Year: 2012

The Knight Capital “Glitch”

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Yesterday, The Knight Capital Group lost $440 million when it sold all the stocks it accidentally bought Wednesday morning because of a “computer glitch.” According to Dealbook:

The losses are greater than the company’s revenue in the second quarter of this year, when it brought in $289 million.

The company said the problems happened because of new trading software that had been installed. The event was the latest to draw attention to the potentially destabilizing effect of the computerized trading that has increasingly dominated the nation’s stock markets.

Until this week, Knight had been one of the biggest beneficiaries of the evolution of the market, helping clients trade in and out of stocks at high speeds.

The glitch occurred over a span of 45 minutes, during which Knight Capital lost $10 million per minute. The stock tumbled 30% yesterday and is down 60% today to a low of $2.75/share.

For a specific glance at the stocks that were affected yesterday, check out this blog post. The blog post begins appropriately “What follows should strike you as crazy. If it doesn’t, read it again, because it is.”

Incredible how much value can be wiped out in a company because someone on the High Frequency Trading desk didn’t do his/her homework.

The Lucrative World of Cardboard Theft

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John Metcalfe writes on the lucrative world of cardboard theft at The Atlantic Cities:

The thieves…drive in trucks rented from U-Haul and Penske or even unmarked Econolines. They cruise slowly down the street manhandling bales of cardboard into the vehicles. Or they’ll dodge behind a large store like Costco to retrieve spoils left outside by the Dumpsters.

It may sound like a tedious way to earn a living, but it’s quite suitable for folks who like a good workout and fast payouts. “You rent a van and drive down Second Avenue [in Manhattan] or Atlantic in Brooklyn, you pick up a ton and a half of cardboard and get paid 150 bucks for it,” says Biderman. “Do that twice a night and you’re doing OK.”

Sometimes, as in the case with three men busted recently in New Jersey, recyclers will allegedly form a front business (“Metro Paper Inc.”) to support their cardboard ring. A favored tactic of this particular heist squad, according to the authorities, was to back their vehicles up to stores while pretending to be licensed haulers. With nobody on the loading docks apparently questioning their authority, they’re suspected to have made off with 900 tons of cardboard in just three months this year, a weight that represents $103,000 in free money.

The cardboard theft isn’t centered just in New York… There have been incidents in Virginia, Connecticut, Georgia, and Florida.

Read the comments for some controversy regarding the article.

Remembering Gore Vidal Through His Quotes

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Gore Vidal, author, playwright,essayist, screenwriter, and political activist, has passed away at age 86. The Telegraph has an obituary of the man, but I liked this compilation of Gore Vidal quotes:

On US politicians:

The United States was founded by the brightest people in the country – and we haven’t seen them since.

On the US electorate:

Half of the American people have never read a newspaper. Half never voted for President. One hopes it is the same half.

On Ronald Reagan:

He is not clear about the difference between Medici and Gucci. He knows Nancy wears one of them.

On John F Kennedy:

He was one of the most charming men I’ve ever known. He was also one of the very worst Presidents.

On political speeches:

In America, if you want a successful career in politics, there is one subject you must never mention, and that is politics. If you talk about standing tall, and it’s morning in America, and you press the good-news buttons, you’re fine. If you talk about budgets, tax reform, bigotry, and so on, you are in trouble. So if we aren’t going to talk issues, what can we talk about? Well, the sex lives of the candidates, because that is about the most meaningless thing that you can talk about.

On the press:

A writer must always tell the truth, unless he is a journalist.

On art and politics:

There is something about a bureaucrat that does not like a poem.

On style:

Style is knowing who you are, what you want to say and not giving a damn.

On looks:

A narcissist is someone better looking than you are.

On adolescence:

Until the rise of American advertising, it never occurred to anyone anywhere in the world that the teenager was a captive in a hostile world of adults.

On jealousy:

Whenever a friend succeeds, a little something in me dies.

On the death of the novel:

You hear all this whining going on, ‘Where are our great writers?’ The thing I might feel doleful about is: ‘Where are the readers?'” (Read more at Esquire)

On ageing:

At a certain age, you have to live near good medical care — if, that is, you’re going to continue. You always have the option of not continuing, which, I fear, is sometimes nobler.

On the secret to a happy life:

Never pass up a chance to have sex or appear on television.

Read more here.

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Trivia: Gore Vidal’s first name was Eugene.

The Swimming Photographers at the Olympic Games

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The New York Times has a nice profile of the photographers at the Olympic Games who bring us the underwater images. I had no idea they were certified scuba divers!

Sports photographers who shoot underwater used to free-dive to make these adjustments; now many, including Bello, Rose and Pretty, are certified scuba divers. That has given them the comfort of extended time underwater to perfect the art of capturing the world’s best swimmers from below. But it also leads to an odd sight every night at the London Aquatics Centre: a glass-and-plastic reef composed of 10 cameras and a platoon of frogmen who enter the pool soon after the last race to tend to them.

Preparation is everything:

Preparation is everything. Each camera has to be set up to focus on a specific race, or perhaps two lanes where a close finish is expected. Sometimes a camera will wait all day for a specific swimmer to splash into frame.

They use a handheld trigger to operate the shutter. It’s connected, via cable, to the camera at the bottom of the pool. Now that cameras are all digital, almost as soon as they are taken, the images can be viewed on a laptop.

Also worth reading is this post on Rob Galbraith’s blog, who interviewed Clive Rose before the Olympics on his camera equipment and set-up:

We [Getty Images] have been working with Canon on an underwater photography solution for the London Olympics for some time now, so we were lucky enough to be able to use a pre-production EOS-1D X with the new EF 8-15mm f/4L Fisheye USM lens during the test event. This was packed inside a prototype custom built waterproof housing. 

The EOS-1D X isn’t even available yet (or wasn’t then), so getting a housing to fit was one of the many challenges that we’ve had to deal with. The housing is connected via hardwire cables that run from the back of the housing along the pool floor to a laptop at poolside. There, we can use Live View to adjust the camera settings to suit which kind of shot we want. The camera is powered (always on) and connected to an Ethernet cable to allow us to draw the images up in real time. We can fire the camera either via the laptop through the Live View software, or hook the camera up to a trigger cable and attach the end of that to a PocketWizard, much the same way as you would for any other remote camera.

 

Bruce Schneier on Spectacular vs. Ordinary Events

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Bruce Schneier, technology expert and author of Liars and Outliers, has a good, well-reasoned op-ed piece in CNN titled “Drawing the Wrong Lessons from Horrific Events.” He reminds us that human brains aren’t very good at probability and risk analysis. We tend to exaggerate the strange and rare events, and downplay the ordinary, familiar, and common ones. We think rare risks are more common than they are. We fear them more than probability indicates we should.

And who are the major storytellers these days? Television and the Internet. So when news programs and sites endlessly repeat the story from Aurora, with interviews with those in the theater, interviews with the families and commentary by anyone who has a point to make, we start to think this is something to fear, rather than a rare event that almost never happens and isn’t worth worrying about. In other words, reading five stories about the same event feels somewhat like five separate events, and that skews our perceptions.

We see the effects of this all the time.

It’s strangers by whom we fear being murdered, kidnapped, raped and assaulted, when it’s far more likely that any perpetrator of such offenses is a relative or a friend. We worry about airplane crashes and rampaging shooters instead of automobile crashes and domestic violence — both of which are far more common and far, far more deadly.

If you want to continue reading on this topic, I highly recommend Nassim Nicholas Taleb’s Fooled by Randomness.

Ken Segall on the New Apple Genius Ads

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Ken Segall, former Apple ad guy, doesn’t like the new Apple “Genius” ads that aired during the Olympics. I’m with him. They are cheesy, of poor quality, and don’t portray Apple and its users in good light. In a blog post “New Mac Ads: Landing with a Serious Thud,” Ken decided to “talk with himself” to rationalize the ads:

“Ken, you’re missing the obvious. Clearly these ads are targeted at first-timers, not for you.”

That’s a seemingly logical defense. It’s also a horrible one. How many great campaigns have you seen that appeal to one target group, but turn off everyone else? There’s no excuse for a campaign like that. Apple’s momentum is fueled by the enthusiasm of its core customers. The last thing it wants is to win new customers at the cost of looking ridiculous to its enthusiastic supporters.

“But how can one campaign appeal to both crowds?”

How soon we forget. If it pleases the court, I present Exhibit A: the now-legendary Mac vs. PC campaign, which delivered 66 fantastic ads over a period of four years. Like the new campaign, Mac vs. PC was also aimed at switchers, but guess what — it was a massive hit with every level of Mac owner, from novice to pro. Those ads actually galvanized the Mac crowd to heavy up on the preaching. And look at the iPad ads. They’re hugely attractive to people who never got the technology bug. But they’re also alluring to those who have been using computers for years. Hmm. Maybe it can be done? To defend the new Mac ads by saying “Hey, they’re not aimed at you” is just a naive view of advertising.

“The Apple Genius idea is really rich. What’s your problem?”

Actually, I agree. The “idea” is pretty good. I’m not convinced it’s worthy of an ongoing campaign, but there is some good comedy in the basic concept. The problem is, a good idea is only half of the winning formula in advertising. The other half is execution — and that’s where this campaign went south.

“Be honest now. That Genius guy is perfectly cast.”

You’re kidding, right? He does an excellent job of fitting the stereotype of an Apple Store Genius, but that’s not necessarily a good thing. These spots are actually cast as if they’re sitcoms — with exaggerated characters like the father-to-be in Labor Day, or the passenger in Mayday, or the sleezy PC store owner in Basically. The spots try to make their points through comedy alone, with little sense of authenticity in characters or situations.

“I laughed out loud more than once.”

I did think that concept of Mayday was funny. But the smiles were mighty hard to come by after that. If you’re going to go the sitcom route — and that’s a very big “if” — you’ll need some writers who are up to the task. The script for Basically just makes me squirm. It’s like going to open mike night at the local comedy club.

“I did wonder if it was a good idea to make customers seem so clueless.”

Therein lies another problem with this campaign. In the effort to show that the Genius is the most helpful guy in the world, Apple has created customers who, shall we say, are on the dim side. In past ads, Apple has shown “ordinary people doing extraordinary things,” simply because Apple products are so easy to use. Now we have thick people who want to be better, but need a Genius to help. Not exactly flattering.

“These ads are very unexpected. Isn’t that what Apple’s all about?”

It’s great to be unexpected. But if you’re not true to the brand, being unexpected just makes you look silly. The Mac vs. PC campaign was unexpected, but its cleverness was in sync with the Apple brand. Absolutely, these ads are very unexpected for Apple — just not of the quality we’re used to.

It’s the best takedown of the ads I’ve read yet, and from a guy who knows what’s he talking about.

The Teenage Swimmers at the London 2012 Olympics

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One of the amazing stories unfolding in the London Olympic Games are the young swimmers shattering world records. Chinese swimmer Ye Shiwen last night became a double Olympic gold medalist at 16. She’s predicting the stars of the future could be even younger.

Ye broke the Olympic 200-meter medley record in 2 minutes, 07.57 seconds in a race she led from start to finish. In the 400-meter medley on July 28, Ye swam her final 50- meter freestyle leg in 28.93 seconds. That same night, U.S. swimmer Ryan Lochte recorded a final leg of 29.10 while winning gold in the men’s 400 medley. According to Bloomberg, Lochte suggested Ye might have beaten him had they raced together.

And:

Ye’s not the youngest winner in the pool. Two days ago, Lithuania’s Ruta Meilutyte, a 15-year-old who trains in Plymouth, England, captured the 100-meter women’s breaststroke title. Their successes make Missy Franklin, a 17-year-old U.S. high school student who took the 100-meter backstroke gold, seem like a relative veteran.

It’s quite interesting to see these world records being shattered by teenagers.

How Should Apple Spend Its $117 Billion in Cash?

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What could Apple buy with its cash hoard of $117 billion? Andrew Ross Sorkin, editor of the Dealbook at The New York Times, offers six suggestions:

1) NUANCE This is the one no-brainer on the list. Nuance, based in Burlington, Mass., provides much of the speech recognition technology behind Apple’s Siri and dictation functions. Right now, Apple has merely licensed it and integrated it into both its mobile devices like iPhones and iPads as well as its new Macintosh operating system. Most users think it is Apple technology, but those services wouldn’t work without Nuance.

2) RESEARCH IN MOTION Yes, this one may be a head-scratcher, considering that the iPhone seems to have eaten RIM’s BlackBerry for breakfast — and lunch. But with a marke value of $3.7 billion it is a relative bargain and could be had for four weeks’ worth of Apple’s spare cash).

Such a deal would instantly put Apple into the enterprise market, giving it access to corporate and government customers that require RIM’s highly secure servers. Apple could build access into RIM’s network directly into future iPhones and maybe even create an iPhone with BlackBerry’s famous keyboard, which for many of us would create the ultimate smartphone.

3) SPRINT Yes, the phone company. This might seem the most out-there idea. But it solves many of Apple’s biggest problems.

Such a deal would give Apple its own wireless network, which it could upgrade to become the ultimate high-speed wireless carrier in the country. It could eventually use the network to bypass the cable operators to deliver content directly to the home on multiple devices, including the product that everyone speculates is on its way: a TV device.

With a stock market value of $13.5 billion, Sprint can be purchased for a song. Apple could easily spend four times more than that — say, $50 billion — to build out the Sprint network and turn it into a showcase for the next generation mobile technology. Apple could still offer its devices on other carriers, but its premium product would exist on its own network.

All good ideas. But the best one offered is Twitter.

A Brief History of Toilet Paper

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A brief history of toilet paper, from The Frailest Thing blog:

Toilet paper, in case you’re wondering, was in use  in China as early as the fourteenth century and it was made in 2′ x 3′ sheets. Everywhere else, and in China before then, people made use of what their environment offered. Leaves, mussel shells, corncobs were among the more common options. The Romans (what have they ever done for us!) used a sponge attached to the end of a stick and dipped in salt water. And yes, as you may have heard, in certain cultures the left hand was employed in the task of scatological hygiene, and in these cultures the left hand retains a certain stigma to this day.

Until the late-nineteenth century, Americans opted for discarded reading material. It’s not clear if this is why Americans still today often take reading material into the bathroom, or if the practice of reading on the toilet yielded a eureka moment subsequently. In any case, magazines, newspapers, and almanacs were all precursors to the toilet paper as we know it today. It has been claimed that the Sears and Roebuck catalog was also known as the  ”Rears and Sorebutt” catalog. The Farmer’s Almanac even came with a hole punched in it so that it could be hung and the pages torn off with ease.

Toilet paper in its present form first appeared in 1857 thanks to Joseph Gayetty. It was thoughtfully moistened with aloe. In 1879, the Scott Paper Company was founded by brothers Edward and Clarence Scott. They sold toilet paper in an unperforated role. By 1885, perforated roles were being sold by Albany Perforated Wrapping Paper Company.

In 1935, Northern Tissue advertised its toilet paper to be “splinter-free.” Apparently, early production techniques managed to embed splinters in the paper. Three cheers for innovation! And finally, in 1942, two-ply toilet paper was introduced in St. Andrew’s Paper Mill in the UK. An odd development considering wartime austerity and rationing. Speaking of rationing, the Virtual Toilet Paper Museum (you’re learning all sorts of things in this post) reports that the first toilet paper shortage in the US took place in 1973. Presumably, it was overshadowed by the oil embargo.

Very interesting.

Which Countries Invented the Various Olympic Events?

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The Wall Street Journal has an interesting article “Why Are You So Bad At the Sport You Invented?” profiling the respective countries which lay the claim to have invented the various Olympic sports.

You probably knew that the marathon has its roots in Greece. But did you know that Iraq invented boxing, Egypt invented archery and fencing, Mongolia invented field hockey, France invented the triathlon, Great Britain invented the shot put and water polo, Japan invented swimming, and Germany invented diving? I didn’t.

Here’s how the WSJ referenced the invention of the various Olympic sports:

The countries were assigned case-by-case based on the circumstance which meant most to the development of the modern sport. Some countries were designated due to that place having created the modern version of the sport, like Germany’s claim of diving—something they originally liked to call “fancy diving.” Others were assigned because countries created a device that essentially birthed a sport, like Canada and the canoe. Some were awarded for having created an earlier version of a modern sport, like China’s claim to soccer or Mongolia’s claim of field hockey. And other sports were awarded to countries who were the first to hold documented competitions, like Japan and swimming.

And as for the results:

By this simple methodology, the most inexcusably horrible country at a sport they claim is Iraq. An Iraqi has never won one of the 841 total Olympic boxing medals despite their claim of boxing as the Ancient Sumerians created carvings depicting boxers in 3000 BC. Egypt and Ireland have similar calamities based on ineptitude in sports they devised in ancient times. Greece has managed to medal at least once in every sport they claim via the Ancient Games, eight in total. If you’re Greek flaunt your heritage in the discus. Don’t watch freestyle wrestling.

This interactive graphic provides the summary and is a must-see.