God and the Markets: Faith vs. Proof

God by ~SoundArt
God by ~SoundArt

In response to a recent post from Jeff Watson, I said “I don’t believe markets can be accurately predicted. I have not yet seen any evidence that proves me wrong and would appreciate learning from those who have access to such science or methods. Markets are not subject to natural laws. My objective is to lose as little purchasing power over time as possible. I have not found a way to accurately [and consistently] predict even a single future price.

Rocky Humbert, the legendary speculator and curmudgeon, promptly responded with “I tend to agree with you, but your statement as composed could also be applied to the existence of G-d. Based on your blog, I know you to be a man of faith. How does one reconcile (”using science or methods”) the lack of faith in the predictability of markets with a faith in G-d? Or perhaps is this logically consistent?

I am happy that my faith has come through my previous posts and thank Rocky for asking this question.

1. I have not seen any federal funding for research into existence of God in recent times. Basic science research goes nowhere without massive funding. I certainly do not propose adding yet another line item to the already gargantuan federal budget that the government believes we can finance but how can one begin to answer profound questions without much scientific study? Perhaps this is like living in the second century and trying to prove the existence of electrons and protons and the genome.

2. I have no irrefutable way to prove the existence of God aside from the miracles in my own life. Some of my reasons for having faith in God are documented here. Having faith and having proof are two different matters. Did everything happen a certain way for me by mere coincidence? Some may say that random events can line up perfectly and repeatedly. Others may say that hard work or luck is the cause. I find it easier to believe that an omnipotent God whose reasons I may not understand has arranged everything for a certain purpose. I have no internal struggle about my faith in God despite the lack of scientific verifiable proof.

3. “Penn State Clips” mentions interesting “Books like Gerald L. Schroeder’s The Science of God: The Convergence of Scientific and Biblical Wisdom, Francis Collins’ The Language of God: A Scientist Presents Evidence for Belief, and the various works of Josh McDowell and Lee Strobel.” Then continues with a very nice point “I agree with you that the beauty of nature is, to me, a proof of God’s existence. It strains credulity for me to believe that the beauty and complexity of all of creation came about by chance. And we only get to see the tiny fraction here on Earth!”

4. I believe that market cycles can be understood by humans who take part in such cycles. I also believe that in the long run people will benefit from diversifying their postponed expenditures in different asset classes. Beating the markets every single year or month or quarter or in the long run probably matters little. Furthermore, I have little faith that the current binary computer models can reliably predict the complex interrelationships in ever changing markets. An interesting read may be the uncertainty principle.

5. Since I am not on a mission to prove anyone anything, I can write my thoughts at the current time based on my limited life and experiences. Some may believe that markets are completely predictable and may even be able to “win” with their systems. I wish they will choose to share their “proofs” as those works may become cornerstones of new and amazing human discoveries and progress. Others may feel God’s love and grace are the “opium” the simple ones like me need to get through life. Certainly evolution will not be quick enough in that deep hole at the time of greatest despair or in the moment of amazing joy to revert the species to the mean. When I read what I wrote last year, I laugh. Maybe a year from now I will laugh about this post.

6. I welcome all thoughts, opinions, debates and proofs. I accept everyone the way I hope God will accepts me with all my flaws, opinions, and thoughts.

I realize that this is probably not the rock solid evidence or reconciliation that Rocky may have been expecting but felt it was better to post rather than have it in the draft folder forever.

13 Comments

  1. ld, I think that nobody will ever be able to prove whether God exists or not.

    It is not a scientifical, it is a psychological one. For instance, I am a very rational, cold blooded guy. I always think in a mechanical way. I like to break things down into processes that I can understand and study. This is why I am having a hard time believing in God. It does not fit my psychological markup.

    That is not your case. You live a passionate life. You do not analyze things, you feel them. Nobody has to prove to you that God exists or not. You already know the answer.

    The bottom line is that we are all different. There is no right or wrong answer for everyone.

  2. LD:
    A most enjoyable post.

    I’d add that it’s important to discern the differences between “faith” and “organized religion/belief in G-d.”

    We all have “faith” in something. Scientists have faith in their methods. Traders/investors have faith in their methods. Religious men have faith in their G-d. At the abstract, metaphysical level, ALL of these faiths are exactly the same. (Yes — the “scientific method” requires faith — at a philosophical level!!!)

    For example, when I was buying stocks (every day) during the dark days of March, I had “faith” that the world’s financial system would not end. I didn’t know how low things would go. And I didn’t know how long it would take to recover. But I had faith that it was not the end of the financial world. (It’s actually a much more difficult decision what to do with my longs now — since the end-of-the-world is no longer priced into the market!)

    Without faith and beliefs– (in whatever domain), it is impossible to function beyond the most basic physical needs.

    Rocky

    p.s. There’s a 20 Year TIPS (inflation linked bond) auction on Monday. They may be your cup of tea — but they too require faith in the Government honoring its obligations!

  3. MDan – Our differences arise from our need to be close. I believe the ‘no right or wrong answer’ comes from our need to deal with those differences. I was pleasantly surprised to hear of your perception of me as someone passionate who feels. Mulţumesc! This is a nice counterbalance to that dreaded INTJ label from Myers Briggs. 🙂

    Rocky – Good point about faith vs. religion. I must say religion is not for me. 🙂

    I need to learn about TIPS a bit. When it comes to the debt structure of US government, what is more senior the US dollar or the Treasuries? That’s probably a silly question since Treasuries are assets against which the dollar is issued. Selling is always harder than buying, in other words, unwinding a commitment is always harder than making one. This one can be experienced in many departments of life.

    As always, thank you for your comments and also for being part of my journey.

  4. I’ve noticed an increase in the mention of a higher being on speculation web sites, and although this is anecdotal, I just don’t have time to quantify it right now. I wonder if there is an indicator here?

    Jeff

  5. Well said, legacy.
    You are in good company with your views above on questioning the need for proof-beyond-all-doubt in underscoring one’s faith. Giants of thought –from antiquity to the modern binary world– who have pondered and pushed the boundaries of thinking (some especially on this very issue), have come away with very much the same conclusion.

    “Win”-ning systems: be it for the markets, the personal ‘abundant’ life, or geo-political exhortations, have run the gamut for a long time; from the dizzying heights of the Tower of Babel to unleashing the power within of Anthony Robbins…
    Like yourself, I am somewhat of a skeptic here.

    Don

    [Your comments with MDan above on ‘differences’, and what you said on ‘comparison’ elsewhere, chime with some other thoughts I’ve been having…
    ‘Differences’ are indeed the touchstone (assay) upon which Man relate with one another; and seems to hold especially true in some of his most important areas of relations: communication and markets.

    Let me dust off my dusty thoughts from the draft folder and see if I cant put it together.
    🙂
    ]

  6. Don – The differences here are not in the context of zero-sum, but rather when their understanding enriches all. The latter type of diversity of thought and experiences is very positive and must be celebrated.

  7. Well LD, for better or worse, my beliefs are very simple, and aligned with the spiritual work of Paramahansa Yogananda and more so the Eastern faiths, though I think there is commonality and importance in the core messages of all the great faiths that have endured over time (i.e. they all matter and are not that dissimilar – I think we just end up in conflict over the interpretations).

    I believe we are part of a higher consciousness that wishes to experience itself, and has created the context to do so with the material world (universe). I don’t how, or why. But I think we are here to experience our way through some kind of great journey, and how we relate to each other as pieces of this great consciousness is somehow important. The material world is also a manisfestation of this consciousness, a slowing down of it’s vibration, as it were. But we are still connected to and through it.

    Shakespeare to me made a very spiritual statement when he said “The world is a stage”. That’s how I see it as well, but I don’t believe there is a fixed script. Our choices are the key to how we navigate and experience our individual journeys, and collecively they produce the “performance” that plays out on the stage.

    When I look at things this way, the horrors and injustice out there make much more sense. No matter what our circumstance and the terrible price, it is only a role, and it is an intended part of the experience. What we “do” in this world adds to the sum of what everyone else “does”, and we each participate, influencing and being influenced by, directly or indirectly, everyone else’s experience.

    And because the universe is so huge, I think that it is reasonable to extrapolate that there is other intelligent life out there in greater and lesser degrees of self-awareness and “advancement” than we here on earth – our particular little theatre.

    In the physical sense, I think we are pure energy, in various degrees of condensation, imbued ultimately with enormous sentient intelligence. At the “lower” levels of vibration we can’t access all of that intelligence, but now and then with methods such as meditation we can tune in. Some people may be wired a little differently and can perhaps resonate with it by other means. As energy, and as physics has shown, I also believe that we can neither be created or destroyed, and that our consciousness at its higher levels retains the memory of its experiences (i.e. life after death). A good analogy of how we are inter-related would be the ocean. If consciousness were water for example, we may evaporate off and end up in the clouds, a lake or a river, or perhaps in an aquifer or icepack somewhere, but ultimately, somehow we flow back to the ocean. And I think we may be doing this many many times in a great cycle (re-incarnation).

    Therefore, I further believe there is no downside to life, and no need to fear death. Also, being altruistic and thinking beyond oneself makes sense, because then you are engaging the greater part of more of you, and expanding your experience. Excessive focus on oneself limits that scope and opportunity for expansiveness. This is one of the challenges I think we have to overcome in the journey. That’s why I think we try to differentiate and organize ourselves in terms of moral principles such as “good” and “evil”. We instinctively know at some level that helping others helps (expands)us, and hurting others ultimately hurts us (diminishes or holds us back), because we are part of the same thing. But within these dualities, there are infinite shades of experience, and everything is relative to something else. (That’s why moral absolutes can eventually be contradicted, and situations found where they no longer apply or actually can become their opposite.)

    Well there you have it. The world according to George. Can I empirically prove any of this? No. But it jives with my own experiences, and it jives with what I know of the physical world through sciences like physics. And now you know – I’m a nut-bar. 🙂

    Cheers,
    George

  8. George: Thank you for the comment. I didn’t fully understand the concept of “vibrations”. Another question is around how beliefs affect us. Is our view of the world, our experiences, and our life the result of our beliefs or are our beliefs the result of what we have experienced, how we view the world, and our life in general, or is it both just at different times in life? Same question IMHO also applies to markets.

  9. LD,

    I think it is less about beliefs than it is about choices. We don’t always choose according to our beliefs, and sometimes our beliefs change. But to address your question, I think the answer is “both”. I think our experiences hone our beliefs, and our beliefs influence our choices and ultimately our experiences. I know this is circular, but then that’s how I think the universe operates.

    Above I laid out what I believe, and it is so far consistent with my life experiences. Should something happen to change that, then I may modify my beliefs. (or go into denial). 🙂

    And, to my detriment, I certainly don’t always act according to my beliefs. (Counter-productive habits I would think are the most difficult challenges to overcome in daily life, at least in my own experience.)

    By vibrations I meant frequncy. In a general sense, Buddhists and Hindus for example believe that higher consciousness is a form of higher frequency energy (e.g. light or perhaps some other subtle form of wave-like energy), and lower frequency energy essentially condenses into the material world and matter (which Einstein himself determined is just another form of energy). This is where I find there is an interesting cross-over between physics and mysticism.

    How I apply it to trading is that first and foremost I take my cues from nature – it is definitely cyclical and regenerative. Therefore so must be human behaviour. Can you predict when and where particular cycles will occur, and their magnitude? Very difficult. (Can you predict when and where a particle will be? According to the Heisenberg uncertainty principle, also very difficult) But can you predict THAT cycles will occur? (Hint: Look at any stock chart, and, perhaps dust off a Statistical Mechanics textbook and know that you can statistically know where a particle will be at some point in the future.) So I focus on trying to passively take advantage of cyclicality in the markets in a statistical way, without trying to predict specific moves. If I can capture enough cycle-bits within a reasonable time frame to effect a profitable outcome, then I have succeeded (in the market anyway). And … so far it’s not working. 🙂

    Cheers,
    George

  10. What George said,
    “I think we are pure energy, in various degrees of condensation, imbued ultimately with enormous sentient intelligence”
    and his description of the levels of vibration/frequencies and the entropy-like flow of natural processes are very sensitively expressed.

    Prompts a pointing to this little tale (Asimov’s scientific perspective merging with mysticism recalls George’s words above):
    https://en.wikipedia.org/wiki/Eyes_Do_More_Than_See

    Don

  11. I do think that your passion for your relgion is beautiful, but i like to believe that if G-d is realy amongst us, he would consider us as the miracles. And i would much rather believe that my future is made up of the choices I make, and not by G-d. I dont want to get the short straw and only live for a few weeks because of a disease i have been born with. But dont worry, G-d loves me, because G-d created me, even though my brother gets to live till his 80 and i live for a few weeks.
    And yes i agree,we probably wont ever get to find out if G-D created us, or the big bang or what not. We believe in different faiths, people, Gods, choices, paths or just believe to make us think “hey, everything is going to be ok” believing in G-d gives us reassurance that someone is watching out for me, and is my lifes witness.
    why are we saying god like g-d? lol

    gabbie x

  12. Gabbie: Welcome to my little corner. You say you would much rather believe that your future is made up of the choices you make. Even in this wonderful country of freedom of choice, I sense the choices made by others affect our lives more significantly than our own choices. If I am a flower, I may believe that I am in charge of my own destiny ignoring the power of the wind, the sun, the water, the nutrients, and the rest of my ecosystem. You comment about living a few weeks has left me quite puzzled. I hope you said that to make a point rather than to describe your situation.

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