I prove that if markets are efficient, meaning current prices fully reflect all information available in past prices, then P = NP, meaning every computational problem whose solution can be verified in polynomial time can also be solved in polynomial time. I also prove the converse by showing how we can “program” the market to solve NP-complete problems. Since P probably does not equal NP, markets are probably not efficient. Specifically, markets become increasingly inefficient as the time series lengthens or becomes more frequent. An illustration by way of partitioning the excess returns to momentum strategies based on data availability confirms this prediction.
We were planning to go to New York tomorrow, but the event we were going for is cancelled due to the city being closed this weekend for hurricane. It’s a little ironic for a Miami person to not be able to go to New York because they are having the hurricane, but there it is.
I can’t help but be reminded of a previous trip that I scrubbed due to bad weather. I had planned to go to DC in mid-February, 2010. That got scrubbed due to an enormous snowstorm. During the time I’d planned to be away, my aorta burst. Had I been in DC, I likely would not have been as near a hospital, nor as likely to go to one, as I was at home — with deeply bad results. Had I flown out late, delayed due to weather, I could have been on the plane when it happened. Had I been on the plane, I’d be dead.
Instead, I’m pretty well — and very lucky. I hope New York is lucky too.
We’re going next weekend instead, assuming New York is still there. By Miami standards the predicted winds by the time Irene gets to New York seem strong, but not incredibly fierce — sort of on the border between a very bad tropical storm and and a lesser hurricane. But I suppose they’re not as well set up for it as we are.
Given all the years we’ve had cars, rain, and umbrellas, why isn’t there an easy, or even effective, way to get into the driver’s seat of a car with a very very wet umbrella that doesn’t either get you wet before you get into the car, or get you wet when you bring the umbrella into the car?
(I mean of course when the car is parked outside: parking indoors makes this easy, but that’s not always an option.)
I could have had a four-digit slashdot number, but never bother registering until I had something to say. So I’m a five-digit member, #18607. For me, Slashdot was essential for years. Then it stopped being essential several years ago. But it never stopped being worth following.
the University of Miami is launching the first step in a three-year initiative to make our Coral Gables campus smoke free. Starting on September 1, 2011, smoking will only be permitted in designated areas on University property. Additional information on our new policy, including a map with the designated smoking locations, is available at www.miami.edu/smokefree.
The inside of the Law School buildings has been nonsmoking for many years. What this means for me is that I’ll be able to eat lunch in the Law School’s wonderful quadrangle, known as “The Bricks”, without having to keep moving to avoid being downwind of some smoker.
Incidentally, the news came via an emailed letter from UM President Donna Shalala which began like this,
To the University of Miami Community:
If we only knew then what we know now.
We believe that wisdom and smarter choices come with time and experience. Warning signs are often the collective voice of hard-earned lessons …
It turned out to be about the dangers of cigarettes, but I hope I can be forgiven for thinking at first that the letter was going to be about something else.