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March 5, 2009

rePost : Personal Yearning : The Atlantic Online | March 2009 | How the Crash Will Reshape America | Richard Florida

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The University of Chicago economist and Nobel laureate Robert Lucas declared that the spillovers in knowledge that result from talent-clustering are the main cause of economic growth. Well-educated professionals and creative workers who live together in dense ecosystems, interacting directly, generate ideas and turn them into products and services faster than talented people in other places can. There is no evidence that globalization or the Internet has changed that. Indeed, as globalization has increased the financial return on innovation by widening the consumer market, the pull of innovative places, already dense with highly talented workers, has only grown stronger, creating a snowball effect. Talent-rich ecosystems are not easy to replicate, and to realize their full economic value, talented and ambitious people increasingly need to live within them.
The Atlantic Online | March 2009 | How the Crash Will Reshape America | Richard Florida.

March 5, 2009

rePost:Closed and Skeptical Minds : Musicians, drunks, and Oliver Cromwell — The Endeavour

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I forgot from what blog I got the advice but I remember distinctly an advice I got that said “be wary with people who say impossible” or something to that effect. I realize now after reading this post from chuck’s shared items what that really meant.
People who love or are in a habit of saying impossible is more probably of the closed/skeptical mind type, there is nothing wrong with being skeptical but there is for me something wrong with being close minded. When you are close minded you are living a life ruled by bias that you may or may no longer know how you came about having. When you live like this for a long time you end up with outdated/no longer true beliefs/ideas.
Why? This is because the world changes so fast and if you are not aware of a lot of the reason(like the previous post a lot of the evidence that influence our beliefs are somewhat invisible to us) you think/act a certain way you maybe doing something that is going against what you originally intended to do or achieve.
The take away in my view is three things:
-Try to journal what is influencing your thoughts.
-Constantly reexamine beliefs to understand if these beliefs/actions/habits are already outdated and should be stopped.
-Finally creating your own personal framework to make this as normal as breathing!

Dennis Lindley coined the term “Cromwell’s rule” for the advice that nothing should have zero prior probability unless it is logically impossible. The name comes from a statement by Oliver Cromwell addressed to the Church of Scotland:

I beseech you, in the bowels of Christ, think it possible that you may be mistaken.

In probabilistic terms, “think it possible that you may be mistaken” corresponds to “don’t give anything zero prior probability.” If an event has zero prior probability, it will have zero posterior probability, no matter how much evidence is collected. If an event has tiny but non-zero prior probability, enough evidence can eventually increase the posterior probability to a large value.
The difference between a small positive prior probability and a zero prior probability is the difference between a skeptical mind and a closed mind.
Musicians, drunks, and Oliver Cromwell — The Endeavour.

March 5, 2009

Learned Today: Disagreement : Overcoming Bias: Beware Ideal Screen Theories

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I honestly was blind sided by this. I find it tedious to explain myself to other people. I find it hard to understand why people don’t understand what I say. This is enlightening to me. The problem is with me, and not the person I am conversing with. I am aware of only a small fraction of the relevant evidence and analysis that influence my belief!

Disagreement – When someone disagrees with you, you should wonder what they know that you do not. They might explain their reasons for their differing belief, i.e., their evidence and analysis, and you might hear and ponder those reasons and yet find that you still disagree. In this case you might feel that the fact that they disagree no longer informs you on this topic; the reasons for their belief screen their belief from informing your belief. And yes, if they could give you all their reasons, that would be enough. But except in a few extremely formal contexts, this is not even remotely close to being true. We are usually only aware of a small fraction of the relevant evidence and analysis that influences our beliefs. Disagreement is problematic, even after you’ve exchanged reasons.
Overcoming Bias: Beware Ideal Screen Theories.

March 3, 2009

-No To Right Of Reply Bill-GMANews.TV – Media groups vow stiff defense against RORB – Nation – Official Website of GMA News and Public Affairs – Latest Philippine News – BETA

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The right of reply bil would like to ensure that the party referred to by a media report has a law defined right to air his side. Its all fine and good in theory but let’s analyze this in its proper context and we would realize that like libel it is another tool that powerful people use to suppress the truth and/or bullying by the media. Ordinary people like me do not have the resources to hire lawyers to try to sue people for libel or if this becomes law try to force media organizations to air my side. Generalizing this, although I have been extremely critical of the Philippine media, the toolset of powerful people in the Philippines would be the only one that is helped by this bill.

Media groups vow stiff defense against RORB
03/04/2009 | 09:02 AM
MANILA, Philippines – After failing to come to terms with lawmakers, media groups vowed Wednesday to stage a “man-to-man” defense against the passage of the Right of Reply Bill in Congress.
National Press Club president Benny Antiporda said they will not allow the passage of the RORB, which he likened to a “beautiful woman with AIDS.”
GMANews.TV – Media groups vow stiff defense against RORB – Nation – Official Website of GMA News and Public Affairs – Latest Philippine News – BETA.

March 3, 2009

Stumbling and Mumbling: The power of stereotypes

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This is sad to read. In the Philippines people are labeled early on because of close family ties, where 2nd or 3rd degree relatives see each other at least once a year. One thing I observe in these awkward situation is the way people give young kids labels that tend to be based on superficial reasons that then I believe sometimes become self fulfilling.

The power of stereotypes
Reputations can be self-fulfilling prophecies ; if you give a man a bad name, he‘ll live down to it. A new paper (pdf) by Thomas Dee shows this.
He did an experiment at Swarthmore College, asking a group of students to take a GRE test. Before the test, some students were asked about their sporting activities, and whether these conflicted with their academic work, whilst others were not asked.
And Mr Dee found that the athletes who were asked these questions performed significantly worse than the athletes who weren’t.
This suggests that when people are primed to be aware of a stereotype – “jocks are dumb” – they are more likely to behave in accordance with it.
Stumbling and Mumbling: The power of stereotypes.

March 3, 2009

-rePost-Recipe for Disaster: The Formula That Killed Wall Street

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Thanks to Paul Wilmott for the pointer here. I learned a lot from this article by Felix Salmon and its somewhat fun to read!

In the world of finance, too many quants see only the numbers before them and forget about the concrete reality the figures are supposed to represent. They think they can model just a few years’ worth of data and come up with probabilities for things that may happen only once every 10,000 years. Then people invest on the basis of those probabilities, without stopping to wonder whether the numbers make any sense at all.
As Li himself said of his own model: “The most dangerous part is when people believe everything coming out of it.”
Recipe for Disaster: The Formula That Killed Wall Street.

March 3, 2009

rePost:Vesess » The Second Age of SMEs

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Explains why the authors think that the present financial crisis is the start of the Second Age of SME’s. Excellent read.

Think small. Think efficient. Share the returns.
…
The point we’re trying to make, however, is that in an economic climate like this, only a SME could afford to offer such discounts, and that it is precisely this ability that will enable such businesses to flourish despite the problems we face. For the first time in years, small businesses have the ability to truly shine, and we’d love to hear how some of our fellow players are using small and efficient business practices to attract customers and grow, despite everything going on around them.
Vesess » The Second Age of SMEs.

March 3, 2009

-rePost-Book/Film Guessing Games-Grasping Reality with Both Hands: Amazon's Kindle and the Recovery of Readerly Naivete; or, Were-Bats–the Big Bug Scourge of the Skies!

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When I was in high school and for most parts of college I kept my watch handy at all times. The MTRCB approval was needed for any film shown commercially and it listed the total run time of the film. The combination of my watch/(and for two years a stopwatch) and the knowledge of the running time of the film has saved me from being naive about a film, if their were any surprise twist left etc. The bad thing about this is that I began to be less emotionally involved with the film I was watching; When I was bringing stopwatches/watches to theaters I was always checking it to see how the pace was going, the action to chatter ratio. The exposition versus the confrontation ratio and other minutae that was although nice to discuss with other film lovers was mainly an exercise in film intellectual stimulation. When I discovered Roger Egbert’s online reviews I was mainly entraced by his love for film, it seemed he had different levels of looking at films. As a film critic, as a film lover, as a lover of stories , and a lover of emotions. I began to see that in trying to one-up other people’s/stranger’s/friend’s observation skills and views I lost that connection to that part of me that just wanted to be escapist and enjoyed a film, whether the lighting/camera work is not as good as it could have been or how smart a film is. I got this back by only being conscious of the time whenever I watch a movie for the second time. I haven’t used a Kindle and I suspect that as long as we (Philippine Consumers) are forced to jump through so many hoops to get a kindle I won’t be using one anytime soon, but I think that it would really improve my naivete !

In a normal book, an author cannot have the antagonist fall with an ensorcelled death-sword in its belly with one-third of the pages left to go and expect the reader to be surprised at what comes next. The thickness of the pages beneath one’s right hand scream: “THAT’S NOT THE ANTAGONIST, SCHMUCK!!!”
Reading it on the Kindle–the sudden appearance of the were-bats has an extra punch that it cannot have in the hard copy…
Grasping Reality with Both Hands: Amazon’s Kindle and the Recovery of Readerly Naivete; or, Were-Bats–the Big Bug Scourge of the Skies!.

March 3, 2009

rePost: Excellent Ranty Advice from Paul Wilmott:Paul Wilmott's Blog: Copulas and Cults

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Can’t say I blame him. People generally hate being different in a real way. The way I observe things, it seems most people just want to stand-out in the center of attention kind of way and not in the different trailblazing kind of way that I admire!
What you think of as just you job consumes probably from 2-10 hours of a 24 hour day. If you add in all the stuff you do because of work like commuting/preparing reports outside office hours/even shopping for office clothes/stuff etc . You can’t deny that what you call as just your job consists of the majority of your usable waking hours.
We need to take charge of our lives and have pride in what we do, and as human beings we have the capacity to think and analyze complex stuff. Why are we not doing exactly that?
As for the picture, for somer strange reason Zemanta thinks it’s relevant!

But that’s only part of the problem. Far more serious, because it extends to all of finance not just to a single model, is the poor education that people get in university financial engineering programs and also the blind-following-the-blind behaviour that is so common throughout the industry.
The copula model is not robust to changes in model assumptions. Black-Scholes is. Did you know that? Or maybe I’m wrong. Would you like to know the truth?
Yes, I could tell you. I could spoonfeed you. You’ve got used to being spoonfed, haven’t you? But you’re passing the buck there, putting an awful lot of responsibility on my shoulders. I can cope, as I’m sure David Li can cope. But you’re a big boy/girl now, you should be able to think for yourself. Isn’t that part of your job description?
It’s getting quite tedious me telling people to get off their backsides and test the models for themselves. Don’t believe anything I say, don’t believe anything Nassim, also quoted in the Salmon article, says. Question everything. Switch your brains back on.
Paul Wilmott’s Blog: Copulas and Cults.

March 3, 2009

rePost:Notes for Students Working on Projects:Knowing and Doing: February 2009 Archives

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This is a nice short list of advice for students working on projects skewed towards software projects! Excellent and short read so go read it!

Notes for Students Working on Projects
My compiler students are getting to the point where they should be deep in writing a parser for their language. Walking back from lunch, I was thinking about some very simple things they could do to make their lives — and project — better.
Knowing and Doing: February 2009 Archives.