carpediemjonah8110]

Awesome. Simplicity is the survivor.

[@galepooley7535]

Economics is not physics. Economics is about knowledge, not atoms. Economics is the study of how human beings create value for one another. And value can change as fast as people can change their minds. See George Gilder in Knowledge and Power.

[@tantzer6113]

Good points about economics, although they have analogues in physics.

[@satoshinakamoto7253]

micreconomics is true, macro is new bs

[@calebaw]

37:20 @nntaleb your definition of finance is probably better applied to trading. "Finance" is the ending/settlement of debt obligation to someone with cash (from a bank), from the latin "fin ance".