The dream of the great psychiatrist Carl Jung was nothing less than analyzing the mythology of world civilization and using it to chart out the characteristics of the human mind and the common consciousness we share in families, communities, countries, religions, and of the species as a whole.
He believed that Mythology and Religion was a projection of the common unconscious of the humans who shared beliefs. Jesus then would be the symbol of unconditional love and forgiveness that somewhere is present in all our minds.... which lead the Indians to put up a non-violent fight against the British. Prophet Mohammad would then be the symbol of the warrior of justice who is present in us all, which lead Joan of Arc to lead an army to victory. Krishna then would be the philosopher in all of us who chooses to rationalize everything he sees and experiences without considering anything a miracle or considering everything a miracle.
The great wars of the Mahabharata, of the Ramamyana, the trials of Hercules, the Trojan War and all the other war stories would be the representation of the eternal fight of Good over Evil. The evil powerful man comes and lusts for the most beautiful woman of the world, who is either Sita or Draupadi or Helen or someone else. The villain captures her and takes her away, or insults her gravely. The hero, who starts with little but courage, intelligence, will power, and a belief in goodness, leads a long battle till he finally triumphs against evil. Lives of loved ones are lost in the process. But the war is always won by the Good. And the most beautiful woman of the world is often the one whose will is done.
The second coming of Jesus, the advent of Imam Mahidi, the incarnation of Krishna, the advent of the Buddha as Maitreyi, all are dreams of one person who walks on the earth and is wise enough to unite all cultures and end the wars and miseries happening in the world today.
Carl Jung believed that all of us, somewhere unconsciously, want this to happen. For Good to win over Evil. To be guided by a great man to the end of this current unhappiness that we see in the world. He dreamed that this was not just a dream. That somewhere deep down inside, we humans are hardwired to think like this.
To that hardwiring in all of us, I pray. One day, seek in yourself the hero who is the second coming of Jesus, of Krishna, of Buddha, of Mohammad, or of anyone else you admire and want to be like. Be the person you want to be. Strive to bring about the change you want to see. Fight for what you believe in. Dedicate your life to a cause that you believe in. Live not with regrets of a great life that could have been lived. Live the great life. Or die a glorious death. Let your dream kill you. But never kill your dream.
Tuesday, January 13, 2009
Saturday, January 10, 2009
Adam Smith
Adam Smith was the dreamer of the metaphor of the "The Invisible Hand". He envisioned the ultimate balancer in society, an invisible hand which ensured that everyone working according to fulfill their own innermost needs, interests, desires, or dreams, would in-effect promote the good of the society at large as well. He wanted to believe that the maximum happiness of the each individual can be aggregated to get the maximum happiness of society.
I do believe he himself did not realize how real the invisible hand could be. That even in the absence of an effective and efficient regulatory system to ensure that the more powerful players in the economy do not exploit the less powerful ones, the invisible hand will ensure that balance reappears in society. The current crisis is an example of the existence this "Invisible Hand" ... or of "Divine Justice" as Warren Buffet calls the crisis.
Why is this "Divine Justice"? Isn't that a sadistic view of looking at the world, with so much unemployment and pain right now? Maybe it is. But balance is the fundamental truth of the world. And any system that tries to pursue a strategy of imbalance, over-spending, over-leverage etc etc, will have to bear pain when the "Invisible Hand of Balance and Equilibrium" enforces itself. The means is painful if the force of imbalance is stubborn, as was the case with the Mamomths of Wall Street.
Applying what the Buddha said: the cause of imbalance in the case of the markets is incomplete knowledge about the markets. Now that we have learnt about the incomplete knowledge of Wall Street and taken its leaders down from the pedestals of the Omniscient Finance Wizards who we can trust with all our money, we are in a position to move toward more balanced financial strategies... if we are wise enough to follow a balanced path this time. Time will tell what the people of the world decide for themselves the next time around: Balance of Imbalance? And thus time will tell whether the "Invisible Hand" decides to bless us or to punish us the next time around.
I do believe he himself did not realize how real the invisible hand could be. That even in the absence of an effective and efficient regulatory system to ensure that the more powerful players in the economy do not exploit the less powerful ones, the invisible hand will ensure that balance reappears in society. The current crisis is an example of the existence this "Invisible Hand" ... or of "Divine Justice" as Warren Buffet calls the crisis.
Why is this "Divine Justice"? Isn't that a sadistic view of looking at the world, with so much unemployment and pain right now? Maybe it is. But balance is the fundamental truth of the world. And any system that tries to pursue a strategy of imbalance, over-spending, over-leverage etc etc, will have to bear pain when the "Invisible Hand of Balance and Equilibrium" enforces itself. The means is painful if the force of imbalance is stubborn, as was the case with the Mamomths of Wall Street.
Applying what the Buddha said: the cause of imbalance in the case of the markets is incomplete knowledge about the markets. Now that we have learnt about the incomplete knowledge of Wall Street and taken its leaders down from the pedestals of the Omniscient Finance Wizards who we can trust with all our money, we are in a position to move toward more balanced financial strategies... if we are wise enough to follow a balanced path this time. Time will tell what the people of the world decide for themselves the next time around: Balance of Imbalance? And thus time will tell whether the "Invisible Hand" decides to bless us or to punish us the next time around.
Wednesday, January 7, 2009
Gautam Buddha
1. Imbalance exists. In the mind, in the body, in our personal relationships, in our professional life, in our social life, and in society at large.
2. The cause of imbalance is incomplete knowledge
3. The reason for incomplete knowledge is clinging to outdated forms of thinking or the impatience to enjoy life without caring about the right way of doing things
4. Incomplete knowledge can be overcome and Balance can be achieved
In Summary, that is the philosophy of the most influential Indian known to have physically walked the earth.
The path he showed to achieve the balance and overcome incomplete knowledge is the Eight-fold path:
Balanced knowledge, Balanced thought, Balanced speech, Balanced action, Balanced livelihood, Balanced effort, Balanced mindfulness, and Balanced concentration.
In my mind, the goal of complete knowledge does not mean that we know everything. Or that we believe in things told to us, but which are not in accordance with our experiences in reality. It just means that we try to balance what we know by studying about its inverse. For example if we know too much about science, we should study religion and vice versa. The eight paths of knowledge today can described as: Natural Science, Mathematics, Psychology, Economics, Literature & Art, History, Sociology, and Religion. In today's day and age, many more subjects can be added to say that we truly has balanced knowledge about the world. A balanced knowledge of such subjects will give us the wisdom to live our lives in t he most balanced manner and achieve the state of eternal inner peace that many of us strive for.
2. The cause of imbalance is incomplete knowledge
3. The reason for incomplete knowledge is clinging to outdated forms of thinking or the impatience to enjoy life without caring about the right way of doing things
4. Incomplete knowledge can be overcome and Balance can be achieved
In Summary, that is the philosophy of the most influential Indian known to have physically walked the earth.
The path he showed to achieve the balance and overcome incomplete knowledge is the Eight-fold path:
Balanced knowledge, Balanced thought, Balanced speech, Balanced action, Balanced livelihood, Balanced effort, Balanced mindfulness, and Balanced concentration.
In my mind, the goal of complete knowledge does not mean that we know everything. Or that we believe in things told to us, but which are not in accordance with our experiences in reality. It just means that we try to balance what we know by studying about its inverse. For example if we know too much about science, we should study religion and vice versa. The eight paths of knowledge today can described as: Natural Science, Mathematics, Psychology, Economics, Literature & Art, History, Sociology, and Religion. In today's day and age, many more subjects can be added to say that we truly has balanced knowledge about the world. A balanced knowledge of such subjects will give us the wisdom to live our lives in t he most balanced manner and achieve the state of eternal inner peace that many of us strive for.
Tuesday, January 6, 2009
Harry Markowitz
The Father of Modern Portfolio Theory, and the use of diversification in Finance. Today, we can't imagine Finance without complicated mathematics in each page we read. At his time, his chose to apply mathematics to the Stock Market as the topic for his dissertation (I wish I could get a PhD for that today - unfortunately they will kick me out of the program if I suggest such a mammoth topic today).
Markowitz wanted to model risk in stock markets and used the central mathematical concept that defines most of Finance theory today: Maximize the average return of the portfolio, while minimizing the variance of the portfolio. This in effect lead to the famous theory of CAPM: All you need to consider while adding a stock to your portfolio is the amount of systematic risk that you are adding. If you are well-diversified then the idiosyncratic risk does not matter.
Through Markowitz, I see the ultimate dream of Krishna taught to the world of scientists and engineers. The Power of Diversification. For everything in Krishna's life and song is diversified. A God with 16,108 wives surely believed that marrying just one woman has too much risk attached to it and so kept adding wives to his portfolio till no single woman's idiosyncrasies could affect him. Only if all the woman got together to protest against him will he ever have a day in his life when he wants sex but cannot get it. The probability of that seems pretty low. That is the central message of Krishna's love life, and of Markowitz's portfolio management, the only difference being is that sex and a portfolio of women in my example, is replaced with consumption/returns/money and a portfolio of stocks. Maybe that is why we refer to Money as like a Wife in Hindu Mythology.
I deeply believe that Diversification is the central concept of Hindu Philosophy. After all, we are said to have 330 million gods. Irrespective of the trouble you are in, I am sure one of the 330 million might be able to help you as an incarnation of either your father or mother or sister or brother or friend or teacher or neighbor or co-worker or someone else. For everyone is an incarnation of God as well, according to the diversified Hindu.
If Hinduism is updated, I am sure that the writer will add the Torah, the Quran, the Bible, the texts of science and all other non-fiction texts to the concept of Hinduism. That only will diversify away the risk of the belief in the non-existence of God. For even if you study relativity, you are just worshiping God Einstein then; who in turn is just an incarnation of the All Mighty Allah. If you study diversification in finance, then you are just worshiping God Markowitz, who again is just an incarnation of God David.
With this dream of Krishna and Markowitz, that humans learn the benefits of diversification and pray to anything and everything that works in nature, I end my post with a prayer:
Om Namah Newtonaay
Om Namah Einsteinaay
Om Namah Markowitzaay
Om Namah Freudaay
Om Namah Nobelaay
Om Namah Gatesaay
Om Namah Buffetaay
Om Namah Jesusaay
Om Namah Mohammadaay
Om Namah Davidaay
Om Namah Shivaay
OM TAT SAT
Markowitz wanted to model risk in stock markets and used the central mathematical concept that defines most of Finance theory today: Maximize the average return of the portfolio, while minimizing the variance of the portfolio. This in effect lead to the famous theory of CAPM: All you need to consider while adding a stock to your portfolio is the amount of systematic risk that you are adding. If you are well-diversified then the idiosyncratic risk does not matter.
Through Markowitz, I see the ultimate dream of Krishna taught to the world of scientists and engineers. The Power of Diversification. For everything in Krishna's life and song is diversified. A God with 16,108 wives surely believed that marrying just one woman has too much risk attached to it and so kept adding wives to his portfolio till no single woman's idiosyncrasies could affect him. Only if all the woman got together to protest against him will he ever have a day in his life when he wants sex but cannot get it. The probability of that seems pretty low. That is the central message of Krishna's love life, and of Markowitz's portfolio management, the only difference being is that sex and a portfolio of women in my example, is replaced with consumption/returns/money and a portfolio of stocks. Maybe that is why we refer to Money as like a Wife in Hindu Mythology.
I deeply believe that Diversification is the central concept of Hindu Philosophy. After all, we are said to have 330 million gods. Irrespective of the trouble you are in, I am sure one of the 330 million might be able to help you as an incarnation of either your father or mother or sister or brother or friend or teacher or neighbor or co-worker or someone else. For everyone is an incarnation of God as well, according to the diversified Hindu.
If Hinduism is updated, I am sure that the writer will add the Torah, the Quran, the Bible, the texts of science and all other non-fiction texts to the concept of Hinduism. That only will diversify away the risk of the belief in the non-existence of God. For even if you study relativity, you are just worshiping God Einstein then; who in turn is just an incarnation of the All Mighty Allah. If you study diversification in finance, then you are just worshiping God Markowitz, who again is just an incarnation of God David.
With this dream of Krishna and Markowitz, that humans learn the benefits of diversification and pray to anything and everything that works in nature, I end my post with a prayer:
Om Namah Newtonaay
Om Namah Einsteinaay
Om Namah Markowitzaay
Om Namah Freudaay
Om Namah Nobelaay
Om Namah Gatesaay
Om Namah Buffetaay
Om Namah Jesusaay
Om Namah Mohammadaay
Om Namah Davidaay
Om Namah Shivaay
OM TAT SAT
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