Author Archive
The Black-Scholes Magic Trick, Explained!
Posted by David in Mathemagical Thinking On August 27, 2023
The economist Paul Romer once compared the models used in finance with the tricks used by magicians, whose secrets are protected by the Magician’s Oath. As he wrote in 2015, “A model is like doing a card
The Prediction Test
Posted by David in Mathemagical Thinking On October 30, 2019
The two most famous theories in the field of forecasting are the butterfly effect, and the efficient market hypothesis. Both are theories, not of prediction, but of non-prediction. The butterfly effect was developed by MIT meteorologist and
Swingers
This post looks at Mathematical Thinking, which we define as “The belief, especially characteristic of scientists, that events can be understood, described, and predicted using mathematical equations; thinking founded on this belief.” Sometimes it’s a good thing,
Magos
Posted by David in Mathemagical Thinking On February 11, 2019
Magic and science have a surprising amount in common. They are both about telling a story, and constructing a narrative of events. In one, the story appears magical, in the other it appears mathematical, but that difference
Automatic Writing
Posted by David in Mathemagical Thinking On January 30, 2019
On the topic of gullibility, here is a story that we like to share with our banker friends during our “seminars” on magical thinking (much better paid than real magic shows and the audience is less demanding).