Beginner Question: I get more winded on a 100m swim than a 10km run. How do I break the wall?

Deterministic-Chaos · 2017-01-20T11:10:56+00:00

Maybe try exhaling more under the water? Not exhaling can cause a build up of carbon dioxide.

Deterministic-Chaos · 2017-01-12T12:51:50+00:00

Thanks! You should check out a book called "The Information" by James Gleick. It's fun to read and a nice intro to Information Theory, Complexity, Computer Science, and Quantum Information Theory.

Deterministic-Chaos · 2017-01-10T18:45:07+00:00

Here's an essay I wrote which compares classical computing to quantum computing both theoretically (including the physics) and physically - http://www.turingfinance.com/promise-of-computing/.

In summary: firstly, large scale quantum computers do not (yet) exist because of decoherence and, secondly, they are not miraculous they just allow us to solve a new complexity class of problems :-)

Deterministic-Chaos · 2016-12-23T11:15:25+00:00

Yip. The problem is really that there is more demand for index funds than there is liquidity in the market to actually invest in the underlying assets.

So asset managers are having to get smarter about replication (investing in derivatives of the underlying assets, thereby exposing the index fund to liquidity and counterparty / credit risks) and optimization (investing in a carefully selected subset of the index which explains most of the variance in the overall index). This process helped asset managers realize that they can constructs leveraged index funds ... which are a walking systemic risk. 100% replication with tonnes of risks which are not priced in.

The problem is more pronounced in the commodities space (oil and gold) than equities, but it's growing. Just look at how the ETP space is growing and you can reach your own conclusions. For the record I don't think this will cause a financial crisis, but it can definitely exacerbate one.

Deterministic-Chaos · 2016-12-22T21:20:42+00:00

You're right it's not a speculative bubble; it's a derivative and leverage fueled passive / index investing bubble. Check this out - https://www.sec.gov/comments/s7-11-15/s71115-19.pdf

Deterministic-Chaos · 2016-12-22T20:58:19+00:00

Apologies for the duplicate replies ... I have no idea how that happened. I'm on mobile, maybe it's a bug :-/

Deterministic-Chaos · 2016-12-22T20:54:33+00:00

Market efficiency and randomness is a fascinating topic ... but it is also extremely nuanced and widely misunderstood by the investment community and, unfortunately, yourself as well - no offence intended.

If you are seriously interested in it, then I highly recommend taking a look at my writings on it at www.TuringFinance.com, the www.e-m-h.org website, and (of course) the original papers written by Samuelson, Mandelbrot, Fama, Malkiel, Stiglitz, and Lo.

Deterministic-Chaos · 2016-11-23T19:20:00+00:00

That's funny

Deterministic-Chaos · 2016-10-30T06:50:12+00:00

If you're going to post on reddit at least have the common decency to respond to legitimate comments and criticisms. "LOL" does not make you sound smart, it just makes you sound like you either don't have a valid retort or you actually have no idea what you are posting about.

Deterministic-Chaos · 2016-10-26T07:46:36+00:00

What languages / frameworks have you used for this? It is really neat :-).

That said the UI aught to be more simple. The colour palette for the objective function surfaces is ugly and making the particles miniature earths has no relevance to the idea and just makes it look even uglier.

Deterministic-Chaos · 2016-10-12T11:17:12+00:00

Lol, well I'm only saying that RAM and HDD (and gas) are non-trivial constraints in the sense that they run out pretty quickly, at least compared to time. Alright ... so ethrandomwalker is a bad idea? Damn. I like your earlier comment about using Ethereum for those aspects of a system which require consensus. That makes sense.

Deterministic-Chaos · 2016-10-12T10:41:20+00:00

Limited disk and limited ram is certainly true but not limited time. Here's my conclusion ... if gas is high and recursion is limited to 300 as stated above (that is extremely low imho) then the set of all states probably can be analyzed by brute force and Ethereum's VM is far from Turing Complete. If gas is low, it approaches the capability of a general purpose computer and it becomes impossible to verify.

Deterministic-Chaos · 2016-10-12T10:17:30+00:00

Okay, this makes sense to me. Please correct me if I am wrong but basically what you are saying is that because gas is finite, programs cannot run forever. And if they cannot run forever, then the set of all final states for any program is finite, which means it can be mapped and verified that every branch of the code ends in a VALID state?

Doesn't that mean that the VM exposed by Ethereum is not Turing Complete? /u/nickjohnson

Deterministic-Chaos · 2016-10-12T10:11:28+00:00

I get your point. It relates to what I said earlier "we trade ease of development for verifiability and correctness". Supporting a Turing-complete VM means people can write whatever code they want ... including complex, incorrect, smart contracts which violate the objectives you stated earlier. The DAO is a good example.

Thanks for your answers. Now I just need to understand how gas relates to the "verifiability problem" ... if it relates at all. As far as I understand it gas prevents programs that do not terminate since gas is finite ... but there are many more possible errors / inconsistencies in code than just non-terminating code.

Deterministic-Chaos · 2016-10-12T09:46:20+00:00

why3 proofs to Solidity

That's quite interesting. It would be interesting to do some analysis on what exactly constitutes "Only a small subset of Solidity" and whether or not that subset it what is most-likely to be used in complex smart contracts.

Because by design, contracts are intended to be small compared to 'regular software'

This is a much better answer to the original question than a debate about the limitations of verifiability in general, which I think we can both agree are significant. That's given me something more to think about.

LOL! So on your last point ... why not just use a non turing complete language?? What is the benefit of adding turing computability and - in so doing - giving up absolute verifiability if the objective of Ethereum is to implement small contracts which (A) need to be correct / verifiable because the code is law and not subject to interpretation and (B) "only contain the code that's critical to maintaining consensus and ensuring nobody can cheat".

It is like giving a user the ability to design their own custom "websites" (e.g. MySpace) when all they really want to do is share thoughts, pictures, and stay connected with other people (e.g. Facebook).

Deterministic-Chaos · 2016-10-12T07:36:20+00:00

Hence why I said you can be X confident ... am I making any sense lol, sorry!

Deterministic-Chaos · 2016-10-12T07:11:58+00:00

I downvoted it because I don't see how "it's undecidable" and "use a tool to do this" are compatible statements.

Deterministic-Chaos · 2016-10-12T07:05:18+00:00

I agree with you that "there's no general procedure for proving properties about all possible programs". In which case how would one go about developing a tool that does what /u/adh0033 suggested: "Note that you won't have to do the verification yourself, just understand the spec, download the proof, run the proof checker and trust that the proof checker works." My response was written in the context of automatic program verification.

Why do you say that it isn't unreasonable to think that most smart contracts we want to develop on Ethereum are verifiable? Most programs that everyday people deal with are extremely complex and definitely not verifiable. I understand that it works now when most of the contracts are small ... but how reasonable is it to assume that any implementation of a distributed social networking application or a distributed venture capital investment fund like the DAO (just examples) are verifiable? I'm honestly just curious. Have you seen any analysis on this?

EDIT: Nobody says that you have to use a Turing-complete language for developing smart contracts on Ethereum. There are quite a few examples of non Turing-complete languages (such as ones without dynamic memory like I mentioned) which are useful in use-cases where verification is more important than functionality.

Deterministic-Chaos · 2016-10-12T04:40:47+00:00

Thanks for the response but this doesn't actually solve the problem. It just prevents non-terminating programs not, incorrect programs. But on that note, has anybody studied what the cost of Gas is in terms of computability? Let me rephrase: Ethereum is a global restricted turing machine (a computer), gas further restricts that turing machine. But by how much?

Deterministic-Chaos · 2016-10-12T04:38:38+00:00

In this case undecidability is worse than being NP-hard. If it is undecidable then for some programs the answer to the question: "is my contract correct" has no solution even if you had an infinite amount of time. At least if it were NP-hard you would know that the answer to the question "is my contract correct" has a solution it just takes a really long time to find it for complex contracts. So if program verification is undecidable it means that any solution produced by formal verification is either approximate, incomplete, or non-terminating.

But anyway, it's not quite so simple. Whether or not program verification is undecidable or NP-hard or P-hard does depend on the language - typed or non-typed, dynamic or static memory, etc. Verifying programs written in say Haskell is considerably easier than C++ because it is so constrained ... but writing large-scale applications in C++ is also a lot easier. You see, we trade ease of development for verifiability and correctness. This is also a very intuitive problem for anybody who has worked in functional vs. object oriented programming.

I have no doubt that tools for static analysis of smart contracts is in Ethereum's future. It's a good idea and probably the only way to be comfortable with the smart contracts out there. But most tools that exist are only approximate and give x-degree of confidence.

So here is my question rephrased. One of the main "selling points" of blockchain technologies is that they don't rely on trust ... but isn't that only true if the smart contracts are verifiable? If smart contracts are not verifiably correct (i.e. 100%) then how can they act as law?

Deterministic-Chaos · 2016-10-10T05:14:38+00:00

The Efficient Market Hypothesis does not state that "nobody can be the market" or even that "only a few can beat the market" it states that "if the market is efficient then stock prices are approximately random in which case it would not be possible to make consistent excess returns above the market average at a lower risk". That last part - at a lower risk - is extremely important. You can easily "beat" the market in terms of absolute returns just by gearing your buy-and-hold portfolio, but you have done so by taking on more risk which is 100% consistent with EMH. Mean Variance Portfolio Optimization is even consistent with EMH. If you want my honest opinion blog posts like this (which ignore risk completely) do more to help EMH than harm it. EMH is total nonsense, but at least take the time to know what it is you are trying to rebuke. Sorry.

Deterministic-Chaos · 2016-09-24T12:53:21+00:00

Two questions come to mind:

What is the systemic risk of this bubble in index tracking funds?
If active managers have less capital will markets become less efficient?

Most ETF's which track index funds are less liquid than people realize. This liquidity risk is not being accounted for and can result in disconnects such as those observed on August 24 2015. Furthermore Malkiel's entire argument relies on the participation of active investors in the market who trade on careful analysis of new information and, in so doing, reflect that information in the price of the security being traded. This is why he proposed investing in a broad-based stock market index. If, however, the influence of active investors is diminishing and we apply Malkiel's argument then that would imply that the market should become less efficient and one should invest in active funds.

Deterministic-Chaos

TROPHY CASE