Author: MIKE

Homeotelic Responses

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One of the themes to Early Retirement Extreme is the homeotelic process (two birds, one stone). Consider health and wealth, waste and waist, and live intentionally. FIRE really just has a branding problem.

Via Early Retirement Extreme.

With kids doing distance learning we are living this out as I take Khan Academy classes to stay a step or two ahead which also satisfies my curiosity and ties into a suggestion from Naval. One theme of the Navalmanack curation is to focus on foundational ideas: more math less macro.

Put another way: there’s a limit to what we can know in large enough systems with many moving parts.

One obstacle to the foundations is stories. Stories link cause and effect regardless of an and. For good, or not.

In The Night Circus, Celia (real magic) is farmed out by her father as a spiritual medium (non-real magic, but still Alchemy?). She tells clients stories of the great beyond. She sees no point, feeling worn out from the whole experience.

“These people mean nothing,” her father says. “They cannot even begin to grasp what it is they think they see and hear, and it is easier for them to believe they are receiving miraculous transmissions from the afterlife. Why not take advantage of that, especially when they are so willing to part with their money for something so simple?”

Fiction is good. Math and science are good. Social science is good, as Rory Sutherland puts it, by just knowing something works along with a willingness to tinker. Real life is good. Working with your hands, making things, is soulful. Combining these is extremely good.

What’s better is homeotelic. 

Touchdown Tom Update: No update this week on our gambling idea. However, it might be that Brady plays less games due to a relatively stable playoff picture and relatively weak end-of-year opponents. This is another feather in the cap of more under unknowns.

How to: Write a battery review

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John Gruber on the iPhone 12 mini/max battery:

“Battery life is a bit hard to quantify, and in my opinion difficult to peg to a single number. Milliamp-hours or watt-hours don’t tell you the story. What you want to know is, in practical real-world use, how long the device lasts on a charge. An ideal test would involve, say, an iPhone 12 Mini and iPhone 12 used side-by-side, doing the same things in the same apps at the same time in the same places.”

When thinking about a job-to-be-done, numbers often get in the way.

This is not the first time Gruber has faced this conundrum, here talking with Ben Thompson about temperature.

Gruber) “I staunchly believe that Fahrenheit is the better scale for weather because it’s based on the human condition. Who gives a crap about what the boiling point of water is, it’s the most ridiculous thing I’ve ever heard in my life.”

(Thompson) “The other thing is that Celsius is not precise enough. In the car it adjusts it by point-five because a single degree of celsius is too much for the car. Fahrenheit is more finely grained in a positive way.”

Insiders suffer the most because it’s efficient to use shorthand, yet it abstracts what the customers want. To serve customers, forget the numbers and get to the really why. For instance, it’s often not about the acidity of the grapes but the story of the label.

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The Paradox of Skills Cascades

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To rephrase the aphorism then: If I can’t spot the fool at the table then the fool at the table is me — if all that matters is this game.

In the chapter on The Poker Bubble, Nate Silvers writes that the paradox of skill can have a cascading effect. “The subtraction of fish from the table can have a cascading effect on the players. The one who was formally the next to worst player is now the sucker and will be losing money at an even faster rate than before and he may bust out too, making the remaining players’s tasks more challenging.”

We can revisit the post on Jeopardy James to consider this idea more fully. Broadly, success in Jeopardy is the outcome of four inputs said Ken Jennings:

  1. Trivia knowledge.
  2. Buzzer skills.
  3. Game board strategy.
  4. Luck.

However, these are not obvious at all times. Jennings, for example, says that once his winning streak approached ‘absurd’ levels the Jeopardy producers allowed new contestants more time on the buzzer. Then it was James Holzhauer who demonstrated the third component, looking for Daily Doubles.

Through each step: trivia, buzzer, and board, the weaker players filter out and the competition grows, forcing out further weaker players.

Here’s where our Jeopardy analogy breaks down. The goal of Jeopardy isn’t winning, the goal is entertainment. Much like The Only Honest Sport, the objective isn’t brilliance or bafflement but for the people at home to feel in the game.

Sometimes the game isn’t about winning, sometimes there’s a game within the game, and to win one game one only must stand out in another. Different games have different finish lines too. If someone says ‘best’ or ‘winner’ it’s only in that context.

…

Tracking Tom Update: We guessed that there’s more that can ‘go wrong’ than right for Tom Brady this season and so far that guess looks just okay. It might be wrong in the end, as Brady is +108 of passing yard pace, but it still feels like good reasoning for taking the under. At the right price, of course.

Framing Celebrity Photos

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From An Economist Walks Into a Brothel:

“On April 1, 2002 Us Weekly first published it’s Star, They’re Just Like Us weekly series featuring pictures of celebrities doing mundane tasks like getting coffee or pumping gas. Before this, everyday pictures weren’t worth much but Us Weekly humanized celebrities by showing them looking less glamorous and people loved it.”

Allison Schrager

Just Like Us is fascinating. The most mundane media yet we scroll.

The context something is presented in changes the way the something is viewed. From power lines to work from home, context matters. That someone changed non-glamorous or every-day to just-like-us is a bit of Alchemy.

The Abilene, Fire, and Simpson’s Paradox

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Names make thoughts legible. Here are a few recent paradoxes to consider.

The Abiline Paradox. Don’t rock the boat (YouTube). Or, when one person goes along with another because they think that I think that they think I want to go along. More from Rory Sutherland.

The Fire Paradox. The more successful humans are suppressing fire in one season, the more likely a larger fire in the next. May also apply to influenza.

Simpson’s Paradox. On Wharton Moneyball , the hosts asked why women die more than men from Covid? It’s because there are more old women. How can someone have a higher overall shooting percentage but a lower percentage from near and far? A nice YouTube explainer is here. Via Wikipedia:

First principles: story

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Imagine a young Ben Folds. He’s walking to piano lessons. He loves the piano but not this particular teacher. It’s snowing. And windy.

There’s a bicycle track through the snow. It’s all Folds sees. It’s snowing and windy.

He sees the track and imagines what happened. The track changes direction, the story changes too. Folds writes:

“I want to laugh at how old-fashioned and easily entertained I must sound to a kid today, who has a lot more seductive electronic shit competing for their attention. But a story is a story, in any era. And the best ones, I’ve always thought, develop from mysteries you want to solve.”

There’s a dichotomy between deep work (Newport) and Against Waldenponding (Rao). We balance on this tightrope each day. Some days more on one end, other days at the other, and some we troop between the two.

Newport wants people to learn first principles, to study things which change slowly. Rao wants people to fit first principles into the world in interesting ways, to prototype, to gather rough consensus and run code. 

Stories are a first principle idea to consider. We run on stories and one way to get better at telling them is through boredom. Folds again:

Related: The 3 Ways to Spend Your Day.

The 3 Ways to Spend your Day

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There are three ways to spend your day working in the knowledge economy.

The first day is to spend it trending. Follow the popular topics on Twitter, Reddit, and YouTube. This is good for serendipitous moments of discovery, awareness of the world, and to ‘keep-up’ with what the external algorithms suggest.

The second way to spend your day is to spend it in the feed. Cultivated email, RSS, and perennial podcasts. An infovore knows what they like and has is delivered. Often it will be confirmatory information from familiar sources, that’s okay if you’re honest about it.

The final way to spend your day is in search. There’s something to be curious about and you intend to do just that. Google offers the broadest service but new entries like Listen Notes and Twitter search modifiers have started to index novel parts of the internet.

There’s no ‘best practice’ for the 3 Ways to Work, rather the work of the day dictates the way.

Much of what we call knowledge work focuses on decision making and much of this is a cycle between the exploration of the new and application of the familiar. It’s a balance between finding new things and digging into curio-seams.

Tyler Cowen is an example. His feeds at Marginal Revolution and Twitter offer the day-to-day goings-on, but searches on Listen Notes, YouTube, and the blog allow someone to figure out ideas like mood affiliation (my notes here), which is one way we make mistakes.

For example: Are plastic bags more harmful than paper? Are bag-bans beneficial? What’s the metric? We’ve already noted another Cowen-ism about solving for the equilibrium, but without search, we’d have missed the idea about mood affiliation. Cowen told Russ Roberts:

“Plastic is often more environmentally friendly than having a paper bag because it takes less energy to make and dispose of. Plastic is better for the world and can even be better than those reusable cloth bags unless you use them two-hundred times and up but that’s hard to do and that’s the break-even point. The environmental virtues of plastic compared to a lot of other alternatives is underrated.”

The question of bag bans for me was pure mood. Us good, them bad. I didn’t consider transport costs (paper is much heavier) and production costs (efficiency figures). Instead, I took the easy route of WYSIATI: what you see is all there is, and all I see in my laundry cupboard is plastic bags.

Drizzle as marketing

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We made this for the Fourth of July. There were delicious. They were also tedious. 

We microwaved a block of white chocolate and used kabob sticks to carefully dip each pretzel into the creamy confection. It required careful speed. Go too quickly and the ratio of chocolate to pretzels was off. Go too slowly and the chocolate vat stiffened but the ratio was better. 

The next time we’ll drizzle the pretzels. The next time we’ll lay them flat and drizzle spoonfuls of white chocolate and red-white-and-blue sprinkles. It would have tasted just as good, looked just as nice, and it would have been drizzled. Think about something that’s been ‘drizzled’ compared to dipped or dunked or plunged. Each of those words carries a different meaning. Each of those words has a tiny bit of Alchemy. 

Businesses succeed by delivering value to customers as well as keeping some value for themselves. Reframing by renaming is an easy way to do just that. 

These ideas are everywhere. Sometimes, like the case of our patriotic pretzels, it can be more work to provide less value. The next time I’ll be delivering some Drizzled Delights rather than chocolate covered pretzels with sprinkles.  

The Vaccine Friendship Paradox

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One non-intuitive concept, at least in scale, is the network. Like average numbers, it takes some work to construct the correct conclusions. Graph, chart, and count the way that people interact, decide, and connect and there will be patterns. It’s network effects which fuel companies like Instagram and create the increasing returns economy.

Networks, as Nicholas Christakis notes, are agnostic. They spread whatever they are seeded with, whether real viruses like Ebola or WOW viruses like corrupted blood. The question then is; How and what to seed a network with?

Eric Bradlow wondered about Covid vaccines on Wharton Moneyball:

“We study diffusion of products all the time. In theory, you want to observe the social graph. In marketing the question is: Who do you give the free product to? This is standard network analysis and with that data you could do a smarter initial seeding (of a vaccine).”

Is there more bang for the buck if one person gets the vaccine rather than another?

Yes, though it’s not intuitive.

As the Friendship Paradox video shows, we aren’t all connected to the same number of friends. Some people have more, some have fewer friends and to wisely allocate a scare resource (like with marathon slots) it takes some small adjustments.

Christakis has spent a lot of time mapping networks and noted that across cultures, space, and time most human networks look the same. Some people are more connected than others. A few have hundred of connections and hundreds have a few.

It’s important for Christakis because like Bradlow, he works with a diffusion problem. Rather than marketing products though, it’s about sharing vaccines and vitamins. The thinking for both goes like this, if you can share something that works with the right person then they will share the benefits of that with the rest of their network.

But how do you pick the right person? Christakis shared this tip: “Go into a village and pick people at random. Have them suggest their friends and vaccinate their friends rather than the originals.”

Most networks are like the Curb Your Enthusiasm network (via Funkhauser).

curb_your_enthusiasm_-_season_9_-_network_graph

Randomly enter that network and you could get anyone but then ask for that person’s friend and more often than not you’ll get Larry. He’s the hub. He’s the super spreader. He’s who to vaccinate or market to.

It’s a neat bit of math. Rather than random choice, ask one question to improve the odds of an idea, movement, or effect catching on.

While there’s nothing on networks, my latests pay-what-you-want is on Tyler Cowen’s ideas about decision making. One idea is ‘meta-rationality’ or knowing when you don’t know AND knowing where or who to go to to find out. 

What you pay: Deals in the NBA

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Shane Jensen to Seth Partnow, “you make the decision to be agnostic to contract in your analysis, but as you think about building a team, contracts are something you need to take into account.” Partnow notes:

“If you’re doing an asset value ranking then age and contract come into the decision making process. There’s some players at the very high end you pay whatever: LeBron, Kawhi, Giannis. You pay them whatever because they still outperform that based on the max contract structure. It’s almost literally impossible to overpay those players.

Partnow

The other group that tends to outperform their contract is rookies, again based on contract structures.

This was in the same podcast where the Wharton hosts discussed Tom Brady, who is making more things go right, and appears to be defying the Howard Marks word of warning: “Buying good things can’t be the secret to success in investing. It has to be the price you pay. It’s not what you buy, it’s what you pay. There’s no asset so good it can’t become overpriced.”