This book confirms George Soros' theory of reflexivity in that the financial markets do not follow the rules and laws of the natural sciences.
Human behaviour, like the weather are very difficult to predict with certainty. Hence any flaw in the assumptions used by an trading model will render the models useless.
The other makes a distinction between intuition, theory and model. And his diagram on the Emotions listed in the original writer Spinoza makes understanding the emotions a breeze.
He did mention that it is every researcher's dream to come up with a theorem that will live longer than his life time , like Newton's Law of Gravitation, Law of Motions, Theorem Pythagoras....
Maybe one day I will come up with one theorem myself..... Well, someone has to to ...on some things that he knows best , right?
And his Financial Modeller's Hippocratic Oath...
•I will remember that I didn’t make the world , and it doesn’t satisfy my equations .
Though I will use the models I or others create to boldly estimate value, I will always look over my shoulders and never forget that the model is not the world.
I will not be overly impressed by mathematics, and I will never sacrifice reality for elegance without explaining to its end users why I have done so.
•I will not give people who use my models false comfort about their accuracy.
•I will make the assumptions and oversights explicit to all who use them.
•I understand that my work may have enormous effects on society and the economy, many beyond my comprehension.
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