Pivot to AI: The secret is out

Despite the ‘proof’ being public the scaling hypothesis remained a Thielian secret until recently. It took chat-GPT to convince Facebook/Meta AI research that scaled-up prosaic AI was a plausible path to beyond human intelligence. They recently had internal meetings sounding the alarm. Deepmind also believed that a significant amount of fundamental advances would be needed. Sadly this is not the case. The scaling curves don’t bend anywhere near fast enough.  I highly recommend reading about how many ‘bees’ worth of synpases/neurons various animals and LLMs have. For example “Davinci is a 175-bee model, which gets us up to hedgehog (or quail) scale. Gopher (280 BP) is partridge (or ferret) sized. More research into actual gophers is needed to know how many gophers worth of parameters Gopher has. “

Here is Anthropic’s version of events

In 2019, several members of what was to become the founding Anthropic team made this idea precise by developing scaling laws for AI, demonstrating that you could make AIs smarter in a predictable way, just by making them larger and training them on more data. Justified in part by these results, this team led the effort to train GPT-3, arguably the first modern “large” language model2, with over 173B parameters.

Since the discovery of scaling laws, many of us at Anthropic have believed that very rapid AI progress was quite likely. However, back in 2019, it seemed possible that multimodality, logical reasoning, speed of learning, transfer learning across tasks, and long-term memory might be “walls” that would slow or halt the progress of AI. In the years since, several of these “walls”, such as multimodality and logical reasoning, have fallen. Given this, most of us have become increasingly convinced that rapid AI progress will continue rather than stall or plateau. AI systems are now approaching human level performance on a large variety of tasks, and yet training these systems still costs far less than “big science” projects like the Hubble Space Telescope or the Large Hadron Collider – meaning that there’s a lot more room for further growth

Imo less formalized version of the scaling hypothesis/laws were known well before 2019. Recent better understanding of scaling laws should not make us much less bullish on ai progress. Though perhaps there is hope we ‘run out of data’ before AI becomes too dangerous. I would not bank on this. 

As long as the scaling hypothesis remained a secret* doing anything that risked convincing more people of the scaling hypothesis was extremely risky, and imo very unethical. It might have seemed from the inside view that either the ‘secret’ was obvious or OpenAI was going to convince everyone of the secret anyway. But until recently there was hope OpenAI would eventually stop being so reckless. But at this point the secret is pretty much out. An AI arms race has been triggered and existing actors will shortly convince many of the remaining important doubters. This will soon include the government of [insert country you don’t like].

EAs systematically doubt the dangers posed by aligned AI. There is not much reason to assume that just because an AI system is aligned to the goals of some humans it will be good for humanity as a whole. Of course, many AIs are focused on ‘at least not everyone dies’ as a wincon but I would hope for a better future.  If AI is extremely hard to align the current game-board is just not too unlikely to be winnable, time is running out fast. It is probably still bad to work on capabilities at top labs like Anthropic or OpenAI. If you happen to make a big advance, like switching to relu, you will burn a huge amount of timeline. But working on cool AI projects now seems positive to me. 

Previously any cool project unacceptably risked convincing even more people of the scaling hypothesis. But if the secret is out it seems worthwhile to try to steer AI in a positive direction. This has been a very big update for me. Until very recently I promoted a hardline stance of ‘absolutely do not work on AI’. But now we might as well play to our out of ‘AI isn’t that hard to align’ and work on steering toward a brighter, based future.

Songs About Friendship

My favorite explanation of what it means to be a friend is “Pigs on the Wing”

You know that I care
What happens to you

And I know that you care
For me too

So I don’t feel alone on the weight of the stone
Now that I’ve found somewhere safe to bury my bone
And any fool knows a dog needs a home
A shelter from pigs on the wing

Pink Floyd, Animals

Possibly my favorite written passage is the last verse of “Wish You Here”. I thought about it all the time when I was separated from my best friend.

How I wish, how I wish you were here
We’re just two lost souls
Swimming in a fish bowl
Year after year
Running over the same old ground
What have we found?
The same old fears
Wish you were here

Pink Floyd, Wish You Were Here

A recent favorite is ” I Want You To Know”. Perhaps it was intended differently but I think it’s a beautiful ode to partnership; a wonderful way to think about a comrade and lover. Even true friends have conflict and things can be hard. But the storm will flow over if we don’t lose faith. You have to believe in your friends.

I’m better under your reflection
But did you know did you know did you know know?
That’s anybody else that’s met ya
It’s all the same all the same all the same glow

Honey it’s raining tonight
But storms always have an eye have an eye
Tell me you’re covered tonight
Or tell me lies tell me lies lies

I want you to know that it’s our time
You and me bleed the same light
I want you to know that I’m all yours
You and me we’re the same force
I want you to know that it’s our time
You and me bleed the same light
I want you to know that I’m all yours
You and me run the same course

Tears Must Flow

This Thanksgiving I was with my girlfriend’s family. Turkey was served. I held back tears for a little and finished my food. But I couldn’t hold them back very long. I ended up going down to the basement to cry. I cried off and on for over an hour. My girlfriend held me. Eventually, we went back upstairs but my mood never really improved. My girlfriend’s mom was hurt. I just cannot do this anymore. I told myself I would get through thanksgiving for my girlfriend’s sake but I just couldn’t stop crying.

In California, I met several birds who had been rescued from farms. These birds grew up in truly hellish conditions. Most chickens live in crowded amonia filled sheds. Here is a very short, very grisly video of the conditions on factory turkey farms. They never, or almost, never got to enjoy feeling safe in the sun. All of the birds I met were rescued because they were in especially terrible shape, even by the standard of birds trapped on factory farms. Despite what they endured they seemed to enjoy many parts of their lives. Several birds seemed actively consistently happy. People, including non-human people, can recover from a lot even if their scars never fully heal. 

It is just so sad to see the body of a bird and think: 

There was still time to say we were sorry. There was probably still time to give you a decent life. A life where you could have felt happy and safe at least some of the time. Maybe in a different world we could have sat in the sun together. We could have been friends. I had a miserable childhood but I eventually got to lead a real life. But instead of apologizing and making amends we killed you. Now you will never get to experience the life you deserved. I am so sorry…

Tears must flow.

Several activists I know have taken the liberation pledge. The pledge is pretty simple. 

one | Publicly refuse to eat animals – live vegan.
two | Publicly refuse to sit where animals are being eaten.
three | Encourage others to take the pledge.

I don’t really believe in taking pledges and try to avoid promises if I can. I trust my future self. But right now I am in compliance with the pledge and expect I will be in the future. Pledge takers commonly wear a bracelet made from a bent fork. Its time to bend a fork. 

Dating Woes

From age thirteen til thirty I identified as a man interested in women. During these eighteen years only two women expressed romantic or sexual interest in me unprompted. Both of them were friends of mine. There was a third ambigous case but thats it! Here is what I looked like recently:

Bit older:

Older Still:

That should give you some idea of how I looked. I am a bit short (5’8”) but I was usually in quite decent shape (I could do 15-25 pullups at all times, could always at least bench bodyweight, etc). During my adulthood I always had a decently active social life. For some of my adult life I had a very active social life.

Most men are unbelievably desexualized. I think many people have no idea what ‘average’ guys are actually like. And they certainly don’t seem to understand how demoralizing it is for most guys to date. I don’t endorse unhealthy responses to male lonliness. But I wanted to share the empirical reality I experienced: I got unprompted interest from women about once a decade. This really sucks. I hope one day society is able to have much healthier norms. I have a lot of respect for any guys who found a way to deal with the hand they were dealt. It’s rough out there. Stay strong brothers.

Context: A lot of my pals are discussing articles like this one and what advice men need. I love sharing advice. But I only like advice when it is very high impact. Most dating advice for guys doesn’t seem very high impact to me. And I think most advice doesn’t contend with how demoralizing the situation is.

I’m Sorry Fluttershy

I could have been a hero in another world.

I will call the friend of mine who commissioned that picture Fluttershy. They posted it shortly before they killed themselves in early March. They weren’t the easiest person to help, but I should have done more than I did. By the end, they were pretty isolated and I was one of the last people they were in contact with.

I will never talk to Fluttershy again, at least not during this age of the world. Looking back it is clear they were always trying to find a way to help me out. Multiple times they gave me the help or advice I needed. They are the person I originally got estrogen from. They were my friend. I miss them so much.

Fluttershy made a lot of mistakes. But it’s a harsh world. It is an especially harsh world if you are the type of person to commission fanart of a My Little Pony character freeing chickens. I can understand why they couldn’t handle it. Fluttershy was in a lot of pain and hated parts of themselves. I am happy that they are no longer suffering so much. I would never try to stop someone who was determined to commit suicide. But I think things could have been different.

Fluttershy needed someone who believed in them. If you are in a negative spiral it is very hard to get out by yourself. Once things are bad it is easy to alienate your friends. And once you lose support things get even worse. This leads to even worse relationships. Someone else has to put in the free energy to reverse the spiral.

Even in Fluttershy’s darkest moments, they thought about helping the least among us. No one was willing and able to help Fluttershy become the hero they wanted to be. I have many, many regrets from my time in California. But chief among them is not making a heroic effort to put Fluttershy on a better path.

I ordered a decent quality print and hung it in my living room. I personally find the idea of the character Fluttershy releasing chickens delightful. But the reason I put up the picture is to remind myself that Fluttershy is gone and we are still here. Whatever heroics Fluttershy wanted to do are left to us. But it’s also a reminder to me personally: to do better next time and to keep dreaming of a kinder world.

There is a lot more that could be said. I really don’t want to write a post remembering Fluttershy that leaves out so much of who they were and the struggles they faced. Given Fluttershy’s stated preferences, I think it is important to exercise the virtue of silence. But I want to present one more aspect of Fluttershy. They always encouraged people to think bigger. It seemed to me they often took this position way too far. We argued about this topic a lot. But Fluttershy has a point. The world needs saving and someone has to save it. At least really try to have a gigantic impact. However big you are thinking, try to go bigger. A lot of value is in the tail.

I will end this by saying I am sorry:

I’m so sorry Fluttershy. I was one of the few people in a position to help and I let you down. Now the world has one less person who dreams of every sweet little chicken being safe and free. And I am left one friend lonelier. I will try to do better next time and continue the work in your absence. I miss you. See you space pony, the rest of us will carry that weight.

Small and Vulnerable

Anyone who is dedicating the majority of their time or money to Effective Altruism needs to ask themselves why. Why not focus on enjoying life and spending your time doing what you love most? Here is my answer:

I have a twin sister but neither of us had many other friends growing up. From second to fifth grade we had none. From sixth to eighth we had one friend. As you might guess I was bullied quite badly. Multiple teachers contributed to this. Despite having no friends my parents wanted us to be normal. They pressured me to play sports with the boys in the neighborhood. I was unable to play with an acceptable level of skill and was not invited to the games anyway. But we were still forced to go ‘play outside’ after school. We had to find ways to kill time. Often we literally rode our bicycles in a circle in a parking lot. We were forced to ‘play outside’ for hours most days and even longer on weekends. I was not even allowed to bring a book outside though sometimes I would hide them outside at night and find them the next day. Until high school, I had no access to the internet. After dinner, I could watch TV, read and play video games. These were the main sources of joy in my childhood.

Amazingly my mom made fun of her children for being weirdos. My sister used to face a wall and stim with her fingers when she was overwhelmed. For some reason, my mom interpreted this as ‘OCD’. So she made up a song titled ‘OCD! Do you mean me?’ It had several verses! This is just one, especially insane, example.

My dad liked to ‘slap me around. He usually did not hit me very hard but he would slap me in the face all the time. He also loved to call me ‘boy’ instead of my name. He claims he got this idea from Tarzan. It took me years to stop flinching when people raised their hands or put them anywhere near my face. I have struggled with gender since childhood. My parents did not tolerate even minor gender nonconformity like growing my hair out. I would get hit reasonably hard if I insisted on something as ‘extreme’ as crossing my legs ‘like a girl in public. I recently started HRT and already feel much better.  My family is a lot of the reason I delayed transitioning.

If you go by the checklist I have quite severe ADHD. ‘Very often’ seemed like an understatement for most of the questions. My ADHD was untreated until recently. I could not focus on school or homework so trying to do my homework took way too much time. I was always in trouble in school and considered a very bad student. It definitely hurts when authority figures constantly, and often explicitly, treat you like a fuck up and a failure who can’t be trusted. But looking back it seems amazing I was considered such a bad student. I love most of the subjects you study in school! When I finally got access to the internet I spent hours per day reading Wikipedia articles. I still spend a lot of time listening to lectures on all sorts of subjects, especially history. Why were people so cruel to a little child who wanted to learn things?

Luckily things improved in high school. Once I had more freedom and distance from my parents my social skills improved a huge amount. In high school, I finally had internet access which helped an enormous amount. My parents finally connected our computer at home to the internet because they thought my sister and I needed it for school. I also had access to the computers in the high school library. By my junior year in high school, I was not really unpopular. Ironically my parent’s overbearing pressure to be a ‘normal kid’ probably prevented me from having a social life until I got a little independence.  Sadly I was still constantly in trouble in school throughout my high school years.

The abuse at home was very bad. But, to be honest, the absolute worst part of my childhood and adolescence was the constant sleep deprivation. Even at thirty years old I cannot handle getting up early; I rarely wake before nine-thirty. A year ago I briefly had to be awake at six-thirty for work. I felt terrible all day and could not think straight. When I was younger I had an even stronger need to sleep in but I had to be in school before eight. People were amazed at my ability to fall into a deep sleep in the middle of a loud classroom. Unless someone woke me up I would just stay asleep at my desk. This was a horrible experience and surely terrible for my brain. I got a break from this torment during the summers but I didn’t really escape until I made it to college.

Obviously, I was an outlier in many respects. But many people are outliers in some important respects. They still deserve an environment that is healthy and lets them flourish. I wanted to learn all sorts of things. But instead of helping me, the school system tortured me and permanently damaged my brain. No one deserves to be treated like that.

We should not frame this in terms of my parents being aberrations. I live in the United States. Many groups here normalize far more extreme repression and physical punishment. In some subcultures, my parent’s behavior is considered unacceptable. But much of what happened to me is still normalized. Even supposedly liberal parents are often terrible to trans children. Society isn’t going to stop sleep-depriving children anytime soon. And there are many people being severely mistreated in very different circumstances.

I cannot get my childhood back, can’t go back in time and transition earlier, and if my brain was harmed the damage is permanent. Whatever other traumas I have won’t fully heal. But I eventually got out. There are millions of people in prison, trapped in abusive nursing homes, or starving in Yemen. There are many more animals on farms. Those people haven’t escaped yet and it is unclear they will ever escape to somewhere safe. Society never should have normalized what happened to me and we shouldn’t normalize what is happening to them. This is an emergency.

When I was small and vulnerable I needed help. For the most part, no help came. I was forced to stew in boredom and misery until I grew bigger, stronger, and accorded more respect. It is always hard to compare experiences. But I know what it’s like to spend about a decade miserable, knowing you are being mistreated and being unable to defend yourself. Maybe one day I will again be unable to defend myself because I am sick or in prison. But for now, I am relatively healthy and free. I cannot just abandon the people and animals who are still trapped. Every day I try to imagine them somehow watching me and I ask whether they would think I forgot them. I hope I never forget. I hope my actions always show I have forgotten neither my past nor their present.

People Will Listen

I have been thinking a lot about the crypto autopsy Scott posted in 2018. In retrospect, there was still an enormous amount of money to be made ‘buying the dip’ in BTC/ETH. And there was even more money to be made buying altcoins. Scott also links to this thread from 2015 strongly advising people to buy bitcoin at around $230 (so approximately 250x gains on the percent you held). The earlier bitcoin discussion on lesswrong might have represented an even more lucrative opportunity but this is some of the best completely explicit advice ever posted on the forum:

LessWrong is where I learned about Bitcoin, several years ago, and my greatest regret is that I did not investigate it more as soon as possible, that people here did not yell at me louder that it was important, and to go take a look at it.  In that spirit, I will do so now.

This is a time to be good rationalists, and investigate a possible opportunity, comparing the present situation to historical examples, and making an informed decision.   Either Bitcoin has begun the process of dying, and this decline will continue in stages until it hits zero (or some incredibly low value that is essentially the same for our purposes), or it will live.  Based on the new all time high being hit in number of transactions, and ways to spend Bitcoin, I think there is at least a reasonable chance it will live.  Enough of a chance that it is worth taking some money that you can 100% afford to lose, and making a bet.  A rational gamble that there is a decent probability that it will survive, at a time when a large number of others are betting that it will fail.

And then once you do that, try your hardest to mentally write it off as a complete loss, like you had blown the money on a vacation or a consumer good, and now it is gone, and then wait a long time.

As I am writing the thread itself has four upvotes. Conversely, the following comment has twenty-six (this thread long predates variable weight votes though we can still vote on it going forward)

I used to believe that bitcoin is under-priced before, but there are so many agents involved in it now (including Wall Street), that I can’t really convince myself that I know better than them – the market is too efficient for me.

Additionally, I’d be especially wary about buying based on arguments regarding the future price based on such obvious metrics, that many agents pay attention to.

This seems like a really strong indictment of the community’s collective rationality. On the other hand, I have been posting some financial advice threads on lesswrong. I have posted much more advice on rationalist adjacent facebook and discord. People listen. I frequently get messages from people telling me they made money thanks to my posts. Several friends of mine got into Solana around $2.50 at the same time and have made six or seven figures from that investment. A few people got in later or for smaller amounts and still made meaningful amounts of money (Solana is no longer a truly amazing investment but it’s still worth buying/holding). Villiam’s comment is important to keep in mind:

Some of us were smarter than others. Good for them! But if we want to help each other, and avoid having the same thing happen the next time, next time when you see an exceptionally important article, don’t just think “others have read the same article, and they are smart people, so they know what to do”. That’s another form of illusion of transparency; after reading the same text, some people will jump up, others will just continue reading. Here are two things you can do to nudge your fellow rationalists in the right direction:

1) Imagine a person who has very little knowledge in this specific area, and for some reason is not going to study more. Can the whole thing be simplified; ideally into a short list that is easy to follow? For example: “Step 1: register online at BitStamp. Step 2: send them the required KYC documents. Step 3: do the money transfer. Step 4: buy Bitcoins. Step 5: HODL!” More people will follow this procedure, than if they just read “buy and/or mine some Bitcoins, find out how”.

2) Offer help at your local meetup. Make a short lecture, explain the details, answer questions. When people are interested, guide them step by step

It is very hard to grok how context people are missing. You need to make it as easy as possible for people to follow your advice. And you need to tell them a real plan. Many of us held a lot of bitcoin at one point or another. Just buying bitcoin was not enough, you needed to stick to a plan for selling. I personally like ‘sell 20% at every doubling’ for volatile investments. Give people the tools to succeed. A good friend of mine wanted to get into Solana for a few thousand dollars but found it difficult to buy. He is out tens of thousands of dollars because I did not make it easier for him to buy. He really could use that money. 

Am I now become your enemy, because I tell you the truth? – Galatians 4:16

The problem is that the more explicit you are the more pushback you should expect to receive. If you just explore a topic and ‘hint hint’ at your advice you won’t expose yourself to the same types of criticisms. You don’t need much plausible deniability to shield yourself. However, you cannot shield yourself very much if you are giving step-by-step instructions and making clear claims. We should take trivial inconveniences very seriously. Therefore we must not add any unnecessary friction. 

My advice is to accept that ‘haters are gonna hate’ and just take the hit. Make your arguments as clear and your advice as easy to follow as possible. But understand that no matter what you do, if you tell people to buy bitcoin at $230, the top comment might be critical. Some people will listen and benefit.

As a group, we should really be taking Aumannian reasoning and noticing confusion more seriously. If something very interesting is going on we need to stop and think and come to a logical conclusion. Obviously, not everyone is going to agree. But at least smaller groups should be able to ‘Stop, Drop and Think’. I hope we can do better as a group but if we cannot, or you leave lesswrong, at least Stop, Drop and Think when you notice a potential opportunity. The rewards for making the right choices can be enormous. 

This post mostly argues in favor of sharing your well-thought-out positions. But another implication of ‘people will listen’ is that you should not give advice flippantly. Don’t quickly fire off conventional wisdom. If you have not thought through your counsel make sure you make this clear. Of course, if you have thought things out I strongly suggest speaking your mind.

There is a season for all things and this seems like a season for thinking about crypto. However, I think pretty much every season is for thinking about money. Money is instrumentally useful for the vast majority of goals. If you want to ‘win’ you should probably think at least a little about money. But I also think these principles extend across domains and are not limited to financial decisions.

The EMH is False – Specific Strong Evidence

I am going to defend the following response to “If you are so smart why aren’t you rich?”: Rationalists actually are smart but we were way too modest and did not bet on our beliefs. The rationalists who actually tried to use rationality to invest often traded extremely lucratively. We should stop being so modest moving forward. Ideas have consequences, including for asset prices. In my opinion, anyone who has been on lesswrong for a long time really should be at least financially independent

I will first present the best evidence I have that the EMH is quite false: There are currently high return trades (5% a month at least, possibly more) with extremely low risk (you can lose 1-2% max, probably less depending on execution). These trades take a little execution but do not require professionals. In the recent past, there were VERY simple bets that returned ~10% a month with even less risk. I will describe both these trades then talk about more speculative evidence.

By the EMH I mean this practical form: People cannot systematically outperform simple strategies like holding VTSAX. Certainly, you cannot expect to have a higher expected value than max(VTSAX, SPY). Opportunities to make money by active investing are either very rare, low volume, or require large amounts of work. Therefore people who are not investing professionally should just buy broad-based index funds. 

I would say that for many asset classes you should have a reasonably strong prior that the current price is correct. I would include stocks and normal sports bets. However this prior is weak enough that the standard to overcome it is basically ‘convincing argument from a friend’. It is important to approach this with the same mindset you would use to make predictions and to be reasonably detail-oriented. I am not claiming this is trivially easy to beat the market just very doable.

Post Election Trump Betting

You could lucratively bet against Donald Trump long after the election on various platforms. The most lucrative way known to me was to short ‘TRUMPFEB’ on ftx.com. TRUMPFEB was a token that would pay out 1$ if Trump was president on Feb 1st and 0$ if he was not. The tokens were tradeable. Importantly you could short them to bet against trump. If TRUMPFEB was selling for 8cents and you short TRUMPFEB you would essentially be betting 1 dollar to make 8cents. Here is a graph of the price over time and some specific values.

Source images: https://www.coingecko.com/en/derivatives/ftx/TRUMPFEB

Roughly the markets thought Trump has a 15-17% chance until Nov 22nd, ~10-11% chance until Dec 10th and ~5-6% chance until January 5th. The odds were non-trivial until the electoral college met in person. You could short TRUMPFEB with 2x leverage which let you double your returns.  You could have easily placed a million-dollar bet shorting TRUMPFEB long after the election. FTX was not available to Americans but you could have gotten somewhat less lucrative odds betting on Polymarket or catnip. Polymarket and Catnip were available to Americans. At least one rationalist I know made over 100k betting on Polymarket.  The Polymarket election market had nine figures of volume. Predictit had low limits and high fees but many other platforms did not.

Safe high return trades exist right now – Perpetual Future Arbitrage

This trade is harder to explain and trickier to execute but it does not require being a professional. A ‘perpetual future’ is a contract that mimics an underlying asset. You can buy them ‘going long’ or you can ‘sell’ them to other people by shorting. For simplicity, let’s talk about BTC and BTC-PERP. BTC-PERP is a tradeable asset that works as follows on ftx.com:
— Ever hour compute the average prices of BTC and BTC-PERP over the last hour

— If BTC-PERP traded higher then longs pay shorts. If BTC is higher than shorts pay longs.  

— The amount paid is 1/24th of the discrepancy (on Binance these payments trigger every 8hours and the payment is 1/3 the difference).

Here is what this looks like. The second to last is the ‘payment’ (negative means I got paid) and the last column is the hourly rate. (These are some example holdings, this is a real account but not a proposed portfolio):

Open in a new tab to actually read the image

The above account is short all the coins. 

In general Perpetuals trade above the price of the underlying coins. The underlying reason is that it is much easier to use leverage when buying perpetual futures. This effect is especially strong if the market is bullish (as it is right now). 

The way to make this into an arbitrage is to buy the underlying coin and short an equal amount of the perpetual. For example, buying Bitcoin and shorting BTC-PERP. Prices almost never differ by more than 0.2%. 

The account above has a value of around 32k. If you add up the payments you will notice I received more than five dollars in one hour. That is 840 USD or 2.65% a week. This payment is a little better than I would expect going forward but if the market remains bullish you can get 10% monthly doing these trades. I would be surprised if you could not get at least 5% returns over the next 30 days. Returns were even better a few months ago. However, rates were sane until about three months and will presumably return to sanity one day. But for now, you can grab some safe returns if you do this trade skillfully. This is not as simple as ‘bet against trump’ and you probably need some python scripts to grab funding rate data. You also need to be careful about how you enter and exit positions. There is some work involved here but it easily makes sense if you have decent amounts of capital to invest (or can somehow pool some capital). 

However the ‘work involved’ does not explain why this has not been arbitraged away as predicted by the EMH. Many large players are actually doing these trades. But at least for now, the ‘smart money’ cannot close the gaps. Markets are often inefficient for a long time. 

Backtesting Rationalist Investing

Hopefully, the previous examples have garnered me some credibility because I am about to do something very dangerous. The perp arbitrage is current and I told people to bet on the elections well ahead of resolution (I told people to bet post-election on various discords). But I think one very obvious implication of ‘rationalist thinking’ was to bet on AI progress. It was especially clear you should do this after Alphago. Conveniently Alphago came out a little over five years ago so we can check the five-year returns of some plausible AI investments:

Goog 3x 

Nvidia 15x 

AMD 30x 

Intel 2x

Tesla 14x

Microsoft 4.5x

Botz ETF (2.5x)

TSM 4x

Facebook 2.5x

QQQ (Tech sector ETF) 3x


SPY (Obvious control group) 2x

You can argue that returns are driven by ‘tech stocks did well’ but GPU stocks did much better than tech in general. And I do think its fair to assume a rational investor who was looking to bet on AI progress would have put some of their portfolio into GPU manufacturers once it became clear that the ‘more compute’ paradigm was going to be influential. Imo Alphago was a good time to be convinced of the ‘more layers’ thesis and at the time most big AI projects were trained on Nvidia GPUS. 

Much has also been made of the fact that Bitcoin was mentioned very early on lesswrong. 

I changed my mind, Now I’m feeling different

We were young
We were young
We were young, we didn’t care
Is it gone?
Is it gone?
Is it floating in the air?
I changed my mind
I changed my mind
Now I’m feeling different

All that time, wasted
I wish I was a little more delicate

I think it us usually best to focus on the strongest arguments for your case so I won’t go into various weaker ones in any depth. But I will note it is possible to lend quite safely at high rates (~20% long term, often much higher APY short term). The ‘Equity Premium Puzzle’ is also a well known anomaly. It is very hard to explain why treasury bill returns have been so low relative to stocks for over a hundred years. I mention these as examples but I ask people to stick to object level counterarguments against my main points. I have been telling people how to beat the market for months. I am telling you how right now. So it doesn’t really make sense to make meta-arguments about how the things I am saying are impossible. The object level have been laid out. 

I too once believed in the EMH but I changed my mind. The third virtue is lightness. In a few days I hope to follow this post up with a sketch of what is still available, practical advice on amateur trading and various paths forward. 

My own mistakes

I should have written about this much earlier. I did tell people to Bet on Biden pre-election but that post had many flaws such as emphasizing predictit instead of Polymarket. In addition, post-election betting was much more obviously lucrative than pre-election betting. The last few months have also been extremely lucrative because of the crypto boom. I talked about many opportunities on various discord but did not post anything systematic and did not post ‘Bet on Biden v2’ to lesswrong nor did I post about crypto. Regardless of the reception, this thread gets I should have posted the information sooner. It is notable many people thanked me for the ‘Bet on Biden’ piece and it really hurts me that I did not sound the alarm louder on later opportunities. I also believe I cost myself a large amount of money by locking myself out of good counsel. I can make various excuses but I will not do so. Maybe my living and family situations played a factor in my bad judgment. Regardless I strongly regret my behavior 

Inclusion and Effective Altruism

Most people involved in effective altruism want to be inclusive. However, some people think the community can feel exclusive to people who are ‘average’. It seems like a decent number of people feel discouraged when they try to move from medium to high engagement with Effective Altruism. Why do people feel this way? To be clear I mean ‘inclusive’ in a broad sense: Can people who want to become involved in the community do so in meaningful ways? Will they feel included?

A very large percentage of EA funding comes from one couple. Estimates suggest that Dustin Moskovitz and Cari Tuna plausibly account for over half that over half of total EA funds. Wealth is quite concentrated in most countries. So it seems more tractable to try to influence large donors even though the average American household donated a few thousand dollars last year. I endorse the common advice to focus on absolute impact. But even a small probability of influencing a large donor is worth more expected dollars than most people can realistically donate. One promising initiative is Founder’s Pledge but there is still a limit to how many people can justify founding a startup.

The EA community is clearly trying to expand its influence in academia. This is probably a sensible strategy. This analysis suggests it worked well for the ‘neoliberal’ movement. However, it is not the easiest project to contribute to. Getting any sort of academic position is very difficult. And academic prestige is quite hierarchical; top schools are much more influential (though there are some interesting outliers like George Mason).  

The EA community also tends to promote a very conservative approach. For example, EAs have been warned not to rush to translate material. It does seem reasonable to be worried about lock-in and EA concepts can be hard to translate. Lock-in risks have also been raised with respect to founding EA groups. Though it seems like forming student groups is still heavily encouraged. If you engage a lot with effective altruist literature you will absorb a message that it is important to get many things right the first time. 

It is worth explicitly asking why the community even wants to be inclusive. Jane Street Capital is not very inclusive. The vast majority of people who want to work there cannot. Some people I have spoken to feel that EA is trying to solve hard problems and those problems are basically unrelated to inclusion. If you accept fewer warm fuzzies you can get more done. In their view, it is basically a category error to even consider inclusion except insofar as inclusion helps solve the hard problems. How can we reply to them on their own terms? 

I think there are a few instrumental reasons to focus on feeling inclusive. It is genuinely difficult to know who is going to be in a position to help or put in an important good word. We don’t know which perspectives will turn out to be influential. Exclusion precludes serendipity.  Weak ties are less likely to help if the community is perceived as discouraging. It is very bad for the movement if the wrong people drop out because they or their friends feel unable to contribute. We don’t want to reduce our exposure to tail windfalls.

I think there are structural problems and no easy answers. But if the community is going to emphasize strategies that are hard to contribute to then we should consider ways to mitigate the downside. Are there straightforward and low-risk ways to get involved that we should promote more. Should we re-consider some decisions like de-emphasizing earning to give and reducing the size of EA global? Donating money is relatively accessible compared to alternatives. I am sure there were sensible reasons to reduce the size of EAG but many people I know were hurt when they could not attend. I am not suggesting to prioritize inclusion over everything else, but I do think we should weight it more heavily when making tradeoffs and considering funding decisions.