Howard Marks and useful models

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Mr. Marks (https://www.oaktreecapital.com/insights/memo/the-illusion-of…) makes some statements about modeling that I believe should not be taken at face value. Specifically he seems to confuse models as having to represent the real world in its infinite detail, which is not possible.

For example:

A real simulation of the U.S. economy…
Simulations by definition are not “real,” they are characterizations of the real world.

This is yet another example of why a model simply can’t replicate something as complex as an economy.
Of course a model cannot replicate reality, that is why it is called a “model” - by definition a simplification of the real world (like a “model” car for example).

Can a model replicate reality? Can it describe the millions of participants and their interactions?
No to the first question and maybe to the second. As computing speed and storage increase, models with increasing complexity will be available for use.

Here is a famous quote I prefer: “All models are wrong, but some are useful.”

Models can represent our state of understanding of a system, which is obviously incomplete. Studying how and why models deviate from reality, including forecasts, is one important approach to improve our understanding of a system.

An interesting and I think successful application of some fairly complex modeling is the forecasting of the paths of tropical storms. While not perfect, I think they do pretty well and you can bet they’ve been working at it diligently for a long time and have been plenty wrong in the past. But they’ve kept at it, and they are getting better all the time.

Thank you, hurricane track forecasters.

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“Thank you, hurricane track forecasters.”

Scientists can (more or less) track hurricanes with satellites once they’ve formed. But apparently they’re not so good at forecasting when they will form.

MAY 29, 2022

2022 COULD BE THE WORST HURRICANE SEASON SINCE KATRINA, MARINE SCIENTIST WARNS

ATLANTIC HURRICANE SEASON starts on June 1, and the Gulf of Mexico is already warmer than average. Even more worrying is a current of warm tropical water looping unusually far into the Gulf for this time of year, with the power to turn tropical storms into monster hurricanes.

It’s called the Loop Current, and it’s the 800-pound gorilla of Gulf hurricane risks.

This year, the Loop Current looks remarkably similar to the way it did in 2005, the year Hurricane Katrina crossed the Loop Current before devastating New Orleans. Of the 27 named storms that year, seven became major hurricanes. Wilma and Rita also crossed the Loop Current that year and became two of the most intense Atlantic hurricanes on record.

Sounds scary…but then…what happened.

"For the first time in seven years, no hurricane has formed in the Atlantic Basin by mid-August. And that might be related to Saharan dust and all the heat we had July into August.

If you’re wondering what happened to that hyper-busy 2022 hurricane season, forecasters say wait
For the first time in seven years, no hurricane has formed in the Atlantic Basin by mid-August. And that might be related to Saharan dust and all the heat we had July into August.

https://www.inquirer.com/news/atlantic-hurricanes-saharan-du…

Meteorologist: “If our model had only predicted all the Saharan dust and all the heat in July and August then…”

Not modeling Saharan dust I understand. But they did predict it would be warmer than average in the GOM and they were still wrong.

If we can’t predict what the climate is going to do three months from now. then perhaps models predicting minute global temperature changes hundreds of years from now should be taken with a grain of salt.

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“If we can’t predict what the climate is going to do three months from now. then perhaps models predicting minute global temperature changes hundreds of years from now should be taken with a grain of salt.”

or this could be focusing on short term noise instead of the long term trend.

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If we can’t predict what the climate is going to do three months from now. then perhaps models predicting minute global temperature changes hundreds of years from now should be taken with a grain of salt.

Hmmm, I wouldn’t put too much faith in that line of reasoning. Those are very different problems.
That’s rather like saying that if you can’t predict a coin toss, forget about predicting that the turkey will be finished roasting in three or four hours.

One is trying to forecast chaos, which is effectively impossible.
The other is mainly averages based on an energy balance, which is a vastly simpler problem, even though it’s a much longer time frame.

The climate is definitely going to get hotter overall in the decades to come.
We can’t know which particular days will be the hottest next month.

Jim

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If we can’t predict what the climate is going to do three months from now. then perhaps models predicting minute global temperature changes hundreds of years from now should be taken with a grain of salt.

Are you not confusing climate with weather? Climate is a long term phenomenon, and even a year or two is too short to be considered long-term.

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“The climate is definitely going to get hotter overall in the decades to come.”

If you say so Jim.

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If we can’t predict what the climate is going to do three months from now. then perhaps models predicting minute global temperature changes hundreds of years from now should be taken with a grain of salt.

Right, but you can’t mess with religion. I’m sure climate change will be blamed on no hurricanes or many hurricanes!

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“The climate is definitely going to get hotter overall in the decades to come.”
…
If you say so Jim.

Though it’s certainly true that if you add heat then things get hotter, the conclusion sure isn’t my idea.
I’m just quoting a bunch of climate scientists.

Like…all of them : )

Jim

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One is trying to forecast chaos, which is effectively impossible.
The other is mainly averages based on an energy balance, which is a vastly simpler problem, even though it’s a much longer time frame.

The climate is definitely going to get hotter overall in the decades to come.
We can’t know which particular days will be the hottest next month.

Indeed. Here’s a good video by physicist Sabine Hossenfelder illustrating the difference between weather and climate: https://youtu.be/i5fwYtU7Rhg

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The problem with simulation is that it is a lot like masturbation. If you do it long enough, you might begin to think it is the real thing.

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Here is a chart showing earth surface temperature from 1880:

https://www.climate.gov/news-features/understanding-climate/….

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Here is a chart showing earth surface temperature from 1880:…

This one might be more fun: it covers the last 20000 years to get a sense of perspective on variations.
https://xkcd.com/1732/

Jim

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Jim, the curve from xkcd splices a very smoothed data set to a higher frequency data set including the infamous “hockey stick” graph of Mann, Bradley and Hughes 1998. MBH98 is one of the most thoroughly refuted papers in the history of science, based on an algorithm that creates a hockey stick from random numbers.

One of the key issues in climate science is determining how much change is natural vs how much is anthropogenic. The two strongest periods of warming this century were from 1917 to 1944, and from 1976 to 2000. The early period was definitely natural, yet it was statistically identical to the later warming, which is often assumed to be anthropogenic. After 2000 there was an 18 year pause with no statistical warming.

In a poll taken among geologists, the group most familiar with long term changes, most believe recent climate change to be less than 50% anthropogenic. In a similar poll of meteorologists, those most familiar with short term changes, a small majority believed recent change is more than 50% anthropogenic. Both groups are just offering their best educated guess, as there is not way to break out the attribution.

I would be very hesitant to say for certain where temperatures are heading. The earth has shown the ability to change abruptly without our influence. Our influence is pushing toward the warming side, but the magnitude of our influence is very poorly measured.

There are websites where people discuss these issues in great detail. My favorite place is Judith Curry’s "Climate etc. My least favorite place would be the TMF BRK board.

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Dwerme and others,

It’s important to source our information about climate change and be wise enough to know when our own biases are in play.

For instance, from Encyclopedia.com, regarding the the paper by by Michael E. Mann, Raymond S. Bradley, and Malcolm K. Hughes was published in the journal Nature, you refer to:

“Since its publication, the paper has been attacked by greenhouse skeptics, and its methods have been criticized by various mathematicians. However, the National Academy of Sciences and the Intergovernmental Panel on Climate Change (IPCC) have both asserted that the graph is, despite uncertainties, an essentially correct picture of global temperature over at least the last 1,000 to 1,300 years.”

The editor, Mark Sappenfield, of the Christian Science Monitor wrote in January, 2020, in How We See Climate Science:

"To me, the debate over climate science speaks to a misunderstanding about how science journalism works. I was a science writer for the Monitor, and many of my stories came from one general source: peer-reviewed studies. This wasn’t because I was lazy or closed to other viewpoints. The whole point of peer review is to subject science to the most rigorous test possible – to let the most knowledgeable people in a field cast a skeptical eye and decide what the best science is.

As much as laboratory work, peer review is a foundation stone of the scientific process, so it is also foundational to science journalism. And at this point, peer-reviewed climate science points to a significant and accelerating human impact on the climate."

He goes on to say that some scientists outside the field of climate-science, and non-scientists differ but about this, however, these alternative views have not passed peer-review. so,

“Is it possible that in this polarized era even scientists are shaped by their ideological bubbles, and peer review has been tainted by a climate change “bias”? That is a vital question for journalists to ask, but at this point we’ve found no evidence that would invalidate the body of current peer-reviewed climate science.”

There are some other organizations and institutions that agree with Mr. Sapplenfield, and continue in their quest to mitigate human-caused climate-change as they have found no convincing evidence to refute peer-reviewed research:

https://www.csmonitor.com/Commentary/From-the-Editors/2020/0…

https://resnick.caltech.edu/events/climate-school

https://climate.nasa.gov

https://www.army.mil/article/253863/army_introduces_strategy…

https://www.reuters.com/investigates/section/climate-change-…

These are just a few, and based in the U.S.

Thanks for helping me focus my thinking on this subject.

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In other words, Jim’s cartoon was pretty close to an accurate depiction of the climate situation…

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'This one (graph) might be more fun: it covers the last 20000 years to get a sense of perspective on variations.

Twenty thousand years is a pretty short time frame when compared to the age of the earth.

Assuming the earth is 4 billion year sold, the chart represents only the last five one hundred thousandths (5/100,000) of the earth’s record. Recency bias any one?

If the earth was one year old (365 days) then your chart would represent only the last 2.6 minutes of that year.

Would 2 minutes of Berkshire’s price data predict where the stock price was going to be in an year, or an hour for that matter?

Did anybody bother to read the label on the “temperature” (x) axis? It says “Compared to the 1961-1990 average”. What’s so special about that reference point and why did the author use it?

Of course the earth has been warming since the last ice age. And it’s a good thing too, since most of Canada and much of the northern US (productive farmland) would be still be covered with ice.

A more meaningful chart might be the one presented in this Science article. It goes back 500 million years, one eighth of the earth’s history. Note, it’s much noisier. It shows the earth both warming and cooling with large amplitude temperature variations of over 20 degrees C. Those variations occurred before man walked on the earth. Did the physical processes that caused those huge variations suddenly go away? Will they not occur in the future, whether man put some CO2 in the air or not?

https://www.science.org/content/article/500-million-year-sur…

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If you’re asking me, I’ll go with the climate peer-reviewed scientific studies of this phenomenon, not this chart. I could be wrong, but I’ll bet climate-change scientists have taken this into consideration, as well.

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The whole point of peer review is to subject science to the most rigorous test possible – to let the most knowledgeable people in a field cast a skeptical eye and decide what the best science is.

As much as laboratory work, peer review is a foundation stone of the scientific process, so it is also foundational to science journalism.

Peer review is a nice concept, but in the world of climate science, it has become “pal review”. The “climategate” emails are full of statements showing how politics and bias has corrupted the scientific process:

I can’t see either of these papers being in the next IPCC report. Kevin [Trenberth] and I will keep them out somehow, even if we have to redefine what the peer-review literature is!”

—Phil Jones, Director of the Climatic Research Unit,

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If you’re asking me, I’ll go with the climate peer-reviewed scientific studies of this phenomenon

That’s an understandable pov, but having read a lot about nutrition and medical science over the last 10 years, and how studies in those fields can be outright crooked, never mind biased, I wouldn’t put too much faith in peer review. Most people here will understand incentives, and in academia the incentives to get published and get funding are very powerful. Most people like to keep their job!

As an example, the NEJM is a very prestigious journal and Marcia Angell was an editor there for many years. Her famous comment is this:

“It is simply no longer possible to believe much of the clinical research that is published, or to rely on the judgment of trusted physicians or authoritative medical guidelines. I take no pleasure in this conclusion, which I reached slowly and reluctantly over my two decades as editor of The New England Journal of Medicine”.

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The following points are likely to be true:

  1. Earth surface temperature has increased like a hockey stick in the past 200 years, and if the trend continues, human will face catastrophe unlike anything it has seen.

  2. Human generated carbon dioxide has likely contributed to the warming effect, whether it’s the main cause is still debatable.

  3. Reducing carbon dioxide emission will likely reduce the speed of global warming, but whether it will turn the tide and save human is still debatable.

When facing possible catastrophe, isn’t it wise to try anything guided by science (best known method so far) that may avoid or alleviate the result?

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