The Money Formula by Paul Wilmott & David Orrell

Author:Paul Wilmott & David Orrell
Language: eng
Format: epub
ISBN: 9781119358688
Publisher: Wiley
Published: 2017-02-17T00:00:00+00:00

Blinding us with Science

While some quants like to invest in art, others find science more appealing. David Harding, who founded Winton Capital, has for example generously funded The Winton Programme for the Physics of Sustainability at Cambridge; The Harding Center for Risk Literacy at the Max Planck Institute for Human Development in Berlin; £5 million towards building a new mathematics gallery at the Science Museum in London; and for science writers the Royal Society Winton Prize for Science Books. Winton Capital also funded a science competition to improve on algorithms for the mapping of dark matter, the mysterious, elusive substance which is thought to permeate the universe, as well as areas behind the fridge.22

David E. Shaw gave up day-to-day operations of his hedge fund in 2001 to concentrate on D.E. Shaw Research, which carries out biochemistry research. The firm's job ads helpfully point out that of successful applicants, a considerable number have “competed successfully in the United States and International Math Olympiads as well as the Putnam Competition.” This is like saying “many of our fitness instructors are Olympic medal holders,” or “most of our drivers are Formula One champions.”

Another heavyweight in the science market is the Templeton Foundation, which is propped up by a $3 billion endowment from the estate of the famed investment manager John Templeton. Each year it hands out grants worth over $100 million, with a significant portion going toward high-energy physics, and in particular supporters of string and multiverse theory. For comparison, the US National Science Foundation's budget for high-energy physics is about $12 million. Whether his foundation is as good at spotting scientific theories as Templeton was at picking stocks remains to be seen. (The physics of string and multiverse theory, as opposed to the mathematics behind it, was critiqued in David's willfully obscure treatise on science called Truth or Beauty. Its sales – since we were on that topic – were unexciting everywhere except in China, where the translated version was unaccountably chosen by Xinhua, the press arm of the Chinese state and mouthpiece of the Communist Party, as recommended New Year holiday reading. As we said, unpredictable.)

And then there is James Simons of Renaissance Technology – one of the biggest patrons of scientists since the Medicis hired Galileo as a tutor. Ranked 76 on the 2015 Forbes list of the world's billionaires (another list which follows a power law23), he has a personal fortune estimated at $14 billion, and seems intent on giving much of it away to promote a range of scientific research through his Simons Foundation.24 Its “Mathematics and Physical Sciences” program focuses on computer science and theoretical physics, doling out million-dollar grants to leading scientists. “Life Sciences” supports research on the boundary between physics and biology, including a brain-modeling project known as the Global Brain. “Education and Outreach” features a program aimed at secondary schools and teachers called Math for America. In addition, there is an Autism Research Initiative and a Center for Data Analysis, which explores big data in areas such as genomics and neuroscience.

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