Month: October 2011

Europe and the Elephant in the Room

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Today’s quote of the day comes from John Lanchester, about the European debt crisis:

The difference between a safe euro and a euro on the verge of failure is the difference between that metaphorical elephant in the room, which you can ignore, and an actual elephant in the room with you, right now, filling the air with its hot, dank breath. That situation would be unignorable, and the source of a rising panic. The euro zone is already in the room with that elephant; unless some decisive steps are quickly taken, the rest of the world will soon be joining it.

More here.

Peter Thiel on Technology, Science, Politics

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Peter Thiel, the founder of PayPal, in his piece, “The End of the Future,” offers excellent food-for-thought regarding technology, science, innovation, politics, and the economy.

The state of true science is the key to knowing whether something is truly rotten in the United States. But any such assessment encounters an immediate and almost insuperable challenge. Who can speak about the true health of the ever-expanding universe of human knowledge, given how complex, esoteric, and specialized the many scientific and technological fields have become? When any given field takes half a lifetime of study to master, who can compare and contrast and properly weight the rate of progress in nanotechnology and cryptography and superstring theory and 610 other disciplines? Indeed, how do we even know whether the so-called scientists are not just lawmakers and politicians in disguise, as some conservatives suspect in fields as disparate as climate change, evolutionary biology, and embryonic-stem-cell research, and as I have come to suspect in almost all fields?

Not so sure about this statement. Nuclear engineering remains a strong major at Georgia Tech, for example:

 One cannot in good conscience encourage an undergraduate in 2011 to study nuclear engineering as a career. 

On the big pharmaceutical companies today:

In the next three years, the large pharmaceutical companies will lose approximately one-third of their current revenue stream as patents expire, so, in a perverse yet understandable response, they have begun the wholesale liquidation of the research departments that have borne so little fruit in the last decade and a half.

I think this is Thiel’s most important point in the piece.  Read it carefully:

If meaningful scientific and technological progress occurs, then we reasonably would expect greater economic prosperity (though this may be offset by other factors). And also in reverse: If economic gains, as measured by certain key indicators, have been limited or nonexistent, then perhaps so has scientific and technological progress. Therefore, to the extent that economic growth is easier to quantify than scientific or technological progress, economic numbers will contain indirect but important clues to our larger investigation.

The single most important economic development in recent times has been the broad stagnation of real wages and incomes since 1973, the year when oil prices quadrupled. To a first approximation, the progress in computers and the failure in energy appear to have roughly canceled each other out. Like Alice in the Red Queen’s race, we (and our computers) have been forced to run faster and faster to stay in the same place.

One interesting anecdote, in which Thiel quotes from the 1967 bestseller The American Challenge by Jean-Jacques Servan-Schreiber:

In 30 years America will be a post-industrial society. . . . There will be only four work days a week of seven hours per day. The year will be comprised of 39 work weeks and 13 weeks of vacation. With weekends and holidays this makes 147 work days a year and 218 free days a year. All this within a single generation.

And what does Thiel really think of John Maynard Keynes?

The most common name for a misplaced emphasis on macroeconomic policy is “Keynesianism.” Despite his brilliance, John Maynard Keynes was always a bit of a fraud, and there is always a bit of clever trickery in massive fiscal stimulus and the related printing of paper money. 

And I strongly agree with Thiel here. It’s a shame how science and engineering get passed over by our politicians:

Most of our political leaders are not engineers or scientists and do not listen to engineers or scientists. Today a letter from Einstein would get lost in the White House mail room, and the Manhattan Project would not even get started; it certainly could never be completed in three years. I am not aware of a single political leader in the U.S., either Democrat or Republican, who would cut health-care spending in order to free up money for biotechnology research — or, more generally, who would make serious cuts to the welfare state in order to free up serious money for major engineering projects.

Where will the United States be in a year? In five years? In ten?

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(via Tyler Cowen)

UVB-76: Russian Short Wave Radio Enigma

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From the latest issue of Wired, an interesting piece on UVB-76, a Russian short wave radio:

On the evening of September 7, something more dramatic—one listener even called it “existential”—transpired. At 8:48 pm Moscow time, a male voice issued a new call sign, “Mikhail Dmitri Zhenya Boris,” indicating that the station was now to be called MDZhB. This was followed by one of UVB-76’s (or MDZhB’s) typically nebulous messages: “04 979 D-R-E-N-D-O-U-T” followed by a longer series of numbers, then “T-R-E-N-E-R-S-K-I-Y” and yet more numbers.

From Wikipedia:

The station features a short, monotonous buzz tone repeating at a rate of approximately 25 tones per minute, for 24 hours per day. The station has been observed since around 1982. On rare occasions, the buzzer signal is interrupted and a voice transmission in Russian takes place. 

To this day, no one still knows what the purpose of the station is. Or precisely where it’s located. However, the author of the Wired piece explains:

Most observers believe that UVB-76 is an idiosyncratic example of what’s called a numbers station, used to communicate encrypted messages to spies or other agents. Typically, these stations transmit numbers in groups of five, making it impossible to detect partitions between words and sentences. The numbers can be decoded using a key in the possession of the intended listener. Numbers stations are thought to have existed since World War I, as documented by the Conet Project, a compilation of recordings that was first released in 1997. (Director Cameron Crowe, a fan of the Conet Project, used samples from it in his 2001 film Vanilla Sky.) Drug runners are believed to have used numbers stations on occasion; so too are the North Koreans, the Americans, the Cubans, and the British. Indeed, shortwave hobbyists suspect MI6 was behind the most famous numbers station on the planet, the much-revered Lincolnshire Poacher.

If you’re interested, you can listed to a feed of UVB-76 online at http://UVB-76.net.

You Can’t Explain the Market

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Chao Deng, in his piece “Memoirs of a Market Reporter,” gets it (mostly) right about analysts/reporters trying to explain the short-term movements in the market:

[The] drudgery of writing the market-close story—stocks up on this; stocks down on that—began to make me wonder whether chasing the inevitable day-to-day ups and downs of markets was worth anyone’s time. Some critics say markets reporters must suffer from A.D.D., because short-term fluctuations in stock indices really don’t matter much in the long run. They say it’s absurd to pin a single narrative on spot news involving countless individual decisions, many of them made by robots. Too often, coverage favors one slant if stocks are up and another if stocks are down when, in fact, nobody really knows.

The depressing part is that markets beg for an explanation, and the public desires one. As if an explanation can assuage our fears:

[A] volatile turn in the markets simply begged for an explanation, sending thousands of extra readers my way.

Here’s the kicker: there is no good explanation for why the markets are down today(a must-read piece by Felix Salmon):

As a general rule, if you see “fears” or “pessimism” in a market-report headline, that’s code for “the market fell and we don’t know why”, or alternatively “the market is volatile and yet we feel the need to impose some spurious causality onto it”.

This kind of thing matters — because when news organizations run enormous headlines about intraday movements in the stock market, that’s likely to panic the population as a whole. They think that they should care about such things because if it wasn’t important, the media wouldn’t be shouting about it so loudly. And they internalize other fallacious bits of journalistic laziness as well: like the idea that the direction of the stock market is a good proxy for the future health of the economy, or the idea that rising stocks are always a good thing and falling stocks are always a bad thing.

Trying to put a reason behind short-term fluctuations is ultimately useless. Remember: you can’t time the market. And don’t believe anyone that tells you they can.

Procrastination as Deception

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In a 1996 essay by John Perry, a professor of philosophy at Stanford University, he writes about so-called structured procrastination:

To make structured procrastination work for you, begin by establishing a hierarchy of the tasks you have to do, in order of importance from the most urgent to the least important. Even though the most-important tasks are on top, you have worthwhile tasks to perform lower on the list. Doing those tasks becomes a way of not doing the things higher on the list. With this sort of appropriate task structure, you can become a useful citizen. Indeed, the procrastinator can even acquire, as I have, a reputation for getting a lot done.

So, is procrastination also known as deception?

At this point, the observant reader may feel that structured procrastination requires a certain amount of self-deception, since one is, in effect, constantly perpetrating a pyramid scheme on oneself. Exactly. One needs to be able to recognize and commit oneself to tasks with inflated importance and unreal deadlines, while making oneself feel that they are important and urgent. This clears the way to accomplish several apparently less urgent, but eminently achievable, tasks.

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Also, do not miss James Surowiecki on procrastination.

On Being Michael Lewis

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This is a superb profile of Michael Lewis, author of Liar’s Poker, Moneyball, and The Big Short in this month’s New York Magazine.

This should immediately leave your jaw on the ground:

The reason, of course, is that he is Michael Lewis. Magazines these days aren’t willing to pay just anyone to go to Europe for 10,000-word semi-satirical finance pieces, especially at Lewis’s rate—$10 a word when he left Portfolio for Vanity Fair.

Good biographical information on Michael Lewis (I didn’t know the fact about his mother):

Even Lewis will admit that he has led something of a charmed life. He was born looking like something out of a Brooks Brothers catalog, grew up in a well-to-do, generations-old New Orleans family, and has aged in that way that Robert Redford has, in that he looks now basically the same but somehow more solid. “He’s a direct descendant of Lewis and Clark,” says Taylor. “That’s on his dad’s side. On his mother’s side, Thomas Jefferson. Or whoever it was that bought Louisiana from the French. His dad is a lawyer. His grandfather was the first Supreme Court justice of Louisiana. The whole family is very southern, the hospitality, the prim and proper, all of that.” He managed to get into Princeton despite being a far from stellar student in high school. “He had such bad grades,” says his mother, Diana Monroe Lewis, who is in fact a descendant of James Monroe. “But he always had the verbal skills,” she added. “He could talk his way out of any situation.”

As I read pretty much all that Michael Lewis publishes, I dare say that this piece about him is a must-read.

Arrested Development is Coming Back!

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Anyong! This is probably the most exciting TV-related news I’ve heard in the past six months. According to the New York Times, Arrested Development is coming back for a full-season. But there’s more, for all you never-nude fans: they’re also going to make a movie!

Anyone else as excited as I am?

The first episode…could focus on Buster Bluth, the deeply neurotic brother played by Tony Hale. “The latest joke we have,” Mr. Hurwitz said, “is that it’s Cambridge, Mass., and there’s all these scientists in lab coats and they’re waiting for somebody. Buster comes through the door in a white lab coat – ‘Let’s begin’ – and they say, ‘Oh, no, you don’t get to wear the lab coat. We’re experimenting on you.’ ”

I’ve recently been thinking about my top five favourite TV shows. Arrested Development is in the top five, and certainly number 1 in the comedy department.

Behind the Scenes at LAX

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A good piece in Los Angeles Times on the ins-and-outs of how LAX, the world’s seventh busiest airport, is run:

Terminals 4 and 5 are where mega-players American and Delta lease space from the Los Angeles World Airport and, by virtue of their size, run these areas as if they were their own.

Then there are Terminals 1, 2 and 3, co-ops really, where smaller airlines share what feels like a shoe box.

Annual passenger volume is still below what it was before 9/11: 61 million now, 67 million then. Yet the airport, which is celebrating 50 years of jet travel, makes more than $100 million in profit annually on fees it charges airlines to use its facilities.

It sounds like the airport is run like a governmental agency:

Open since December, the Airport Response Coordination Center, or ARCC, is the airport’s central nervous system. Operators here control the stoplights outside the terminals to regulate vehicle flow. From here, an incident desk deploys plumbers to the flood in a restroom in Terminal 2 or a leaky water fountain in Terminal 3.

In a smaller room steps away, a police officer checks hundreds of surveillance cameras that monitor entrances, checkpoints and runways. Zooms in, zooms out, tilts down, pans left. What’s he looking for? Anomalies. Anything that doesn’t make sense in the normal flow of a gigantic airport.

I’d be very interested to read profiles of other major airports, such as that of Atlanta’s Hartsfield-Jackson, New York’s JFK, or Tokyo’s Narita.

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(hat tip: @matthiasrascher)

Technology’s Gang of Four

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From The London Review of Books, we have this gem:

This spring, the billionaire Eric Schmidt announced that there were only four really significant technology companies: Apple, Amazon, Facebook and Google, the company he had until recently been running. People believed him. What distinguished his new ‘gang of four’ from the generation it had superseded – companies like Intel, Microsoft, Dell and Cisco, which mostly exist to sell gizmos and gadgets and innumerable hours of expensive support services to corporate clients – was that the newcomers sold their products and services to ordinary people. Since there are more ordinary people in the world than there are businesses, and since there’s nothing that ordinary people don’t want or need, or can’t be persuaded they want or need when it flashes up alluringly on their screens, the money to be made from them is virtually limitless…

Very interesting analogy from the real Gang of Four to technology companies. Do you agree?