Flying a “Foil in the Flow” above the “Walled Gardens”
Post #7 out of 9: The Ergodic “Ideal Client” for Investment Management, and the Non-Ergodic Client for Retirement Planning
This seventh post about the value of Ergodicity Economics to retirement planning continues a final series of nine posts that mark the completion of CTRI dissolution, and placement of its IP in the Public Domain on account of the founders’ retirement. Each post covers a section of a final Notebook titled “From Rational Investors, Inc. to the Curve, Triangle & Rectangle Institute, a 25-year Story of Change in a Hard-to-Change Industry, and What May Come Next” that summarizes a history of retirement planning, and projects its future. The placement of this IP, the “Constructive Skepticism” Curriculum, in the public domain matches its “Purpose” to help individuals improve their personal, business, and investment decision-making by evolving the basis for their “Predictions” from “Trust Them”, to “Show Me”, and to “See Yourself”.
This post comes in the form of a downloadable pdf file, see link below, to preserve the formatting of illustrations.
This pdf file presents a section of the Final Notebook that summarizes portions of the “Constructive Skepticism” Curriculum that address making good investment decisions. The earlier sections in this series of posts summarized portions of the curriculum that addressed making good individual decisions, and making good business decisions in support of the first, and second “Predictions”.
Like the household balance sheet, and the analysis of risk capacity discussed in earlier posts about making good individual decisions for retirement planning, Ergodicity Economics (EE) benefits retirement clients and their advisors by revealing critical features of the financial modeling landscape that would otherwise remain hidden, or distorted. EE reveals the practical, and different meanings of old and new mathematical tools used to measure rates of change in financial planning.
The first version of Volume 1, Workbook #IV: Making Good Investment Decision included several quantitative sections about Ergodicity Economics. These remain available to readers in the 2022 posts on Substack. The second version of this Workbook does not include these sections, as seen in the 2023 posts on Substack. Substack keeps the posts organized chronologically. See the “Pinned Post” at the top of this Substack for the dates that match specific versions of the Workbooks, Handbooks, and Notebooks. These quantitative, Substack sections about Ergodicity Economics led to the making of this third “Prediction” about the next 25 years for retirement planning: (iii) Advisors and clients will recognize the existential differences in “Meaning” between the ‘Ensemble” perspective of the Disinterested Observer (i.e. Academics and Institutions), and the “Time Average” perspective of the Decision-Maker (i.e. Individual Clients and their Advisors).
The ninth post will mark the last step in the dissolution of CTRI, and the possible placement of its IP in the Public Domain should no other not-for-profit organization want to actively continue the development of the “Constructive Skepticism” Curriculum. The placement of CTRI’s IP, the “Constructive Skepticism” Curriculum, in the Public Domain would make it passively available to any and all, and thus remain a match with its “Meaning” and “Purpose” to help financial clients, advisors, and executives improve their individual, business, and investment decision-making by evolving the basis for their “Predictions” from “Trust Them”, to “Show Me”, and to “See for Yourself”.
One way or the other, CTRI’s founders hope that this IP will continue to help readers answer questions such as: What new ideas will inject themselves into the culture? How will these new ideas change the nature of the “Ideal Client” over the next 25 years? What do you need to know about such ideas, and their impact on your “Ideal Client” in order to remain a “Productive Host” in this evolving Fintech ecosystem? What can you do now, or did not do earlier, that will shape your future, and the future of your clients in this new environment?