[Script Info]
Title: 
[Events]
Format: Layer, Start, End, Style, Name, MarginL, MarginR, MarginV, Effect, Text
Dialogue: 0,0:00:00.82,0:00:03.65,Default,,0000,0000,0000,,Chris Anderson: You were something\Nof a mathematical phenom.
Dialogue: 0,0:00:03.68,0:00:06.74,Default,,0000,0000,0000,,You had already taught at Harvard\Nand MIT at a young age.
Dialogue: 0,0:00:06.76,0:00:08.95,Default,,0000,0000,0000,,And then the NSA came calling.
Dialogue: 0,0:00:09.46,0:00:10.67,Default,,0000,0000,0000,,What was that about?
Dialogue: 0,0:00:11.21,0:00:15.13,Default,,0000,0000,0000,,Jim Simons: Well the NSA --\Nthat's the National Security Agency --
Dialogue: 0,0:00:15.15,0:00:17.12,Default,,0000,0000,0000,,they didn't exactly come calling.
Dialogue: 0,0:00:17.46,0:00:21.94,Default,,0000,0000,0000,,They had an operation at Princeton,\Nwhere they hired mathematicians
Dialogue: 0,0:00:21.96,0:00:24.90,Default,,0000,0000,0000,,to attack secret codes\Nand stuff like that.
Dialogue: 0,0:00:25.29,0:00:26.97,Default,,0000,0000,0000,,And I knew that existed.
Dialogue: 0,0:00:27.32,0:00:29.50,Default,,0000,0000,0000,,And they had a very good policy,
Dialogue: 0,0:00:29.52,0:00:33.37,Default,,0000,0000,0000,,because you could do half your time\Nat your own mathematics,
Dialogue: 0,0:00:33.39,0:00:36.88,Default,,0000,0000,0000,,and at least half your time\Nworking on their stuff.
Dialogue: 0,0:00:37.56,0:00:39.03,Default,,0000,0000,0000,,And they paid a lot.
Dialogue: 0,0:00:39.06,0:00:42.11,Default,,0000,0000,0000,,So that was an irresistible pull.
Dialogue: 0,0:00:42.13,0:00:44.04,Default,,0000,0000,0000,,So, I went there.
Dialogue: 0,0:00:44.07,0:00:45.41,Default,,0000,0000,0000,,CA: You were a code-cracker.
Dialogue: 0,0:00:45.43,0:00:46.60,Default,,0000,0000,0000,,JS: I was.
Dialogue: 0,0:00:46.62,0:00:47.78,Default,,0000,0000,0000,,CA: Until you got fired.
Dialogue: 0,0:00:47.80,0:00:49.38,Default,,0000,0000,0000,,JS: Well, I did get fired. Yes.
Dialogue: 0,0:00:49.41,0:00:50.65,Default,,0000,0000,0000,,CA: How come?
Dialogue: 0,0:00:51.28,0:00:52.61,Default,,0000,0000,0000,,JS: Well, how come?
Dialogue: 0,0:00:53.61,0:00:58.57,Default,,0000,0000,0000,,I got fired because,\Nwell, the Vietnam War was on,
Dialogue: 0,0:00:58.59,0:01:04.33,Default,,0000,0000,0000,,and the boss of bosses in my organization\Nwas a big fan of the war
Dialogue: 0,0:01:04.35,0:01:08.75,Default,,0000,0000,0000,,and wrote a New York Times article,\Na magazine section cover story,
Dialogue: 0,0:01:08.77,0:01:10.54,Default,,0000,0000,0000,,about how we would win in Vietnam.
Dialogue: 0,0:01:10.57,0:01:13.70,Default,,0000,0000,0000,,And I didn't like that war,\NI thought it was stupid.
Dialogue: 0,0:01:13.72,0:01:16.38,Default,,0000,0000,0000,,And I wrote a letter to the Times,\Nwhich they published,
Dialogue: 0,0:01:16.41,0:01:20.42,Default,,0000,0000,0000,,saying not everyone\Nwho works for Maxwell Taylor,
Dialogue: 0,0:01:20.45,0:01:25.13,Default,,0000,0000,0000,,if anyone remembers that name,\Nagrees with his views.
Dialogue: 0,0:01:25.55,0:01:27.21,Default,,0000,0000,0000,,And I gave my own views ...
Dialogue: 0,0:01:27.24,0:01:29.40,Default,,0000,0000,0000,,CA: Oh, OK. I can see that would --
Dialogue: 0,0:01:29.42,0:01:31.98,Default,,0000,0000,0000,,JS: ... which were different\Nfrom General Taylor's.
Dialogue: 0,0:01:32.00,0:01:33.91,Default,,0000,0000,0000,,But in the end, nobody said anything.
Dialogue: 0,0:01:33.93,0:01:37.63,Default,,0000,0000,0000,,But then, I was 29 years old at this time,\Nand some kid came around
Dialogue: 0,0:01:37.66,0:01:40.74,Default,,0000,0000,0000,,and said he was a stringer\Nfrom Newsweek magazine
Dialogue: 0,0:01:40.77,0:01:46.14,Default,,0000,0000,0000,,and he wanted to interview me\Nand ask what I was doing about my views.
Dialogue: 0,0:01:46.16,0:01:50.06,Default,,0000,0000,0000,,And I told him, "I'm doing\Nmostly mathematics now,
Dialogue: 0,0:01:50.08,0:01:53.46,Default,,0000,0000,0000,,and when the war is over,\Nthen I'll do mostly their stuff."
Dialogue: 0,0:01:54.12,0:01:56.95,Default,,0000,0000,0000,,Then I did the only\Nintelligent thing I'd done that day --
Dialogue: 0,0:01:56.97,0:02:01.13,Default,,0000,0000,0000,,I told my local boss\Nthat I gave that interview.
Dialogue: 0,0:02:01.15,0:02:02.61,Default,,0000,0000,0000,,And he said, "What'd you say?"
Dialogue: 0,0:02:02.64,0:02:04.10,Default,,0000,0000,0000,,And I told him what I said.
Dialogue: 0,0:02:04.13,0:02:06.44,Default,,0000,0000,0000,,And then he said,\N"I've got to call Taylor."
Dialogue: 0,0:02:06.46,0:02:08.84,Default,,0000,0000,0000,,He called Taylor; that took 10 minutes.
Dialogue: 0,0:02:08.87,0:02:11.13,Default,,0000,0000,0000,,I was fired five minutes after that.
Dialogue: 0,0:02:11.59,0:02:12.81,Default,,0000,0000,0000,,CA: OK.
Dialogue: 0,0:02:12.84,0:02:13.99,Default,,0000,0000,0000,,JS: But it wasn't bad.
Dialogue: 0,0:02:14.01,0:02:16.50,Default,,0000,0000,0000,,CA: It wasn't bad,\Nbecause you went on to Stony Brook
Dialogue: 0,0:02:16.53,0:02:19.66,Default,,0000,0000,0000,,and stepped up your mathematical career.
Dialogue: 0,0:02:19.68,0:02:22.14,Default,,0000,0000,0000,,You started working with this man here.
Dialogue: 0,0:02:22.16,0:02:23.32,Default,,0000,0000,0000,,Who is this?
Dialogue: 0,0:02:24.35,0:02:25.76,Default,,0000,0000,0000,,JS: Oh, [Shiing-Shen] Chern.
Dialogue: 0,0:02:25.79,0:02:28.89,Default,,0000,0000,0000,,Chern was one of the great\Nmathematicians of the century.
Dialogue: 0,0:02:28.92,0:02:34.15,Default,,0000,0000,0000,,I had known him when\NI was a graduate student at Berkeley.
Dialogue: 0,0:02:34.17,0:02:36.04,Default,,0000,0000,0000,,And I had some ideas,
Dialogue: 0,0:02:36.07,0:02:38.52,Default,,0000,0000,0000,,and I brought them to him\Nand he liked them.
Dialogue: 0,0:02:38.54,0:02:45.16,Default,,0000,0000,0000,,Together, we did this work\Nwhich you can easily see up there.
Dialogue: 0,0:02:45.19,0:02:46.34,Default,,0000,0000,0000,,There it is.
Dialogue: 0,0:02:47.20,0:02:50.80,Default,,0000,0000,0000,,CA: It led to you publishing\Na famous paper together.
Dialogue: 0,0:02:50.83,0:02:54.07,Default,,0000,0000,0000,,Can you explain at all what that work was?
Dialogue: 0,0:02:55.03,0:02:56.19,Default,,0000,0000,0000,,JS: No.
Dialogue: 0,0:02:56.21,0:02:58.48,Default,,0000,0000,0000,,(Laughter)
Dialogue: 0,0:02:58.97,0:03:01.03,Default,,0000,0000,0000,,JS: I mean, I could\Nexplain it to somebody.
Dialogue: 0,0:03:01.05,0:03:03.13,Default,,0000,0000,0000,,(Laughter)
Dialogue: 0,0:03:03.15,0:03:05.02,Default,,0000,0000,0000,,CA: How about explaining this?
Dialogue: 0,0:03:05.04,0:03:07.77,Default,,0000,0000,0000,,JS: But not many. Not many people.
Dialogue: 0,0:03:09.14,0:03:11.96,Default,,0000,0000,0000,,CA: I think you told me\Nit had something to do with spheres,
Dialogue: 0,0:03:11.98,0:03:13.84,Default,,0000,0000,0000,,so let's start here.
Dialogue: 0,0:03:13.87,0:03:17.47,Default,,0000,0000,0000,,JS: Well, it did,\Nbut I'll say about that work --
Dialogue: 0,0:03:17.49,0:03:20.69,Default,,0000,0000,0000,,it did have something to do with that,\Nbut before we get to that --
Dialogue: 0,0:03:20.72,0:03:24.26,Default,,0000,0000,0000,,that work was good mathematics.
Dialogue: 0,0:03:24.28,0:03:26.77,Default,,0000,0000,0000,,I was very happy with it; so was Chern.
Dialogue: 0,0:03:27.91,0:03:32.09,Default,,0000,0000,0000,,It even started a little sub-field\Nthat's now flourishing.
Dialogue: 0,0:03:32.64,0:03:37.93,Default,,0000,0000,0000,,But, more interestingly,\Nit happened to apply to physics,
Dialogue: 0,0:03:37.96,0:03:42.25,Default,,0000,0000,0000,,something we knew nothing about --\Nat least I knew nothing about physics,
Dialogue: 0,0:03:42.28,0:03:44.56,Default,,0000,0000,0000,,and I don't think Chern\Nknew a heck of a lot.
Dialogue: 0,0:03:44.58,0:03:48.54,Default,,0000,0000,0000,,And about 10 years\Nafter the paper came out,
Dialogue: 0,0:03:48.57,0:03:53.05,Default,,0000,0000,0000,,a guy named Ed Witten in Princeton\Nstarted applying it to string theory
Dialogue: 0,0:03:53.07,0:03:57.92,Default,,0000,0000,0000,,and people in Russia started applying it\Nto what's called "condensed matter."
Dialogue: 0,0:03:57.95,0:04:02.84,Default,,0000,0000,0000,,Today, those things in there\Ncalled Chern-Simons invariants
Dialogue: 0,0:04:02.86,0:04:04.73,Default,,0000,0000,0000,,have spread through a lot of physics.
Dialogue: 0,0:04:04.75,0:04:05.93,Default,,0000,0000,0000,,And it was amazing.
Dialogue: 0,0:04:05.95,0:04:07.32,Default,,0000,0000,0000,,We didn't know any physics.
Dialogue: 0,0:04:07.71,0:04:10.57,Default,,0000,0000,0000,,It never occurred to me\Nthat it would be applied to physics.
Dialogue: 0,0:04:10.59,0:04:14.38,Default,,0000,0000,0000,,But that's the thing about mathematics --\Nyou never know where it's going to go.
Dialogue: 0,0:04:14.40,0:04:15.90,Default,,0000,0000,0000,,CA: This is so incredible.
Dialogue: 0,0:04:15.92,0:04:20.28,Default,,0000,0000,0000,,So, we've been talking about\Nhow evolution shapes human minds
Dialogue: 0,0:04:20.31,0:04:22.82,Default,,0000,0000,0000,,that may or may not perceive the truth.
Dialogue: 0,0:04:22.84,0:04:26.15,Default,,0000,0000,0000,,Somehow, you come up\Nwith a mathematical theory,
Dialogue: 0,0:04:26.18,0:04:28.02,Default,,0000,0000,0000,,not knowing any physics,
Dialogue: 0,0:04:28.05,0:04:30.55,Default,,0000,0000,0000,,discover two decades later\Nthat it's being applied
Dialogue: 0,0:04:30.57,0:04:33.60,Default,,0000,0000,0000,,to profoundly describe\Nthe actual physical world.
Dialogue: 0,0:04:33.63,0:04:34.78,Default,,0000,0000,0000,,How can that happen?
Dialogue: 0,0:04:34.80,0:04:35.96,Default,,0000,0000,0000,,JS: God knows.
Dialogue: 0,0:04:35.98,0:04:38.09,Default,,0000,0000,0000,,(Laughter)
Dialogue: 0,0:04:38.85,0:04:41.100,Default,,0000,0000,0000,,But there's a famous physicist\Nnamed [Eugene] Wigner,
Dialogue: 0,0:04:42.02,0:04:47.61,Default,,0000,0000,0000,,and he wrote an essay on the unreasonable\Neffectiveness of mathematics.
Dialogue: 0,0:04:47.64,0:04:51.59,Default,,0000,0000,0000,,Somehow, this mathematics,\Nwhich is rooted in the real world
Dialogue: 0,0:04:51.61,0:04:56.61,Default,,0000,0000,0000,,in some sense -- we learn to count,\Nmeasure, everyone would do that --
Dialogue: 0,0:04:56.63,0:04:58.46,Default,,0000,0000,0000,,and then it flourishes on its own.
Dialogue: 0,0:04:58.98,0:05:01.82,Default,,0000,0000,0000,,But so often it comes\Nback to save the day.
Dialogue: 0,0:05:02.29,0:05:04.47,Default,,0000,0000,0000,,General relativity is an example.
Dialogue: 0,0:05:04.50,0:05:07.61,Default,,0000,0000,0000,,[Hermann] Minkowski had this geometry,\Nand Einstein realized,
Dialogue: 0,0:05:07.64,0:05:11.48,Default,,0000,0000,0000,,"Hey! It's the very thing\Nin which I can cast general relativity."
Dialogue: 0,0:05:11.51,0:05:14.62,Default,,0000,0000,0000,,So, you never know. It is a mystery.
Dialogue: 0,0:05:15.06,0:05:16.27,Default,,0000,0000,0000,,It is a mystery.
Dialogue: 0,0:05:16.30,0:05:19.59,Default,,0000,0000,0000,,CA: So, here's a mathematical\Npiece of ingenuity.
Dialogue: 0,0:05:19.62,0:05:20.96,Default,,0000,0000,0000,,Tell us about this.
Dialogue: 0,0:05:20.98,0:05:26.91,Default,,0000,0000,0000,,JS: Well, that's a ball -- it's a sphere,\Nand it has a lattice around it --
Dialogue: 0,0:05:26.93,0:05:28.50,Default,,0000,0000,0000,,you know, those squares.
Dialogue: 0,0:05:30.70,0:05:35.60,Default,,0000,0000,0000,,What I'm going to show here was\Noriginally observed by [Leonhard] Euler,
Dialogue: 0,0:05:35.63,0:05:37.88,Default,,0000,0000,0000,,the great mathematician, in the 1700s.
Dialogue: 0,0:05:38.22,0:05:43.40,Default,,0000,0000,0000,,And it gradually grew to be\Na very important field in mathematics:
Dialogue: 0,0:05:43.43,0:05:45.76,Default,,0000,0000,0000,,algebraic topology, geometry.
Dialogue: 0,0:05:47.04,0:05:51.40,Default,,0000,0000,0000,,That paper up there had its roots in this.
Dialogue: 0,0:05:51.43,0:05:53.26,Default,,0000,0000,0000,,So, here's this thing:
Dialogue: 0,0:05:53.28,0:05:57.74,Default,,0000,0000,0000,,it has eight vertices,\N12 edges, six faces.
Dialogue: 0,0:05:57.76,0:06:01.59,Default,,0000,0000,0000,,And if you look at the difference --\Nvertices minus edges plus faces --
Dialogue: 0,0:06:01.62,0:06:02.77,Default,,0000,0000,0000,,you get two.
Dialogue: 0,0:06:02.79,0:06:05.01,Default,,0000,0000,0000,,OK, well, two. That's a good number.
Dialogue: 0,0:06:05.03,0:06:09.28,Default,,0000,0000,0000,,Here's a different way of doing it --\Nthese are triangles covering --
Dialogue: 0,0:06:09.31,0:06:13.88,Default,,0000,0000,0000,,this has 12 vertices and 30 edges
Dialogue: 0,0:06:13.91,0:06:18.10,Default,,0000,0000,0000,,and 20 faces, 20 tiles.
Dialogue: 0,0:06:18.58,0:06:23.17,Default,,0000,0000,0000,,And vertices minus edges\Nplus faces still equals two.
Dialogue: 0,0:06:23.19,0:06:26.04,Default,,0000,0000,0000,,And in fact, you could do this\Nany which way --
Dialogue: 0,0:06:26.06,0:06:29.46,Default,,0000,0000,0000,,cover this thing with all kinds\Nof polygons and triangles
Dialogue: 0,0:06:29.48,0:06:30.80,Default,,0000,0000,0000,,and mix them up.
Dialogue: 0,0:06:30.83,0:06:34.11,Default,,0000,0000,0000,,And you take vertices minus edges\Nplus faces -- you'll get two.
Dialogue: 0,0:06:34.13,0:06:35.74,Default,,0000,0000,0000,,Here's a different shape.
Dialogue: 0,0:06:36.48,0:06:41.73,Default,,0000,0000,0000,,This is a torus, or the surface\Nof a doughnut: 16 vertices
Dialogue: 0,0:06:41.75,0:06:45.100,Default,,0000,0000,0000,,covered by these rectangles,\N32 edges, 16 faces.
Dialogue: 0,0:06:46.53,0:06:49.21,Default,,0000,0000,0000,,Vertices minus edges comes out to be zero.
Dialogue: 0,0:06:49.24,0:06:50.71,Default,,0000,0000,0000,,It'll always come out to zero.
Dialogue: 0,0:06:50.74,0:06:55.05,Default,,0000,0000,0000,,Every time you cover a torus\Nwith squares or triangles
Dialogue: 0,0:06:55.07,0:06:59.01,Default,,0000,0000,0000,,or anything like that,\Nyou're going to get zero.
Dialogue: 0,0:07:00.51,0:07:02.90,Default,,0000,0000,0000,,So, this is called\Nthe Euler characteristic.
Dialogue: 0,0:07:02.93,0:07:06.38,Default,,0000,0000,0000,,And it's what's called\Na topological invariant.
Dialogue: 0,0:07:06.85,0:07:08.00,Default,,0000,0000,0000,,It's pretty amazing.
Dialogue: 0,0:07:08.03,0:07:10.82,Default,,0000,0000,0000,,No matter how you do it,\Nyou're always get the same answer.
Dialogue: 0,0:07:10.84,0:07:17.14,Default,,0000,0000,0000,,So that was the first sort of thrust,\Nfrom the mid-1700s,
Dialogue: 0,0:07:17.17,0:07:20.94,Default,,0000,0000,0000,,into a subject which is now called\Nalgebraic topology.
Dialogue: 0,0:07:20.96,0:07:23.94,Default,,0000,0000,0000,,CA: And your own work\Ntook an idea like this and moved it
Dialogue: 0,0:07:23.97,0:07:26.42,Default,,0000,0000,0000,,into higher-dimensional theory,
Dialogue: 0,0:07:26.44,0:07:29.53,Default,,0000,0000,0000,,higher-dimensional objects,\Nand found new invariances?
Dialogue: 0,0:07:29.55,0:07:34.20,Default,,0000,0000,0000,,JS: Yes. Well, there were already\Nhigher-dimensional invariants:
Dialogue: 0,0:07:34.22,0:07:38.68,Default,,0000,0000,0000,,Pontryagin classes --\Nactually, there were Chern classes.
Dialogue: 0,0:07:38.70,0:07:42.25,Default,,0000,0000,0000,,There were a bunch\Nof these types of invariants.
Dialogue: 0,0:07:42.27,0:07:46.41,Default,,0000,0000,0000,,I was struggling to work on one of them
Dialogue: 0,0:07:46.43,0:07:50.63,Default,,0000,0000,0000,,and model it sort of combinatorially,
Dialogue: 0,0:07:50.66,0:07:53.68,Default,,0000,0000,0000,,instead of the way it was typically done,
Dialogue: 0,0:07:53.70,0:07:58.06,Default,,0000,0000,0000,,and that led to this work\Nand we uncovered some new things.
Dialogue: 0,0:07:58.09,0:08:01.59,Default,,0000,0000,0000,,But if it wasn't for Mr. Euler --
Dialogue: 0,0:08:01.61,0:08:05.59,Default,,0000,0000,0000,,who wrote almost 70 volumes of mathematics
Dialogue: 0,0:08:05.62,0:08:07.35,Default,,0000,0000,0000,,and had 13 children,
Dialogue: 0,0:08:07.37,0:08:13.81,Default,,0000,0000,0000,,who he apparently would dandle on his knee\Nwhile he was writing --
Dialogue: 0,0:08:13.84,0:08:19.61,Default,,0000,0000,0000,,if it wasn't for Mr. Euler, there wouldn't\Nperhaps be these invariants.
Dialogue: 0,0:08:20.16,0:08:24.25,Default,,0000,0000,0000,,CA: OK, so that's at least given us\Na flavor of that amazing mind in there.
Dialogue: 0,0:08:24.80,0:08:26.35,Default,,0000,0000,0000,,Let's talk about Renaissance.
Dialogue: 0,0:08:26.37,0:08:32.23,Default,,0000,0000,0000,,Because you took that amazing mind\Nand having been a code-cracker at the NSA,
Dialogue: 0,0:08:32.25,0:08:35.48,Default,,0000,0000,0000,,you started to become a code-cracker\Nin the financial industry.
Dialogue: 0,0:08:35.50,0:08:38.19,Default,,0000,0000,0000,,I think you probably didn't buy\Nefficient market theory.
Dialogue: 0,0:08:38.22,0:08:44.60,Default,,0000,0000,0000,,Somehow you found a way of creating\Nastonishing returns over two decades.
Dialogue: 0,0:08:44.63,0:08:46.30,Default,,0000,0000,0000,,The way it's been explained to me,
Dialogue: 0,0:08:46.32,0:08:49.82,Default,,0000,0000,0000,,what's remarkable about what you did\Nwasn't just the size of the returns,
Dialogue: 0,0:08:49.85,0:08:53.73,Default,,0000,0000,0000,,it's that you took them\Nwith surprisingly low volatility and risk,
Dialogue: 0,0:08:53.75,0:08:55.58,Default,,0000,0000,0000,,compared with other hedge funds.
Dialogue: 0,0:08:55.60,0:08:57.53,Default,,0000,0000,0000,,So how on earth did you do this, Jim?
Dialogue: 0,0:08:58.07,0:09:02.18,Default,,0000,0000,0000,,JS: I did it by assembling\Na wonderful group of people.
Dialogue: 0,0:09:02.21,0:09:06.16,Default,,0000,0000,0000,,When I started doing trading, I had\Ngotten a little tired of mathematics.
Dialogue: 0,0:09:06.19,0:09:10.11,Default,,0000,0000,0000,,I was in my late 30s,\NI had a little money.
Dialogue: 0,0:09:10.13,0:09:12.64,Default,,0000,0000,0000,,I started trading and it went very well.
Dialogue: 0,0:09:13.06,0:09:15.81,Default,,0000,0000,0000,,I made quite a lot of money\Nwith pure luck.
Dialogue: 0,0:09:15.84,0:09:17.50,Default,,0000,0000,0000,,I mean, I think it was pure luck.
Dialogue: 0,0:09:17.52,0:09:19.63,Default,,0000,0000,0000,,It certainly wasn't mathematical modeling.
Dialogue: 0,0:09:19.66,0:09:23.49,Default,,0000,0000,0000,,But in looking at the data,\Nafter a while I realized:
Dialogue: 0,0:09:23.51,0:09:26.07,Default,,0000,0000,0000,,it looks like there's some structure here.
Dialogue: 0,0:09:26.09,0:09:29.79,Default,,0000,0000,0000,,And I hired a few mathematicians,\Nand we started making some models --
Dialogue: 0,0:09:29.81,0:09:34.08,Default,,0000,0000,0000,,just the kind of thing we did back\Nat IDA [Institute for Defense Analyses].
Dialogue: 0,0:09:34.10,0:09:36.93,Default,,0000,0000,0000,,You design an algorithm,\Nyou test it out on a computer.
Dialogue: 0,0:09:36.96,0:09:39.12,Default,,0000,0000,0000,,Does it work? Doesn't it work? And so on.
Dialogue: 0,0:09:39.44,0:09:40.92,Default,,0000,0000,0000,,CA: Can we take a look at this?
Dialogue: 0,0:09:40.95,0:09:45.49,Default,,0000,0000,0000,,Because here's a typical graph\Nof some commodity.
Dialogue: 0,0:09:46.49,0:09:50.53,Default,,0000,0000,0000,,I look at that, and I say,\N"That's just a random, up-and-down walk --
Dialogue: 0,0:09:50.55,0:09:53.41,Default,,0000,0000,0000,,maybe a slight upward trend\Nover that whole period of time."
Dialogue: 0,0:09:53.44,0:09:55.55,Default,,0000,0000,0000,,How on earth could you trade\Nlooking at that,
Dialogue: 0,0:09:55.58,0:09:57.90,Default,,0000,0000,0000,,and see something that wasn't just random?
Dialogue: 0,0:09:57.92,0:10:01.17,Default,,0000,0000,0000,,JS: In the old days -- this is\Nkind of a graph from the old days,
Dialogue: 0,0:10:01.20,0:10:05.48,Default,,0000,0000,0000,,commodities or currencies\Nhad a tendency to trend.
Dialogue: 0,0:10:05.50,0:10:11.56,Default,,0000,0000,0000,,Not necessarily the very light trend\Nyou see here, but trending in periods.
Dialogue: 0,0:10:11.58,0:10:15.64,Default,,0000,0000,0000,,And if you decided, OK,\NI'm going to predict today,
Dialogue: 0,0:10:15.66,0:10:20.63,Default,,0000,0000,0000,,by the average move in the past 20 days --
Dialogue: 0,0:10:20.66,0:10:23.76,Default,,0000,0000,0000,,maybe that would be a good prediction,\Nand I'd make some money.
Dialogue: 0,0:10:23.79,0:10:29.39,Default,,0000,0000,0000,,And in fact, years ago,\Nsuch a system would work --
Dialogue: 0,0:10:29.42,0:10:31.81,Default,,0000,0000,0000,,not beautifully, but it would work.
Dialogue: 0,0:10:31.83,0:10:34.34,Default,,0000,0000,0000,,You'd make money, you'd lose\Nmoney, you'd make money.
Dialogue: 0,0:10:34.37,0:10:36.56,Default,,0000,0000,0000,,But this is a year's worth of days,
Dialogue: 0,0:10:36.59,0:10:40.83,Default,,0000,0000,0000,,and you'd make a little money\Nduring that period.
Dialogue: 0,0:10:41.88,0:10:43.84,Default,,0000,0000,0000,,It's a very vestigial system.
Dialogue: 0,0:10:44.52,0:10:48.05,Default,,0000,0000,0000,,CA: So you would test\Na bunch of lengths of trends in time
Dialogue: 0,0:10:48.08,0:10:50.51,Default,,0000,0000,0000,,and see whether, for example,
Dialogue: 0,0:10:50.54,0:10:54.02,Default,,0000,0000,0000,,a 10-day trend or a 15-day trend\Nwas predictive of what happened next.
Dialogue: 0,0:10:54.04,0:11:00.80,Default,,0000,0000,0000,,JS: Sure, you would try all those things\Nand see what worked best.
Dialogue: 0,0:11:01.52,0:11:04.86,Default,,0000,0000,0000,,Trend-following would\Nhave been great in the '60s,
Dialogue: 0,0:11:04.89,0:11:07.02,Default,,0000,0000,0000,,and it was sort of OK in the '70s.
Dialogue: 0,0:11:07.04,0:11:08.92,Default,,0000,0000,0000,,By the '80s, it wasn't.
Dialogue: 0,0:11:08.94,0:11:11.76,Default,,0000,0000,0000,,CA: Because everyone could see that.
Dialogue: 0,0:11:11.78,0:11:14.56,Default,,0000,0000,0000,,So, how did you stay ahead of the pack?
Dialogue: 0,0:11:15.05,0:11:21.18,Default,,0000,0000,0000,,JS: We stayed ahead of the pack\Nby finding other approaches --
Dialogue: 0,0:11:21.20,0:11:23.94,Default,,0000,0000,0000,,shorter-term approaches to some extent.
Dialogue: 0,0:11:25.11,0:11:28.45,Default,,0000,0000,0000,,The real thing was to gather\Na tremendous amount of data --
Dialogue: 0,0:11:28.48,0:11:32.06,Default,,0000,0000,0000,,and we had to get it by hand\Nin the early days.
Dialogue: 0,0:11:32.08,0:11:35.55,Default,,0000,0000,0000,,We went down to the Federal Reserve\Nand copied interest rate histories
Dialogue: 0,0:11:35.57,0:11:38.84,Default,,0000,0000,0000,,and stuff like that,\Nbecause it didn't exist on computers.
Dialogue: 0,0:11:38.86,0:11:40.50,Default,,0000,0000,0000,,We got a lot of data.
Dialogue: 0,0:11:40.53,0:11:44.69,Default,,0000,0000,0000,,And very smart people -- that was the key.
Dialogue: 0,0:11:45.46,0:11:49.24,Default,,0000,0000,0000,,I didn't really know how to hire\Npeople to do fundamental trading.
Dialogue: 0,0:11:49.75,0:11:52.70,Default,,0000,0000,0000,,I had hired a few -- some made money,\Nsome didn't make money.
Dialogue: 0,0:11:52.72,0:11:54.60,Default,,0000,0000,0000,,I couldn't make a business out of that.
Dialogue: 0,0:11:54.63,0:11:56.67,Default,,0000,0000,0000,,But I did know how to hire scientists,
Dialogue: 0,0:11:56.69,0:12:00.08,Default,,0000,0000,0000,,because I have some taste\Nin that department.
Dialogue: 0,0:12:00.10,0:12:01.94,Default,,0000,0000,0000,,So, that's what we did.
Dialogue: 0,0:12:01.97,0:12:05.20,Default,,0000,0000,0000,,And gradually these models\Ngot better and better,
Dialogue: 0,0:12:05.22,0:12:06.56,Default,,0000,0000,0000,,and better and better.
Dialogue: 0,0:12:06.58,0:12:09.80,Default,,0000,0000,0000,,CA: You're credited with doing\Nsomething remarkable at Renaissance,
Dialogue: 0,0:12:09.82,0:12:12.42,Default,,0000,0000,0000,,which is building this culture,\Nthis group of people,
Dialogue: 0,0:12:12.44,0:12:15.59,Default,,0000,0000,0000,,who weren't just hired guns\Nwho could be lured away by money.
Dialogue: 0,0:12:15.61,0:12:19.52,Default,,0000,0000,0000,,Their motivation was doing\Nexciting mathematics and science.
Dialogue: 0,0:12:19.86,0:12:22.26,Default,,0000,0000,0000,,JS: Well, I'd hoped that might be true.
Dialogue: 0,0:12:22.28,0:12:25.86,Default,,0000,0000,0000,,But some of it was money.
Dialogue: 0,0:12:25.89,0:12:27.28,Default,,0000,0000,0000,,CA: They made a lot of money.
Dialogue: 0,0:12:27.30,0:12:29.84,Default,,0000,0000,0000,,JS: I can't say that no one came\Nbecause of the money.
Dialogue: 0,0:12:29.86,0:12:32.12,Default,,0000,0000,0000,,I think a lot of them\Ncame because of the money.
Dialogue: 0,0:12:32.14,0:12:34.16,Default,,0000,0000,0000,,But they also came\Nbecause it would be fun.
Dialogue: 0,0:12:34.19,0:12:36.68,Default,,0000,0000,0000,,CA: What role did machine learning\Nplay in all this?
Dialogue: 0,0:12:36.70,0:12:39.76,Default,,0000,0000,0000,,JS: In a certain sense,\Nwhat we did was machine learning.
Dialogue: 0,0:12:40.88,0:12:47.17,Default,,0000,0000,0000,,You look at a lot of data, and you try\Nto simulate different predictive schemes,
Dialogue: 0,0:12:47.19,0:12:49.38,Default,,0000,0000,0000,,until you get better and better at it.
Dialogue: 0,0:12:49.40,0:12:53.17,Default,,0000,0000,0000,,It doesn't necessarily feed back on itself\Nthe way we did things.
Dialogue: 0,0:12:53.19,0:12:55.50,Default,,0000,0000,0000,,But it worked.
Dialogue: 0,0:12:56.15,0:13:00.21,Default,,0000,0000,0000,,CA: So these different predictive schemes\Ncan be really quite wild and unexpected.
Dialogue: 0,0:13:00.23,0:13:02.15,Default,,0000,0000,0000,,I mean, you looked at everything, right?
Dialogue: 0,0:13:02.17,0:13:05.49,Default,,0000,0000,0000,,You looked at the weather,\Nlength of dresses, political opinion.
Dialogue: 0,0:13:05.51,0:13:08.35,Default,,0000,0000,0000,,JS: Yes, length of dresses we didn't try.
Dialogue: 0,0:13:08.37,0:13:10.43,Default,,0000,0000,0000,,CA: What sort of things?
Dialogue: 0,0:13:10.45,0:13:11.61,Default,,0000,0000,0000,,JS: Well, everything.
Dialogue: 0,0:13:11.64,0:13:14.90,Default,,0000,0000,0000,,Everything is grist for the mill --\Nexcept hem lengths.
Dialogue: 0,0:13:16.85,0:13:19.15,Default,,0000,0000,0000,,Weather, annual reports,
Dialogue: 0,0:13:19.18,0:13:23.91,Default,,0000,0000,0000,,quarterly reports, historic data itself,\Nvolumes, you name it.
Dialogue: 0,0:13:23.93,0:13:25.08,Default,,0000,0000,0000,,Whatever there is.
Dialogue: 0,0:13:25.11,0:13:27.73,Default,,0000,0000,0000,,We take in terabytes of data a day.
Dialogue: 0,0:13:27.75,0:13:31.88,Default,,0000,0000,0000,,And store it away and massage it\Nand get it ready for analysis.
Dialogue: 0,0:13:33.45,0:13:34.83,Default,,0000,0000,0000,,You're looking for anomalies.
Dialogue: 0,0:13:34.85,0:13:37.80,Default,,0000,0000,0000,,You're looking for -- like you said,
Dialogue: 0,0:13:37.83,0:13:40.28,Default,,0000,0000,0000,,the efficient market\Nhypothesis is not correct.
Dialogue: 0,0:13:40.30,0:13:43.77,Default,,0000,0000,0000,,CA: But any one anomaly\Nmight be just a random thing.
Dialogue: 0,0:13:43.80,0:13:47.45,Default,,0000,0000,0000,,So, is the secret here to just look\Nat multiple strange anomalies,
Dialogue: 0,0:13:47.48,0:13:48.81,Default,,0000,0000,0000,,and see when they align?
Dialogue: 0,0:13:49.24,0:13:52.45,Default,,0000,0000,0000,,JS: Any one anomaly\Nmight be a random thing;
Dialogue: 0,0:13:52.48,0:13:55.51,Default,,0000,0000,0000,,however, if you have enough data\Nyou can tell that it's not.
Dialogue: 0,0:13:55.54,0:14:00.49,Default,,0000,0000,0000,,You can see an anomaly that's persistent\Nfor a sufficiently long time --
Dialogue: 0,0:14:00.51,0:14:05.49,Default,,0000,0000,0000,,the probability of it being\Nrandom is not high.
Dialogue: 0,0:14:05.51,0:14:10.37,Default,,0000,0000,0000,,But these things fade after a while;\Nanomalies can get washed out.
Dialogue: 0,0:14:10.39,0:14:12.81,Default,,0000,0000,0000,,So you have to keep on top\Nof the business.
Dialogue: 0,0:14:12.84,0:14:15.51,Default,,0000,0000,0000,,CA: A lot of people look\Nat the hedge fund industry now
Dialogue: 0,0:14:15.53,0:14:19.93,Default,,0000,0000,0000,,and are sort of ... shocked by it,
Dialogue: 0,0:14:19.96,0:14:22.13,Default,,0000,0000,0000,,by how much wealth is created there,
Dialogue: 0,0:14:22.15,0:14:24.40,Default,,0000,0000,0000,,and how much talent is going into it.
Dialogue: 0,0:14:25.52,0:14:29.53,Default,,0000,0000,0000,,Do you have any worries\Nabout that industry,
Dialogue: 0,0:14:29.55,0:14:31.97,Default,,0000,0000,0000,,and perhaps the financial\Nindustry in general?
Dialogue: 0,0:14:31.99,0:14:34.70,Default,,0000,0000,0000,,Kind of being on a runaway train that's --
Dialogue: 0,0:14:34.72,0:14:38.75,Default,,0000,0000,0000,,I don't know --\Nhelping increase inequality?
Dialogue: 0,0:14:38.77,0:14:42.60,Default,,0000,0000,0000,,How would you champion what's happening\Nin the hedge fund industry?
Dialogue: 0,0:14:42.63,0:14:45.24,Default,,0000,0000,0000,,JS: I think in the last\Nthree of four years,
Dialogue: 0,0:14:45.26,0:14:47.36,Default,,0000,0000,0000,,hedge funds have not done especially well.
Dialogue: 0,0:14:47.39,0:14:48.79,Default,,0000,0000,0000,,We've done dandy,
Dialogue: 0,0:14:48.81,0:14:52.81,Default,,0000,0000,0000,,but the hedge fund industry as a whole\Nhas not done so wonderfully.
Dialogue: 0,0:14:52.84,0:14:57.74,Default,,0000,0000,0000,,The stock market has been on a roll,\Ngoing up as everybody knows,
Dialogue: 0,0:14:57.76,0:15:01.21,Default,,0000,0000,0000,,and price-earnings ratios have grown.
Dialogue: 0,0:15:01.23,0:15:04.29,Default,,0000,0000,0000,,So an awful lot of the wealth\Nthat's been created in the last --
Dialogue: 0,0:15:04.32,0:15:07.67,Default,,0000,0000,0000,,let's say, five or six years --\Nhas not been created by hedge funds.
Dialogue: 0,0:15:08.46,0:15:11.68,Default,,0000,0000,0000,,People would ask me,\N"What's a hedge fund?"
Dialogue: 0,0:15:11.70,0:15:13.96,Default,,0000,0000,0000,,And I'd say, "One and 20."
Dialogue: 0,0:15:13.99,0:15:17.55,Default,,0000,0000,0000,,Which means -- now it's two and 20 --
Dialogue: 0,0:15:17.58,0:15:20.93,Default,,0000,0000,0000,,it's two percent fixed fee\Nand 20 percent of profits.
Dialogue: 0,0:15:20.95,0:15:23.31,Default,,0000,0000,0000,,Hedge funds are all\Ndifferent kinds of creatures.
Dialogue: 0,0:15:23.33,0:15:26.57,Default,,0000,0000,0000,,CA: Rumor has it you charge\Nslightly higher fees than that.
Dialogue: 0,0:15:27.34,0:15:30.42,Default,,0000,0000,0000,,JS: We charged the highest fees\Nin the world at one time.
Dialogue: 0,0:15:30.44,0:15:33.67,Default,,0000,0000,0000,,Five and 44, that's what we charge.
Dialogue: 0,0:15:33.69,0:15:35.09,Default,,0000,0000,0000,,CA: Five and 44.
Dialogue: 0,0:15:35.12,0:15:38.35,Default,,0000,0000,0000,,So five percent flat,\N44 percent of upside.
Dialogue: 0,0:15:38.37,0:15:41.16,Default,,0000,0000,0000,,You still made your investors\Nspectacular amounts of money.
Dialogue: 0,0:15:41.18,0:15:42.63,Default,,0000,0000,0000,,JS: We made good returns, yes.
Dialogue: 0,0:15:42.66,0:15:45.66,Default,,0000,0000,0000,,People got very mad:\N"How can you charge such high fees?"
Dialogue: 0,0:15:45.68,0:15:47.31,Default,,0000,0000,0000,,I said, "OK, you can withdraw."
Dialogue: 0,0:15:47.33,0:15:50.15,Default,,0000,0000,0000,,But "How can I get more?"\Nwas what people were --
Dialogue: 0,0:15:50.17,0:15:51.68,Default,,0000,0000,0000,,(Laughter)
Dialogue: 0,0:15:51.70,0:15:54.14,Default,,0000,0000,0000,,But at a certain point,\Nas I think I told you,
Dialogue: 0,0:15:54.17,0:15:59.34,Default,,0000,0000,0000,,we bought out all the investors\Nbecause there's a capacity to the fund.
Dialogue: 0,0:15:59.36,0:16:02.07,Default,,0000,0000,0000,,CA: But should we worry\Nabout the hedge fund industry
Dialogue: 0,0:16:02.09,0:16:07.53,Default,,0000,0000,0000,,attracting too much of the world's\Ngreat mathematical and other talent
Dialogue: 0,0:16:07.56,0:16:10.79,Default,,0000,0000,0000,,to work on that, as opposed\Nto the many other problems in the world?
Dialogue: 0,0:16:10.82,0:16:12.75,Default,,0000,0000,0000,,JS: Well, it's not just mathematical.
Dialogue: 0,0:16:12.77,0:16:15.45,Default,,0000,0000,0000,,We hire astronomers and physicists\Nand things like that.
Dialogue: 0,0:16:15.83,0:16:18.26,Default,,0000,0000,0000,,I don't think we should worry\Nabout it too much.
Dialogue: 0,0:16:18.29,0:16:21.43,Default,,0000,0000,0000,,It's still a pretty small industry.
Dialogue: 0,0:16:21.45,0:16:27.45,Default,,0000,0000,0000,,And in fact, bringing science\Ninto the investing world
Dialogue: 0,0:16:27.48,0:16:29.63,Default,,0000,0000,0000,,has improved that world.
Dialogue: 0,0:16:29.66,0:16:33.73,Default,,0000,0000,0000,,It's reduced volatility.\NIt's increased liquidity.
Dialogue: 0,0:16:33.75,0:16:36.94,Default,,0000,0000,0000,,Spreads are narrower because\Npeople are trading that kind of stuff.
Dialogue: 0,0:16:36.96,0:16:42.04,Default,,0000,0000,0000,,So I'm not too worried about Einstein\Ngoing off and starting a hedge fund.
Dialogue: 0,0:16:42.48,0:16:46.64,Default,,0000,0000,0000,,CA: You're at a phase in your life now\Nwhere you're actually investing, though,
Dialogue: 0,0:16:46.67,0:16:50.40,Default,,0000,0000,0000,,at the other end of the supply chain --
Dialogue: 0,0:16:50.42,0:16:54.53,Default,,0000,0000,0000,,you're actually boosting\Nmathematics across America.
Dialogue: 0,0:16:54.55,0:16:56.42,Default,,0000,0000,0000,,This is your wife, Marilyn.
Dialogue: 0,0:16:56.44,0:17:01.20,Default,,0000,0000,0000,,You're working on\Nphilanthropic issues together.
Dialogue: 0,0:17:01.22,0:17:02.38,Default,,0000,0000,0000,,Tell me about that.
Dialogue: 0,0:17:02.41,0:17:06.06,Default,,0000,0000,0000,,JS: Well, Marilyn started --
Dialogue: 0,0:17:06.08,0:17:09.53,Default,,0000,0000,0000,,there she is up there,\Nmy beautiful wife --
Dialogue: 0,0:17:09.55,0:17:12.52,Default,,0000,0000,0000,,she started the foundation\Nabout 20 years ago.
Dialogue: 0,0:17:12.55,0:17:13.70,Default,,0000,0000,0000,,I think '94.
Dialogue: 0,0:17:13.72,0:17:15.82,Default,,0000,0000,0000,,I claim it was '93, she says it was '94,
Dialogue: 0,0:17:15.84,0:17:18.41,Default,,0000,0000,0000,,but it was one of those two years.
Dialogue: 0,0:17:18.44,0:17:20.57,Default,,0000,0000,0000,,(Laughter)
Dialogue: 0,0:17:20.60,0:17:27.32,Default,,0000,0000,0000,,We started the foundation,\Njust as a convenient way to give charity.
Dialogue: 0,0:17:28.35,0:17:30.85,Default,,0000,0000,0000,,She kept the books, and so on.
Dialogue: 0,0:17:30.88,0:17:37.59,Default,,0000,0000,0000,,We did not have a vision at that time,\Nbut gradually a vision emerged --
Dialogue: 0,0:17:37.62,0:17:43.12,Default,,0000,0000,0000,,which was to focus on math and science,\Nto focus on basic research.
Dialogue: 0,0:17:43.57,0:17:46.34,Default,,0000,0000,0000,,And that's what we've done.
Dialogue: 0,0:17:46.36,0:17:52.72,Default,,0000,0000,0000,,Six years ago or so, I left Renaissance\Nand went to work at the foundation.
Dialogue: 0,0:17:52.74,0:17:54.32,Default,,0000,0000,0000,,So that's what we do.
Dialogue: 0,0:17:54.34,0:17:57.25,Default,,0000,0000,0000,,CA: And so Math for America\Nis basically investing
Dialogue: 0,0:17:57.27,0:17:59.91,Default,,0000,0000,0000,,in math teachers around the country,
Dialogue: 0,0:17:59.93,0:18:03.74,Default,,0000,0000,0000,,giving them some extra income,\Ngiving them support and coaching.
Dialogue: 0,0:18:03.76,0:18:06.81,Default,,0000,0000,0000,,And really trying\Nto make that more effective
Dialogue: 0,0:18:06.84,0:18:09.44,Default,,0000,0000,0000,,and make that a calling\Nto which teachers can aspire.
Dialogue: 0,0:18:09.46,0:18:14.25,Default,,0000,0000,0000,,JS: Yeah -- instead of beating up\Nthe bad teachers,
Dialogue: 0,0:18:14.27,0:18:19.13,Default,,0000,0000,0000,,which has created morale problems\Nall through the educational community,
Dialogue: 0,0:18:19.15,0:18:21.59,Default,,0000,0000,0000,,in particular in math and science,
Dialogue: 0,0:18:21.62,0:18:27.75,Default,,0000,0000,0000,,we focus on celebrating the good ones\Nand giving them status.
Dialogue: 0,0:18:27.77,0:18:30.70,Default,,0000,0000,0000,,Yeah, we give them extra money,\N15,000 dollars a year.
Dialogue: 0,0:18:30.72,0:18:35.19,Default,,0000,0000,0000,,We have 800 math and science teachers\Nin New York City in public schools today,
Dialogue: 0,0:18:35.22,0:18:37.03,Default,,0000,0000,0000,,as part of a core.
Dialogue: 0,0:18:37.05,0:18:40.74,Default,,0000,0000,0000,,There's a great morale among them.
Dialogue: 0,0:18:40.76,0:18:43.27,Default,,0000,0000,0000,,They're staying in the field.
Dialogue: 0,0:18:43.29,0:18:46.19,Default,,0000,0000,0000,,Next year, it'll be 1,000\Nand that'll be 10 percent
Dialogue: 0,0:18:46.21,0:18:49.76,Default,,0000,0000,0000,,of the math and science teachers\Nin New York [City] public schools.
Dialogue: 0,0:18:49.78,0:18:55.69,Default,,0000,0000,0000,,(Applause)
Dialogue: 0,0:18:55.71,0:18:59.12,Default,,0000,0000,0000,,CA: Jim, here's another project\Nthat you've supported philanthropically:
Dialogue: 0,0:18:59.14,0:19:01.54,Default,,0000,0000,0000,,Research into origins of life, I guess.
Dialogue: 0,0:19:01.56,0:19:03.01,Default,,0000,0000,0000,,What are we looking at here?
Dialogue: 0,0:19:03.54,0:19:05.42,Default,,0000,0000,0000,,Well, I'll save that for a second.
Dialogue: 0,0:19:05.44,0:19:07.60,Default,,0000,0000,0000,,And then I'll tell you\Nwhat you're looking at.
Dialogue: 0,0:19:07.63,0:19:10.68,Default,,0000,0000,0000,,Origins of life is a fascinating question.
Dialogue: 0,0:19:10.71,0:19:12.24,Default,,0000,0000,0000,,How did we get here?
Dialogue: 0,0:19:13.17,0:19:14.94,Default,,0000,0000,0000,,Well, there are two questions:
Dialogue: 0,0:19:14.96,0:19:20.83,Default,,0000,0000,0000,,One is, what is the route\Nfrom geology to biology --
Dialogue: 0,0:19:20.86,0:19:22.24,Default,,0000,0000,0000,,how did we get here?
Dialogue: 0,0:19:22.26,0:19:24.63,Default,,0000,0000,0000,,And the other question is,\Nwhat did we start with?
Dialogue: 0,0:19:24.65,0:19:27.75,Default,,0000,0000,0000,,What material, if any,\Ndid we have to work with on this route?
Dialogue: 0,0:19:27.78,0:19:30.84,Default,,0000,0000,0000,,Those are two very,\Nvery interesting questions.
Dialogue: 0,0:19:31.77,0:19:37.61,Default,,0000,0000,0000,,The first question is a tortuous path\Nfrom geology up to RNA
Dialogue: 0,0:19:37.63,0:19:39.89,Default,,0000,0000,0000,,or something like that --\Nhow did that all work?
Dialogue: 0,0:19:39.91,0:19:42.30,Default,,0000,0000,0000,,And the other,\Nwhat do we have to work with?
Dialogue: 0,0:19:42.32,0:19:44.10,Default,,0000,0000,0000,,Well, more than we think.
Dialogue: 0,0:19:44.12,0:19:48.96,Default,,0000,0000,0000,,So what's pictured there\Nis a star in formation.
Dialogue: 0,0:19:49.84,0:19:53.26,Default,,0000,0000,0000,,Now, every year in our Milky Way,\Nwhich has 100 billion stars,
Dialogue: 0,0:19:53.28,0:19:55.78,Default,,0000,0000,0000,,about two new stars are created.
Dialogue: 0,0:19:55.80,0:19:58.27,Default,,0000,0000,0000,,Don't ask me how, but they're created.
Dialogue: 0,0:19:58.30,0:20:01.38,Default,,0000,0000,0000,,And it takes them about a million\Nyears to settle out.
Dialogue: 0,0:20:02.13,0:20:04.31,Default,,0000,0000,0000,,So, in steady state,
Dialogue: 0,0:20:04.33,0:20:08.18,Default,,0000,0000,0000,,there are about two million stars\Nin formation at any time.
Dialogue: 0,0:20:08.20,0:20:11.66,Default,,0000,0000,0000,,That one is somewhere\Nalong this settling-down period.
Dialogue: 0,0:20:12.07,0:20:15.00,Default,,0000,0000,0000,,And there's all this crap\Nsort of circling around it,
Dialogue: 0,0:20:15.03,0:20:16.52,Default,,0000,0000,0000,,dust and stuff.
Dialogue: 0,0:20:17.48,0:20:20.50,Default,,0000,0000,0000,,And it'll form probably a solar system,\Nor whatever it forms.
Dialogue: 0,0:20:20.53,0:20:22.70,Default,,0000,0000,0000,,But here's the thing --
Dialogue: 0,0:20:22.73,0:20:29.07,Default,,0000,0000,0000,,in this dust that surrounds a forming star
Dialogue: 0,0:20:29.10,0:20:35.13,Default,,0000,0000,0000,,have been found, now,\Nsignificant organic molecules.
Dialogue: 0,0:20:35.96,0:20:42.10,Default,,0000,0000,0000,,Molecules not just like methane,\Nbut formaldehyde and cyanide --
Dialogue: 0,0:20:42.12,0:20:48.64,Default,,0000,0000,0000,,things that are the building blocks --\Nthe seeds, if you will -- of life.
Dialogue: 0,0:20:49.14,0:20:51.83,Default,,0000,0000,0000,,So, that may be typical.
Dialogue: 0,0:20:52.40,0:20:59.33,Default,,0000,0000,0000,,And it may be typical\Nthat planets around the universe
Dialogue: 0,0:20:59.35,0:21:02.96,Default,,0000,0000,0000,,start off with some of these\Nbasic building blocks.
Dialogue: 0,0:21:03.83,0:21:06.54,Default,,0000,0000,0000,,Now does that mean\Nthere's going to be life all around?
Dialogue: 0,0:21:06.57,0:21:07.93,Default,,0000,0000,0000,,Maybe.
Dialogue: 0,0:21:07.96,0:21:12.08,Default,,0000,0000,0000,,But it's a question\Nof how tortuous this path is
Dialogue: 0,0:21:12.11,0:21:16.50,Default,,0000,0000,0000,,from those frail beginnings,\Nthose seeds, all the way to life.
Dialogue: 0,0:21:16.53,0:21:21.72,Default,,0000,0000,0000,,And most of those seeds\Nwill fall on fallow planets.
Dialogue: 0,0:21:21.74,0:21:23.15,Default,,0000,0000,0000,,CA: So for you, personally,
Dialogue: 0,0:21:23.18,0:21:25.90,Default,,0000,0000,0000,,finding an answer to this question\Nof where we came from,
Dialogue: 0,0:21:25.92,0:21:29.58,Default,,0000,0000,0000,,of how did this thing happen,\Nthat is something you would love to see.
Dialogue: 0,0:21:29.60,0:21:31.39,Default,,0000,0000,0000,,JS: Would love to see.
Dialogue: 0,0:21:31.41,0:21:32.90,Default,,0000,0000,0000,,And like to know --
Dialogue: 0,0:21:32.93,0:21:38.10,Default,,0000,0000,0000,,if that path is tortuous enough,\Nand so improbable,
Dialogue: 0,0:21:38.12,0:21:42.88,Default,,0000,0000,0000,,that no matter what you start with,\Nwe could be a singularity.
Dialogue: 0,0:21:43.34,0:21:44.49,Default,,0000,0000,0000,,But on the other hand,
Dialogue: 0,0:21:44.51,0:21:47.99,Default,,0000,0000,0000,,given all this organic dust\Nthat's floating around,
Dialogue: 0,0:21:48.01,0:21:51.80,Default,,0000,0000,0000,,we could have lots of friends out there.
Dialogue: 0,0:21:52.95,0:21:54.11,Default,,0000,0000,0000,,It'd be great to know.
Dialogue: 0,0:21:54.13,0:21:57.61,Default,,0000,0000,0000,,CA: Jim, a couple of years ago,\NI got the chance to speak with Elon Musk,
Dialogue: 0,0:21:57.64,0:22:00.47,Default,,0000,0000,0000,,and I asked him the secret of his success,
Dialogue: 0,0:22:00.50,0:22:04.19,Default,,0000,0000,0000,,and he said taking\Nphysics seriously was it.
Dialogue: 0,0:22:04.70,0:22:08.70,Default,,0000,0000,0000,,Listening to you, what I hear you saying\Nis taking math seriously,
Dialogue: 0,0:22:08.72,0:22:11.73,Default,,0000,0000,0000,,that has infused your whole life.
Dialogue: 0,0:22:12.12,0:22:16.69,Default,,0000,0000,0000,,It's made you an absolute fortune,\Nand now it's allowing you to invest
Dialogue: 0,0:22:16.71,0:22:21.21,Default,,0000,0000,0000,,in the futures of thousands and thousands\Nof kids across America and elsewhere.
Dialogue: 0,0:22:21.57,0:22:24.42,Default,,0000,0000,0000,,Could it be that science actually works?
Dialogue: 0,0:22:24.45,0:22:27.22,Default,,0000,0000,0000,,That math actually works?
Dialogue: 0,0:22:27.24,0:22:31.62,Default,,0000,0000,0000,,JS: Well, math certainly works.\NMath certainly works.
Dialogue: 0,0:22:31.64,0:22:32.84,Default,,0000,0000,0000,,But this has been fun.
Dialogue: 0,0:22:32.86,0:22:37.81,Default,,0000,0000,0000,,Working with Marilyn and giving it away\Nhas been very enjoyable.
Dialogue: 0,0:22:37.83,0:22:40.77,Default,,0000,0000,0000,,CA: I just find it --\Nit's an inspirational thought to me,
Dialogue: 0,0:22:40.79,0:22:44.80,Default,,0000,0000,0000,,that by taking knowledge seriously,\Nso much more can come from it.
Dialogue: 0,0:22:44.82,0:22:47.84,Default,,0000,0000,0000,,So thank you for your amazing life,\Nand for coming here to TED.
Dialogue: 0,0:22:47.87,0:22:48.62,Default,,0000,0000,0000,,Thank you.
Dialogue: 0,0:22:48.65,0:22:49.75,Default,,0000,0000,0000,,Jim Simons!
Dialogue: 0,0:22:49.81,0:22:54.19,Default,,0000,0000,0000,,(Applause)