Adonis Diaries

Posts Tagged ‘“Outliers”

Minority rule: it takes a few very intolerant and tenacious people to make the system more honest

No troll should be able to abuse the media and academic system!

Ethical Breaches

Background: After being called a BS vendor by Nassim Nicholas Taleb in the past, Smith in a vendetta, has written 4 articles with similar attempts at discrediting and distorting without the slightest familiarity with the subject. More on these, later, as this is not the end.

Rule 1: You shall not use a media company such as Bloomberg to troll people you hate.
Rule 2: You shall not use the credibility of an academic position to troll people, particularly when you have failed academia and are concealing that you were terminated.
The article makes sure we know that Noah Smith is an assistant professor at Stony Brooks.
Except that I was told in January that he had been “resigned” for not meeting academic standards and was not coming back for the Jan 2016 semester,
in fact “never coming back”.
Smith claimed a sabbatical which conflicts with what I was told by faculty members.
Smith should not be using sham affiliations for positions he doesn’t have so he can talk about a subject he knows nothing about.

This is a public service for others who might fall prey to the overactive BS operator passing for expert Noah Smith (who was thrown out of academia for not meeting standards), with the misfortune of having been given a voice on Bloomberg, thus risking to turn Bloomberg (otherwise with tight standards) into a BS vending operation.

John Peter  shared this link of Nassim Nicholas Taleb. April 18 at 4:38pm ·

Added a page as public service (he will now leave me alone, this is to protect others, preserve the integrity of the system)
This is the minority rule: it takes only a few very very intolerant and tenacious people to make the system more honest.
http://www.fooledbyrandomness.com/SmithBSVendor.html

Summary of Breaches of Journalistic Ethics & Logic  in Noah Smith’s Bloomberg View Article on The Black Swan of April 16, 2016

Ethical Flaw

Taleb in The Black Swan:

There are two varieties of rare events:

a) the narrated Black Swans, those that are present in the current discourse and that you are likely to hear about on television, and

b) those nobody talks about, since they escape models—those that you would feel ashamed discussing in public because they do not seem plausible. I can safely say that it is entirely compatible with human nature that the incidences of Black Swans would be overestimated in the first case, but severely underestimated in the second one.
[…]
This miscalculation problem is a little more subtle.

In truth, outliers are not as sensitive to underestimation since they are fragile to estimation errors, which can go in both directions.

As we saw in Chapter 6, there are conditions under which people overestimate the unusual or some specific unusual event (say when sensational images come to their minds)—which is how insurance companies thrive.

So my general point is that these events are very fragile to miscalculation, with a general severe underestimation mixed with an occasional severe overestimation.

Noah Smith in Bloomberg View: [goes on and on presenting the Black Swan as only overestimating market crashes]… In other words, Taleb might be wrong — people might be overestimating, rather than underestimating, the risk of market crashes.

So visibly Noah Smith is not familiar with the book that he is discussing.

This led to an incoherent response: Noah Smith said he “agrees with points above” (not explaining then his Taleb is “wrong” other than to create hype), and his editor, James Grieff saying “He read the book but disagrees with it”. His editor claims that “he read the book”is like someone claiming he read War and Peace, it takes place in Venezuela.

Background: Noah Smith has a long documented track record of writing critiques of books he hasn’t seen, and discussing papers he hasn’t read.

Here you have authors spending 10 years writing a book, and some troll with a megaphone critiquing it on things that have nothing to do with the content.

I first became aware of it when he previously commented on my skin-in-the-game without realizing there was the expression of a mathematical theorem, when it was on page 2.

Logical Fiasco

The editor has to have a problem to miss the severe asynchrony. Noah Smith  takes a book published in 2007 (before the last crisis), discussing events until 2006, then says “Taleb is wrong” from inference on market estimation of probability between 2007-2016 and what decision to take today based on prices today, 2016.

Perhaps the participants adjusted to events of 2007, the book, or something else.  The claim by Noah Smith about the Black Swan concerns the market value of risk, not the structure of risk, which is something subsequent to the book. That his editor missed the asynchrony is very, very strange…

Other Violations of Professionalism

Noah Smith has no familiarity with finance.

In 2009 I made a statement in Moscow about 4 trades to do. I was not aware of being filmed and used trader language.

One of them was short T Bonds. After I communicated to Noah Smith that he was a BS vendor, he advertised in 2014 my claim of short bonds … in 2009 as a way to wreck my credibility in every way possible.  Did he report on the other trades in the ensemble? No.

Did it hit him that trades are something that don’t last 4 years? No.

Did it hit him that bonds collapsed after the talk? (markets happen to go up and down).  No.

Did he realize that I have several hundred thousand trades in my career and no self respecting scientist would play the media megaphone to select one, particularly 5 years later without knowing the true outcome?

This is why he couldn’t write an academic paper: his mind has a defect in its logical wiring.

No finance academic would commit the lack of professionalism of cherry-picking a trade in a portfolio, and, worse, not realizing that a dynamic trader buys and sells and there is low correlation between the trade and the fate of the market.

How can someone that ignorant about finance write about finance?

Stating the obvious, but oh so cleverly

Malcolm Gladwell is a cerebral and jaunty writer, with an unusual gift for making the complex seem simple and for seeking common-sense explanations for many of the apparent mysteries, coincidences and problems of the everyday.

He is also an intellectual opportunist, always on the look-out for a smart phrase or new fad with which to define and explain different social phenomena.

In his first book, The Tipping Point, he studied events such as crime waves and fashion trends and settled on an arresting metaphor to explain why they happen. ‘Ideas and products and messages and behaviours spread just like viruses,‘ he wrote, suggesting that we contaminate and infect one another with preferences and recommendations, until we reach a ‘tipping point’, after which a social epidemic becomes contagious and crosses a threshold to reach saturation point.

The tipping point: who does not now use this phrase to describe a moment of definitive transition? (‘Tipping point’ seems to have become this generation’s ‘paradigm shift’, a phrase popularised by Thomas Kuhn in his 1962 book The Structure of Scientific Revolutions

The success of the book, which began as an article in the New Yorker, the magazine for which he works as a staff writer, propelled Gladwell into the realm of super-consultancy. He has since become a lauded pontificant and ideas progenitor on the international lecture circuit.

He is the go-to man for a corporate business elite seeking to understand the way we live, think and consume today.

It helps that with his wild, unruly curls and wide-eyed gaze, Gladwell has the look of an übergeek.

He seems to have absorbed one important lesson of the consumerist culture he deconstructs – that the image you project is paramount; in effect, he has made himself, superficially at least, into a brand.

If you didn’t know he was a writer and journalist, you wouldn’t be surprised to hear that he was a leading operator at Microsoft or Google. As it is, he’s a kind of literary Bill Gates, a guy so far ahead of the rest of the pack that you never quite know what he will do next.

What is an outlier?

The word may not be a neologism but I have never heard anyone use it in conversation. According to one dictionary definition, an outlier is ‘something that is situated away from or classed differently from a main or related body’.

But Gladwell uses the word with more metaphorical flexibility. For him, an outlier is a truly exceptional individual who, in his or her field of expertise, is so superior that he defines his own category of success. Bill Gates is an outlier and so are Steve Jobs of Apple, Robert Oppenheimer and many others Gladwell speaks to or writes about as he seeks to offer a more complete understanding of success.

The trouble with the book is that Gladwell is ultimately engaged in a long argument with nobody but himself. Throughout, he defines his position against a floating, ubiquitous, omnipotent ‘we’; a Greek chorus of predictable opposition and received opinion. ‘There is something profoundly wrong with the way we look at success,’ he writes.

‘We cling to the idea that success is a simple function of individual merit and that the world in which we grow up and the rules we choose to write as a society don’t matter at all.’ And so he goes on.

These assumptions can be irritating, since who is this naive, unquestioning, plural intelligence identified as ‘we’?

Do we in wider society really believe that outstanding success, in whichever field, is achieved without extraordinary dedication, talent and fortuitous circumstance, as Gladwell would have it?

Do we really take no account of the sociopolitical context into which someone was born and through which they emerged when we attempt to quantify outlandish achievement?

Do we really believe that genius is simply born rather than formed? Gladwell wants his readers to take away from this book ‘the idea that the values of the world we inhabit and the people we surround ourselves with have a profound effect on who we are’.

But I don’t know anyone who would dispute this.

The world for Gladwell is a text that he reads as closely as he can in seeking to decode and interpret it. He is adept at identifying underlying trends from which he extrapolates to form hypotheses, presenting them as if they were general laws of social behaviour.

But his work has little philosophical rigour. He’s not an epistemologist; his interest is in what we think, rather than in the how and why of knowledge itself.

There is also a certain one-dimensional Americanness at work: many of his examples and case studies are American and he spends rather too much time in New York, at one point even riffing at length about the founder of the literary agency that represents him.

The book would have been more interesting if he’d roamed wider and travelled more, if it had been more internationalist in ambition and outlook.

However, it’s still fun to follow Gladwell on his meandering intellectual journeys, even if the conclusions he arrives at here are so obviously self-evident as to be banal. Even when he is not at his best he is worth taking seriously.

He has a lucid, aphoristic style. His case studies are well chosen, such as when he writes about the birth dates of elite ice hockey players and discovers a pattern: most are born in the first three months of the year.

His range is wide, and he writes as well in Outliers about sport as he does about corporate law firms in New York or aviation. Little is beneath his notice.

One last thing, as Gladwell might say. There’s perhaps another way of reading Outliers and that’s as a quest for self-understanding, since the author himself is obviously an outlier. In seeking to find out more about how other people like him came to be who they are and to occupy the exalted positions they do, he’s also indirectly seeking to learn more about himself, about how he came to be who he is: the smartest guy at the New Yorker, with the big ideas and the lucrative book deals.

Jason Cowley is editor of the New Statesman. His book The Last Game: Love, Death and Football will be published in April 2009.

Note: I have reviewed extensively most of Gladwell books, (to my knowledge) and I enjoyed the read and the ideas.

What’s your Worldview and how it was formed?

Worldview is not a matter of logic, rational thinking, reflection… and it is not merely a bunch of emotions, feelings, guts, heuristics, mental short cuts…

Worldview is all the above, a complex, convoluted make up of irrational positions, opinions, ready-made reactions…

Worldview is mostly the results and outcomes of emotional reactions.

Consider your willpower to be a battery: If before reacting your willpower is depleted then you have to rely on your acquired habits, talents and skills to counter your innate behaviors that were constituted through social in-group behaviors.

Your worldview is a unique model that you tailored-made throughout your life, experiences, conditions, situations… in order to survive the thousands of daily problems, frustrations and barriers.

Your worldview is constituted of all the planning you undertook, the do-it lists, the step-by-step thinking on your projects, the failed attempts and alliances.

And if you are lucky, you might realize that the “planning fallacy”  never follows the learning curve that you swear for from experience in other activities.

We are not natural-born planners. Why?

1. Wishful thinking cannot be overcome: it is part of our survival technique and strategy too.

2. We tend to overlook external influences and all those rare events that bust our well-thought out detailed plans

3. We fail to revisit the past projects and plans, those that were a success story and those that failed to materialize.

4. We miss to read the outliers in the events that intervened in the failure process and those that came handy unexpectedly.

Have you tried a pre-mortem session speech to your team?
A year from now, we are supposed to finish this project. Imagine this project turned out to be a disaster. Take 15 minutes to write about your imagined disaster”

Predicting the Future, Delight the weird, Hard work of understanding

Seth Godin posted 3 short pieces.

Strategies for predicting the Future: Accuracy, resilience and denial

… three ways to deal with the future.

Accuracy is the most rewarding way to deal with what will happen tomorrow–if you predict correctly.

Accuracy rewards those that put all their bets on one possible outcome.

The thing is, accuracy requires either a significant investment of time and money, or inside information (or luck, but that’s a different game entirely).

Without a reason to believe that you’ve got better information than everyone else, it’s hard to see how you can be confident that this is a smart bet.

Resilience is the best strategy for those realistic enough to admit that they can’t predict the future with more accuracy than others.

Resilience isn’t a bet on one outcome. It’s an investment across a range of possible outcomes, a way to ensure that regardless of what actually occurs (within the range), you’ll do fine.

And denial, of course, is the strategy of assuming that the future will be just like today.

If you enter a winner-take-all competition against many other players, accuracy is generally the only rational play.

Consider a cross-country ski race. If 500 people enter and all that matters is first place, then you and your support team have to make a very specific bet on what the weather will be like as you wax your skis.

Picking a general purpose wax is the resilient strategy, but you’ll lose out to the team that’s lucky enough or smart enough to pick precisely the right wax for the eventual temperature.

Of course, and this is the huge of course, most competitions aren’t winner take all.

Most endeavors we participate in offer long-term, generous entrants plenty of rewards.

Playing the game is a form of winning the game. In those competitions, we win by being resilient.

Unfortunately, partly due to our fear of losing as well as our mythologizing of the winner-take-all, we often make two mistakes.

The first mistake is to overdo our focus on accuracy, on guessing right, on betting it all on the ‘right’ answer. We under appreciate just how powerful long-term resilience can be.

And the second mistake is to be so overwhelmed by all the choices and all the apparent risk that instead of choosing the powerful path of resilience, we choose not to play at all.

Denial rarely pays.

Posted by Seth Godin on January 03, 2014

Delight the weird, the outlier

Everyone who eats at your restaurant expects a good cup of coffee, and it’s difficult to wow them, because, of course, your competition is working to do the same thing.

But of course, it’s not everyone who wants a cup of coffee. Some want a cup of tea, or a cup of herbal tea, and those folks are used to being ignored, or handed an old Lipton tea bag, or something boring.

What if you had thirty varieties for them to choose from?

Everyone who stays at your hotel expects the same sort of service, and it’s difficult to wow them, because, of course, your competition is working to do the same thing.

But of course, it’s not everyone. Some people travel with their dogs, and they’re used to being disrespected.

What if you gave those people a choice of a dozen dog toys, three dog beds and a special dog run out back?

When you delight the weird, the overlooked and the outliers, they are significantly more likely to talk about you and recommend you.

Posted by Seth Godin on January 05, 2014

The hard work of understanding

Sometimes, we’re so eager to have an opinion that we skip the step of working to understand. Why is it the way it is? Why do they believe what they believe?

We skip reading the whole thing, because it’s easier to jump to what we assume the writer meant.

We skip engaging with customers and stakeholders because it’s quicker to assert we know what they want.

We skip doing the math, examining the footnotes, recreating the experiment, because it might not turn out the way we need it to.

We better hurry, because the firstest, loudest, angriest opinion might sway the crowd.

And of course, it’s so much easier now, because we all own our own media companies.

Posted by Seth Godin on January 04, 2014

“You have the right to make errors and not to understand in school”, and you are intelligent too

You have this math teacher who addresses his class: “I adore students who can’t comprehend math.  This is great: I will be of service. Together, we’ll do some progress…”  This teacher never gives up and keeps repeating and trying different approaches until the topic is understood and the students feel “good in math”

An experiment was conducted and the only variation between the experimental and the control groups of students was this priming warning: “Learning is not easy. It is very normal that you’ll make mistakes. With practice, you’ll invariably succeed...”  The experimental group outperformed the control group.

This type of experiment was done in many different kinds of mental tasks and learning fields, and the results are very consistent: Let the student know that it is normal to make mistakes and not understand…

Apparently, in most countries, the school systems do not prompt students that failure to understand is part of the learning process.

Students are not initiated to manage difficulties in learning. When a student does an error, he feels paralyzed by a sense of incompetence.

The traditional message in school systems, transmitted by teachers, is that “Generating mistakes and errors is a bad tendency. Only result counts…”

Experiments are demonstrating that failure to succeed in school has little to do with intelligence deficiency or lack of good will to learn. It is the competitive climate that is doing most of the ravages in students’ failure to doing well in school.

What are these  competitive gimmicks that tie students in knots?
1. Teacher asks students to raise hands when solving a problem or answering a question.  You could have an answer, but you need extra time to think it out. The consequence is that you feel totally incompetent relative to other students, and you feel bogged down for the “slowness of your mind”

2. Students are ranked every month for performance. Even those students in the 10th percentile feel not suited enough for learning or going to graduate schools.

Can you tell me the kinds of competitions you had to be submitted to in your school?

Do you feel that having to constantly compare your performance with the other students is pretty depressing and not conducive to good learning habits?

In Finland’s school system, student of less than 13-year do not submit to exams, rating, ranking, or any kinds of competitive gimmicks. And Finland ranks the highest among the western school systems in student performance. Still, Asian students do better in math and sciences (China, South Korea…). Why?

First,  Asians are good at math because their language allows them to count faster. For western language the numbers “four” and “seven” takes way longer to pronounce than “si” and “qi” in Chinese. Particularly when we deal with longer numbers like 389, or 10,932…

Chinese number system is very logical for adding and subtracting and for easy memorization and mental calculations. Chinese can associate numbers better and have more time to think in solving a math problem instead of spending four years (as with western languages) to learn how to count and spell correctly numbers.

Not all Chinese will have this advantage if they were brought to America at a very young age and learned English in kindergarten. The Chinese that are born in America are taught English when they start school and so have hard time learning to count numbers in English. At home, the Chinese kids learn to count in the simple Chinese number system.

Second:  Growing rice is an extremely hard and complex work, waking up at 5 am and caring for the rice paddy all year round.  And this habit comes with a reward. Rice is life to a Chinese farmer and rice is needed to run a family business as well as food throughout the year. Their thought is that if a farmer does not work hard, they will starve to death and the land becomes lazy.

Chinese have acquired a reputation for being hard workers and handed down from their ancestors. Asian kids are most probably raised at home to become hard workers and those are the Asian students who get higher scores in math and sciences tests in comparison to other ethnicity.

The Asians kids gain a “built in advantage” of several years over the western kids. It is not just a matter of acquiring mental agility as it is practicing doing real math, instead of practicing how to count and spell numbers for years. Read link in note 2.

Note 1: Post inspired from a piece by Jacqueline de Linares in the French weekly Le Nouvel Observateur

Note 2: https://adonis49.wordpress.com/2012/01/22/a-few-cultures-find-math-easy-many-cultures-have-difficulties/Malcolm Gladwell’s chapter in “Outliers”  on Rice Paddies and Math Tests

A few cultures find math easy: many cultures have difficulties

Do you think math abilities is genetic? Not quite, apparently.  Do you think that math is just a matter of manipulating numbers? Not quite, apparently.  There are at least four main factors that promote math thinking and abilities:

First factor: There are indications that math aptitude is generated from customs of persistent habit in resolving problems. It appears that doing well in Math is related to engaged attitudes for working hard:  The more persistent and resolved to solve a problem, the longer your attitude to be engaged in what you do, the better you are in math.

For example, people in culture working in rice fields that require constant and hard effort all year round do better in math than other people who just saw, forget the field for a season, and just reap in the proper season.  A rice paddy, the size of a room, is built from the ground up, irrigated frequently at the proper level, and constantly maintained and worked 360 days a years, rain or shine…A rice paddy is literally “blood” and sweat and waking up everyday at 5 am to tend to the paddies: The rice peasant and his family have to tend to the adequate amount of water, varieties of proper rice shoots, cleaning each plant from parasites…If you need good quality and two harvest, you have got to sacrifice blood, sweat, persistence, endurance…The survival in rice planting culture is very delicate, and working hard with resolve is a way of life.

Second factor: Cultures with vocal numbers that are reduced to single syllables do better than culture complicating the utterance of simple numbers with long string of syllables.  Why? Kids of 5 year-old, instead of focusing on manipulating numbers, spend many precious years just memorizing how to say and comprehend verbal numbers. Our short-term memory of a couple of seconds can handle ten syllables, and if the numbers are of single syllable, kids are better at memorizing and recalling strings of 10 numbers in any order they are presented: Digits are fun and no longer a complicated manipulation of transformations from the verbal to the numeric dimensions…

Third factors:  Cultures with logical correspondence between the vocalized numbers and the digits do better than other cultures in math. For example, what eleven (11) has to do with one and ten? Or the French number 93 (quatre vingt threize) has to do with nine tens and three?  Instead of first transforming a complicated vocalized number before figuring out its corresponding digital number, the Cantonese Chinese culture has arranged to say the numbers the way they are written logically.

For example, how would you keep in your short-term memory two numbers such as two hundred and forty-five (245) and seven hundred and twenty-one (721)?  Suppose these two numbers are vocalized as (two hundred four ten and five),  and ( seven hundred two ten and one), which would constitute 10 syllables since each number is of a single syllable, the kids in which culture would have a qualitative edge in manipulating numbers and math?

Adding and subtracting the two numbers are straightforward in Cantonese: The digits are plainly arranged for computation, and you don’t need several mental transformations before you get to the task of adding…

Kids of 3 year-old in a particular culture have more facility with math than kids of over 5 year-old in other cultures, simply because they don’t need to undergo several mental manipulations and having to retrieve from the various working memory data and information stored in verbal forms and complicated shapes…

Culture relying mainly on trading variety of goods end up devising a coded language for transactions, mainly by truncating the verbal numbers and shortening the sentences in transactions:  I guess, lengthy verbal numbers originally adopted in the language are truncated when transacting goods…

Four, kids who are trained to solve all the math problems and exercises after each math chapters, from the easiest to the hardest, in neat and legible handwriting, do better than kids who have no patience of solving but what they consider to be harder than the other problems, and don’t care to sit down and put down on paper how they solved the problem…

This practice of solving all the math problems and exercises has this huge benefit of spending 10,000 hours in math practice-sessions, a requirement to getting top among math professionals…

Curiously, kids and students who excel in math have acquired the habit of focusing entirely on the lesson in class.

Maybe the second and third factors don’t translate well into the abstract domain of mathematics in the long-term, simply because the kids get used to relying very much on their short-term memory and fail to train adequately their working memory for other kinds of intelligence and abilities.  But the first and fourth factors are essential for doing great in math.

Note: This post was inspired from a chapter in “Outliers” by Malcolm Gladwell

The “Jamaican syndrome”: Discrimination against your own types?

In Jamaica and the Antilles islands, slaves were brought in from Africa to cultivate sugar cane fields.  Harvesting sugar canes is different from picking cotton in south USA: You need the proper industries to process the sugar canes in the fields, and thus, you need to train slaves to maintain and run the factories

In Jamaica, a British colony, the lighter-shade former slaves, from successive breeding with the whiter people, acquired the same rights in society before the darker-shade former slaves, and they were very prized among the members of the same family.

There are far more dangerous and insidious discrimination among the “colored” people in Jamaica. The Jamaican sociologist Fernando Henriques wrote:

“The most lightly colored will be favored at the expense of the other members in a family. In adolescence, and until marriage, the darker members will be kept out of the way when friends of the “fairer” members are being entertained.

The fair child is regarded as raising the “color of the family” (by a notch toward white), and nothing must be put in the way of his/her success… A fair person will try to sever social relations he may have with the darker relatives…The darker members of the “Negro family” will encourage the efforts of a very fair relative to “pass” for white.

The practices of intra-family relations lay the foundation for the public manifestation of color prejudices…”

Malcolm Gladwell, in “Outliers“, recounts the story of his aunt.

Malcolm’s aunt was on a train to meet her darker colored daughter and she fell in love with a lighter-colored gentleman. As she stepped out of the train, the aunt passed her daughter without saluting or acknowledging her.

After many violent riots in Jamaica in 1835, the British Empire started extending grants for higher education in England to the brilliant students of colored emancipated slaves.  The aunt of Gladwell was among the recipients of these grants.

As the concept goes: “If a progeny of young colored children is brought forth, these are emancipated…”


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