Dec

31

As time is counted, the earth has once again made another lap around the sun. The stock market has for another year continued on in its optimist triumphant. I would like to praise those that value time, honor it, and consistently strive with discipline and faith in self and others to pursue exponential growth.

It is my belief that an intuitive understanding of the exponential function, its power, persistence (perhaps even an eternal legacy) is the basis of a person's success and happiness however one defines it. If its power is denied, it ensures one's failure.

It is said that the polite do not talk of illicit sex, dogmatic fanaticism (often found in the most political or the pious religious) and gambling. I would suggest that these forbidden desires are rooted in our natural instinct for exponential growth, either to fool ourselves into believing we are pursuing exponential growth or by short cutting time.

However, if you talk about saving and investing in business acumen, marriage and family and building a solid reputation, even the most conformist among us will approve. These are much slower but more respected historically proven methods to build one's fortune, establish one's family dynasty or build a legacy, and if one endures the short term trials and pain, successful ways to pursue exponential growth.

It would appear that people have a natural respect for the slow persistence of having an edge but taking a short term risk. Nature has in it a reward system that respects those that honor time but can endure short term risk. But the exponential growth model tests our faith in time, humankind and even those closest to us. It is in these times of vulnerability however, that if one accepts this vulnerability and commits more, one is most likely to receive the most from this faith.

Yet this model of growth can be easy to fake. Love, financial advisors, and moralists are the trifecta for con-men. Further it can be difficult to distinguish a linear growth model from an exponential growth model. Scatter plots of an exponential growth often are highly correlated to linear growth model making it hard to distinguish. Further, after growth, time alone often make it clear if the growth is because of a trustworthy foundation, or if the growth was artificial creating by borrowing from the future, creating an exponential decay of debt. Further, as Yogi said, "It's difficult to make predictions especially about the future."

With exponential growth, comes reoccurring compounding. But the hallmark of the "chaos model" also has a similar compounding. A small seemingly insignificant compromise can cause a collapse of such a growth model if resources become strained and great power or wealth are too concentrated, like the flap of the wings of a butterfly can change the course of a hurricane. The best of plans can be derailed by a slight change in the environment sending the growth plan into dogmatism, centralized power and concentration of wealth by systematization rather than market forces.

But exponential growth gets its power not just from patience and time, but from each other. Most powerful is small groups of people banded together by mutual trust to work together for the long term good of each other. When an engineer and a machinist get together with a scientist and a business man the combination can be much bigger than four added together. Their entwined strengths can combine and their weaknesses can be covered.

Families are perhaps the most rewarding and enduring growth model, but they also can be the most difficult to try to predict. This of course can be difficult to see day to day when the follicles of those closest to you are so apparent , or when a T-Rex of centralized power is hunting for you.

An insistence that second order and higher effects are fully understood and controlled beyond reason, if everything is always roses, consistency of only positive returns and the advertisement thereof are all signs that a marriage, business and reputation are about to implode. It takes faith in one's self, in those that love you and that you trust in, to those you agreed to do business with and the markets in general to ask for accountability, as vulnerabilities are exposed, to ask, to test and prove to yourself that all are still pursuing exponential growth…rather than faking it. But one must be willing to ask, to test and confront those challenges sure to arise from building a long term plan. One must be willing to admit that the higher order effects of pursuing exponential growth creates uncertainties that will be met. Rather than pretend that you have already tamed exponential growth and it must be submissive to you.

May your faith in the power of humankind to solve problems, be fruitful, and those closest to you to share one another's vulnerability intertwined together bringing all super but all to human strength, another year.


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