On Hope and Numbers

We try to provide hope, but not false hope.

So we give ranges, starting with the best estimate of survival, because my patients have told me they shut down after they hear the worst estimate. We talk about setting goals, about maximizing quality of life, because we don’t have much leverage with quantity of life. We emphasize spending as much time as possible with family and friends, and as little time as possible with people wearing white coats. We tell them we’re not going to give up if they don’t give up.

But the truth is, we don’t know.

–Dr. Mikkael Sekeres, director of the leukemia program at the Cleveland Clinic, on hope and numbers in this New York Times post. Powerful.

Amazon as a Charitable Organization

Following the dismal 4th quarter earnings announcements by Amazon, detailed below, Amazon’s share price shot up by more than 10%.

  • Q4 revenue of $21.27 billion missed expectations of $22.23 billion
  • Q1 EPS of $0.21 missed expectations of $0.27;
  • The firm guided top-line lower, seeing Q1 sales of $15-$16 billion, below the estimate of $16.5 billion
  • The firm guided operating income much lower, seeing Q1 op income of ($285)-$65 Million on expectations of $261.4 MM
  • The firm said the its physical books sales had the lowest growth in 17 years
  • Total employees grew by 7,000 in the quarter and 32,200 Y/Y to a record 88,400
  • Worldwide net sales Y/Y growth was the slowest in years at 23%, down from 30% in Q3 and 34% a year ago
  • And, last and certainly least, LTM Net Income is now officially negative, or ($49) meaning as of this moment the firm with the idiotically high PE has an even more idiotic N/M PE.

The question is why? Matthew Yglesias has a great thought: Amazon is a charitable organization. To wit:

The company’s shares are down a bit today, but the company’s stock is taking a much less catastrophic plunge in already-meager profits than Apple, whose stock plunged simply because its Q4 profits increased at an unexpectedly slow rate. That’s because Amazon, as best I can tell, is a charitable organization being run by elements of the investment community for the benefit of consumers. The shareholders put up the equity, and instead of owning a claim on a steady stream of fat profits, they get a claim on a mighty engine of consumer surplus. Amazon sells things to people at prices that seem impossible because it actually is impossible to make money that way. And the competitive pressure of needing to square off against Amazon cuts profit margins at other companies, thus benefiting people who don’t even buy anything from Amazon.

It’s a truly remarkable American success story. But if you own a competing firm, you should be terrified. Competition is always scary, but competition against a juggernaut that seems to have permission from its shareholders to not turn any profits is really frightening.

Sometimes (often) the markets are a fool’s game.

Seth Godin: Get Over Yourself

In the wake of Sandy’s devastation, Seth Godin offers:

In the face of billions of dollars of destruction, of the loss of life, of families disrupted, it’s easy to wonder what we were so hung up on just a few days ago. Many just went face to face with an epic natural disaster, and millions are still recovering. Writer’s block or a delayed shipment or an unreturned phone call seem sort of trivial now.

We’re good at creating drama, at avoiding emotional labor and most of all, at thinking small. Maybe we don’t need another meeting, a longer coffee break or another hour whittling away at our stuckness.

There’s never been a better opportunity to step up and make an impact, while we’ve got the chance. This generation, this decade, right now, there are more opportunities to connect and do art than ever before. Maybe even today.

It’s pretty easy to decide to roll with the punches, to look at the enormity of natural disaster and choose to hunker down and do less. It’s more important than ever, I think, to persist and make a dent in the universe instead.

We’ve all been offered access to so many tools, so many valuable connections, so many committed people. What an opportunity.

How will you take advantage of this opportunity?

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Here is my review of Seth Godin’s Linchpin, which is perhaps the best book he’s written.

Michael Crichton Explains The Gell-Mann Amnesia Effect

The Gell-Mann Amnesia effect has shown up in my timeline today. I had no idea what it meant, but now I know:

Briefly stated, the Gell-Mann Amnesia effect is as follows. You open the newspaper to an article on some subject you know well. In Murray’s case, physics. In mine, show business. You read the article and see the journalist has absolutely no understanding of either the facts or the issues. Often, the article is so wrong it actually presents the story backward—reversing cause and effect. I call these the “wet streets cause rain” stories. Paper’s full of them.

In any case, you read with exasperation or amusement the multiple errors in a story, and then turn the page to national or international affairs, and read as if the rest of the newspaper was somehow more accurate about Palestine than the baloney you just read. You turn the page, and forget what you know.

That’s Michael Crichton’s explanation.

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(via Paul Kedrosky)

Moneyball and What Makes People “Go Batshit Crazy”

I watched Moneyball last night. I read Michael Lewis’s book several years, and it’s still one of the best sports books I’ve ever read. I thought the movie wouldn’t have anything new to offer. Boy, was I wrong.

You don’t need to know about OBP, WHIP, or OPS to get caught up in this drama. Moneyball is a classic underdog story that just happens to have baseball as its backdrop. There are too many excellent quotes in the film, but I wanted to highlight just one. It happens near the end of the movie, when Billy Beane (played by Brad Pitt), the general manager of the Oakland A’s, travels to Boston. While at Fenway Park, Beane is propositioned by John Henry, the principal owner of the Red Sox. Here’s what Henry tells Beane:

For forty-one million, you built a playoff team. You lost Damon, Giambi, Isringhausen, Pena and you won more games without them than you did with them. You won the exact same number of games that the Yankees won, but the Yankees spent one point four million per win and you paid two hundred and sixty thousand. I know you’ve taken it in the teeth out there, but the first guy through the wall. It always gets bloody, always. It’s the threat of not just the way of doing business, but in their minds it’s threatening the game. But really what it’s threatening is their livelihoods, it’s threatening their jobs, it’s threatening the way that they do things. And every time that happens, whether it’s the government or a way of doing business or whatever it is, the people are holding the reins, have their hands on the switch. They go batshit crazy. I mean, anybody who’s not building a team right and rebuilding it using your model, they’re dinosaurs. They’ll be sitting on their ass on the sofa in October, watching the Boston Red Sox win the World Series. 

That’s what I call a money quote.

Parul Sehgal on the Power of Books and Reading Rapaciously

In honor of the National Book Festival last weekend, The Big Reads blog asked literary critic Parul Sehgal to reflect on the power of books in her life. An editor at The New York Times Book Review, Ms. Sehgal previously worked as the books editor at NPR.org, and as a senior editor at Publishers Weekly. It’s a short column, and these were two of my favorite quotes:

Some of us read rapaciously and with mysterious agendas of our own. And I’d hazard that the more we—or our communities—have been disenfranchised or humiliated, the harder we’ll read when we come to books. Because we’re not just reading, are we? We’re spying. We’re reading ourselves into societies and narratives that have excluded us. We’re trying to get inside your head.

Also, this:

We read first for distraction then consolation then for company. And finally to be worthy of the company we kept.

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(hat tip: Andrew Sullivan)

Ray Bradbury on Optimism

INTERVIEWER: How important has your sense of optimism been to your career?

BRADBURY: I don’t believe in optimism. I believe in optimal behavior. That’s a different thing. If you behave every day of your life to the top of your genetics, what can you do? Test it. Find out. You don’t know—you haven’t done it yet. You must live life at the top of your voice! At the top of your lungs shout and listen to the echoes. I learned a lesson years ago. I had some wonderful Swedish meatballs at my mother’s table with my dad and my brother and when I finished I pushed back from the table and said, God! That was beautiful. And my brother said, No, it was good. See the difference? Action is hope.

At the end of each day, when you’ve done your work, you lie there and think, Well, I’ll be damned, I did this today. It doesn’t matter how good it is, or how bad—you did it. At the end of the week you’ll have a certain amount of accumulation. At the end of a year, you look back and say, I’ll be damned, it’s been a good year.

That’s from this fantastic Paris Review interview.

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(via Swiss Miss & explore)

Seth Godin on Initiative and Starting Out

Seth Godin offers this piece of advice on initiative and starting out in this The Great Discontent interview:

There’s a picture that I just saw online two days ago… It’s a picture of someone graduating from college. You can’t tell, but you can guess that they’re probably $150,000 in debt. Written on the top of their mortarboard with masking tape it says, “Hire me.” The thing about the picture that’s pathetic, beyond the notion that you need to spam the audience at graduation with a note saying you’re looking for a job, is that you went $150,000 in debt and spent four years of your life so someone else could pick you. That’s ridiculous. It really makes me sad to see that. The opportunity of a lifetime is to pick yourself. Quit waiting to get picked; quit waiting for someone to give you permission; quit waiting for someone to say you are officially qualified and pick yourself. It doesn’t mean you have to be an entrepreneur or a freelancer, but it does mean you stand up and say, “I have something to say. I know how to do something. I’m doing it. If you want me to do it with you, raise your hand.”

The entire interview is excellent.

I am a big fan of Seth Godin’s books, especially Linchpin, which I reviewed here.

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(hat tip: Tina Ross Eisenberg)

Remembering Gore Vidal Through His Quotes

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.

Nora Ephron on Reading

Reading is everything. Reading makes me feel like I’ve accomplished something, learned something, become a better person. Reading makes me smarter. Reading gives me something to talk about later on. Reading is the unbelievably healthy way my attention deficit disorder medicates itself. Reading is escape, and the opposite of escape; it’s a way to make contact with reality after a day of making things up, and it’s a way of making contact with someone else’s imagination after a day that’s all too real. Reading is grist. Reading is bliss.

That’s Nora Ephron writing in I Feel Bad About My Neck: And Other Thoughts on Being a Woman. She died last night at the age of 71 in Manhattan.

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(via Brain Pickings)