Daily Speculations
The Web Site of Victor Niederhoffer & Laurel Kenner
Dedicated to the scientific method, free markets, deflating ballyhoo,
creating value, and laughter;
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Daily Speculations The Web Site of Victor Niederhoffer & Laurel Kenner
Dedicated to the scientific method, free markets, deflating ballyhoo,
creating value, and laughter; |
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4/11/2004
by Andrew Moe
I have two small daughters (2 1/2 and 1/2), so this was an
action packed
weekend. One of the highlights was our neighborhood Easter egg
hunt, held
at the local park. A group of about 50 kids ranging in age
from toddlers to
teens massed at the top of the hill. The Easter Bunny yelled
go and a
frenzy of whirling arms, legs, baskets and bonnets came
tumbling down the
hill. Standing at a distance, I was struck by the various
strategies used
to accumulate eggs. The older kids, faster and wiser, quickly
spread out
and covered the entire park in an amazingly efficient
dispersal pattern.
The toddlers, on the other hand, swarmed together with pack
mentality. Any
area they covered was quickly laid barren, forcing them to
swarm to a new
area.
A few observations:
1. While the each member of the swarm was successful in
gathering eggs, they
got far less than those who went it alone.
2. Free thinkers were rewarded. Some chose to look up, instead
of down, and
found eggs hidden in the trees.
3. The swarm had to keep moving to find new areas of eggs.
4. Those who quickly moved to a new area by themselves could
pluck the eggs
at their leisure. They were richly rewarded.
5. If the swarm was heading your way, you could either deflect
it or move -
both strategies were effective.
6. Once the swarm engulfed you, you became part of it's
dynamic and suffered
an immediate regime change. Eggs in your
area vanished fast.
7. Swarms follow a leader, though the individual patterns of
the members may
appear chaotic. (my 2 1/2 year old bounced around in every
direction, but
was never more than 10 feet from the Easter Bunny).
8. A charismatic leader can take the swarm in any direction.
If so
motivated, deception could be used to distract the swarm.
9. Survivability of a single egg was stable and fairly
constant until the
swarm hit. It then reduced to zero quickly.
For those who count, complexity theory deals with swarms. The
Santa Fe
Institute has a great deal of information on the topic at
http://www.santafe.edu/.
Hoping you're all adding eggs to your basket,
Andrew Moe
Ken Smith adds: At 6 am I looked out to the front lawn and observed a lone American Robin listening for worms and insects in the dew-moist grassy ground. The bird shuffled from point to point in a random-appearing change of direction. This is breeding season; the birds are now carnivores. After breeding they will switch to a vegetarian diet. The Robin was patient at each stop, giving his senses time to pick up the signals nature has programmed him to use in his search for food, food which furnishes him with reproductive energy. He has arisen early and discovered this niche for himself, my front lawn, recently watered. A signal from the ground is perceived and Sir Robin quickly has his prey, no hesitation. This guy is an active hunter, as in active trader. His little computer brain and sense organs are crawling the field in search of prey, a morsel to fatten his resources. Sir Robin will switch to another lawn or playground or marsh when his present search produces less energy than the energy required to do the search. He will fly away, perhaps randomly choosing the next site for exploration. When breeding season is over, the eggs hatched and nurtured, Sir Robin will change his diet preference. And the turning of the earth, the sun, and the moon will influence him to change his territory, his environment, his location in relation to these planetary orbits. A trader seeks a niche, as the good Doctor Niederhoffer has suggested. Sir Robin, as an epitome of nature's example, has a bird brain yet survives, breeds, and flourishes. How complicated do we need to be to survive as traders? "Once breeding season is over, the sweet-singing and familiar robin of our backyards becomes more furtive and shy. Large nomadic flocks form and range over the countryside in search of berries such as mulberry, sumac, grape, viburnum, and cedar, as they shift from their breeding season diet of insects and earthworms to become wholly vegetarian. By September, many are moving south from the northern parts of the eastern half of the country to winter with southern residents in the Middle Atlantic and Gulf states. In the West, Robins wander broadly in search of food and move generally to areas of lower altitude. But some linger as far north as Canada when food supplies are adequate, so the first robin you see in spring may not have come from too far away." http://birds.cornell.edu/BOW/AMEROB/
Ken Smith RERUM NOVARUM