Saturday, December 13, 2014

How to Get a Clue or How Can You Get Better at Recognizing Patterns?

If you follow the stock market, you might notice that when stock prices go up too fast or go up for an extended period of time there is a good chance they will tumble back down at bit. The tumble may be minor or significant. But, we can see a pattern here which we will call "What goes up, must come down".

This pattern does not just apply to stocks. We can see a very similar pattern in the careers of celebrities and politicians - riding high one day and in free fall the next. It also happens with hit music, fashions and fads. It might even happen in your love life or your job. It is a useful pattern that we see in many very diverse situations.

The "What goes up, must come down" pattern is simplistic but it is a place to start. Once we recognize this pattern we can refine our understanding of the phenomenon which the pattern describes. We can ask questions like - do difference situations have a different pattern in their rise and fall. Do some things go up fast and fall just as quickly while others grind up slowly and go down like a beach ball filled with water? Are there elements of situations that give us a clue regarding which rise and fall pattern they might fit? Once we have one pattern, no matter how simple it may be, we can expand it into a whole family of other patterns.

Are there different patterns that describe the same situation? For example, we just used the "What goes up, must go down" pattern to describe your love life. Maybe other patterns will do just as well. Let's say we have a pattern of "Initial euphoria, disillusionment, accepting reality" which also applies to your love life. Perhaps this pattern could apply to corporate mergers, or peace treaties.

The point here is that the more patterns you can recognize the more situations you can apply them in and the more nuanced your understanding of phenomena can become. So, start looking for patterns and when you find one try applying it to other situations. And begin creating more nuanced patterns for specific situations. Over time you will develop a collection of patterns that you can apply to a variety of situations. But that, it only the beginning.

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