The whole edifice of modern financial theory is, as described earlier, founded on a few simplifying assumptions. It presumes that homo economicus is … - Benoit Mandelbrot

Weierstrass, Cantor, or Peano! In physics, an analogous development threatened since about 1800, since Laplace’s Celestial Mechanics avoided all illustration. And it is exemplified by the statement by P. A. M. Dirac (in the preface of his 1930 Quantum Mechanics) that nature’s “fundamental laws do not govern the world as it appears in our mental picture in any very direct way, but instead they control a substratum of which we cannot form a mental picture without introducing irrelevancies.” The wide and uncritical acceptance of this view has become destructive. In particular, in the theory of fractals “to see is to believe.

The Mandelbrot set is the modern development of a theory developed independently in 1918 by Gaston Julia and Pierre Fatou. Julia wrote an enormous book — several hundred pages long — and was very hostile to his rival Fatou. That killed the subject for 60 years because nobody had a clue how to go beyond them. My uncle didn't know either, but he said it was the most beautiful problem imaginable and that it was a shame to neglect it. He insisted that it was important to learn Julia's work and he pushed me hard to understand how equations behave when you iterate them rather than solve them. At first, I couldn't find anything to say. But later, I decided a computer could take over where Julia had stopped 60 years previously.

"They found they could have made a tidy paper profit in the following six-month period, on average, 12.01 percent a year above what a simple, market-following index fund would have earned them. But beyond six months, the picture changed: After two years, their paper profits vanished as the stock prices "corrected" themselves."