Source: minority Investment author: Wang Xianke
In the "three-body", there is a "Sagittarius and farmer hypothesis" that runs through the whole situation:
Sagittarius hypothesis: there is a sharpshooter who punches a hole in a target every ten centimeters. Imagine that there is a two-dimensional intelligent creature living on the plane of this target. after observing their own universe, scientists have discovered a great law: "every 10 centimeters of the universe, there must be a hole." They regard the random behavior of the sharpshooter on a whim as the iron law of their own universe.
Farmer hypothesis: there is a flock of turkeys on a farm. The farmer comes to feed them at 11:00 at noon every day. A scientist in the turkey had been observing this phenomenon for a year without exception, so he discovered a great law: "Food comes at 11:00 every day." It announced the law to the turkeys on Thanksgiving morning, but there was no food at 11:00, and the farmer came in and killed them all.
The laws of physics require uniform distribution in time and space, but the laws observed by two-dimensional biological scientists and turkey scientists are only an illusion created by high-dimensional creatures such as Sagittarius and farmers over a certain period of time.
The stock market is a high-dimensional and complex market, and there is no "physical law" that is immutable and accurately measurable.
In the study of complexity science, two simple cases are often cited to illustrate the emergence of unpredictable complex patterns caused by the interactive behavior of simple individuals. Ants and brain neurons, as the basic units of ant colony and brain, their structure and function are very simple, but the whole they form shows very complex structure and function. When ants converge into ant colonies, they can work together and build complex caves. Tens of billions of neurons receive both internal and external stimuli, forming the consciousness, cognition and behavior of life.
According to their own judgment, the two trading behaviors made by each investor come together to create a high-dimensional and complex stock market and form the short-term voting function of Mr. Market.
The stock market has become a "farmer", showing a variety of low-dimensional "laws" in different time periods, which may be observed by some turkey investors and based on which a variety of investment theories can be established, put into practice or used to mislead others. Due to the opening of the capital market, the change of listing and delisting standards, the change of investor structure and other factors, the market environment has been changing, and relying on these temporary "illusion" investment methods, it is difficult to obtain long-term compound interest returns.
Through layer by layer analysis, we should excavate the underlying logic of the income source of the investment method, and analyze whether this logic is rigorous and sustainable.
Investment is a practical knowledge, and the core is prediction. it is important to understand the nature of investment and the source of long-term return, and practice it in a reliable and sustainable way.
In the long run, the fundamental source of return on investment is the value created by the enterprise. GDP in the US has grown at an annualised rate of 3 per cent over the past 200 years, and the stock market made up of relatively good companies has generated a return on long-term equity investment of about 7 per cent.
Investors in complex markets need to understand the limitations of their perception, build capacity circles, find companies with predictability and long-term investment prospects, and bet when prices are attractive. going down this road is more likely to get long-term, compound interest returns.
As Buffett said:
In 1965, we didn't deliberately plan any great plan (subtext: there is no law for us to use) to achieve the above (long-term compound interest) results, we just know that we should go in this direction. As for how it should be achieved in the future (what results), there is no clear concept.
Edit / lambor
