the complete set of possible bets on future states of the world can be constructed with existing assets without friction

For example, for all households 35-44, the median net worth is ~$60,000. If you are a college-educated 35-44 with $100,000 you might feel a sense of entitlement at how good you are at managing your finances given you are so far above the median.

This is until you realize that the median college-educated 35-44 year old household has a net worth of $180,000.

Now, there is nothing wrong with being above or below the median, but, if you want to know if you are keeping up with the Joneses, make sure you have the right Joneses.

If you had beaten the market by 5% a year from 1960-1980, you would have made less money than if you had underperformed the market by 5% a year from 1980-2000.

many retail investors worship at the temple of alpha when they really should be praying for beta.

Japan is the winner for the greatest asset bubble of all time because of how well it scores on the three criteria (Market Cap, Price, and Recovery Time) relative to all other bubbles in market history.

To be precise, the Japanese stock market lost over $2 trillion and Japanese land values have declined by $8 trillion since the late 1980s/early 1990s.

More importantly, in the 30 years since the peak, both Japanese stocks and residential real estate have yet to recover.

bold thinking from a guy who knows a thing or two. change to the establishment being proposed by the establishment.

"Current supervisory tools were designed to restrain banks from overextending themselves. Right now, we have the opposite problem: banks are not filling the void left by the retreat of market-based finance.

Banks should be part of the solution, not part of the problem. Now is the time to draw on the accumulated balance sheet buffers that were built while the sun was shining. To boost lending capacity further, we need a global freeze on bank dividends and share buybacks.

However, this first step may not be enough, as lenders pull in their horns and retreat from risk-taking. That’s why there needs to be a second step of enlisting the banks to lend, using central bank funding for lending schemes. Risk sharing by governments through guarantee schemes is needed to ensure that economic risks are not pushed to banks or the central bank.

A crisis in market finance needs market-based solutions. For central bank liquidity to reach the far corners of the financial system, it must directly target individuals and businesses that need it most. Otherwise, central bank actions may be just pushing on a string."

technical debt in finance

Goodhart's Law: "When a measure becomes a target, it ceases to be a good measure."
floccinaucinihilipilification: trying to put a firm estimate on certain things is essentially worthless

at what point can the whole country of Norway just go on vacation and live off the interest?

"An update on the fund’s website showed the Government Pension Fund Global’s value reaching 10 trillion Norwegian crowns for the first time at 0857 GMT — more than $200,000 for every man, woman and child in Norway."

Millburn’s new equity fund will use machine learning to decipher signals from exchange-traded funds in order to make long bets on the underlying securities such as members of the S&P 500 and MSCI World.

RL algorithms and illustrate the definitions of the reward function, actions and policy functions in details, as well as introducing algorithms that could be applied to FTFs