• Nick

Gordian Knot & Complex Problems

Don't let the intertwined loops distract you from the solution


"Alexander Cutting the Gordian Knot" (1767) by Jean-François Godefroy

The Gordian Knot is a legend from Gordium, ancient capital of Phrygian associated with Alexander the Great.


An Ox-cart, decided to one of the the Phrygian god Sabazios had been tied it to a post with intricate knots "so tightly entangled that it was impossible to see how they were fastened". For centuries no one could untie the knot. An oracle had declared that any man who could unravel its elaborate knots was destined to become ruler of all of Asia.


The Gordian ox-cart's knot was still in the palace of the former kings when Alexander the Great arrived. Alexander wanted to untie the knot but struggled to do so without success. He then reasoned that it would make no difference how the knot was loosed, so he drew his sword and sliced it in half with a single stroke. (In an alternative version of the story, Alexander loosed the knot by pulling the Linchpin from the yoke.)


Alexander later went on to conquer Asia as far as the Indus and the Oxus, thus fulfilling the prophecy. (See https://en.wikipedia.org/wiki/Gordian_Knot for more details.)


Whether the legend is true or just apocryphal, it is often used as a metaphor for an intractable problem solved easily by thinking creatively ("cutting the Gordian knot"). I find this a really attractive metaphor for solving complex investment problems.


It is true that the way forward for many investment problems can be solved by a "back to basic principles" approach. Clear, simple principles often reduce apparently complex problems to simple ones.


But at other times, it can be hard to discern what the key principles are or that different principles point in different directions. Discussions and efforts to solve the problem can seem to be caught in endless loops. For these problems, we need to stop travelling along the loops. We need to see what other ways can we tackle the problem. Is there a way to cut through to our objective? Alternatively, can we identify a lynchpin which if we can locate, the rest of the problem will be solved ?


Cutting through to solution by focusing on what you are trying to achieve, and not getting stuck on the loops of the problem, would be the essence of Gordian Advice.

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Any opinion expressed is that of Gordian Advice, is not a statement of fact, is subject to change and does not constitute investment advice as defined by MIFID II or UK Financial Conduct Authority.  All investors should seek professional investment advice before proceeding with any investment.