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Financial Bombshell of the Day

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The details unveiled in the Bloomberg Markets Magazine piece “Secret Fed Loans Gave Banks Undisclosed $13B” are stunning. And here we thought we knew everything we knew about the 2007-2008 financial crisis. Think again:

The Federal Reserve and the big banks fought for more than two years to keep details of the largest bailout in U.S. history a secret. Now, the rest of the world can see what it was missing.

The Fed didn’t tell anyone which banks were in trouble so deep they required a combined $1.2 trillion on Dec. 5, 2008, their single neediest day. Bankers didn’t mention that they took tens of billions of dollars in emergency loans at the same time they were assuring investors their firms were healthy. And no one calculated until now that banks reaped an estimated $13 billion of income by taking advantage of the Fed’s below-market rates, Bloomberg Markets magazine reports in its January issue.

Saved by the bailout, bankers lobbied against government regulations, a job made easier by the Fed, which never disclosed the details of the rescue to lawmakers even as Congress doled out more money and debated new rules aimed at preventing the next collapse.

This statistic is just astonishing (half the value of U.S. GDP!):

The amount of money the central bank parceled out was…dwarfed the Treasury Department’s better-known $700 billion Troubled Asset Relief Program, or TARP. Add up guarantees and lending limits, and the Fed had committed $7.77 trillion as of March 2009 to rescuing the financial system, more than half the value of everything produced in the U.S. that year.

There’s a lot more quotable material here, so I suggest you read the whole thing…

The Sad Story of the Bulldog

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Tomorrow, the University of Georgia Bulldogs face off against the Georgia Tech Yellow Jackets in the annual “Clean Old Fashioned Hate” football game. But it’s the animal that will be present at the sideline which has caught my attention: the mascot of UGA, a bulldog named Uga.

In a very strong piece in The New York Times, “Can The Bulldog Be Saved?,” we learn about the bulldog’s history, how its bred, and the host of diseases that the bulldog succumbs to. What humans desire in the bulldog, such as its squashed face, is a trait that can be passed down from generation to generation through selective breeding. But if you read the piece, you’ll tend to agree that “it is the most extreme example of genetic manipulation in the dog-breeding world that results in congenital and hereditary problems.” A few quotes from the piece below.

Bulldogs are more prone to diseases than other dog breeds:

Bulldogs are significantly more likely than other dogs to suffer from a wide range of health issues, including ear and eye problems, skin infections, respiratory issues, immunological and neurological problems and locomotor challenges. 

It is worthwhile to note how the British Kennel Club and its American counterpart, the Bulldog Club of America, differ on the bulldog standard:

The British Kennel Club announced that it was revising the bulldog standard (a written template for the look and temperament of a breed) in an effort to make bulldogs sleeker and healthier. The new bulldog standard in England calls for a “relatively” short face, a slightly smaller head and less-pronounced facial wrinkling.

But the Bulldog Club of America (B.C.A.), which owns the copyright to the American standard, says it has no plans to follow suit. The American standard still calls for the breed to have a “massive, short-faced head,” a “heavy, thick-set, low-swung body,” a “very short” face and muzzle and a “massive” and “undershot” jaw.

An interesting note on how Uga VII served his mascot duties:

Uga VII didn’t appear to relish his mascot duties. Unlike his father, Uga VI, who was loud and boisterous and enjoyed chasing after the school’s costumed bulldog mascot, Hairy Dawg, Uga VII seemed most comfortable in the back corner of his doghouse — or, better yet, outside the stadium entirely. A few minutes before halftime, Seiler’s adult son, Charles, led the dog off the field by a leash to a waiting golf cart. Uga VII hopped on, and a young woman drove us out the stadium’s back service entrance, up a hill, around some bends to an unspectacular patch of grass that doubles as the dog’s game-day bathroom. When the cart came to a stop, Uga VII bounded off it and spent the next few minutes happily sniffing the grass, urinating on a tree and defecating behind a bush.

An analogy of how humans would breathe if they were bulldogs:

Dr. John Lewis, an assistant professor of dentistry and oral surgery at Ryan Veterinary Hospital of the University of Pennsylvania, says the human equivalent to breathing the way some bulldogs do “would be if we walked around with our mouth or nose closed and breathed through a straw.”

A trivia about the bulldog’s showing at the Westminster dog show:

The last time a bulldog won best in show at Westminster was 1955, and it has been nearly 30 years since a bulldog made it out of the group competition, which pits it against other nonsporting yet decidedly higher-brow breeds — including what may be the bulldog’s aesthetic opposite, the poodle.

A brief history of the bulldog and the author’s observations about how hard it is to judge a healthy bulldog:

It was my first time at a bulldog show, and I had a hard time differentiating the champion dogs from the inexperienced newcomers — or the hopelessly outmatched. Some of the more than 60 bulldogs in attendance appeared to move around the show ring better than others, which several show breeders confirmed to me was something that most judges value. (The bulldog standard in America calls for a bulldog’s gait to be “unrestrained, free and vigorous” but concedes that the breed’s “style and carriage are peculiar.”) While I discounted several dogs for appearing overweight, the judge chose one of the larger bulldogs (Brix) as her winner and told me after the competition that she likes bulldogs to be “big and sturdy.”

What was clear to me while watching these bulldogs compete was that none could have succeeded at the breed’s original purpose. Bulldogs get their name from their role in bull-baiting, arguably the most popular sport of the Elizabethan era. Though the genetic origin of the bulldog is debated, most believe that bull-baiting dogs of that era were descended from a mastiff-type dog. Fighting bulldogs were leaner and higher off the ground than bulldogs today, and their muzzles were longer. They had smaller heads, fewer facial rolls and a long tail. As a respected bulldog breeder conceded to me at the B.C.A. show, “Bulldogs today are not even a figment of what they used to be.”

It’s a fascinating piece, and well worth reading. The author, Benoit Denizet-Lewis, has spent at least a year compiling facts for this article, as his personal stories of visit to Sanford Stadium (on the campus of University of Georgia) attest.

A Chess Game at Zuccotti Park

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I enjoyed this short McSweeney’s piece about a chess game at Zuccotti Park:

Despite my hustle alert level being on high, I still agreed to play James for five dollars. I wasn’t in any mood to quit playing, especially if quitting meant I had to join the debate that was going on near the chess table between some “end the fed” guys and a couple of central-casting Bard students over whether or not Obama was to blame for the economic crisis.

The game was uneventful except that neither of us was in the mood to let the other one take moves back anymore. We stayed friendly and jocular over the board, but on the board it was all business. I opened with the Queen’s Gambit, he declined. “A little rusty” my ass. We played a fairly even game and ended in a draw. He seemed disappointed. One of the Bard students asked if we were done and if he could get next.

“We are playing best-of-three.” James looked at me and winked.

Now my hustle alert level was at severe. I figure James just got me for ten dollars. I briefly contemplated just paying him the money right then and there, I was so sure I didn’t stand a chance. We set the pieces up and played on. The Bard student returned to help his comrades win their political debate against the Ron Paul guys.

There are all kinds of seemingly divergent viewpoints here in Zuccotti Park waiting to be arrested. There are libertarians and there are socialists; there are 9-11 “truther” idiots and there are World Trade Center first responders; there are Democrats and there are Republicans; there are anarchists who hate the state and there are public sector unionists who work for it.

My favorite part is the analogy of zugzwang (pronounced ˈtsuːktsvaŋ), a chess term, to life in America and the Occupy protesters:

But the current position doesn’t look good for me. I’m ahead in material, but all of my pieces are committed to defending my king. I’m in zugzwang.

Zugzwang is a term used in chess to refer to a position where every move you have is a bad one. Once you’re in zugzwang, things like having more pieces than your opponent doesn’t matter anymore. If you can’t use them to attack you may as well not have them at all. Often players who find themselves in zugzwang simply resign.

A growing number of people in America know what it feels like to be in zugzwang. For some of them their whole life has been one long zugzwang, they can’t remember ever having any good options. Without catching a lucky break, a lifetime of hard work for most people results in just that—a lifetime of hard work. For others they maybe once thought they had it all—a good job with a pension, a nice house with a payment they could afford, set for life. Then in an instant it all disappeared. House is underwater, ARM is popping on the loan, pension fund bought a bunch of mortgage-backed securities. All that’s left is utter, hopeless zugzwang.

How does it end?

The Origin of Occupy Wall Street

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A good piece in The New Yorker describes the origin of the Occupy Wall Street movement. It began after conversation between Kalle Lasn, a 69-year old editor of Adbusters magazine, and Micah White, the magazine’s senior editor and Lasn’s closest collaborator.

This is how Occupy Wall Street began: as one of many half-formed plans circulating through conversations between Lasn and White, who lives in Berkeley and has not seen Lasn in person for more than four years. Neither can recall who first had the idea of trying to take over lower Manhattan. In early June, Adbusterssent an e-mail to subscribers stating that “America needs its own Tahrir.” The next day, White wrote to Lasn that he was “very excited about the Occupy Wall Street meme. . . . I think we should make this happen.” He proposed three possible Web sites: OccupyWallStreet.org, AcampadaWallStreet.org, and TakeWallStreet.org.

So what other causes has Adbusters been behind?

This spring, the magazine was pushing boycotts of Starbucks (for driving out local businesses) and the Huffington Post (for exploiting citizen journalists). Then, in early June, the art department designed a poster showing a ballerina poised on the “Charging Bull” sculpture, near Wall Street. Lasn had thought of the image late at night while walking his German shepherd, Taka: “the juxtaposition of the capitalist dynamism of the bull,” he remembers, “with the Zen stillness of the ballerina.” In the background, protesters were emerging from a cloud of tear gas. The violence had a highly aestheticized, dreamlike quality—Adbusters’ signature. “What is our one demand?” the poster asked. “Occupy Wall Street. Bring tent.”

As you may know, the #Occupy movement began on September 17. How was the date picked?

White and Lasn spent a few days in early July debating when the occupation should start. At first, White argued that it should begin on July 4, 2012, so that protesters would have time to prepare. Lasn believed that the political climate could have shifted entirely by then. He proposed late September of this year; then he settled on the seventeenth, his mother’s birthday. White agreed. Lasn instructed the art department to insert “September 17th” beneath the bull and the ballerina, and Adbusters devoted a tactical-briefing e-mail on July 13th exclusively to the proposed occupation.

More here.

Modernist Cuisine, or the Art and Science of Cooking

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Earlier this year, Modernist Cuisine was published, much to the fanfare of those who love to cook (and design aficionados). With a list price of $625 (though you can buy it on Amazon for the bargain price of $450), this six-volume, 2,400 page set reveals the art and science of cooking.

Last month, one of the authors of the book, Nathan Myhrvold (CEO and a founder of Intellectual Ventures, a firm dedicated to creating and investing in inventions) sat down with Edge.org and explained the premise of the book, who would want to read it, and offered a few thoughts on the publishing industry.

Cooking obeys the laws of physics, in particular chemistry. Yet it is quite possible to cook without understanding it. You can cook better if you do understand what is going on, particularly if you want to deviate from the ways that people have cooked before. If you want to follow a recipe exactly, slavishly, what the hell, you can do it without understanding it. As a rote automaton, you can say, “yes, I mixed this, I cook at this temperature” and so forth. But if you want to do something really different, if you want to go color outside the lines, if you want to go outside of the recipe, it helps if you have some intuition as to how things work.

For this book, we set out to describe the science of cooking — and do so in a very visual way. Other people like Harold McGee, in 1984, wrote a book called On Food and Cooking, which is a seminal work that started a whole trend of people explaining the science of cooking to both average people and chefs. Therefore we were not the first, but we decided that we would have a more visual description. We would first explain how traditional cooking actually works and then use that as a springboard to talk about more modern cooking techniques and how you can use them.

Not only have we written a book, but we have written a paper-based book — we don’t have an electronic edition. There are a couple of reasons for that. The first is that every task should have the best appropriate technology deployed behind it. If you want to deploy large, beautiful, high-resolution pictures to people in the world of cooking, there is no better platform in 2011 than a paper book.

This is an interesting perspective on the book. The mindset for publishing this book is similar to Steve Jobs’s thought process behind his products (When asked how much market research Apple did for the iPad, Jobs boldly answered: “None. It’s not the customers’ jobs to know what they want.”). Anyway, Myhrvold explains:

I’m not sure actually who is going to buy and read the book. We’ve created this without focus groups. There are two fundamental approaches you can take to designing a book or any product for that matter. You can run all kinds of focus groups and do market research and ask yourself, “what do people want?” There are a lot of very successful products that are made that way. Or you can say, “I’m going to follow my own curiosity and vision and make the book that I would love to have and hope someone agrees.” That is the algorithm that we took for this book.

On the remarkable effort to get this book completed:

At peak we had 36 people full time working on the book. We had about 18 for a period of 3.5 years overall. Now, that is wonderful and it has some issues. The wonderful part is that you benefit from everybody’s knowledge and you get pushed in ways that you wouldn’t have gotten pushed otherwise. There are lot of things where I would have said, “oh, forget it, we don’t need to do that,” but somebody else got excited about it and by the time I realized it, we had already done it.

The bad part is you have to negotiate things. You have to make decisions as a team. Somebody has to be Solomon and cut the baby sometimes and say, yes, that is enough. You may think that we didn’t have very many “No” decisions given that we have 2,400 pages. But in fact there was a ton of stuff we left out because I didn’t want to have 24,000 pages. Running a book project as a team is unusual and of course, it’s unheard of for novels.

On comparing publishing to various restaurants:

Producing the book is different. The world of publishing has been so oriented around inexpensive books, which is wonderful in many ways. It’s great that the world is focused on cheap things that you can sell to lots of people. But image a world of restaurants where the only restaurants were chain restaurants that were in malls, where Ruth’s Chris was the most high-end restaurant in the country? Not that Ruth’s Chris is bad. I go there and it’s a great thing. But Ruth’s Chris and PF Chang’s are not the sum total of the restaurant world.

But publishing executives want their books to be at best Ruth’s Chris. In fact, they would really prefer the Cheesecake Factory. So cookbooks are all made to be the Cheesecake Factory of restaurants. The Cheesecake Factory is great, I am not denigrating it. But it is wonderful that there is an El Bulli, that there is a Per Se, there is a Le Bernardin, a Daniel, that there’s a Momofuku, that there’s a variety of restaurants that in their own way, some very high end, some not particular expensive or high end, but it’s that cultural richness that makes the world of food fantastic.

I haven’t bought the book (nor can I afford to), but I find the purpose behind this book fascinating. Do read the whole conversation at Edge.org.

Why Are American Universities Failing?

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There’s no easy answer. Unmotivated students. High student debt. Too much emphasis on athletics versus academics. Declining emphasis on teaching (versus doing research). And so on. In this post in New York Review of Books, Anthony Grafton cites eight different sources (books and papers) and provides some clues:

Vast numbers of students come to university with no particular interest in their courses and no sense of how these might prepare them for future careers. The desire they cherish, Arum and Roksa write, is to act out “cultural scripts of college life depicted in popular movies such as Animal House(1978) and National Lampoon’s Van Wilder (2002).” Academic studies don’t loom large on their mental maps of the university. Even at the elite University of California, students report that on average they spend “twelve hours [a week] socializing with friends, eleven hours using computers for fun, six hours watching television, six hours exercising, five hours on hobbies”—and thirteen hours a week studying.

For most of them, in the end, what the university offers is not skills or knowledge but credentials: a diploma that signals employability and basic work discipline. Those who manage to learn a lot often—though happily not always—come from highly educated families and attend highly selective colleges and universities. They are already members of an economic and cultural elite. Our great, democratic university system has become a pillar of social stability—a broken community many of whose members drift through, learning little, only to return to the economic and social box that they were born into.

This paragraph sounds more depressing than what my first year in college was actually like (there was no Facebook yet):

Is the higher education bubble about to pop? I don’t know. The more thoughtful writers warn against monocausal explanations. Bowen and his colleagues, for example, test the effects of student loans on attrition rates. They conclude that it is not clear that debt is a primary cause of student failure. Still, these developments are interwoven, in the experience of many students if not in the intentions of legislators. Imagine what it’s like to be a normal student nowadays. You did well—even very well—in high school. But you arrive at university with little experience in research and writing and little sense of what your classes have to do with your life plans. You start your first year deep in debt, with more in prospect. You work at Target or a fast-food outlet to pay for your living expenses. You live in a vast, shabby dorm or a huge, flimsy off-campus apartment complex, where your single with bath provides both privacy and isolation. And you see professors from a great distance, in space as well as culture: from the back of a vast dark auditorium, full of your peers checking Facebook on their laptops.

The summarizing piece is worth reading. I just wish the author made some effort to break down graduation rates, debt levels, etc. by public/private universities, household income, and race.

How to Buy a Used or New Car: Confessions of a Car Salesman

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How did the car business get so screwed up? There’s nothing else in our society that is sold with the consumer so conspicuously unprepared.

And it’s true. Car buying is one of the most stressful consumer experiences. But it doesn’t have to be this way. After reading this extensive piece on Edmunds.com, I learned more about the business than I’ve ever had before. The author of the piece was a writer for Edmunds who went working undercover at two dealerships: a high-volume, high-pressure dealership and a no-haggle dealership:

The editor explained that they wanted me to write a series of articles describing the business from the inside. Of course I would learn the tricks of the trade, and that would better prepare me to write advice for Edmunds.com. But the benefits of the project would be greater than just information. I would live the life of a car salesman for three months. That would give me an insight and perspective that couldn’t be gained by reading books or articles or interviewing former car salesmen.

What he learned over those three months is incredible:

So, you think I’m romanticizing car salesmen? Trying to clean them up and excuse their evil ways? And, you might ask, if the salesmen aren’t the bad guys, who is?

Having been a salesman myself, I began to view the managers and dealership owners as the real culprits. While salesmen play people games with the customer, the guys in the tower work the numbers with computers, their eyes fixed on the bottom line. They can see at a glance what kind of profit they are taking from the customer and they do it any way. Furthermore, they bully the sales staff, encouraging them to manipulate, control and intimidate customers while they take the lion’s share of the profit.

Sometimes, the profit a salesman generates is not even pocketed by them. One salesman told me the F&I people can work their magic to rob a salesman of his commission. They move front-end profit to the back end where it evaporates from the salesman’s voucher and returns, over the years, to the dealer in the form of high interest and steady payouts.

There’s so much gold in the piece, but I picked out the highlights below. The piece is broken into nine parts: 1) Going Undercover, 2) Getting Hired, 3) Meeting, Greeting and Dealing, 4) Life on the Lot, 5) A Tale of Two Deals 6) Learning from the Pros, 7) No-Haggle Selling, 8) Parting Shots, and 9) Lessons from the Lot. The whole piece reads like a mini-novel, but if you’re in a hurry, at least check out the last section, in which the author provides specific recommendations on what you can do to get the best deal on a used or new car:

Concept 3: Profit Equals Commission

I never really thought of this until I sold cars but… Car salespeople earn their living by inflating the price of the car you are buying. The more they inflate the price, the bigger their commission. This might seem very obvious, but we tend to lose sight of it when the smiling salesperson greets us on the car lot. They make us think they have our best interests in mind. The good salespeople do have our interests in mind. The unscrupulous salespeople are thinking how your purchase increases their commission. One of the dealerships I worked at had a sliding scale for commissions. The higher the profit, the higher the commission. Naturally, the salespeople tried to hit that point where the commission was bumped to the higher percentage. That might mean moving you into a higher level vehicle. It might mean increasing the profit by financing sleight of hand. In both cases, this smiling salesperson, with the personable air, didn’t have your best interests in mind. I believe in paying a dealer a profit for his car. I also believe in rewarding the salesperson for their expert help. But I don’t think this justifies making an unfair profit at my expense.

On humor being an effective way to get closer to the customer:

Many salespeople find that humor is a good way to overcome objections. If a customer says they’re “only looking,” the salesperson might answer, “Last time I was only looking I wound up married.” If a customer objects to being hurried into buying the car, the salesperson might say, “The only pressure on this lot is in the tires.” These prepackaged lines were exchanged between car salesmen in the slow times with the feeling that the right joke at the right moment could be the ticket to a sale.

The most interesting parts of the piece, to me, were the psychological lessons that they were taught as salespeople. For example:

At one point, during a sales seminar, I was actually taught how to shake hands. The instructor, a veteran car salesman said: “Thumb to thumb. Pump one, two, three, and out.” Another vet told me to combine the handshake with a slight pulling motion. This is the beginning of your control over the customer. This would prepare the “up” to be moved into the dealership where the negotiation would begin. The car lot handshake is sometimes combined with the confident demand, “Follow me!” If you employ this method you turn and begin walking into the dealership. Do not look back to see if they are following you. Most people feel the obligation to do what they are told and they will follow you, if only to plead, “But I’m only looking!”

The author made a strong point that the salesman wasn’t the customer’s enemy; rather, the enemy was the person who the customer doesn’t see (the manager). This is a key takeaway, I think:

What the customer didn’t realize was that the poor car salesman or woman was not really the enemy. The real enemy was the manager sitting in the sales tower cracking the whip. Suppose for a moment a customer told us they were “only looking,” and we said, “fine, take your time,” and went back into the sales tower. Now we find ourselves looking up into the steely eyes of the sales manager.

“That’s your customer out there,” the manager would say.

“But they said they’re only looking,” I would answer.

“Only looking? You’re going to take that for an answer?” Foam was beginning to form at the corners of the sales manager’s mouth. “What the hell kind of salesman are you? Of course they’re looking! They’re all only looking until they buy. You want them to go across the street and buy a car over there? Because they havereal salesmen over there. Now go back out there and sell those people a car. And don’t let them leave until they buy or until you turn them over to your closer.”

Again, this is a fascinating piece and well worth the read in its entirety. And while the piece is dated (circa 2001, when there weren’t as many people who realized that “The Internet is your friend”), there’s also an update for 2009.

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For the hat tip, I thank longform.org.

Questions for the reader: What has been your best/worst experience shopping for a used or new car? Feel free to share in the comments. Did you find any of the advice in the piece at Edmunds.com useful/interesting?

A Mission to Mars (on Earth)

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“Our main challenge right now is to avoid being bored. Every single day is very similar to the previous one.”

At the Institute for Biomedical Problems in Moscow, six men (three Russians, an Italian, a Frenchman, and a Chinese national) are finishing up a remarkable 520-day experiment in isolation. They are participants in a simulated mission to Mars about a “ship” dubbed Mars500.

Bill Donahue, the author of the Wired piece, had a chance to interact with the participants:

When I visited the institute last year…The voyagers were sealed off from terrestrial life, each one allotted a private bunk room just 32 feet square and access to a common living room, a small gym, a greenhouse, and two minuscule lavatories. The crew’s food storage room is almost as big as their living quarters, and when they entered isolation on June 3, 2010, it contained every single calorie they would consume as they soared through “space,” then spent nine days on “Mars” (in this case a small pit of red sand) before returning and exiting a year and a half later.

I did find the betting on who would quit the program a bit unsettling:

Isolation is hard; being deprived of fresh air and social variety makes you go batshit. That narrative is so ingrained in the collective psyche that when the Irish bookmaking chain Paddy Power set odds on Mars500, it all but anticipated failure. If a bettor wagered a dollar that the original six-member crew would not last the whole mission, he was, by Paddy’s lights, practically predicting the sun would rise tomorrow—he’d only get $1.20 back. Paddy, meanwhile, set 8-to-1 odds that at least one crew member would go “clinically insane” after leaving the Mars500 experiment. (Fairly long odds until you consider that most jobs don’t come with an 11 percent chance that you’ll go clinically insane in a year and a half.) The Irish bookie even set odds as to who’d be first to quit. It tapped the sole Chinese astronaut, Yue Wang, putting him at 2-1. (Yue was, after all, the most culturally isolated.)

And if you think everything is rosy aboard the Mars500, consider what has happened in a previous isolation experiment (in the year 2000):

The booze wasn’t the only contraband aboard that simulated space station run. The ship’s Russian cosmonauts regularly watched pornography, Kraft admitted, and one Japanese man, Masataka Umeda, left the mission two months early in protest. Meanwhile, there were cockroaches in the showers and mice crawling up through cracks in the floor.

The experiment sounds quite unpleasant, but these men are doing it for science!

Being aboard Mars500 is mostly menial and toilsome—the astronauts are glorified lab rats. Scientists are keeping close tabs on how the isolates’ hearts are coping with the stress of confinement. They are monitoring the microflora in the crew’s intestines, subjecting them to questionnaires on their interpersonal dramas, and hitting them with regular doses of blue light to gauge its effect on their psychological states. The regimen is at times exhausting. “The biggest challenge for me,” Charles wrote in one email, “is the width of my bed—60 centimeters. As soon as I have more than one device to wear during the night (for blood pressure tests, electrocardiograms, electroencephalograms, etc.), I can’t move.”

Haruki Murakami’s 1Q84 is His The Brothers Karamazov

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In an excellent New York Times Magazine piece on Haruki Murakami, Sam Anderson meets with the writer to talk about his latest book being released in the United States: 1Q84. I have pre-ordered it months ago from Amazon.com (you should too), and I can’t wait to read it.

Below, Anderson vividly describes the book and how 1Q84 is Murakami’s The Brothers Karamazov (I’ve read it when I was in high school):

For decades now, Murakami has been talking about working himself up to write what he calls a “comprehensive novel” — something on the scale of “The Brothers Karamazov,”one of his artistic touchstones. (He has read the book four times.) This seems to be what he has attempted with “1Q84”: a grand, third-person, all-encompassing meganovel. It is a book full of anger and violence and disaster and weird sex and strange new realities, a book that seems to want to hold all of Japan inside of it — a book that, even despite its occasional awkwardness (or maybe even because of that awkwardness), makes you marvel, reading it, at all the strange folds a single human brain can hold.

Reading the piece, you come to learn how humble Murakami is. The Little People are characters in 1Q84, and Anderson notes how the idea just came to Murakami:

“The Little People came suddenly,” he said. “I don’t know who they are. I don’t know what it means. I was a prisoner of the story. I had no choice. They came, and I described it. That is my work.”

And in case you’re wondering: do Murakami’s dreams resemble his novels?

I asked Murakami, whose work is so often dreamlike, if he himself has vivid dreams. He said he could never remember them — he wakes up and there’s just nothing. The only dream he remembers from the last couple of years, he said, is a recurring nightmare that sounds a lot like a Haruki Murakami story. In the dream, a shadowy, unknown figure is cooking him what he calls “weird food”: snake-meat tempura, caterpillar pie and (an instant classic of Japanese dream-cuisine) rice with tiny pandas in it. He doesn’t want to eat it, but in the dream world he feels compelled to. He wakes up just before he takes a bite.

This part about translation is fascinating, I think:

Murakami has consistently denied being influenced by Japanese writers; he even spoke, early in his career, about escaping “the curse of Japanese.” Instead, he formed his literary sensibilities as a teenager by obsessively reading Western novelists: the classic Europeans (Dostoyevsky, Stendhal, Dickens) but especially a cluster of 20th-century Americans whom he has read over and over throughout his life — Raymond Chandler, Truman Capote, F. Scott Fitzgerald, Richard Brautigan, Kurt Vonnegut. When Murakami sat down to write his first novel, he struggled until he came up with an unorthodox solution: he wrote the book’s opening in English, then translated it back into Japanese. This, he says, is how he found his voice. Murakami’s longstanding translator, Jay Rubin, told me that a distinctive feature of Murakami’s Japanese is that it often reads, in the original, as if it has been translated from English.

But as Anderson later notes, Murakami’s “entire oeuvre…is the act of translation dramatized.”

I am currently reading Murakami’s Dance Dance Dance. It might take me some time to finish reading 1Q84, as it’s over 900 pages (Murakami’s take on his book: “It’s so big…It’s like a telephone directory”). I’ve never been to Japan, but reading Murakami’s fiction makes me want to visit. But as you learn from Anderson’s piece, Murakami’s Japan is different from actual Japan in so many ways.

On a final note, do not miss the interactive feature that goes along with Anderson’s piece.

On Overconfidence and Cognitive Fallacy

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In this week’s New York Times Magazine, Daniel Kahneman, emeritus professor of psychology and of public affairs at Princeton University, writes about the hazards of overconfidence. His piece begins with an anecdote from his days in the Israeli army and then moves on to lambasting overconfidence of professional investors. A lot of the ideas here I was already familiar with, but I liked Kahneman’s conclusion:

We often interact with professionals who exercise their judgment with evident confidence, sometimes priding themselves on the power of their intuition. In a world rife with illusions of validity and skill, can we trust them? How do we distinguish the justified confidence of experts from the sincere overconfidence of professionals who do not know they are out of their depth? We can believe an expert who admits uncertainty but cannot take expressions of high confidence at face value. As I first learned on the obstacle field, people come up with coherent stories and confident predictions even when they know little or nothing. Overconfidence arises because people are often blind to their own blindness.

True intuitive expertise is learned from prolonged experience with good feedback on mistakes. You are probably an expert in guessing your spouse’s mood from one word on the telephone; chess players find a strong move in a single glance at a complex position; and true legends of instant diagnoses are common among physicians. To know whether you can trust a particular intuitive judgment, there are two questions you should ask: Is the environment in which the judgment is made sufficiently regular to enable predictions from the available evidence? The answer is yes for diagnosticians, no for stock pickers. Do the professionals have an adequate opportunity to learn the cues and the regularities? The answer here depends on the professionals’ experience and on the quality and speed with which they discover their mistakes. Anesthesiologists have a better chance to develop intuitions than radiologists do. Many of the professionals we encounter easily pass both tests, and their off-the-cuff judgments deserve to be taken seriously. In general, however, you should not take assertive and confident people at their own evaluation unless you have independent reason to believe that they know what they are talking about. Unfortunately, this advice is difficult to follow: overconfident professionals sincerely believe they have expertise, act as experts and look like experts. You will have to struggle to remind yourself that they may be in the grip of an illusion.

My only gripe: I believe overconfidence is even more systemic than Kahneman posits. I believe there are overconfident dentists, waitresses, accountants, and engineers. What about you?