Everything should be made as simple as possible

26 results back to index

pages: 122 words: 29,286

Learning Scikit-Learn: Machine Learning in Python by Raúl Garreta, Guillermo Moncecchi

computer vision, Debian, Everything should be made as simple as possible, natural language processing, Occam's razor, Silicon Valley

The general rule is that, in order to avoid overfitting, we should prefer simple (that is, with less parameters) methods, something that could be seen as an instantiation of the philosophical principle of Occam's razor, which states that among competing hypotheses, the hypothesis with the fewest assumptions should be selected. However, we should also take into account Einstein's words: "Everything should be made as simple as possible, but not simpler." The idem curse of dimensionality may suggest that we keep our models simple, but on the other hand, if our model is too simple we run the risk of suffering from underfitting. Underfitting problems arise when our model has such a low representation power that it cannot model the data even if we had all the training data we want.

pages: 199 words: 48,162

Capital Allocators: How the World’s Elite Money Managers Lead and Invest by Ted Seides

Albert Einstein, asset allocation, business cycle, coronavirus, Covid-19, COVID-19, crowdsourcing, deliberate practice, diversification, Everything should be made as simple as possible, family office, fixed income, high net worth, hindsight bias, impact investing, implied volatility, impulse control, index fund, Lean Startup, loss aversion, passive investing, Ralph Waldo Emerson, risk tolerance, Sharpe ratio, sovereign wealth fund, tail risk, The Wisdom of Crowds, Toyota Production System, zero-sum game

The staunch proponents of index fund management might want to consider why some of the smartest people in the business have independently chosen to pursue strategies that cannot be indexed. Perhaps the wisdom of this crowd is entirely wrong and investment success is easy, but I doubt it. Albert Einstein once said, “Everything should be made as simple as possible, but no simpler.” I believe the active/passive debate is full of nuance that is lost in proclaiming the failure of active management. Both active and passive are valuable tools that can serve important purposes in achieving investment success. Active management success is far from a foregone conclusion.

Presentation Zen Design: Simple Design Principles and Techniques to Enhance Your Presentations by Garr Reynolds

Albert Einstein, barriers to entry, business intelligence, business process, cloud computing, Everything should be made as simple as possible, Hans Rosling, Kickstarter, lateral thinking, Richard Feynman, Silicon Valley, women in the workforce, Yogi Berra

Humans are natural pattern seekers, so be mindful of this aptitude in yourself and in others. Design is a “whole brain” process. You are creative, practical, rational, analytic, empathetic, and passionate. Foster these skills in yourself and in others. 12. Simplify as much as you can—but no more. It was Albert Einstein who said, “Everything should be made as simple as possible, but not simpler.” Simplicity is our guiding principle. Simplicity means many things to many people. Scores of books have been written on the subject. For our purposes, simplicity means embracing most of the concepts discussed here to avoid the extraneous. It means making the conscious decision to cut unnecessary information and design elements.

pages: 226 words: 59,080

Economics Rules: The Rights and Wrongs of the Dismal Science by Dani Rodrik

airline deregulation, Albert Einstein, bank run, barriers to entry, Bretton Woods, business cycle, butterfly effect, capital controls, Carmen Reinhart, central bank independence, collective bargaining, Daniel Kahneman / Amos Tversky, David Ricardo: comparative advantage, distributed generation, Donald Davies, Edward Glaeser, endogenous growth, Eugene Fama: efficient market hypothesis, Everything should be made as simple as possible, Fellow of the Royal Society, financial deregulation, financial innovation, floating exchange rates, fudge factor, full employment, George Akerlof, Gini coefficient, Growth in a Time of Debt, income inequality, inflation targeting, informal economy, information asymmetry, invisible hand, Jean Tirole, Joseph Schumpeter, Kenneth Arrow, Kenneth Rogoff, labor-force participation, liquidity trap, loss aversion, low skilled workers, market design, market fundamentalism, minimum wage unemployment, oil shock, open economy, Pareto efficiency, Paul Samuelson, price stability, prisoner's dilemma, profit maximization, quantitative easing, randomized controlled trial, rent control, rent-seeking, Richard Thaler, risk/return, Robert Shiller, Robert Shiller, school vouchers, South Sea Bubble, spectrum auction, The Market for Lemons, the scientific method, The Wealth of Nations by Adam Smith, Thomas Kuhn: the structure of scientific revolutions, Thomas Malthus, trade liberalization, trade route, ultimatum game, University of East Anglia, unorthodox policies, Vilfredo Pareto, Washington Consensus, white flight

The term “analysis” itself has its roots in Greek, where it signifies the breaking of complex things into simpler elements. It is the antonym of “synthesis,” which refers to combining things. Neither analysis nor synthesis is possible without these simpler components. Simple need not mean simplistic, of course. As Einstein is supposed to have said, “Everything should be made as simple as possible, but no simpler.” When causal mechanisms interact strongly with each other and cannot be studied in isolation, models do need to include those interactions. If a coffee blight, say, both raises costs of production and disrupts a price-fixing agreement among principal coffee exporters, we cannot analyze the effects of each—the supply shock and the reduced cartelization—separately.

pages: 187 words: 62,861

The Penguin and the Leviathan: How Cooperation Triumphs Over Self-Interest by Yochai Benkler

business process, California gold rush, citizen journalism, Daniel Kahneman / Amos Tversky, East Village, Everything should be made as simple as possible, experimental economics, experimental subject, framing effect, Garrett Hardin, informal economy, invisible hand, jimmy wales, job satisfaction, Joseph Schumpeter, Kenneth Arrow, knowledge economy, laissez-faire capitalism, loss aversion, Murray Gell-Mann, Nicholas Carr, peer-to-peer, prediction markets, Richard Stallman, Scientific racism, Silicon Valley, Steven Pinker, telemarketer, Toyota Production System, Tragedy of the Commons, twin studies, ultimatum game, Washington Consensus, Yochai Benkler, zero-sum game, Zipcar

Some work on cognitive psychology anchors this in “cognitive fluency”—our tendency to remember and hold on to things that are simple to understand and remember. We seem to have a strong preference for, and tend to easily accept, simple explanations that allow for simple solutions (for example, if the crops failed, God must be angry). Even in scientific theory, Einstein famously said: “Everything should be made as simple as possible, but not one bit simpler.” A straightforward, uncomplicated theory of human nature that reduces our actions as simple, predictable responses to punishments and incentives and helps us explain away confusing and even disturbing behaviors is incredibly appealing and attractive to the human mind.

Speaking Code: Coding as Aesthetic and Political Expression by Geoff Cox, Alex McLean

4chan, Amazon Mechanical Turk, augmented reality, bash_history, bitcoin, cloud computing, computer age, computer vision, crowdsourcing, dematerialisation, Donald Knuth, Douglas Hofstadter, en.wikipedia.org, Everything should be made as simple as possible, finite state, Gödel, Escher, Bach, Hacker Conference 1984, Ian Bogost, Jacques de Vaucanson, Larry Wall, late capitalism, means of production, natural language processing, new economy, Norbert Wiener, Occupy movement, packet switching, peer-to-peer, Richard Stallman, Ronald Coase, Slavoj Žižek, social software, social web, software studies, speech recognition, stem cell, Stewart Brand, The Nature of the Firm, Turing machine, Turing test, Vilfredo Pareto, We are Anonymous. We are Legion, We are the 99%, WikiLeaks, Yochai Benkler

It should be noted, however, that Raymond’s idea of openness does not stretch beyond UNIX as he has made himself gatekeeper of The Hacker’s Dictionary, changing the very definition of programmer culture to reflect his own free-market ideology. (Available at http://www.ntk.net/2003/06/06/.) 19. Raymond, The Art of UNIX Programming, 25. The phrase alludes to Einstein’s soundbite, “Everything should be made as simple as possible, but no simpler.” 20. Florian Cramer, “Exe.cut[up]able statements: The Insistence of Code,” in Gerfried Stocker and Christine Schöpf, eds., Code: The Language of Our Time (Linz: Ars Electronica; Ostfildern-Ruit: 116 Notes to Pages 22–26 Hatje Cantz, 2003). He is referring to Barthes’s S/Z: An Essay.

pages: 240 words: 65,363

Think Like a Freak by Steven D. Levitt, Stephen J. Dubner

Albert Einstein, Anton Chekhov, autonomous vehicles, Barry Marshall: ulcers, call centre, Cass Sunstein, colonial rule, Edward Glaeser, Everything should be made as simple as possible, food miles, Gary Taubes, income inequality, Internet Archive, Isaac Newton, medical residency, Metcalfe’s law, microbiome, prediction markets, randomized controlled trial, Richard Thaler, Scramble for Africa, self-driving car, Silicon Valley, sunk-cost fallacy, Tony Hsieh, transatlantic slave trade, éminence grise

Why does that fourth-grader seem plenty smart in conversation but can’t answer a single question when it’s written on the blackboard? Sure, driving drunk is dangerous, but what about drunk walking? If an ulcer is caused by stress and spicy foods, why do some people with low stress and bland diets still get ulcers? As Albert Einstein liked to say, everything should be made as simple as possible, but not simpler. This is a beautiful way to address the frictions that bedevil modern society: as grateful as we are for the complex processes that have produced so much technology and progress, we are also dizzied by their sprawl. It is easy to get seduced by complexity; but there is virtue in simplicity too.

pages: 242 words: 68,019

Why Information Grows: The Evolution of Order, From Atoms to Economies by Cesar Hidalgo

"Robert Solow", Ada Lovelace, Albert Einstein, Arthur Eddington, assortative mating, business cycle, Claude Shannon: information theory, David Ricardo: comparative advantage, Douglas Hofstadter, Everything should be made as simple as possible, frictionless, frictionless market, George Akerlof, Gödel, Escher, Bach, income inequality, income per capita, industrial cluster, information asymmetry, invention of the telegraph, invisible hand, Isaac Newton, James Watt: steam engine, Jane Jacobs, job satisfaction, John von Neumann, Joi Ito, New Economic Geography, Norbert Wiener, p-value, Paul Samuelson, phenotype, price mechanism, Richard Florida, Ronald Coase, Rubik’s Cube, Silicon Valley, Simon Kuznets, Skype, statistical model, Steve Jobs, Steve Wozniak, Steven Pinker, The Market for Lemons, The Nature of the Firm, The Wealth of Nations by Adam Smith, total factor productivity, transaction costs, working-age population

“Empirical Research in Transaction Cost Economics: A Review and Assessment,” Journal of Law, Economics, and Organization 11, no. 2 (1995): 335–361. 5. This story comes from Ronald Coase, “The Institutional Structure of Production,” American Economic Review 82, no. 4 (1992): 713–719. 6. For those who are not familiar with the quote, it is “Everything should be made as simple as possible, but not simpler.” Details on the history of this quote, including the debate about whether it was actually voiced by Einstein, can be found at http://quoteinvestigator.com/2011/05/13/einstein-simple. 7. It is also reasonable to consider simpler theories that limit the size of firms.

pages: 212 words: 65,900

Symmetry and the Monster by Ronan, Mark

Albert Einstein, Andrew Wiles, conceptual framework, Everything should be made as simple as possible, G4S, Henri Poincaré, John Conway, John von Neumann, Kickstarter, New Journalism, Pierre-Simon Laplace, Richard Feynman, V2 rocket

The point was to discuss the strange connection between the Monster and the j-functions, but the underlying reason for this connection remained – and still remains – elusive. We shall come back to this later. In the meantime, at the end of the 1970s, the existence of the Monster was still an open question. No one had yet constructed it, so let us turn to the problems involved. 16 Construction Everything should be made as simple as possible, but not simpler. Albert Einstein In early 1977, when Sims and Leon had constructed the Baby Monster on a computer, as a group of permutations, it was natural to ask whether the Monster could be constructed in a similar way. Unfortunately this seemed out of sight, as I mentioned earlier, so an alternative method was needed.

The Psychopath Inside: A Neuroscientist's Personal Journey Into the Dark Side of the Brain by James Fallon

Bernie Madoff, epigenetics, Everything should be made as simple as possible, meta-analysis, personalized medicine, phenotype, Rubik’s Cube, selective serotonin reuptake inhibitor (SSRI), stem cell, theory of mind

But for the sake of simplicity, especially when teaching or writing a paper, I like to organize the brain into a 3×3×3 “Rubik’s Cube” pattern. This twenty-seven-part brain is as simple as I’m willing to go and still be able to sleep at night without violating Einstein’s first law of simplicity in science: “Everything should be made as simple as possible, but not simpler.” Everyone is familiar with the idea that we have a left brain and a right brain. But this conception is woefully lacking in some important ways. On the next page is a drawing of the side of the brain at the top left, a view of the top of the brain looking down from above, and a view of the medial portion of the brain that you would see if you sliced the brain down the middle.

pages: 262 words: 80,257

The Eureka Factor by John Kounios

active measures, Albert Einstein, Bluma Zeigarnik, call centre, Captain Sullenberger Hudson, deliberate practice, en.wikipedia.org, Everything should be made as simple as possible, Flynn Effect, functional fixedness, Google Hangouts, impulse control, invention of the telephone, invention of the telescope, Isaac Newton, Louis Pasteur, meta-analysis, Necker cube, pattern recognition, Silicon Valley, Skype, Steve Jobs, theory of mind, US Airways Flight 1549, Wall-E, William of Occam

Of course, it’s convenient when things are simple. Two kinds of thought are more complicated to explain than one type. However, it’s useful to keep in mind an extension of Occam’s razor that is usually attributed to Albert Einstein and is sometimes known as “Einstein’s razor”: “Everything should be made as simple as possible, but no simpler.” AND THE WINNER IS … * * * During the early 1990s, there was not yet a consensus among cognitive psychologists that insight was a unique mode of thought, so it was important to demonstrate that insight differs from analysis. Roderick Smith and John tackled this problem with a behavioral study.

pages: 360 words: 85,321

The Perfect Bet: How Science and Math Are Taking the Luck Out of Gambling by Adam Kucharski

Ada Lovelace, Albert Einstein, Antoine Gombaud: Chevalier de Méré, beat the dealer, Benoit Mandelbrot, butterfly effect, call centre, Chance favours the prepared mind, Claude Shannon: information theory, collateralized debt obligation, correlation does not imply causation, diversification, Edward Lorenz: Chaos theory, Edward Thorp, Everything should be made as simple as possible, Flash crash, Gerolamo Cardano, Henri Poincaré, Hibernia Atlantic: Project Express, if you build it, they will come, invention of the telegraph, Isaac Newton, Johannes Kepler, John Nash: game theory, John von Neumann, locking in a profit, Louis Pasteur, Nash equilibrium, Norbert Wiener, p-value, performance metric, Pierre-Simon Laplace, probability theory / Blaise Pascal / Pierre de Fermat, quantitative trading / quantitative finance, random walk, Richard Feynman, Ronald Reagan, Rubik’s Cube, statistical model, The Design of Experiments, Watson beat the top human players on Jeopardy!, zero-sum game

Almost every detail had gone, with nothing left but a handful of lines. Yet the shape was still recognizable as a bull. In those few strokes, Picasso had captured the essence of the animal, creating an image that was abstract, but not ambiguous. As Albert Einstein once said of scientific models, it was a case of “everything should be made as simple as possible, but not simpler.” Abstraction is not limited to the worlds of art and science. It is common in other areas of life, too. Take money. Whenever we pay with a credit card, we are replacing physical cash with an abstract representation. The numbers remain the same, but superfluous details—the texture, the color, the smell—have been removed.

pages: 300 words: 79,315

Getting Things Done: The Art of Stress-Free Productivity by David Allen

Albert Einstein, asset allocation, cognitive dissonance, conceptual framework, Everything should be made as simple as possible, George Santayana, index card, Kickstarter, knowledge worker, Ralph Waldo Emerson, rolodex

If you have only twenty or thirty of these, it may be fine to keep them all on one list labeled “Next Actions,” which you’ll review whenever you have any free time. For most of us, however, the number is more likely to be fifty to 150. In that case it makes sense to subdivide your “Next Actions” list into categories, such as “Calls” to make when you’re at a phone or “Project Head Questions” to be asked at your weekly briefing. Everything should be made as simple as possible, but not simpler. —Albert Einstein Nonactionable Items You need well-organized, discrete systems to handle the items that require no action as well as the ones that do. No-action systems fall into three categories: trash, incubation, and reference. Trash Trash should be self-evident.

pages: 265 words: 79,747

Happier at Home: Kiss More, Jump More, Abandon Self-Control, and My Other Experiments in Everyday Life by Gretchen Rubin

A Pattern Language, airport security, Albert Einstein, clean water, en.wikipedia.org, endowment effect, Everything should be made as simple as possible, knowledge worker, out of africa, placebo effect, Saturday Night Live, Telecommunications Act of 1996

After the first year, one of my housemates said kindly, “The thing about living with you, Gretchen, is that you don’t subtract, and you don’t add. You never leave a mess, and you never bring home a dessert or call the cable guy.” Which was so obviously true that it didn’t even hurt my feelings. I was always telling myself, “Keep it simple.” But as Albert Einstein pointed out, “Everything should be made as simple as possible, but not simpler.” I was made happier by my decision to bring paper plates, not home-baked muffins, to Eleanor’s start-of-school party, but “Keep it simple” wasn’t always the right response. Many things that boosted my happiness also added complexity to my life. Having children.

Gaming the Vote: Why Elections Aren't Fair (And What We Can Do About It) by William Poundstone

affirmative action, Albert Einstein, business cycle, Debian, desegregation, Donald Trump, en.wikipedia.org, Everything should be made as simple as possible, global village, guest worker program, hiring and firing, illegal immigration, invisible hand, jimmy wales, John Nash: game theory, John von Neumann, Kenneth Arrow, manufacturing employment, Nash equilibrium, Paul Samuelson, Pierre-Simon Laplace, prisoner's dilemma, Ralph Nader, RAND corporation, Ronald Reagan, Silicon Valley, slashdot, the map is not the territory, Thomas Bayes, Tragedy of the Commons, transcontinental railway, Unsafe at Any Speed, Y2K

Some like the psychic satisfaction of casting a negative vote for Wintergreen. eBay lets online buyers and sellers rate one another after each transaction. The three allowed choices are called positive, negative, and neutral. (This is not quite evaluative voting, as eBay ignores the neutral votes in computing the ratings. It's really approval voting with an option to abstain.) Smith quotes Albert Einstein: "Everything should be made as simple as possible, but no simpler:' The choices we make in every election are important. They deserve a little extra effort, if that's what it takes. You may now have noticed something extremely odd. It took Nobel Prize-level work to devise the impossibility theorem. Yet James Hong and Jim Young (re)invented range voting while tossing back a few drinks.

pages: 502 words: 107,657

Predictive Analytics: The Power to Predict Who Will Click, Buy, Lie, or Die by Eric Siegel

Albert Einstein, algorithmic trading, Amazon Mechanical Turk, Apple's 1984 Super Bowl advert, backtesting, Black Swan, book scanning, bounce rate, business intelligence, business process, butter production in bangladesh, call centre, Charles Lindbergh, commoditize, computer age, conceptual framework, correlation does not imply causation, crowdsourcing, dark matter, data is the new oil, en.wikipedia.org, Erik Brynjolfsson, Everything should be made as simple as possible, experimental subject, Google Glasses, happiness index / gross national happiness, job satisfaction, Johann Wolfgang von Goethe, lifelogging, Machine translation of "The spirit is willing, but the flesh is weak." to Russian and back, mass immigration, Moneyball by Michael Lewis explains big data, Nate Silver, natural language processing, Netflix Prize, Network effects, Norbert Wiener, personalized medicine, placebo effect, prediction markets, Ray Kurzweil, recommendation engine, risk-adjusted returns, Ronald Coase, Search for Extraterrestrial Intelligence, self-driving car, sentiment analysis, Shai Danziger, software as a service, speech recognition, statistical model, Steven Levy, text mining, the scientific method, The Signal and the Noise by Nate Silver, The Wisdom of Crowds, Thomas Bayes, Thomas Davenport, Turing test, Watson beat the top human players on Jeopardy!, X Prize, Yogi Berra, zero-sum game

Carving Out a Work of Art In every block of marble I see a statue as plain as though it stood before me, shaped and perfect in attitude and action. I have only to hew away the rough walls that imprison the lovely apparition to reveal it to the other eyes as mine see it. —Michelangelo Everything should be made as simple as possible, but not simpler. —Albert Einstein (as paraphrased by Roger Sessions) The decision tree fails unless we tame its wild growth. This presents a tough balance to strike. Like a parent, we strive to structure our progeny’s growth and development so they’re not out of control, and yet we cannot bear to quell creativity.

pages: 335 words: 104,850

Conscious Capitalism, With a New Preface by the Authors: Liberating the Heroic Spirit of Business by John Mackey, Rajendra Sisodia, Bill George

Bear Stearns, Berlin Wall, Buckminster Fuller, business process, carbon footprint, collective bargaining, corporate governance, corporate social responsibility, creative destruction, crony capitalism, cross-subsidies, en.wikipedia.org, Everything should be made as simple as possible, Fall of the Berlin Wall, fear of failure, Flynn Effect, income per capita, invisible hand, Jeff Bezos, job satisfaction, lone genius, Mahatma Gandhi, microcredit, Nelson Mandela, Occupy movement, profit maximization, Ralph Waldo Emerson, shareholder value, six sigma, social intelligence, Social Responsibility of Business Is to Increase Its Profits, Steve Jobs, Steven Pinker, The Fortune at the Bottom of the Pyramid, The Wealth of Nations by Adam Smith, too big to fail, union organizing, wealth creators, women in the workforce, zero-sum game

But some of the most critical elements of culture, such as love and authenticity, do not lend themselves to hard measures. It is confusing for managers to be told to optimize stakeholder interests. They need a simple, transparent goal, like maximizing shareholder value. A principle dubbed Einstein’s razor says, “Everything should be made as simple as possible, but no simpler.” It can be difficult for some people to understand the larger business system of interdependent stakeholders. As we have discussed, they need a high degree of systems intelligence, and sadly, many people just don’t have that yet. However, people who have integrative minds capable of seeing the interdependencies of the larger business system realize that business is not a math problem to be solved.

pages: 406 words: 115,719

The Case Against Sugar by Gary Taubes

Albert Einstein, British Empire, cuban missile crisis, epigenetics, Everything should be made as simple as possible, Gary Taubes, Isaac Newton, meta-analysis, microbiome, phenotype, pre–internet, Ralph Nader, RAND corporation, randomized controlled trial, selection bias, the new new thing, the scientific method, Works Progress Administration

Scientists know this essential concept as Occam’s Razor. When Isaac Newton said, “We are to admit no more causes of natural things than such as are both true and sufficient to explain their appearances,” he was saying the same thing that Albert Einstein, three centuries later, said (or was paraphrased as saying): “Everything should be made as simple as possible, but no simpler.” We should begin with the simplest possible hypothesis, and only if that can’t explain what we observe should we consider more complicated explanations—in this case, multiple causes. This is not, however, how medical researchers and public-health authorities have come to think about these disorders.

pages: 405 words: 121,531

Influence: Science and Practice by Robert B. Cialdini

Albert Einstein, attribution theory, bank run, cognitive dissonance, conceptual framework, desegregation, Everything should be made as simple as possible, experimental subject, Mars Rover, meta-analysis, Mikhail Gorbachev, Milgram experiment, Norman Macrae, Ralph Waldo Emerson, telemarketer, The Wisdom of Crowds

The charity request card in Figure 1.2 seems rather ordinary except for the odd sequencing of the donation request amounts. Explain why, according to the contrast principle, placing the smallest donation figure between two larger figures is an effective tactic to prompt more and larger donations. What points do the following quotes make about the dangers of click-whirr responding? “Everything should be made as simple as possible, but not simpler.” Albert Einstein “The greatest lesson in life is to know that even fools are sometimes right.” Winston Churchill How does the photograph that opens this chapter reflect the topic of the chapter? * * * Figure 1.2 Charity Request Appeal * * * Chapter 2 Reciprocation The Old Give and Take . . .and Take Pay every debt, as if God wrote the bill.

pages: 555 words: 119,733

Autotools by John Calcote

Albert Einstein, card file, Debian, delayed gratification, don't repeat yourself, en.wikipedia.org, Everything should be made as simple as possible, place-making, Richard Feynman, Valgrind

I began this book with the statement that people often start out hating the Autotools because they don't understand the purpose of the Autotools. By now, you should have a fairly well developed sense of this purpose. If you were disinclined to use the Autotools before, then I hope I've given you reason to reconsider. Recall the famously misquoted line from Albert Einstein, "Everything should be made as simple as possible, but no simpler."[161] Not all things can be made so simple that anyone can master them with little training. This is especially true when it comes to processes that are designed to make life simpler for others. The Autotools offer the ability for experts—programmers and software engineers—to make open source software more accessible to end users.

pages: 510 words: 120,048

Who Owns the Future? by Jaron Lanier

3D printing, 4chan, Affordable Care Act / Obamacare, Airbnb, augmented reality, automated trading system, barriers to entry, bitcoin, book scanning, Burning Man, call centre, carbon footprint, cloud computing, commoditize, computer age, crowdsourcing, David Brooks, David Graeber, delayed gratification, digital Maoism, Douglas Engelbart, en.wikipedia.org, Everything should be made as simple as possible, facts on the ground, Filter Bubble, financial deregulation, Fractional reserve banking, Francis Fukuyama: the end of history, Garrett Hardin, George Akerlof, global supply chain, global village, Haight Ashbury, hive mind, if you build it, they will come, income inequality, informal economy, information asymmetry, invisible hand, Jaron Lanier, Jeff Bezos, job automation, John Markoff, Kevin Kelly, Khan Academy, Kickstarter, Kodak vs Instagram, life extension, Long Term Capital Management, Marc Andreessen, Mark Zuckerberg, meta-analysis, Metcalfe’s law, moral hazard, mutually assured destruction, Network effects, new economy, Norbert Wiener, obamacare, packet switching, Panopticon Jeremy Bentham, Peter Thiel, place-making, Plutocrats, plutocrats, Ponzi scheme, post-oil, pre–internet, race to the bottom, Ray Kurzweil, rent-seeking, reversible computing, Richard Feynman, Ronald Reagan, scientific worldview, self-driving car, side project, Silicon Valley, Silicon Valley ideology, Silicon Valley startup, Skype, smart meter, stem cell, Steve Jobs, Steve Wozniak, Stewart Brand, Ted Nelson, The Market for Lemons, Thomas Malthus, too big to fail, Tragedy of the Commons, trickle-down economics, Turing test, Vannevar Bush, WikiLeaks, zero-sum game

Brandeis goes, “We can have democracy in this country, or we can have great wealth concentrated in the hands of a few, but we can’t have both.”* *I have been unable to find an original attribution for this quote, so am not certain it is authentic. Once I cited a quote of Einstein’s (“Everything should be made as simple as possible, but not simpler”) and was informed by an Einstein biographer that there was no evidence he had said it. Then I met a woman who had known Einstein and heard him say it! In this case, I have no idea, but it’s a super quote, whoever said it. Even for those who might dispute the primacy of either markets or democracy, the same principle will hold.

pages: 482 words: 125,973

Competition Demystified by Bruce C. Greenwald

additive manufacturing, airline deregulation, AltaVista, asset allocation, barriers to entry, business cycle, creative destruction, cross-subsidies, deindustrialization, discounted cash flows, diversified portfolio, Everything should be made as simple as possible, fault tolerance, intangible asset, John Nash: game theory, Nash equilibrium, Network effects, new economy, oil shock, packet switching, pets.com, price discrimination, price stability, selective serotonin reuptake inhibitor (SSRI), shareholder value, Silicon Valley, six sigma, Steve Jobs, transaction costs, yield management, zero-sum game

Then we turn to the other forces, starting with industry competitors and direct competitive interactions where these apply and next including suppliers and customers in a bargaining context. Our purpose here is not to ignore Porter’s forces but to prioritize and clarify them. Simplicity and clarity are important virtues of strategic analysis, provided we keep in mind Einstein’s admonition that “Everything should be made as simple as possible, but not simpler.” CHAPTER 2 Competitive Advantages I Supply and Demand THE DIFFERENTIATION MYTH According to an axiom of managerial wisdom, commodity businesses are to be avoided. Any operation in which sellers offer essentially identical products to price-sensitive customers faces an intense struggle for economic survival and must accept a lower than average level of profitability.

pages: 349 words: 134,041

Traders, Guns & Money: Knowns and Unknowns in the Dazzling World of Derivatives by Satyajit Das

accounting loophole / creative accounting, Albert Einstein, Asian financial crisis, asset-backed security, Bear Stearns, beat the dealer, Black Swan, Black-Scholes formula, Bretton Woods, BRICs, Brownian motion, business process, buy and hold, buy low sell high, call centre, capital asset pricing model, collateralized debt obligation, commoditize, complexity theory, computerized trading, corporate governance, corporate raider, Credit Default Swap, credit default swaps / collateralized debt obligations, cuban missile crisis, currency peg, disinformation, disintermediation, diversification, diversified portfolio, Edward Thorp, Eugene Fama: efficient market hypothesis, Everything should be made as simple as possible, financial innovation, fixed income, Haight Ashbury, high net worth, implied volatility, index arbitrage, index card, index fund, interest rate derivative, interest rate swap, Isaac Newton, job satisfaction, John Meriwether, locking in a profit, Long Term Capital Management, mandelbrot fractal, margin call, market bubble, Marshall McLuhan, mass affluent, mega-rich, merger arbitrage, Mexican peso crisis / tequila crisis, money market fund, moral hazard, mutually assured destruction, Myron Scholes, new economy, New Journalism, Nick Leeson, Nixon triggered the end of the Bretton Woods system, offshore financial centre, oil shock, Parkinson's law, placebo effect, Ponzi scheme, purchasing power parity, quantitative trading / quantitative finance, random walk, regulatory arbitrage, Right to Buy, risk free rate, risk-adjusted returns, risk/return, Satyajit Das, shareholder value, short selling, South Sea Bubble, statistical model, technology bubble, the medium is the message, the new new thing, time value of money, too big to fail, transaction costs, value at risk, Vanguard fund, volatility smile, yield curve, Yogi Berra, zero-coupon bond

Quants usually use the Latin to give it an air of authenticity: ‘Pluralitas non est ponenda sine neccesitate.’ The principle is used to justify a variety of things including the non-existence of God, an essential element of derivatives. The principle is also used to state that everything should be made as simple as possible to explain the matter in question. Creating a yield curve is akin to joining dots. You have some known interest rates and you have to draw a line between them to estimate rates on the dates when there are none observable. You now see the problem. You could make up any interest rate between two known points and no one could prove you wrong – the problem of ‘verifiability’.

pages: 696 words: 143,736

The Age of Spiritual Machines: When Computers Exceed Human Intelligence by Ray Kurzweil

Ada Lovelace, Alan Turing: On Computable Numbers, with an Application to the Entscheidungsproblem, Albert Einstein, Any sufficiently advanced technology is indistinguishable from magic, backpropagation, Buckminster Fuller, call centre, cellular automata, combinatorial explosion, complexity theory, computer age, computer vision, cosmological constant, cosmological principle, Danny Hillis, double helix, Douglas Hofstadter, Everything should be made as simple as possible, first square of the chessboard / second half of the chessboard, fudge factor, functional programming, George Gilder, Gödel, Escher, Bach, I think there is a world market for maybe five computers, information retrieval, invention of movable type, Isaac Newton, iterative process, Jacquard loom, John Markoff, John von Neumann, Lao Tzu, Law of Accelerating Returns, mandelbrot fractal, Marshall McLuhan, Menlo Park, natural language processing, Norbert Wiener, optical character recognition, ought to be enough for anybody, pattern recognition, phenotype, Ralph Waldo Emerson, Ray Kurzweil, Richard Feynman, Robert Metcalfe, Schrödinger's Cat, Search for Extraterrestrial Intelligence, self-driving car, Silicon Valley, social intelligence, speech recognition, Steven Pinker, Stewart Brand, stochastic process, technological singularity, Ted Kaczynski, telepresence, the medium is the message, There's no reason for any individual to have a computer in his home - Ken Olsen, traveling salesman, Turing machine, Turing test, Whole Earth Review, Y2K

After all, the designs created by the evolution of life-forms on Earth appear to have become more complex over time. However, complexity is not a perfect fit, either. Sometimes, a deeper order—a better fit to a purpose—is achieved through simplification rather than further increases in complexity. As Einstein said, “Everything should be made as simple as possible, but no simpler.” For example, a new theory that ties together apparently disparate ideas into one broader, more coherent theory reduces complexity but nonetheless may increase the “order for a purpose” that I am describing. Evolution has shown, however, that the general trend toward greater order does generally result in greater complexity.22 Thus improving a solution to a problem—which may increase or decrease complexity—increases order.

pages: 467 words: 154,960

Trend Following: How Great Traders Make Millions in Up or Down Markets by Michael W. Covel

Albert Einstein, Atul Gawande, backtesting, Bear Stearns, beat the dealer, Bernie Madoff, Black Swan, buy and hold, buy low sell high, capital asset pricing model, Clayton Christensen, commodity trading advisor, computerized trading, correlation coefficient, Daniel Kahneman / Amos Tversky, delayed gratification, deliberate practice, diversification, diversified portfolio, Edward Thorp, Elliott wave, Emanuel Derman, Eugene Fama: efficient market hypothesis, Everything should be made as simple as possible, fiat currency, fixed income, game design, hindsight bias, housing crisis, index fund, Isaac Newton, John Meriwether, John Nash: game theory, linear programming, Long Term Capital Management, mandelbrot fractal, margin call, market bubble, market fundamentalism, market microstructure, mental accounting, money market fund, Myron Scholes, Nash equilibrium, new economy, Nick Leeson, Ponzi scheme, prediction markets, random walk, Renaissance Technologies, Richard Feynman, risk tolerance, risk-adjusted returns, risk/return, Robert Shiller, Robert Shiller, shareholder value, Sharpe ratio, short selling, South Sea Bubble, Stephen Hawking, survivorship bias, systematic trading, the scientific method, Thomas L Friedman, too big to fail, transaction costs, upwardly mobile, value at risk, Vanguard fund, William of Occam, zero-sum game

It might feel like there should be something more exciting, more glamorous, more fun to do in which case you might consider a trip to Las Vegas. If you want to win, you execute the signal as prescribed. That means you trade at price level 20, and you throw the curve ball when called for by the coach. What do you want? Fun, excitement and glamour? Or do you want to execute correctly and possibly win? Everything should be made as simple as possible, but not simpler. Albert Einstein 218 Trend Following (Updated Edition): Learn to Make Millions in Up or Down Markets Process Versus Outcome The Greek philosopher Archilochus tells us, the fox knows many things, but the hedgehog knows one great thing. The fox— artful, sly and astute— represents the financial institution that knows many things about complex markets and sophisticated marketing.

pages: 543 words: 153,550

Model Thinker: What You Need to Know to Make Data Work for You by Scott E. Page

"Robert Solow", Airbnb, Albert Einstein, Alfred Russel Wallace, algorithmic trading, Alvin Roth, assortative mating, Bernie Madoff, bitcoin, Black Swan, blockchain, business cycle, Capital in the Twenty-First Century by Thomas Piketty, Checklist Manifesto, computer age, corporate governance, correlation does not imply causation, cuban missile crisis, deliberate practice, discrete time, distributed ledger, en.wikipedia.org, Estimating the Reproducibility of Psychological Science, Everything should be made as simple as possible, experimental economics, first-price auction, Flash crash, Geoffrey West, Santa Fe Institute, germ theory of disease, Gini coefficient, High speed trading, impulse control, income inequality, Isaac Newton, John von Neumann, Kenneth Rogoff, knowledge economy, knowledge worker, Long Term Capital Management, loss aversion, low skilled workers, Mark Zuckerberg, market design, meta-analysis, money market fund, Nash equilibrium, natural language processing, Network effects, p-value, Pareto efficiency, pattern recognition, Paul Erdős, Paul Samuelson, phenotype, pre–internet, prisoner's dilemma, race to the bottom, random walk, randomized controlled trial, Richard Feynman, Richard Thaler, school choice, sealed-bid auction, second-price auction, selection bias, six sigma, social graph, spectrum auction, statistical model, Stephen Hawking, Supply of New York City Cabdrivers, The Bell Curve by Richard Herrnstein and Charles Murray, The Great Moderation, The Rise and Fall of American Growth, the rule of 72, the scientific method, The Spirit Level, the strength of weak ties, The Wisdom of Crowds, Thomas Malthus, Thorstein Veblen, Tragedy of the Commons, urban sprawl, value at risk, web application, winner-take-all economy, zero-sum game

A modeler had to be able to prove each step in an argument. This constraint led to an aesthetic that valued stark models. English friar and theologian William of Ockham (1287–1347) wrote, “Plurality must never be posited without necessity.” Einstein summed up this principle, known as Ockham’s Razor, as follows: everything should be made as simple as possible, but not simpler. Today, when we run up against the constraint of analytic tractability, we can turn to computation. We can build elaborate models with many moving parts without concern for analytic tractability. Scientists take this approach when constructing models of the global climate, the brain, forest fires, and traffic.

pages: 1,239 words: 163,625

The Joys of Compounding: The Passionate Pursuit of Lifelong Learning, Revised and Updated by Gautam Baid

activist fund / activist shareholder / activist investor, Airbnb, Albert Einstein, Andrei Shleifer, asset allocation, Atul Gawande, availability heuristic, backtesting, barriers to entry, beat the dealer, Benoit Mandelbrot, Bernie Madoff, bitcoin, Black Swan, business process, buy and hold, Cal Newport, Cass Sunstein, Checklist Manifesto, Clayton Christensen, cognitive dissonance, collapse of Lehman Brothers, commoditize, corporate governance, correlation does not imply causation, creative destruction, cryptocurrency, Daniel Kahneman / Amos Tversky, delayed gratification, deliberate practice, discounted cash flows, disintermediation, disruptive innovation, Dissolution of the Soviet Union, diversification, diversified portfolio, dividend-yielding stocks, Edward Thorp, Elon Musk, Everything should be made as simple as possible, financial independence, financial innovation, fixed income, follow your passion, framing effect, George Santayana, Hans Rosling, hedonic treadmill, hindsight bias, Hyman Minsky, index fund, intangible asset, invention of the wheel, invisible hand, Isaac Newton, Jeff Bezos, Joseph Schumpeter, Kickstarter, knowledge economy, Lao Tzu, Long Term Capital Management, loss aversion, Louis Pasteur, Mahatma Gandhi, mandelbrot fractal, margin call, Mark Zuckerberg, mental accounting, Milgram experiment, moral hazard, Nate Silver, Network effects, Nicholas Carr, offshore financial centre, oil shock, passive income, passive investing, pattern recognition, Peter Thiel, Ponzi scheme, price anchoring, quantitative trading / quantitative finance, Ralph Waldo Emerson, Ray Kurzweil, reserve currency, Richard Feynman, Richard Thaler, risk free rate, risk-adjusted returns, Robert Shiller, Robert Shiller, salary depends on his not understanding it, Savings and loan crisis, shareholder value, six sigma, software as a service, software is eating the world, South Sea Bubble, special economic zone, Stanford marshmallow experiment, Steve Jobs, Steven Levy, Steven Pinker, stocks for the long run, sunk-cost fallacy, tail risk, the market place, The Signal and the Noise by Nate Silver, The Wisdom of Crowds, time value of money, transaction costs, tulip mania, Upton Sinclair, Walter Mischel, wealth creators, Yogi Berra, zero-sum game

Sherlock Holmes would look for the simplest, most natural explanation for a case, but he also believed in not oversimplifying complex matters, especially when dealing with systems involving complicated interactions. Similarly, Albert Einstein believed in the power of simplicity, but he also understood its limitations: “Everything should be made as simple as possible, but no simpler.” For example, the reason for the popularity of the price-to-earnings (P/E) ratio is its simplicity and accessibility. A ratio of 20× simply means that a company is available at a market capitalization that is twenty times its annual earnings. In other words, the stock price is trading at twenty times its earnings per share.

pages: 612 words: 187,431

The Art of UNIX Programming by Eric S. Raymond

A Pattern Language, Albert Einstein, barriers to entry, bioinformatics, Clayton Christensen, combinatorial explosion, commoditize, correlation coefficient, David Brooks, Debian, domain-specific language, don't repeat yourself, Donald Knuth, Everything should be made as simple as possible, facts on the ground, finite state, general-purpose programming language, George Santayana, Innovator's Dilemma, job automation, Larry Wall, MVC pattern, pattern recognition, Paul Graham, peer-to-peer, premature optimization, pre–internet, publish or perish, revision control, RFC: Request For Comment, Richard Stallman, Robert Metcalfe, Steven Levy, transaction costs, Turing complete, Valgrind, wage slave, web application

When you think you are in a situation that demands caching, it is wise to look one level deeper and ask why the caching is necessary. It may well be no more difficult to solve that problem than it would be to get all the edge cases in the caching software right. Complexity Chapter 13. Complexity As Simple As Possible, but No Simpler Everything should be made as simple as possible, but no simpler. -- Albert Einstein At the end of Chapter 1, we summarized the Unix philosophy as “Keep It Simple, Stupid!” Throughout the Design section, one of the continuing themes has been the importance of keeping designs and implementations as simple as possible. But what is “as simple as possible”?

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Good Calories, Bad Calories: Challenging the Conventional Wisdom on Diet, Weight Control, and Disease by Gary Taubes

Albert Einstein, California gold rush, caloric restriction, caloric restriction, cognitive dissonance, collaborative editing, Drosophila, Everything should be made as simple as possible, experimental subject, Gary Taubes, invention of agriculture, John Snow's cholera map, longitudinal study, meta-analysis, phenotype, placebo effect, Ralph Nader, randomized controlled trial, Richard Feynman, Robert Gordon, selection bias, the scientific method, Thomas Kuhn: the structure of scientific revolutions, twin studies, unbiased observer, Upton Sinclair

The remaining 30 percent will raise LDL cholesterol but will also raise HDL cholesterol and will have an insignificant effect, if any, on the ratio of total cholesterol to HDL. All of this suggests that eating a porterhouse steak in lieu of bread or potatoes would actually reduce heart-disease risk, although virtually no nutritional authority will say so publicly. The same is true for lard and bacon. “Everything should be made as simple as possible,” Albert Einstein once supposedly said, “but no simpler.” Our understanding of the nutritional causes of heart disease started with Keys’s original oversimplification that heart disease is caused by the effect of all dietary fat on total serum cholesterol. Total cholesterol gave way to HDL and LDL cholesterol and even triglycerides.