Monthly Archives: July 2011

Kevin Slavin: How algorithms shape our world – June 2011

Kevin was involved in some internet/gaming startups
Area/Code (exited > Zynga New York) Starling.
which mix virtual and reality

I think this talk was seeded by a lucky seating assignment on an airplane, next to a Hungarian physicist who had worked on detecting steath airplanes and now was looking for stealth transactions on Wall Street.

Synopsis of his view:
Stealth works by breaking up the signal into lots of little pieces, like a flock of birds. You break it by scanning for flocks of birds which emit electronic signals.

3000 physiscist working on wall street. Need to hide big trades (i.e. pension fund buys/sells 10% of a company). Done via algorithms. Other algos can then detect these algos.

Algos now high speed. 2-5 milliseconds. To the point where network latency determines profit or loss. Thus companies now put their server farms right next to where the big pipe comes into NY. A fiber optic cable was laid from chicago to NY to reduce latency times.

We are changing the physical infrastructure to serve the algos.

The algos are black boxes.

Strong analogy with the filter bubble, see Eli Pariser

The role of politicians

Comment the other day that the role of a politician is to deliver his constituents to his funders.

revised: Politicians are not opinion leaders, but middlemen.

Eli Pariser "The Filter Bubble" 23rd Jun 2011

Ironic– this guy is famous only because Google turned his website into THE page which organized community in response to 9/11, yet he things google just doesn’t get what is important.

His take:
We see the internet/world via facebook and google. These use personal filters when deciding what to present to us.

Problems: We don’t know what is being filtered out.

Facebook has a like button, which is popular and has a strong filter weight. But while you can “like” a photo of a kitten, it is hard to “like” a story of famine, even though you wish to spread awareness of the event.

Primary design criteria for the filter is to keep you clicking, and keep you using the site. Designed to be addictive, not nutritious. Facebook and google are not free, they are sponsored.
People feel good (small dopermegenic burst) when they are told something they already know, or agree with. Everyone likes to be right. The filters use this.

Two people can get vastly different pictures of the world. Example: two searches on “Egypt”. One gets news articles about the Arab Spring, the other gets tourist information about the pyramids.

My take:
He is right about everything, but his thoughts are not mature.

You might not “Like” a famine, but you can “like” a call to action to solve the problem.

He discovered the problem when he tried to find facebook friends who he knew saw the world differently than he did, and found them filtered out. Well, he could have just emailed/messaged them, couldn’t he? How bad did he want to know what they were thinking?

Use curated websites when you want an overview. Google “popular conservative blogs”.

Of course the tools are not universally applicable. Of course the tool alters the way you think about the issue. But it is just a tool, not the one ring.

DRAFT– (im)morality of debt

This is an idea I wish to develop more.

Posting an early draft version, full of flaws

The morality of US debt

I did a favor for someone recently, which involved money. They thanked me and said they didn’t know how they would ever repay me. I said getting the money back would be enough.

Debt. It is essential to social function, to a functioning society. But even more important than debt is debt forgiveness, redemption. Debt is obligation, debt is bondage, and ultimately, debt is slavery.

Elizabeth Warren and Amelia Tyagi, writing in the Boston Review in 2005, discuss the sorry state of middle America’s finances. There seems to be a cry from the right wing and from banks that this is middle America’s fault, that if only they weren’t so consumer crazy, always buying the latest and best fasion and gadgets, all the while living beyond their means, then they would be in better shape. The cry was turned into a major re-write of bankrupcy laws, laws which were in essence written by the lenders.

But the data does not show that Americans are overspending, in fact they spend less of their income on food/restaurants, clothes, appliances, cars, etc. then they did in the 70’s. Instead, they face higher costs, for taxes, health insurance, child care.

My neice was unemployed for a period of some months. She doesn’t have a savings built up because she is young, having just graduated college, and hasn’t had time. So she lived off her credit card. Irresponsible? I hardly think so. The bank charged her 24% interest on the credit card loan. How do you repay a debt which has an interest rate of 24%? Who is acting immorally here? In her defense, the debt has been repaid, along with the usurious and exploitative interest charges.

And wait a minute, wasn’t it these same prophets of the right who encourage middle America to spend? Who was it who urged us, as our ‘patriotic duty’, to go shopping after 9-11? Since when did consumption become a patriotic duty?

That question has, in fact, been answered in the great BBC documentary ‘The Century of the Self’. This describes how the industrial revolution lead to excess of capacity, threatening the foundations of the industrial society, and, more importantly, the bank balances of its leaders. Something had to be done. Something was done. Advertising convinced us that the route to personal fulfillment was through buying things. This is a message which is continually rammed down our throat, in ever sophistocated means. It is, in fact, a precept. If we measure a country’s growth in terms of GNP, then GNP must increase each year, which can only happen if consumption also increases each year. Our economy is built on a model of continually and exponentially growning consumption.

Whenever the right wing gets moralistic, they turn to Christianity to back themselves. This is quite odd when applied to debt. One wonders what would happen if they prayed the Lord’s prayer, the way Jesus taught us we are supposed to pray. “Forgive us our debts, as we have forgiven our debtors. But was Jesus talking about money here? Well, yes, he actually did have a few parables about people who owed money. Nor should we forget the Year of Jubilee, as decreed by God the Father, during which all financial debts are forgiven. Certainly the debts in the Lord’s prayer are more than financial, but just as certainly they do not exclude the financial.

And at this point it is also instructive to think about where all this money which we supposedly owe comes from. Did the banks take from their hard-earned resources, which they had carefully built and saved over the years, and risk them to help us? Not hardly. Thanks to the glory of fractional reserve banking (and yes, this is a good thing), the money is, in fact, something they just made up.

And didn’t we, in fact, just spend billions (or was it more) of OUR money, earned by the sweat of our brow, via our taxes (remember that the ultra rich and the corporations do not pay tax, only middle America), to bail out these banks?

Something is very wrong with the Repulican party

stock picks– ideas from

Presented with a grain of salt. A big grain.

Memristors: a great, new type of electronics awaits. Today’s price:
HPQ 37.47
Magnachip Semiconductor LLC (NYSE:MX) 11.28
Micron Technology, Inc. (NASDAQ:MU), 7.86
and Netlist, Inc. (NASDAQ:NLST). 1.86


HTML 5 will revolutionize the web, and AMD makes the video cards which will make it happen
AMD 7.66
Medicine and drug discovery
Accelr8 Technology Corp. (AMEX:AXK) 4.01

product is BACeITM which identifies bacteria without need for a culture.

Macro economics

Evidence: macro-based funds (i.e. Soros) have been struggling in this last year, even though the year has been dominated by macro factors. Why?

It is now macro-political, not macro-economic. The politics are much harder to predi

Tomas Sedelack "The Economics of good and evil"

Advises the Hungarian goverment on policy.

Studied economy in myths and religious texts, then studied myths and religious texts in economics.

triggered an idea– model the evolution of the fairy tale?

Governments have two tools: Fiscal policy, that is the ability to put the people into debt, and monetary policy, that is the ability to print money (or remove it)

Fiscal policy: Jacob/Pharoh, 7 rich years and 7 lean years.

Interesting that it has been 7 rich years, from 2001 until 2008…
Jocob advised Pharoh to set aside 20%

We ate everything, and in fact did more, we borrowed recklessly during the good years.

Compare GDP to deficit growth, US had a net of -28% over the last few years. GDP by itself is not enough, since you can only borrow money from your future (unless you default..)

Hungarian policy is to keep the GDP growth and deficit at a fixed ratio. Save in the rich years, spend in the lean years.

Monitary policy. Analogy to the One Ring in LotR. Great power, but corrupts and destroys. He is here talking about the ability to print money.

Interest rate is like alcohol. Alcohol doesn’t give you more energy, it merely lets you move some energy to Friday night from Saturday morning. Nothing wrong with that. A bit of a problem if you move energy from Monday morning to Sunday night, esp. if you have an important meeting.

Problem with interest rates is you time-shift the money more than a few days, and you do not know what the conditions will be when the energy deficit hits.

Our society has a built in weakness. It says you need the money at the start of your career, to pay for college, house, car. And you have the money at the end of your career. Which is a problem if you don’t become CEO.

Ian Leslie 06-09-2011 Necessary Lies

Mr. Leslie works in advertising and writing (newspaper columns and books)

Argues that lies are essential to civilization.

The development of the neocortex is to allow us to both be better liars and better at detecting lies. Strong correlation between brain size and “trickyness”/deceit in monkeys.

Punishing lies harshly only makes people better liars. Example of two schools, one run by nuns with strict corpreal punishment for lying, the other where it resulted in detention. At the nuns school, lies became endemic, the norm.

Politicians. They don’t lie as much as they are rumoured too, but that is because no-one can lie 100% of the time. Pols lie because we reward the ones who do, who promise what we want even though it is not possible. We punish them when they tell the truth, or decribe the situation as it really is.

Medicine. The strength of the placebo effect.

Self deception. We all lie to ourselves. Seeing ourselves as others do is equivalent to clinical depression. Belief in ones self correlates with later success in most fields; the “truth” of that belief is not so important. Mr. Leslie calls this lieing to oneself.

This self deception also appears on a social level, and is hugely important to a society. The American ideal that we can all succeed in business, or that we are all if not today, then soon, to be in the upper 1%.

My take:
First, he confuses lies with vision. The vision only succeeds when you believe in it. This is also why we want our leaders to give us vision and hope. It is the only way out of the mess.

A vision is sight of how things could be, not how they are. A vision is not a lie, not some dangerous delusion. It is central to what makes us human.

I think Mr. Leslie would agree.

Hume’s take: Man is driven by imagination (i.e. vision, or things which exist in the mind but do not necessarily correspond to the current state of the world) The organizing principles which support these visions are the cultural context, both broad and narrow.

spotting addicts

In memory of Amy Winehouse

The disease of addiction. All addicts, regardless of the substance or their social status share a consistent and obvious symptom; they’re not quite present when you talk to them. They communicate to you through a barely discernible but un-ignorable veil… They have about them the air of elsewhere, that they’re looking through you to somewhere else they’d rather be. And of course they are. The priority of any addict is to anaesthetise the pain of living to ease the passage of the day with some purchased relief.

All we can do is adapt the way we view this condition, not as a crime or a romantic affectation but as a disease that will kill. We need to review the way society treats addicts, not as criminals but as sick people in need of care. We need to look at the way our government funds rehabilitation. It is cheaper to rehabilitate an addict than to send them to prison, so criminalisation doesn’t even make economic sense.


We cannot predict the future

Posting this because the idea has come up 2 or 3 times in the last few days.

People are bad at predicting the future. Even experts.

From Freakenomics blog:
It’s impossible to predict the future, but humans can’t help themselves. From the economy to the presidency to the Super Bowl, educated and intelligent people promise insight and repeatedly fail by wide margins. These mistakes and misses go unpunished, both publicly and in our brain, which has become trained to ignore the record of those who make them. In this hour of Freakonomics Radio, we’ll dream of the day when bad predictors pay.

hour long vid here: