4 ms·

What does this mean? Can you please rephrase?

stavros 5y ago
ELI5: "Who knows?"
late2part 5y ago
Here's what I think he means. If you look at trends over an arbitrary period, they may look useful. If you look at the similar trends over a larger period, they look different. Therefore, the smaller periods are just random variations relative to the larger periods.
- xapata 5y ago
  Close. It's more a comment on the structure of those random variations, and whether it's appropriate to describe the system as periodic at all. For example, sometimes it rains, and sometimes the sun shines. Is the weather cyclical? Depends on the place, time, and time-scale you're considering. Maybe a better example is roulette. If you watch the "cycles" of red and black, you might imagine you could make predictions. Gamblers are often fooled by this randomness.
  - lordnacho 5y ago
    This is a good observation that I upvoted because it's very relevant. A lot of things look like cycles but have no oscillating dynamic, it's true. But you could suppose that business cycles are caused by a build-up of bad debt. Things to well, debts can be paid, collateral gets worth more, more investment, etc. This can't go on forever and the reverse cycle then occurs, often as rates come up. Soros store about this and called it reflexivity. Of course I'm not saying business cycles are definitely caused by this, there's probably more to it than that. But it's a common explanation.
    - xapata 5y ago
      > caused by a build-up of bad debt Why does it build up? A generalized autoregressive model explains that just as well as an oscillator does. The key difference is how predictable the periods are. The more waves you're composing to force the oscillator model to fit, the less likely it's appropriate.
xapata 5y ago
Many people look at a chart that goes up and down and imagine they see cycles. It's popular to speak of business cycles, for example. Unfortunately, it is not clear that anything in the economy oscillates such that it's appropriate to describe the system as having cycles. You might have heard of Fourier transforms. Any time-series can be transformed into its sinusoidal components, even if a composition of waves is not a good model. It's possible, and in my opinion more likely, that the business cycle is not a cycle at all.
- lifeisstillgood 5y ago
  I mean, this is pretty much the explanation for share price movements, so, yeah it should be for everything else. Consider my mind blown - thank you !

ELI5: "Who knows?"

Here's what I think he means. If you look at trends over an arbitrary period, they may look useful. If you look at the similar trends over a larger period, they look different. Therefore, the smaller periods are just random variations relative to the larger periods.

xapata 5y ago
Close. It's more a comment on the structure of those random variations, and whether it's appropriate to describe the system as periodic at all. For example, sometimes it rains, and sometimes the sun shines. Is the weather cyclical? Depends on the place, time, and time-scale you're considering. Maybe a better example is roulette. If you watch the "cycles" of red and black, you might imagine you could make predictions. Gamblers are often fooled by this randomness.
- lordnacho 5y ago
  This is a good observation that I upvoted because it's very relevant. A lot of things look like cycles but have no oscillating dynamic, it's true. But you could suppose that business cycles are caused by a build-up of bad debt. Things to well, debts can be paid, collateral gets worth more, more investment, etc. This can't go on forever and the reverse cycle then occurs, often as rates come up. Soros store about this and called it reflexivity. Of course I'm not saying business cycles are definitely caused by this, there's probably more to it than that. But it's a common explanation.
  - xapata 5y ago
    > caused by a build-up of bad debt Why does it build up? A generalized autoregressive model explains that just as well as an oscillator does. The key difference is how predictable the periods are. The more waves you're composing to force the oscillator model to fit, the less likely it's appropriate.

xapata 5y ago

Many people look at a chart that goes up and down and imagine they see cycles. It's popular to speak of business cycles, for example. Unfortunately, it is not clear that anything in the economy oscillates such that it's appropriate to describe the system as having cycles. You might have heard of Fourier transforms. Any time-series can be transformed into its sinusoidal components, even if a composition of waves is not a good model. It's possible, and in my opinion more likely, that the business cycle is not a cycle at all.

lifeisstillgood 5y ago
I mean, this is pretty much the explanation for share price movements, so, yeah it should be for everything else. Consider my mind blown - thank you !