what i've been writing about the last two weeks, would love some input
context: language emerged as a compression format optimized for human to human communication. when humans had to code computers, we forced reality through that same bottleneck — describe the world in words, then translate words into instructions. early AI inherited this constraint because humans had to interpret, label, and validate the training signal.
but if AI systems begin training and building themselves, that constraint is loosened and potentially goes away altogether. the question becomes: what's the optimal compression format for different domains of reality?
the answer is almost certainly domain specific, and definitely not language.
why it matters: financial market microstructure is one of the domains where signal has historically been non linguistic.
whoever builds the right native representation gets a durable edge, which is why HFTs are currently CRUSHING. HFTs will only become more profitable and more powerful in the age of AI precisely because they didn't win by describing markets in words. they won by building representations that live at the native resolution of the signal. that was then internalized into new ways of gathering data, new ways of analyzing that data, and then novel ways of trading that data at the bleeding edge of physics.
THE SAME THING IS HAPPENING IN INDUSTRIALS OVER THE NEXT DECADE. we're in phase 0 - the industrial topologies don't really even exist yet.
basically i'm working on connecting:
(a) data type
(b) model type
(c) impact on market structure
ideas i'm exploring:
🕉️ semiotics and neurosymbolic models - how do you utilize symbolic, human-legible structure (rules, logic, categories)
🏔️ topology or geometry based deep learning - representing relationships as graphs instead of token sequences, embedded context into the representation of relationships. a good representation should transform predictably when the underlying thing transforms
🧵physics informed representations - especially for real world data in energy, materials, etc where we can encode governing equations (like thermodynamics) as structural constraints
🌎 world models - a learned simulator of how states evolve, instead of predict the next token it's predict the next state of this world given an action
⏱️time series signals - this is financial data, sensors, etc anything where there is sequential structure and where tracking state change, i.e. the delta from moment to moment, is vital
language imposes one geometry. reality has a different geometry in every domain. the AI systems that figure out the right geometry for a domain will compress reality more efficiently, make better predictions, and take better actions.
but you're an investor? wtf?
investment lens is:
- how do you gather data (telemetry, sensors, etc)
- how does model, application, and interface evolve
- who will internalize these two to generate returns in markets of all types, both existing and emergent