I love Tim Harford

I am a HUGE fan of Tim Harford.  Who is Tim Harford??? You should be ashamed of yourself... but I forgive you.  He is a an award winning economist (2006 Bastiat Prize for economic journalism) that writes for the FT and regularly contributes to BBC.  Read this and tell me you didn't get a chuckle out of it (like with the Dilbert, I had been putting off reading his website (the address to his website will be posted at the bottom of this blog entry and will be included somewhere else on my blog) until I had more time, so please excuse the delay between his post and my repost):

Is the credit crunch suitable for children?

Published on the 13th of December, 2008

Dear Economist,
My young son came home from school and asked me: “Mummy, what’s a credit crunch?” How can I explain this to a five-year-old?
Ms LG, London

Dear Ms LG,

Once upon a time, there was a blameless girl called Consumerella, who didn’t have enough money to buy all the lovely things she wanted. She went to her Fairy Godmother, who called a man called Rumpelstiltskin who lived on Wall Street and claimed to be able to spin straw into gold. Rumpelstiltskin sent the Fairy Godmother the recipe for this magic spell. It was written in tiny, tiny writing, so she did not read it but hoped the Sorcerers’ Exchange Commission had checked it.

The Fairy Godmother carried away armfuls of glistening straw-derivative at a bargain price. Emboldened by the deal, she lent Consumerella – who had a big party to go to – 125 per cent of the money she needed. Consumerella bought a bling-bedizened gown, a palace and a Mercedes – and spent the rest on champagne. The first payment was due at midnight.

At midnight, Consumerella missed the first payment on her loan. (The result of overindulgence, although some blamed the pronouncements of the Toastmaster, a man called Peston.) Consumerella’s credit rating turned into a pumpkin and Rumpelstiltskin’s spell was broken. He and the Fairy Godmother discovered that their vaults were not full of gold, but ordinary straw.

All seemed lost until Santa Claus and his helpers, men with implausible fairy-tale names such as Darling and Bernanke, began handing out presents. It was only in January that Consumerella’s credit card statement arrived and she discovered that Santa Claus had paid for the gifts by taking out a loan in her name. They all lived miserably ever after. The End.

Also published at ft.com.

(Tim Harford's website)

A couple more quotes

So, I am proud to say that I am a BlackBerry owner and I am addicted to it.  One of the reasons is because of a program I have on it called viigo.  It allows you to subscribe to RSS feeds (like my blog or Google Reader or any news site etcetera) and it will show you the headlines in a pretty easy to read format.  If you want more information, you can view the full article right there on your phone (most of the time).  Two of the feeds I subscribe to are The Quotations Page quotes of the day and the Buddhist thought of the day.  Below are a couple of quotes that I particularly like...

In matters of style, swim with the current; in matters of principle, stand like a rock. - Thomas Jefferson

I think Jefferson's quote can be generalized a bit and have it still retain its meaning (and yes, I realize this is obvious, but i still feel a need to say it).  I think we can take this quote to say that in things that are rather trivial, do what you want.  If that is to conform to the status quo, go for it.  But in matters that are actually meaningful, figure out where you stand and stick with your convictions.

One cannot always be a hero, but one can always be a human. - Goethe

I think this quote is very similar to Edmund Burke's "Nobody made a greater mistake than he who did nothing because he could only do a little."  To me, they are both saying that while we may have lofty goals of being impossibly generous and helping, we need to realize that even actions that do not meet these unattainable standards are worth doing.

Holding onto anger is like grasping a hot coal with the intent of throwing it at someone else; you are the one who gets burned. - Buddha

Okay, this one is also very obvious, but very insightful.  If we hold onto our anger, we let it distract us from more important things (such as happiness).  It is important to realize when people are doing things expressly to make us angry and when people do things that unintentionally make us angry.  I think this issue can be solved by yet another quote (that I think I posted before... just like the Burke quote).  This one is Hanlon's Razor: Never attribute to malice that which can adequately be explained by stupidity.  There is no sense in allowing yourself to be wrapped up in anger when somebody says or does something which makes you angry when they had no intention of making you angry in the first place.  I would suggest that if you are angry about something, figure out why you are angry and whether the source of the anger meant to anger you or not.  And in either case, calmly explain why it is that you're angry and just let it go...

The nature of communication

I have always been fascinated by the very nature of communication.  I personally think that language was invented as means to pass knowledge from one person to another with the need for personal experience.  Take for instance a pair of early Homo sapiens eating, we will call them Jack and John for simplicity's sake.  Jack eats some berries (goodberries) and finds them to be sweet and refreshing.  John eats some different berries (badberries) and finds them to be bitter and caustic and, ultimately, ends up with an upset stomach.  

Now, let's say the next day Jack and John go to the same area to get some berries for a snack (I know that studies and evidence suggests that in primitive societies, men hunt while women and children gather, but let's not worry about that in this post...).  Jack reaches for some badberries.  If John could tell Jack about his experience with the badberries, Jack would be very grateful and would gain a lot of utility from this knowledge.  Similarly, John would be appreciative of Jack telling him about the goodberries.  So at some point, early Homo sapiens must have realized that sharing knowledge could be of very high utility and they, consequently, invented language.  (On that note, here is a very interesting article about human evolution and language)

By gaining this ability to share information without the need for personal experience, humans have been able to learn very quickly... I would argue that we've been able to learn quicker than other animals have been.  Think about it.  If other animals didn't learn at all, then wouldn't many more birds and squirrels die by running in front of/flying into cars?  Clearly they have learned that cars are lethal to them.  Am I suggesting something like what is suggested in "Bee Movie"?  Yes, but not to that extent (obviously).  The best argument I could come up with other than learning is that animals view human inventions, such as cars, as predators.  The inherent problem with that argument, though, is that birds fly at cars and then turn skyward at the last moment to avoid being killed.  If they viewed cars as predators, why in the world would they fly toward cars instead of away from them?  I think the only logical explanation (and I am open to other arguments, so if you disagree, please leave a comment with your argument) is that other animals also learn.  How?  Language.  

Just like with humans, birds and squirrels have figured out a way to tell their young something specific (that cars can kill them) without requiring them to experience that thing.  So here is the problem... what caused humans to learn quicker than other animals through language?  I think (but am not sure) that current theory suggests it is due to Homo sapiens's brain size and utilization.  

So assuming (which might be a big assumption) that this is a somewhat accurate description of why language was developed, what does this mean going forward?  Well, if you consider that the math children currently learn in grade school (even in the US which ranks terribly in terms of mathematical ability of school children) is the same kind of math that their grandparents or maybe even their parents didn't learn until college, it doesn't seem to be too great a leap of logic to say that humans will continue to become increasingly intelligent.  Other than that, I have no clue about how evolution and increased passage of knowledge will affect humans...  I am interested in what you have to say though, so please let me know and maybe we can help advance our species.

(I realize that I have not even mentioned the arbitrary nature of words, but that will be discussed in another post)

Better late than never?

Sorry that I am late posting this... but I've been kind of busy of late and I still think this is relevant enough to warrant being posted. Enjoy!!



http://www.dilbert.com/2008-12-13/

Utility of people

As the holiday season approaches, families re-congregate the world over. Sons and daughters away at college often return home to be with their families. Children that have their own families may or may not return home to be with their parents, but they are with their families nonetheless. Often, there are people we want to be with, but are unable to be with. This person may be a good friend, a parent, a grandparent, a son, a daughter, a brother, a sister, an uncle, an aunt, a great-grandparent, etcetera. Clearly, this means that spending time with this person gives you some amount of utility greater than the amount of utility you gain by not being with them. Of course there are ways to to gain some of this utility without physically spending time with them (phone calls, video conferences for the more web-savvy, or maybe even just a letter), so the question then becomes, how does one optimize his or her's utility during the holiday season. The answer, obviously, is to analyze how much utility you gain from each person that you can spend time with.

This, however, presents some problems because trade-offs aren't always as straightforward as they may seem... take for instance the quandary of spending time with friends or family. I think most people would agree that family precedes friends in terms of utility, but what if you can spend the holidays with a group of friends that is large enough so that the total utility derived by being with the group outweighs that of being with your family? If your friends and your family live in a close proximity, it may be possible for you to spend the day with your family and the night with your friends. Win-win. But what if your friends live all over the world? Well, in this case you probably won't be able to spend the holidays with a group of any real size... so family would probably outweigh. Let's say, though, that a group of friends are trying to decide whether they should go home for the holidays or spend them together. In addition to the people themselves, you have to take into consideration traditions, customs, meals, drinks, etcetera.

The choice is hard. My suggestion is to be with your family (as many members as possible from as many generations as possible), and be sure to call your friends and other relatives because they miss you just as much as you miss them.

Happy holidays to you all, and I hope that you will choose to maximize your utility... I know I will.