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Weekly Joke (via Stta Consulting)
A priest announced to his congregation: “I have good news and bad news. The good news is, we have enough money to pay for our new building program. The bad news is, it’s still out there in your pockets.”
Must Read Articles For All Weekly Visitors!!!
How do you get people to completely destroy their health? - via Bakadesuyo – In this paper, we take a structural approach to investigate the effects of wages and working hours on health behaviors of low-educated persons using variation in wages and hours caused by changes in economic activity. We find that increases in hours are associated with an increase in cigarette smoking, a reduction in physical activity, and fewer visits to physicians. More importantly, we find that most of the effects associated with changes in hours can be attributed to the changes in the extensive margin of employment. Increases in wages are associated with greater consumption of cigarettes.
Bill Gates Recomends This Video: 9 Billion People + 1 Planet = ? – via Value Investing World – This discussion explores the promise and perils of the next 50 years. Can humanity, heading toward a population of approximately 9 billion, advance economically without overheating the planet? Can food and water supplies be sustained without erasing what’s left of wild nature?
Friendships, family relationships get better with age thanks to forgiveness, stereotypes - via Eureka Alert -
Part of what makes those relationships so golden during the golden years is that people of all ages are more likely to forgive and respect one’s elders, according to research from Purdue University. “Older adults report better marriages, more supportive friendships and less conflict with children and siblings,” said Karen Fingerman, the Berner-Hanley Professor in Gerontology, Developmental and Family Studies. “While physical and cognitive abilities decline with age, relationships improve. So what is so special about old age? We found that the perception of limited time, willingness to forgive, aging stereotypes and attitudes of respect all play a part. But it’s more than just about how younger people treat an older person, it’s about how people interact.”
Spain’s Debt Maturity Wave Hits Next Month And It’s Already Obvious They Don’t Have Enough Cash - via Business Insider – Spain faces a confluence of events in July, whereby it will need to finance 21.7 billion euros within a single month. This combines shortfalls in its budget and a wave of scheduled government debt redemptions. Even if the Spanish government draws down its cash reserves, Goldman Sachs believes it will still be short 12.6 billion euros.
Fear of Flying? The Odds of a Plane Crash, and the People Who’ve Survived - via Book of Odds – In 1908, Thomas Selfridge, a 26-year-old first lieutenant in the Army, was a passenger on a biplane during a powered-flight demonstration when it crashed. He was killed. The biplane’s pilot, who was badly injured but survived, was Orville Wright. Selfridge has the dubious distinction of being the first airplane passenger to not survive the flight. Since his death, there has not been a single year without an airplane-related fatality somewhere in the world.
Personal Bankruptcy Odds Rising in 2010 – via Book of Odds – We reported not long ago on a steep increase in the odds an adult will file for personal bankruptcy—up from 1 in 207.2 in 2007 to 1 in 158.6 in 2008. Today, after a slight improvement in 2009, the numbers are again going in a worrisome direction, despite other signs of improvement in the economy. Just look at Teresa Giudice, star of Bravo’s The Real Housewives of New Jersey. She has just owned up to the fact that she and her husband filed for Chapter 7 bankruptcy last fall. According to the New York Post, the Giudices owe nearly 11 million dollars—their creditors include the lenders holding mortgages on three homes plus the note on their Caddy, an assortment of upscale department stores, a fertility doctor, even the phone company.
The Real Concern When Couples Fight - via SciAm – New research reveals that nearly all fights between romantic partners can be distilled into two fundamental complaints. Christie Nicholson reports. They found that every argument, covering everything from laundry to string theory, resolves itself into two fundamental complaints: one person feels that he or she is being blamed or controlled, unjustly, for something that has nothing to do with the argument, or one feels neglected, and this manifests in the feeling of “you don’t really care about me” or “you are not as invested as I am.”
Video: More emotional intelligence in the subway – via Dan Pink – Last year, the folks at Volkswagen and Fun Theory devised an engaging (and musical!) way for people to exit a subway station. Now they’ve come up with a equally engaging way for people to enter a subway station.
Video: Matthieu Ricard: Change your Mind, Change your Brain - via Value Investing World
Miguel’s Weekly Favorites
How the Brain Pays Attention - via PsychCentral – Neuropsychologist Marlene Behrmann gives an overview of visual perception, different types of attention, and visual processing in an interview for the excellent cognitive science educational site, Go Cognitive.
The overwhelming habit of biases and self-evaluation - via Social Psych Eye – Differences amongst groups of people tend to be most salient at the cultural level. A comparison often cited is that of Eastern and Western cultures. These group differences, however, tend to be caricatured stereotypes of people that may not hold true in all contexts. Take for instance, the cultural differences in East vs. West explained pictorially. Life for those in the Eastern culture is pictured as having multiple individuals holding hands signifying collectivism. In the Western culture there is a picture of one individual, depicting the concept of individualism. Another cultural difference is portrayed as Westerners addressing problems directly, and Easterners indirectly addressing problems.
Book Review: More Money Than God - via NYT – This is not an obvious time to be glorifying financial tycoons. Making enough money to buy your own private island might have earned you an airbrushed magazine cover a decade ago. Nowadays, though, the erstwhile Masters of the Universe are viewed with such opprobrium that one of their favorite lawyers told me recently he was advising his clients to soft-pedal their objections to financial reform legislation because the more Wall Street hates it, the better it plays on Main Street.
Book Review: Crises Economics By Roubini - via NYT – In late March, the former Federal Reserve chairman Alan Greenspan told Al Hunt of Bloomberg Television that the financial crisis had been a “once in a century” shocker. “We all misjudged the risks involved,” Greenspan said. “Everybody missed it — academia, the Federal Reserve, all regulators.”
Tipping Determined by More than Just Service - via Book Of Odds- The practice of tipping carries with it all kinds of ethical quandaries. A tip is supposed to be a reward for good service, yet in many situations tipping is simply expected—no matter what. The odds an adult usually tips a waiter or waitress are 1 in 1.02 (98%). It gets even murkier when it comes to tip jars. Do you tip the person who pours your joe at Dunkin’ Donuts or serves up your soft serve at Dairy Queen? How about a full-fledged barista? And if you do tip, how much? (See “ To Stiff or Not To Stiff: Tipping in America). It turns out the answers to those questions can depend on some factors which might surprise (or disturb) you, including:
Data Aggregation: Their Boston, Our Boston - via Boston.com – In the Age of Aggregation, even an impulsive click on your cellphone can become a piece of data for a project you never knew existed. Where do tourists go in Boston? Where do locals stop to take pictures? On this map, the red dots mark photos taken by visitors to the city; the blue dots are photos taken by locals. You can see the red gathered together in huge clusters, forming a spine through central Boston, while the blue dots sprawl outward through the neighborhoods, a kind of anti-tourist guide to the city.
When Do Exaggerations and Misstatements Cross the Line? – via Knowledge & Wharton – When public figures are caught embellishing their accomplishments or qualifications, whether by exaggeration or misstatement, people everywhere express outrage. Indeed, as more and more politicians, CEOs and other big names these days try to make amends for fudging their resumes, incorrectly relating the details of a story or otherwise playing fast and loose with the facts, the general reaction from an increasingly jaded public is: “What were they thinking?”
Why flee when you can fight: the counter-evolutionary practice of bullfighting - via Social Psych Eye – A bullfight conjures many images, such as cheering crowds, brave matadors, and rushing bulls. A bullfighter earns respect and attention because, unlike most of the population, he dares to step into the bullring and face a bull. In the process the bullfighter asserts control over the body and controls the innate response to run and instead seeks to fight the bull. So when a bullfighter decides to run from a bull instead of fight it, albeit a natural evolutionary response, it becomes a newsworthy event.
Using Science to get Johnny to study - via Boston -How do we motivate kids — especially kids in rough situations — to want education? Researchers at the University of Michigan studied middle school students in Detroit and found that, while almost 90 percent expected to go to college, only half wanted a career that actually required education. And this difference was critical. Students whose career goals did not require education (e.g., sports star, movie star) spent less time on homework and got lower grades. The good news is that the researchers found it was easy to make education more salient, and thereby motivate kids. When students were shown a graph depicting the link between education and earnings, they were much more likely to hand in an extra-credit homework assignment the next day than if they were shown a graph depicting the earnings of superstars.
As Corals Die Off, Scientists Watch for Signs of Evolution - via NSF – Biologist Mikhail Matz uses next-generation sequencers and a massive, NSF-supported supercomputer to study corals at the genomic level and look for evolutionary changes
Bill Gates: Eliminating Killer Diseases with New Medicines - via Bill Gates Blog – For people suffering from serious but treatable diseases like pneumonia and tuberculosis, access to drugs can mean the difference between life and death. A new report and two recent announcements are signs of progress in efforts to expand access.
Telecommuting can be hazardous to your career - via PhysOrg- Working from home has many advantages. By cutting out the commute, employees can save money, boost productivity and reduce their carbon footprint.
Scientific expertise lacking among ‘doubters’ of climate change, says Stanford-led analysis - via Eureka Alert – The small number of scientists who are unconvinced that human beings have contributed significantly to climate change have far less expertise and prominence in climate research compared with scientists who are convinced, according to a study led by Stanford researchers. In a quantitative assessment – the first of its kind to address this issue – the team analyzed the number of research papers published by more than 900 climate researchers and the number of times their work was cited by other scientists.
New Book: A Lively History of the Quirky Math of Voting - via Princeton – Since the very birth of democracy in ancient Greece, the simple act of voting has given rise to mathematical paradoxes that have puzzled some of the greatest philosophers, statesmen, and mathematicians. Numbers Rule traces the epic quest by these thinkers to create a more perfect democracy and adapt to the ever-changing demands that each new generation places on our democratic institutions.
Nudging People to Buy Health Insurance - via Economix – I have argued (in last week’s post, in January and last year) that if Americans want a private health insurance system that does not base the price of individually sold policies on that individual’s health status and that does not allow an insurer to refuse to sell a policy because of an individual’s health issues, then they should accept a mandate that all Americans purchase at least a minimum package of health insurance. That, in turn, requires that lower-income families be publicly subsidized to enable them to afford the insurance.
Obama Adopts Behavioral Economics - via Business Week – Peter R. Orszag, the White House budget director, plans to resign this summer, the first member of President Barack Obama’s Cabinet to do so. He leaves behind an indelible mark on two of the President’s signature issues: the $862 billion economic stimulus plan and the $940 billion health-care reform law, both of which he had a major hand in drafting.
Why Is Wordplay Still Sexy? - via Big Think – Is it fun to watch our finest writers being witty with one another, as it’s fun to watch Federer play Nadal? There are similarities. They rise to the occasion. Lauren Collins’s New Yorker Talk of the Town piece on dinner out with Salman Rushdie and Christopher Hitchens is a reminder of this, these two being a bit the literary Federer and Nadal of our day. Who else plays these kinds of games (“the-ruining-everything-by-changing-one-letter game,” for example), and what are they worth to the rest of us aside from idle, cool distraction? They are worth this: they remind us that, despite the many naysayers—including this week’s Observer piece on Why Fiction No Longer Matter As Much—there are reasons we prize the literary tradition in our culture, and there is reason why we prize fiction in particular.
Six Strange New Planets Discovered - via Good – Since 1995, astronomers have discovered about 450 exoplanets that exist outside our solar system. Recently, they found more than they bargained for. Space.com reports that the European CoRoT satellite has discovered six new exoplanets. One of the worlds is twice the size of Jupiter, and all of them have strange and unique characteristics. CoRoT (Convection Rotation and planetary Transits) is operated by the French space agency CNES. Launched in 2006, it is a planet-hunting spacecraft that observes stars over long periods of time. CoRoT contains 27-cm diameter afocal telescope and a 4-CCD camera designed to study stars and the light they emit. One way it looks for planets is to study the variations of lights passing by stars—many of which prove to be orbiting planets. And once CoRoT sees an exoplanet, it focuses in to reveal an abundance of information.
Talking on your cell phone while driving may be hazardous to your close relationships - via PhysOrg – Warnings about the dangers of distracted driving while using a cell phone are prevalent these days, but cell phone use while driving may also put family relationships in jeopardy, says University of Minnesota professor Paul Rosenblatt.
Do creative work activities create stress? - via PhysOrg – The demands associated with creative work activities pose key challenges for workers, according to new research out of the University of Toronto that describes the stress associated with some aspects of work and its impact on the boundaries between work and family life.
Television Series: Power of Art: Renaissance to Modern – via Open Culture – Simon Schama’s 2006 television series, Power of Art, takes you on a tour of eight transformative painters, moving from Rembrandt and Caravaggio to Picasso and Rothko. I have more to tell you about this series on Brainpickings today.
7 More Psychological Techniques - via PsyBlog – Trying to make connections? Here are seven more research-based techniques to increase creativity. “Creativity can solve almost any problem. The creative act, the defeat of habit by originality overcomes everything.” ~George Lois
Sarah Jones on Stereotypes and Stereotyping - via Situationist – We highly recommend a 13-minute podcast in which Sarah Jones (a Tony Award winning playwright and performer) reflects on morals, racial stereotyping, and the perils of West Coast jaywalking. You can listen to the podcast (recorded live at The Moth Main Stage) here.
Ocean pollution ‘threatening the human food supply’ - via Raw Story – Sperm whales feeding even in the most remote reaches of Earth’s oceans have built up stunningly high levels of toxic and heavy metals, according to American scientists who say the findings spell danger not only for marine life but for the millions of humans who depend on seafood.
You’re Getting a Bonus! So Why Aren’t You Motivated? - via Harvard – If you’re like most professionals working in large corporations, you’re eligible for an annual bonus as part of your pay. If you’re one of the luckier ones, you’ve been hearing rumors lately that with the economy recovering, that bonus may become a reality again. Good for you. But maybe not so good for your company. Chances are, its bonus program is costing it plenty but it isn’t seeing much of a motivation boost in return, from you or anyone else.
The Age of the Infovore- via FT – Tyler Cowen’s “Create Your Own Economy” is now out in paperback entitled “The Age of the Infovore“, perhaps an acknowledgement that the initial title wasn’t working out. I liked the book at lot. As suits the infovoracious it is wide-ranging, somewhat scattershot but extremely creative, original and thought-provoking. If the book has a theme it is that different people think very differently – not just that they have different tastes or different beliefs but that the entire way they organise the world is different – and that the internet offers some people a much better way to order their encounters with the world than they have previously been offered. It changed the way I think.
Smoking ban or cigarette taxation? - via Economic Logic – While people are now used to widespread smoking bans in the United States, European countries are right now going through the painful transitions, with the expected anxieties from restaurant and bar owners. They will do fine, but one can still ask whether simple taxation of tobacco would not be sufficient and especially more efficient in internalizing second hand smoke.
Confidence Beats Competence - via Neuromarketing -What are the ideal characteristics for a person in a sales position? Great people skills? Strong product knowledge? Add confidence to the list. Continuing a discussion started in Convince With Confidence, there’s more evidence that the average person finds a confident demeanor persuasive, even when the confidence may mask a lower level of competence.
Podcast: False Memories – How Can Your Memory Be So Bad? - via PsychFiles – For some reason we believe that our memories are accurate. They are far from it. What we remember is a hodge-podge, a patchwork of images, stories, and bits and pieces from our past. In this episode I describe some of the very interesting research showing how our memories can be manipulated in surprising ways. Learn why you loved asparagus as a kid (really you did, really).
Gain Self-Insight Through Abstract Thinking - via Spring.co.uk – How to see yourself as others do: experiments suggest alternative to flawed intuitive technique. You and I can talk, we can reach out and touch each other on the arm and we can see each other, but we can never know exactly what’s going on in the other’s head. It’s partly why psychological science is so hard and it’s why understanding how we are viewed by others is so hard.
Sex Differences in How Salary Increases Are Perceived- via Psychology Today – Men_Women_Pay_Raise If asked to choose between these two options, which would you pick? (A) You will receive a $500 salary increase, and your colleague will also receive a $500 salary increase; or (B) You will receive a $600 salary increase but your colleague will receive an $800 salary increase. Of course, the dilemma here is whether to choose more money for one’s self (option B) that ultimately though yields more money to one’s peer, or less money for one’s self (option A) but an equal salary increase for one’s peer. From a strict income maximization perspective (as has been traditionally postulated by classical economists), option B is the “rational” choice. Of course though, people have a disutility for perceived unfairness, and as such they often choose option A.
Secret of AA: After 75 Years, We Don’t Know How It Works – The church will be closed tomorrow, and the drunks are freaking out. An elderly lady in a prim white blouse has just delivered the bad news, with deep apologies: A major blizzard is scheduled to wallop Manhattan tonight, and up to a foot of snow will cover the ground by dawn. The church, located on the Upper West Side, can’t ask its staff to risk a dangerous commute. Unfortunately, that means it must cancel the Alcoholics Anonymous meeting held daily in the basement.
Do scientists make “broad, and quite likely false, claims about what drives human behavior”? - via Brains On Purpose – Have you sometimes been skeptical about the results of research when the subjects are all college undergrads, and wondered how representative these subjects were of people as a whole? Regarding that skepticism, here’s the abstract of an article for you from Science (AAAS):
Types of Thinkers - via Overcoming Bias – What we don’t have, in other words, are thinkers. People who can think for themselves. … Thinking means concentrating on one thing long enough to develop an idea about it. Not learning other people’s ideas, or memorizing a body of information, however much those may sometimes be useful. Developing your own ideas. In short, thinking for yourself. You simply cannot do that in bursts of 20 seconds at a time, constantly interrupted by Facebook messages or Twitter tweets. (more)
Difference Wisdom - via Overcoming Bias – Seek serenity to accept what you cannot change, courage to change what you can, and wisdom to know the difference. Imagine that you were thinking of buying or building a house. Now consider various possible hypothesis you might have about your degree of influence over this resulting house.
Salem witches & Game Theory - via Mind Your Decisions – a math puzzle I came across a fun math puzzle that’s relates to the game theory of guessing. The puzzle was posted by James Grime, a mathematician who has posted some nice videos under the name singingbanana.
Exclusive Picks + Financial Topics
How do regulators cope with terabytes of data? – via Jayanath R Varma – Traditionally, securities regulators have coped with the deluge of high frequency data by not asking for the data in the first place. The exchanges are supposed to be the front line regulators and leaving the dirty work to them allows the US SEC and its fellow regulators around the world to avoid drowning under terabytes of data. But the flash crash seems to be changing that. The US SEC had to figure out what happened in those few minutes on May 6, 2010. When it attempted to reconstruct the market using data from different exchanges, it ended up with nearly 10 terabytes of data. The SEC says in its joint report with the CFTC on the preliminary findings about the flash crash:
What might history tell us about the Greek crisis? - via China Financial Markets – The Greek crisis may in many ways seem unprecedented, but of course it isn’t. I think by now everyone already knows that Greece has spent much of the past 200 years – more than half by some counts – in default or in one form or another of debt restructuring, but in fact there are plenty of other periods of sovereign default and restructuring that can tell us something about what is happening and what will happen. I would suggest that there at least five things we can “predict” with some degree of confidence from looking at historical precedents:
A special report on debt - via Economist – There is an old joke about a stranger who asks a local for directions and gets the cheerful reply: “If I wanted to go there, I wouldn’t start from here.” That advice sums up the dilemma the developed countries face in dealing with their debt. They have accumulated a mountain of it at every level, from the personal to the corporate and the sovereign. As this special report has shown, this was encouraged by a legal system that sheltered debtors, a corporate and financial sector that used debt to boost its returns and a cultural change that made it more respectable.
Physics Risk Isn’t Market Uncertainty - Via PsyFi Blog – The idea that economics should be modelled on the concepts of physics has been prevalent for the best part of a century. It’s a deliciously engaging idea, that the steadfast and unbending rules of science should be the template for the queen of the social sciences. The only trouble is that in economics human beings are part of the system and don’t tend to behave as economists would wish them to. On the other hand the ideas generated by analogies between physics and economics have generated a whole bunch of truly great economic ideas and are the basis of the whole of microeconomics. Although it’s tempting to argue that these ideas don’t truly make sense it’s actually quite hard to make this accusation stick. Economics and physics are connected – only just not quite the way economists like to imagine.
Nial Ferguson – The people’s banker - via FT – “For me the greatest interest and enjoyment were human relations,” Siegmund Warburg observed in later life to the academic George Steiner. “It was the human side, in practice the negotiating side, which attracted me to banking.” For most of the postwar period, from the foundation of SG Warburg & Co in 1946 until his death in 1982, Warburg was the most dynamic figure in the City of London. If anyone embodied the era of relationship banking, it was Warburg.
Three debts: A view from emerging Europe - via Voxeu – As the debate rages over the best path for fiscal policy, this column looks at the causes of the Eurozone crisis, especially in emerging Europe. It argues that despite the debate focusing on public debt, the key issue is the development of private debt. That suggests that the key policy remedy would be private debt consolidation supported by countercyclical fiscal policy.
Curbing speculation could destabilize commodity prices, study says - via PhysOrg – Price spikes for gasoline, grain and other commodities could be magnified if lawmakers curb speculative trading in futures markets, according to a new study released today in conjunction with this weekend’s G20 summit.
Survey challenges popular beliefs about high-tech startup patents - via Physorg – A new survey of high-technology entrepreneurs finds that patents provide less incentive to innovate than popularly believed, but offer tangible benefits by limiting competition, attracting financing, and increasing the chances of an acquisition or IPO.
Academic Research Worth Reading
The insurance industry in Brazil: a long-term view – via HBS – This paper surveys the formation and development of insurance business in Brazil. It describes its origins, from the colonial times and imperial era to recent events. Particular attention is given to regulatory changes, showing how they evolved in response to macroeconomic shocks that affected the Brazilian economy during this period.