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Posts tagged ‘interpretation’

Data and the interpretation thereof!

The following is excerpted from an article titled What Bitcoin Price Predictions Teach Us About Tribalistic Thinking, which appeared in MEDIUM. I am impelled to excerpt the same below as my paraphrasing abilities wouldn’t come anywhere near the lucidity with which the idea had been expressed.

It all boils down to this. There are two kinds of people, or tribes, in the world: those who believe in technical analysis (or fill in the blank with your favorite tribe), and those who don’t. I happen to fall in the latter camp, in part because that was my academic upbringing, and yet some of my own research is not consistent with the EMH. I’m willing to be convinced to switch tribes if there is compelling evidence. Despite his harsh words, even Malkiel is also able to make the case for why technical analysis might work: for example, he points out that “the crowd instinct of mass psychology” of investors jumping on the bandwagon could propel stock prices in a continuation of a trend. I tend to put a lot of weight in the academic evidence. That being said, there is so much subjectivity in the interpretation of charts that it’s very difficult for academics to devise a test of their efficacy. What I do know is that I’ll be watching bitcoin’s price closely to see if it penetrates the neckline, and if it does, how far it drops.

There’s a much broader take-away beyond the relatively narrow realm of investing. Whatever “tribes” you belong to, make sure you understand where the other tribes are coming from. Listen and learn, even if you don’t agree with them. Don’t just go out and buy Technical Analysis of Stock Trends and become a chartist. Don’t just go out and buy A Random Walk Down Wall Street and become an EMH-er. Buy both books, give it some thought, investigate, and then perhaps join a tribe. I’m glad I have both books on my bookshelf.

Listen to opposing points of view. Keep an open mind. Look at the evidence. Be mindful of all of the tribes you belong to and be respectful to those that you don’t belong to.

Stephen Foerster is a co-author, with Andrew Lo, of In Pursuit of the Perfect Portfolio: The Stories, Voices, and Key Insights of the Pioneers Who Shaped the Way We Invest, Princeton University Press (August 17, 2021).

To transpose this idea to the data on COVID from STATISTA would be very interesting. STATISTA, seems to me to be the best source for data since they obtain their data from both governmental sources, the NGOs and various other sources and try to arrive at a harmonised data set, which I think is credible.

The data put out by the Governments have to be aligned with the earlier proclamations made, the preparedness for the future and most importantly facts have to be trimmed to keep the morale of its citizens high, and even project to the other nations that they are performing as per the international outcomes.

NGOs have their own charter and they go around ferreting for data from sources, not yet factored by the Governmental sources, and bring out the discrepancies to malign the parties performing the functions of the Government. In between these ideologically presented forces lies the Commercial interest of the various medical interests, which are profit driven! In this melee to arrive at the facts and consequently project the future trajectory would be impossible. As such, it is better as suggested, at the close of the excepted portion, to know both the interpretations, not merely for the purpose of choosing or identifying where one belongs but also to sympathetically view the other point of view.

Being a Protestant, I did not subscribe to the concept of the LIMBO or the PURGATORY. But when ranged against two massive interests, instead of being an ignorant onlooker and being swayed by the power of the Heaven and the Hell, better to be in a place to observe both and at least feel good with a falsely inflated sense of understanding!

The Graft!

There once was a garden in which stood a huge banyan tree. The tree had by its longevity spread its seeds through the centuries by birds which had eaten its fruits. The garden became a forest and subsequently, filled the nation with banyan trees all over.
Suddenly, a few insects had invaded the banyan and started gnawing at them, or so the farmer thought. This spread and most of the banyan trees got afflicted with those insects.
A farmer saw the plight of the huge banyan in his vicinity, losing its majestic qualities and merely living off the structural support of the aerial roots which had become trunks to the main  banyan tree. The main banyan has become hollow, sheltering the birds and rodents. The farmer tried to resuscitate the main trunk, but to no avail.
The farmer took the issue to an agricultural scientist for a solution.
The scientist after prolonged study discovered that the main trunk was no more the conduit for the nutrients of the water and minerals from the ground, as the passages had been clogged over the years and that the aerial roots which had become trunks, after supplementing to the efforts of the main branch, had taken over the functions because of Necessity.
The scientist discovered that the main trunk by forwarding all the nutrients and water to the branches, had not utilised the same nutrients and water for nourishing itself, even though God had designed it to be not merely a conduit for conveying but also a beneficiary of such conveying. The scientist invented another specie of a Banyan, which had followed the God designed principle of deducting the user charges, for conveying the nutrients and water.
The scientist advised the farmer, see: we cannot restore the health of all the existing banyan trees of this strain, but we can GRAFT the specie of the banyan which collects user fee into this banyan and over a period of time attempt to grow a breed of Banyan, which would not be prone to this self-inflicting debility.
Thus the Grafting of another specie into the original banyan was done.
Generations later, the hybrid (grafted breed) replaced the old banyan trees after half a millennium.
The new generation of scientists after 500 years discovered certain health issues of the hybrid and had to decide whether to bring back the old banyan tree’s strain by eliminating the grafted strains which have become a part of the hybrid banyan trees.
A conclave was convened and all the farmers, scientists and vegetation enthusiasts met.
The squabbling went on for years.

The Traditionalists said that the GRAFTING was wrong, as the original banyan tree’s integrity had been compromised.

The Modernists said, we are people here by accident and our duty is to primarily rectify the issues, as is understood by us now, and continue with the historical grafting untouched. They further added as a compromise, we can accentuate the original strains without stymieing the grafted strains.
The Traditionalists said: No, elimination of the grafted strain was a must through stymieing the supply of nutrients and water through targeted policies.
The Functionalists, said: See, both are banyan trees and we have grafted only strains of another banyan into this Banyan, so why eliminate the benefits derived out of the newer strain grafted by our forefathers? We do not know the challenges faced by our forefathers 500 years ago, nor can we predict the inherent gains through the grafting done centuries back. The fact that the hybrid strain has coped with these 500 years, should vouchsafe for the benefits of the rectification. So let us not INTERPRET HISTORY in a cussed way, but allow the grafted strain to continue and provide more nutrients to the older strain of the original banyan.

The Purists would have none of it.
The matter is now escalated and it has been resolved that the whole country should participate in determining whether to eliminate the Grafted strain or to allow more nutrition to the older strain without stymieing the grafted strain.
The next conclave has been fixed for May, 2019.
God bless India.


All things are subject to interpretation whichever interpretation prevails at a given time is a function of power and not truth.
Friedrich Nietzsche
If we ever get to understand this statement of Nietzsche, we would be able to understand the FUNCTION of the Courts.

Let us look at it this way, in the USA the Supreme Court judges are known by their party affiliations, which are well known. So if the bench consists of more Democrats than Republican, their judgments , observed from the point of view of their affiliations would, engender a DEMOCRATIC bent.

If we analyze their “reasoning”, it may sound extremely logical, reasonable and fair.  Are these logicality, reasonableness and fairness, which have been the bed rock of  their “reasoning”, merely the hidden TOOLS in the hands of the “POWERFUL”?

MAY BE NIETZSCHE is, was and will be RIGHT ALWAYS!

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