bialek

http://arxiv.org/PS_cache/cond-mat/pdf/0205/0205297.pdf

The paper was a really nice introduction to the concepts. Someone once told me that if you didn't use a stochastic framework it would be difficult to understand the concepts in finance as the feedback loops and interrelationships among trading units would be too complex and unknown to model and understand in a deterministic manner. That is, you need to aggregate and then model behaviour at whcih point you get some help from the LLN and CLT.This seems to contrast with (if I recall correctly from some other thread) N's view that you should take the deterministic route as the stochastic approach was nonsense.

yes, i like parisi's work too

QuoteOriginally posted by: ScottCavenythe question is, what does this have, if it has anything, to do with finance?Probably nothing. Finance is finance. It's quite a narrow subject.

you're probably right: Complex systems have *nothing* to do with finance.

For all those interested in Kolmogorov complexity, there is an excellent intro by Ming Li and Paul Vitanyi, An Introductin to Kolmogorov Complexity and Its Applications .

Thanks N; thanks Olivier.