Nassim Nicholas Taleb on Role of Luck

Nassim Nicholas Taleb has a new short paper titled “Why It is No Longer a Good Idea to Be in The Investment Industry” (PDF link). The concluding argument is:

To conclude, if you are starting a career, move away from investment management and performance related lotteries as you will be competing with a swelling future spurious tail. Pick a less commoditized business or a niche where there is a small number of direct competitors. Or, if you stay in trading, become a market-maker.

Felix Salmon weighs in and argues the opposite:

The professions you really want to avoid, after reading Taleb’s paper, are not financial but rather creative. Where do you find millions of people all trying to succeed against the odds? Just look at how many bands there are, how many aspiring novelists, how many struggling artists. Nearly all of them think that if they create something great, that will improve their chances of success in their field. But given the sheer number of people they’re competing against, and given the fact that the number of breakout stars in each field is shrinking rather than growing, the fact is that just about everybody with massive success will have got there by sheer luck.

Sometimes, the luck is obvious: EL James, by all accounts, is an absolutely dreadful writer, but has still somehow managed to become a multimillionaire best-selling author. Carly Rae Jepsen has a catchy pop tune, but is only really successful because she happened to be in the right place at the right time. Dan Colen might be a fantastic self-publicist, but not particularly more so than many other, much less successful artists. And so on.

Salmon is strong in his conviction that every successful musician, artist, novelist became successful mainly because of luck. I don’t agree with that premise entirely: I believe there are things you can do to sway the chances of luck helping you along the way. But that doesn’t mean hard work, confidence, and talent should be discounted.

The Reddit “AMA” with the Mars Curiosity Team

Over on Reddit today, the members of the Mars Curiosity team did an “Ask Me Anything.” The list of participants included:

Bobak Ferdowsi (aka “Mohawk Guy”) – Flight Director

Steve Collins aka “Hippy NASA Guy” – Cruise Attitude Control/System engineer

Aaron Stehura – EDL Systems Engineer

Jonny Grinblat aka “Pre-celebration Guy” – Avionics System Engineer

Brian Schratz – EDL telecommunications lead

Keri Bean – Mastcam uplink lead/environmental science theme group lead

Rob Zimmerman – Power/Pyro Systems Engineer

Steve Sell – Deputy Operations Lead for EDL

Scott McCloskey -­ Turret Rover Planner

Magdy Bareh – Fault Protection

Eric Blood – Surface systems

Beth Dewell – Surface tactical uplinking

Below are a selection of questions/answers which I found to be most interesting.

Q. Since the Martian Day is 24 hours, 40 minutes, 40 minutes longer than an Earth day, do the JPL scientists and engineers live their lives on Martian days to stay in sync?

A. Yes. All of the operators (engineers, scientists, drivers, planners) live on Mars time, by shifting the schedule +40 minutes each day. This is order to maximize the efficiency of each sol.

On the computers aboard Curiosity:

Q. The processor you guys used feels ancient to me. How did you guys program on it? Is it only “CPU-instructions” or was there some higher level programming for it?

A. You are right that the processor does feel acient. Our current smartphones are more powerful. The reasoning for this is three-fold. First of all, the computer was selected about 8 years ago, so we have the latest and greated space certified parts that existed then. Second of all, it was the most rubost and proven space grade processor at that time. Thirdly, in order to make a processor radiation hardened it requires lots of tricks on the silicon that is not conducive to making it fast. Given that, it does not run any GUIs and can just focus on raw programming, and actually gets a lot done. All of the programming is done in C, and our toolchain is very similar to programming on any platform.

[Editor’s note: see this previous post about Curiosity’s 2MP cameras]

I was surprised by the answer to this question:

Q. How many of you have PhDs?

A. None of us in the room (14 of us).

And the best food-for-thought question came courtesy of Reddit user Terrik27:

Q. What are your thoughts on the quote by Carl Sagan: “If there is life on Mars, I believe we should do nothing with Mars. Mars then belongs to the Martians, even if the Martians are only microbes.” If we found Martian microbes, would we declare the planet a ‘nature preserve’? Would that mean no more missions there at all, or only scientific missions?

A. We abide by a set of planetary protection guidelines that you can read more about here. The groundwork:

1. All countries party to the treaty “shall pursue studies of outer space, including the moon and other celestial bodies, and conduct exploration of them so as to avoid their harmful contamination.”

2. In accordance with the NASA policy, requirements are based on the most current scientific information available about the target bodies and about life on Earth. The Planetary Protection Officer requests recommendations on implementation requirements for missions to a specific solar system body, or class of bodies, from internal and external advisory committees—but most notably from the Space Studies Board of the National Research Council

3. If the target body has the potential to provide clues about life or prebiotic chemical evolution, a spacecraft going there must meet a higher level of cleanliness, and some operating restrictions will be imposed. Spacecraft going to target bodies with the potential to support Earth life must undergo stringent cleaning and sterilization processes, and greater operating restrictions.

4. Careful mission design and planning are essential to meeting this requirement. For example, at the end of an orbiter mission the spacecraft may be placed into a long-term orbit so that radiation and other elements of the local space environment can eliminate any Earth microbes that might be onboard. After navigation considerations are taken into account, missions must meet stringent cleanliness requirements. Spacecraft and their components must be cleaned very carefully, and sometimes sterilized. After cleaning, spacecraft are tested to ensure that cleanliness requirements have been met and can be maintained until launch.

Also, props to the Curiosity team for liking Bill Nye the Science Guy, which I watched religiously as a kid as well.

You can dig through the entire AMA right here.

AOHell, or How Phishing Got Its Start

In a paper [PDF link] penned last year, Koceilah Rekouche recounts the earliest days of phishing. Surprise, surprise: it happened on America OnLine (or AOL). Here’s how the process worked:

1. Obtain an anonymous AOL account by creating one using a fake bank account number or credit card, or use an account that was stolen in a previous attack.

2. Create a screen name on the account that appears official (e.g. BillingDept). 

3. Write the “bait” message which will explain to users the need for us to “verify”their passwords or billing information. For example: “Hi, this is AOL customer service. Due to a problem with our records, we need you to reply to this message with your current password in order to avoid being disconnected.”

4. Locate a New Member Lounge chat room and open its occupant list.

5. Send a private message containing the bait to each person in the room.

The paper is quite revealing, and having read the whole thing, it’s obvious that the people behind the phishing attempts wanted to create a community of hackers. Rekouche discusses how AOHell, an early software created for the purposes of stealing passwords and credit cards, proliferated:

A major goal in writing AOHell was to gain a user base not just within AOL’s hacking community but, moreimportantly, to get users from outside this community and thus increase its size by recruiting and educatingnew people. This was extremely successful as the popularity of AOHell and similar programs were largelyresponsible for growing the warez, hacking, and programming communities to a point where they reachedthousands of participants. For each new release, and periodically in between releases, I would spam a copy ofthe program, along with a layman’s description of the things that it could do, to every person in the Teen Chatrooms. This was a very effective way of getting new people to use the program as email spamming had not yetcome about. Phishing was one component of the software, but most AOL teenagers were drawn by the otheradvertised functions such as the ability to “punt” their friends offline or the ability to scroll ASCII art in thechat rooms.

It’s a fascinating paper. For the pointer, I thank this Wall Street Journal post, in which you can make a contribution of how you’ve been hacked, if ever.

On Extreme Weather and Environmental Catastrophe

For the September issue of National Geographic, Peter Miller writes about weather gone wild:

There’s been a change in the weather. Extreme events like the Nashville flood—described by officials as a once-in-a-millennium occurrence—are happening more frequently than they used to. A month before Nashville, torrential downpours dumped 11 inches of rain on Rio de Janeiro in 24 hours, triggering mud slides that buried hundreds. About three months after Nashville, record rains in Pakistan caused flooding that affected more than 20 million people. In late 2011 floods in Thailand submerged hundreds of factories near Bangkok, creating a worldwide shortage of computer hard drives.

And it’s not just heavy rains that are making headlines. During the past decade we’ve also seen severe droughts in places like Texas, Australia, and Russia, as well as in East Africa, where tens of thousands have taken refuge in camps. Deadly heat waves have hit Europe, and record numbers of tornadoes have ripped across the United States. Losses from such events helped push the cost of weather disasters in 2011 to an estimated $150 billion worldwide, a roughly 25 percent jump from the previous year. In the U.S. last year a record 14 events caused a billion dollars or more of damage each, far exceeding the previous record of nine such disasters in 2008.

On the gloomy prediction of weather by end of the century:

By the end of the century the average world temperature could rise anywhere from three to eight degrees Fahrenheit—depending in part on how much carbon we emit between now and then. Scientists expect the weather to change substantially. Basic circulation patterns will move toward the Poles, just as some plants and animals are doing as they flee (or take advantage of) the expanding heat. The tropical rain belt is already widening, climatologists report. The subtropical dry zones are being pushed poleward, into regions such as the American Southwest, southern Australia, and southern Europe, making these regions increasingly susceptible to prolonged and intense droughts. Beyond the subtropics, in the midlatitudes, including the lower 48 of the United States, storm tracks are moving poleward too—a long-term trend superimposed on the year-to-year fluctuations triggered by La Niña or El Niño.

If that’s not depressing enough for you, I have a book recommendation. Alan Weisman’s The World Without Us is a remarkable thought experiment: what would happen if the human species were suddenly extinguished? How would the weather affect our remaining infrastructure? What would happen to weeds and trees as they take over the remnants of human civilization? It’s the best book I’ve read on environmental science.

Fake Science 101: Confessions of a Fake Scientist

Phil Edwards, the man behind the Fake Science blog and author of Fake Science 101, writes a confession:

The most difficult part about being a fake scientist is telling people what you do for a living. It’s hard enough with friends, family members, and Internal Revenue Service auditors, but small talk is even rockier terrain. One summer on a flight from Chicago to San Francisco, I found myself stammering in my airplane seat when the subject of occupations came up. Five-hour flights can create some awkward situations, but this one seemed particularly perilous. I had to admit I was a fake scientist. And I was sitting next to a real one.

Though actual science has remained opaque to me during my tenure as a fake scientist, I have learned a bit about real scientists. When I started encountering them, I took an anthropological pleasure in analyzing their quirks and humor. (I’m so nonscientific that even when I’m pretending to be a scientist, it’s a social scientist.) I should note that my data on this group isn’t statistically significant or peer reviewed—I am, after all, the type of scholar who spends most of his time Photoshopping babies drinking from beakers. Still, I’ve gleaned a bit about scientists from having conversations, responding to Facebook comments, and reading enthusiastic tweets.

I learned quickly that real scientists—the people I’d satirized with crisp lab coats and serious lab-goggle-covered faces—could be incredibly silly. I should have known that from my friends in scientific fields, but it remained shocking to see lauded pros act gleefully absurd. When I created a fake gossip magazine about scientists, I never anticipated that Mike Brown would tweet back. (He’s an astronomer whose Twitter name, @plutokiller, should give you an idea how he feels about his role in declassifying Pluto as a planet.) That silliness drew scientists to my site, and their intelligence only enhanced it.

The Amazon book reviews are particularly good:

“This book is so good, I almost don’t mind that I died penniless!”–Nikola Tesla

“For the last time, I am not the physicist Stephen Hawking. I’m Steve Hawking and I’m a business administrator in Ohio. I will not read your book.”–Stephen Hawking, Says He’s Not The Physicist, But Who Knows?

“Thank you for contacting the offices of Neil Armstrong. The office cannot respond to all letters, but thank you for your interest. Please enjoy the enclosed color photograph.”–Neil Armstrong, First Man On the Moon

Click to read the rest of the confession, in which Phil Edwards discovers something new about bears going on knife hunts.

The Economist on Obesity in America

The CDC estimates obesity-related health care costs $147 billion per year. The Economist has a very skeptical take on whether America can do something about the obesity epidemic:

I very much doubt America is going to do anything, as a matter of public health policy, that has any appreciable effect on obesity rates in the next couple of decades. It’s not that it’s impossible for governments to hold down obesity; France, which had rapidly rising childhood obesity early this century, instituted an aggressive set of public-health interventions including school-based food and exercise shifts, nurse assessments of overweight kids, visits to families where overweight kids were identified, and so forth. Their childhood obesity rates stabilised at a fraction of America’s. The problem isn’t that it’s not possible; rather, it’s that America is incapable of doing it.

America’s national governing ideology is based almost entirely on the assertion of negative rights, with a few exceptions for positive rights and public goods such as universal elementary education, national defence and highways. But it’s become increasingly clear over the past decade that the country simply doesn’t have the political vocabulary that would allow it to institute effective national programmes to improve eating and exercise habits or culture. A country that can’t think of a vision of public life beyond freedom of individual choice, including the individual choice to watch TV and eat a Big Mac, is not going to be able to craft public policies that encourage people to exercise and eat right. We’re the fattest country on earth because that’s what our political philosophy leads to. We ought to incorporate that into the way we see ourselves; it’s certainly the way other countries see us.

I disagree. Here is one comment on what America can do:

1. Stop subsidising the production of grains (especially wheat and corn). This just makes cheap carbohydrates cheaper.

2. End USDA control of the “Dietary Guidelines for Americans”. The job of the USDA is to promote the sale of US agricultural products, not human health. There is an inherent conflict of interest here, which leads to guidelines that ignore the science.

3. Consider taxing (added) sugar, much like the other substances that create negative externalities are taxed (eg alcohol and tobacco).

Matthew Inman and the Tesla Museum Campaign

The man behind the Internet-famous Oatmeal comics, Matthew Inman, has a new idea: building a Tesla museum. Using the IndieGoGo crowdfunding website, he writes:

Tesla’s final laboratory is located in the sleepy town of Shoreham, New York.  It’s known as Wardenclyffe and it’s where Tesla attempted to build a tower that would provide free wireless energy to the entire earth. Unfortunately, Tesla lost his funding before the project was completed and in 1917 the Wardenclyffe tower was demolished.  Subsequently, the land was sold to a film and paper manufacturer.

However, the land, laboratory, and foundation beneath the tower are still there and very recently went up for sale. And right now a non-profit is trying to buy the property and turn it into a Nikola Tesla Museum. The property is listed at $1.6 million, and this non-profit has received a matching grant from New York State of up to $850k.  This means that if we can raise $850k, New York State will match us for that same amount — putting the total raised at $1.7 million. 

There is currently another offer on the table from someone who wants to purchase the property potentially tear it down or turn it into a retail establishment. There is no Tesla museum in the United States, despite Tesla’s extraordinary accomplishments.  If we can outbid this other person and buy the land it will permanently be protected as a historic site and eventually converted into a Nikola Tesla Science Center. 

The most revealing fact is that the IndieGoGo account for the campaign is linked directly to the bank account of the non-profit organization associated with saving this Tesla property.

I have no doubt the project will meet its campaign goal of $850,000. Less than 24 hours into it, more than $300,000 has been raised!

The Surprising Business of Life Insurance Policies

Are you worth more dead than alive? That’s the premise behind this fascinating New York Times Magazine piece, which goes into depth behind life insurance policies.

First, the author drives one point home:

Selling your life and selling a house have more in common than you’d think. The seller puts a listing on the market. Prospective buyers do research and get inspections; there are offers and counteroffers until the seller accepts a bid. The seller doesn’t literally peddle his own life, of course, but his life-insurance policy. The distinction is in many ways moot, however, as the sales value is inextricably linked to a cold-eyed estimation of how much longer the seller has to live.

There are many, many reasons why selling your own policy can be a bad idea:

For all the supposed benefits, settlements still strike many people as creepy. They invert the traditional incentives of life insurance. Insurance companies have always had an interest in you, the policyholder, living as long as possible so that they can collect more premiums. Generally, you also want to live a long time, for obvious reasons. But a settlement means someone hits the jackpot when you die, and the sooner that happens, the more money that person makes.

The investors who buy policies from others must be diligent (even if what they are doing is unsympathetic):

Life-settlement investors, like those in other sectors, crave timely information about their holdings, and the key metric for predicting portfolio performance is the health status of the policyholders. To acquire this sensitive information, Fred says a Vespers representative would call and question the policyholders — or their adult children, nurses and doctors — as often as quarterly. He would then receive tracking reports summarizing what the company learned.

Much of what I’ve read in the NYT piece I’ve read previously, in different concoctions, at other sites. So the biggest takeaway from the piece, for me, was near the end:

Back in 1921, a Stanford University psychologist, Lewis Terman, selected 1,528 kids for a study on what demographic and psychological factors enabled students to excel, in both their early years and later in life. The children were regularly assessed even as they grew into adults, got jobs and had families. After Terman’s death in 1956, the project was taken up by other researchers, who continued tracking the participants all the way into the 21st century. That the study hadn’t been designed to analyze longevity scarcely mattered to Friedman: here was a large group of people who had undergone standardized assessments from age 11 till death. Friedman and his colleagues exhaustively mined the Terman data for statistically valid correlations between the “psychosocial” profiles of the participants and how long they lived. “Surprisingly, the long-lived among them did not find the secret to health in broccoli, medical tests, vitamins or jogging,” Friedman wrote in his 2011 book “The Longevity Project.” “Rather, they were individuals with certain constellations of habits and patterns of living.”

Friedman’s findings buck much of the conventional wisdom on longevity. For instance, the cheerful study participants were less likely, on average, to live to a ripe old age than the more serious ones, in part because happy-go-lucky people are prone to “illusory optimism,” meaning they underestimate health risks and are less likely to follow medical advice. Highly sociable people, on average, did not live longer than less gregarious ones as is commonly believed, because they tended to drink, smoke and party more. Over all, Friedman found a longevity edge for the successful nerds of the world, the scientist types over lawyers and businesspeople. “The findings clearly revealed that the best childhood personality predictor of longevity was conscientiousness — the qualities of a prudent, persistent, well-organized person — somewhat obsessive and not at all carefree,” Friedman wrote.

Sounds like it’s good to be a nerd!

But really, if this topic is new to you, I suggest reading the entire piece. The topic is macabre, but it’s quite fascinating.

A Brief History of Trading on Wall Street

You don’t get to read about history in the Dealbook blog, but we get a great one today about the history of trading on Wall Street. It’s pretty crazy to think that in the early days of Wall Street, stock prices were communicated by runners:

Even after the introduction of the trans-Atlantic cable in 1865 and the telephone in 1878, brokers still relied on manpower over gadgetry. Market prices were listed on slips of paper, and runners, most younger than 17, would deliver letters between brokerage houses, according to a report by Alexandru Preda at the University of Edinburgh. The new technologies were not seen as reliable. Problems ranged from typographical errors in the closing stock prices listed by newspapers to outright forgery.

In the days after the Civil War ended, traders seeking a timely edge still relied upon foot speed. The fastest man on Wall Street was William Heath, a celebrated runner with a huge drooping mustache, who was nicknamed “the American Deer.” Standing an inch taller than the Olympic sprinter Usain Bolt of Jamaica, Mr. Heath was reported by The New York Times to have been “as quick in his locomotion as in his operation.”

On the invention of the first ticker symbol, which was unreliable:

In 1867, Edward A. Calahan, a draftsman with the American Telegraph Company who previously worked as a messenger on Wall Street, unveiled the first stock ticker. The device, which earned its name from the unique sound it created, featured two wheels of type placed under a glass jar. The ticker printed off company names and stock prices on a narrow strip of paper, which was read aloud by a clerk.

Mr. Calahan’s machine was the first step in a major technological revolution of Wall Street, but it was also slow and unreliable. Twice a week, the batteries had to be filled with sulfuric acid, which was carried around in buckets. More important, the wheels of type would not always print in unison resulting in a mash of letters and numbers.

Catch up on the rest of the history lesson here.

How Movies Are Censored in Iran

Max Fisher writes a column in The Atlantic on the technology used to censor films in Iran:

Censoring foreign movies used to mean simply pulling out the scissors, cutting away inappropriate scenes and shots until the film was a good deal shorter and made a lot less sense. But, in 2010, Iranian authorities acquired new technology allowing them to manipulate images and dialogues into Islamic inappropriateness. 
“Romantic dialogue is often changed. For example, it isn’t proper for a woman to say to her partner, ‘I love you,'” Iranian journalist Reza Valizadeh explained to Radio Free Europe’s Golnaz Esfandiari in a 2010 interview. “It’s clear how dialogue about sexual proposals is dealt with — they are changed to marriage proposals. Also we see that beer becomes lemonade on state television and whiskey becomes orange juice. Also dialogue about politics is often changed.”
Censors will sometimes edit immodest images — whether it’s a man and woman sitting too closely, someone drinking a cocktail, or even an open neckline — by cutting the offending person or object or by simply placing some visual obstacle. The Iranian film fan site put together a series of side-by-side comparisons showing the before-and-after of this new censorship technique. 
Click through to see startling examples of censorship in the post.