Case of the Mondays

I picked up some sort of bug over the weekend which has had me at about 50% strength this weekend, even with Dad and Denise in town. Not fun. Here is some stuff that is fun:

What Does Oil Doubling in Two Years Mean? (Hint: every other time, it meant recession) (The Big Picture)

Short white guy makes his case for NCAA dunk contest. Wow. (Deadspin)

NFL and NFLPA gave themselves another week to hammer out a new labor agreement (Deadspin)

Trials bike stuff is always so cool (via Adventure Journal)


A Hill in Spain from chris akrigg on Vimeo.

Another sweet video from Early Ups (via AJ)



Late 2010 from Andrew Whiteford on Vimeo.

Tuesday Links

The Myth of Japan's 'Lost Decades' (The Atlantic via TBP)

Driver Mows Down Dozens of Bicyclists During Rally in Brazil (Deadspin). I've seen this on multiple blogs and its terrifying.

Holy S%@t Ski Fall. Watch your step. I watched this at least 4 times. (Adventure Journal)

Avalanches (when viewed from a distance) are awesome (AJ)

Nigel Marsh @ TED: How to Make Work/Life Balance Work (The Big Picture)

Europeans are drunks (The Economist via Reformed Broker)

Former CEO of IBM's Op-Ed in the WSJ

Don't miss Louis Gerstner's piece in the WSJ and Barry Ritholtz's follow-up. To me the ideas aren't inherently ground-breaking, they are just summarized and explored more eloquently than I could hope to.

OKCupid Analysis: The Mathematics of Beauty & Game Theory

OKCupid is an online dating service with something like 4 million users. Nothing noteworthy in and of itself it would seem. BUT they have a reputation for doing some really interesting analysis on their own users in order to unearth some findings about humans as social creatures. Their most recent post (Hat tip Barry Ritholtz for pointing it out) looks at how a girl's perceived attractiveness influences the number of messages she receives.

Of course, the most simple correlation is being hot. A higher attractiveness rating generally leads to a higher number of messages received, but there is another factor as well. It seems that a higher standard deviation of opinions leads to a higher received message total as well. Basically, if men disagree on whether the girl is attractive or not, the ones that find her attractive are more likely to send her a message while generically 'cute' girls (ranked 3 and 4 consistently on a 5 star scale) get relatively ignored.

Here is where game theory comes into play: The authors' supposition is that if men think there is less likely competition for a girl they find attractive, their perceived likelihood of success (i.e. a reply message) goes up. That increase in probability of desired outcome increases their cost-benefit of acting (by sending a message). In a wager, there are two factors that increase your desire to gamble:
1. Higher potential winnings (in this case a more attractive partner)
2. Higher probability of winning (a reply message from said potential partner)

The interestingly worded result: "If someone doesn't think you're hot, the next best thing for them to think is that you're ugly."


Brilliant! Basically, it is suggesting that women creating an online profile should have an edgy picture (unless you are guaranteed to get all 5's, in which case you are probably not on an online dating site). As they suggest:

If you're a little chubby, play it up. If you have a big nose, play it up. If you have a weird snaggletooth, play it up: statistically, the guys who don't like it can only help you, and the ones who do like it will be all the more excited.

In a real world sense, it makes the woman less intimidating.

Check out the full article here

NYT: Why So Many Rich People Don't Feel Very Rich

Fascinating (and short) article in the economics blog of the NYT yesterday. I tended to attribute the income inadequacy feeling to a 'keeping up with the Jones' but this article makes a good point:

Those in the middle earn a little less than people a few percentiles up from them, whereas those at the top earn a lot less than their counterparts in nearby, higher percentiles. For example, those who aspire to hop from the 30th percentile to the 35th percentile would need in increase their cash income by $4,000 annually (or by about 17 percent); those who aspire to hop from the 91st percentile to the 96th percentile would require an increase of $324,900 (or 171 percent).


Good stuff (Hat tip TBP)

Links!

While perhaps less fun than my ski videos, there are a few worthwhile articles:

Can Banks Foreclose on mortgages they don't own? (i.e. loans were securitized and sold). This could prevent many homes from being foreclosed and would only prolong the excess supply in the housing market. (The Big Picture)

Team MacroMan's Non Predictions (Set 1 Commodities, Set 2 Equities, Set 3 Rates)

Check out this really cool MP3 experiment (H/T TBP)

Euro stories.

The Economist has two articles looking at the costs of breaking up the euro and why some countries may do it anyway

Interesting post by David Beckworth looking at Poland versus the countries that adopted the euro.

How to Build a Consumer Society in Five million words or less

Take the time to read this behemoth out of the NYT magazine. Its an interesting (albeit anecdotal) perspective on trying to transform China from an industrial to a consumer-driven society. An interesting observation that this is where several economies have gotten stuck before (Japan, Russia).

via Ritholtz

Attack of the links

Holy Father blesses skiers (Outside Blog)

Green Lantern Trailer looks cool (H/T Reformed Broker)

Some cool outdoor time lapses, a little weird, but still pretty (Adventure Journal)

Another great video from the Provo brothers (H/T Backcountry blog)



Federal Reserve Monetary Policy 101, in the form of a comic book (H/T Big Picture)

Sit at a desk all day? Me too. Check out some stretches from K-Star, the CrossFit mobility guru (MobWod) 

Various thoughts

Silver broke $22 this morning, gold is still hovering around all time highs on news of a Spain downgrade and Anglo-Irish Bank needing another cash influx on the order of billions of euros.

Business is increasing steadily.

Saw a leaf with frost on it this morning during my commute.... aaaaaahhhhhhhh!

Contrarian Indicator

The Big Picture has a good follow-up to my post about contrarian indicators, check it out:

Article Here

Vancouver will have a long hangover from Olympic party

Quick follow-up to yesterday's post about international sporting events and lavish stadiums being a financial parasite to the public municipalities that fund them. Exhibit #593: Vancouver

Hat tip Reformed Broker

Stadiums and the Sport Economist

If you have never checked out The Sports Economist, do so. Its interesting analysis of economic principles applied to sports. Their big kick has been about the public disaster that is new stadiums (and Olympics, World Cups, etc). The potential economic benefits are always overstated by biased consultants and then the unwitting (or is it witless) public is left with long term debt on an asset that no longer produces enough revenue to fund itself.

Today's example: The Old Giants stadium. According to the NYT:


The old Giants Stadium, demolished to make way for New Meadowlands Stadium, still carries about $110 million in debt, or nearly $13 for every New Jersey resident, even though it is now a parking lot.

3 links from the NYT on housing

NYT - The Bearish and The Less So on the Housing Market - interesting consideration of housing as a luxury good or a staple. I would tend to think its a luxury good, largely for one reason: if you win the lottery (the powerball or something mega), you buy a huge house. (via Reformed Broker)

Cool Rent v. Buy calculators from the NYT awhile back: here for the basic one and here for the advanced (with chart!)

Visual Guide to Deflation

Excellent example of how economics doesn't always have to be that complicated: check out this visual guide to deflation from Mint.com via Ritholtz. I can't add much to it, so just click already.

Westerners are the Weird Ones

Cool article from the National Post examining our Western hemisphere psychological biases. The article opens by examining the fact that everywhere else, the Ultimatum Game results very differently (You are given $100 and have to decide how much to give to the other player. The other player can either accept or reject the offer. If the other player rejects, no one gets any money). One enlightening quote:

"The UBC researchers also found that 96% of behavioural science experiment subjects are from Western industrialized countries, which account for just 12% of the world's population. Sixty-eight percent were Americans. The United States is dominant in the field of psychology, accounting for 70% of all journal citations, compared with 37% in chemistry. Undergraduate students are often used to stand in for the entire species."

Read the full article here

Link-fest

Bloomberg - BP released a report taking partial responsibility for the Deepwater Horizon disaster. Also to blame? Everyone else.Still, an interesting look at exactly what happened in the days leading up to the explosion. I have learned more about drilling than I ever thought I would.

WSJ - After an emergency meeting this morning, Japan has pledged to use trillions of yen to limit the rapid increase in the yen. Japan's very fragile recovery is largely based on exports. A strengthening yen makes exports less competitive on a price basis. You can understand their concern.

The Big Picture - Excellent, succinct summary of week's events (as always).

Bloomberg - Bernanke's speech in Jackson Hole. Pretty much a non-event. Elaborated how the Fed could act further in the event of further economic deterioration. The most salient point (to me) was that the Fed cannot do this alone. I interpret this as a very polite way of saying that monetary policy can't help much if fiscal policy, housing, consumer demand and bank lending are all working against it. But that is my interpretation.

Mark's Daily Apple - Mired in Media - Discusses the three day rule behind unplugging from technology once in awhile and also some of the detriment of attempting to multi-task.

What Fat Ladies in Bikinis tells us about investing

Its the Friday before a long weekend here (its actually called Summer Bank Holiday), so here's great post at Weakonomics (via Ritholtz) about average investor rationale. My favorite:

Oh sure, she knows she’s big, but she’s refusing to admit how big she is.  Just like the investor knows they’ve lost money, but they won’t sell because they don’t want to admit it to themselves.  In her world, she isn’t really fat until she gives up and starts wearing the one-piece.  She hasn’t lost money until she sells the stock.

By wearing the bikini, she’s sending a message to herself that she could still slim down, or that she’s not as big as she is.  Exhibit 1B on the other hand knows she’s big, and just wants to have fun at the beach.  She knows she’s big, but doesn’t want to distract herself or others by jumping into the back-cleavage olympics.  She’s just as likely, if not more likely to actually make a turn around.  She’s the one who sold her stock at a loss and moved on with her life.  It’s the rational decision, and the best one for her bottom line (and perhaps her waistline.

Enjoy. This also reminded me of this bumper sticker:

Structural v. Cyclical Unemployment

Felix Salmon has a good post at Reuters about cyclical v. structural unemployment.

I tend to fall into the structural camp because of changes in technology, increasing labor force rigidity (thanks unions!) as well as the home ownership /regional inflexibility Mr. Salmon mentions.

H/T Reformed Broker

Links

Here are the interesting stories I've been reading last night and this morning:

Record number of Americans are pulling from their retirement (hardship exemptions and the like) - Zero Hedge via Reformed Broker

Wall Street Firms are Firing again - WSJ - When the firms that generate the research are cutting staff, that can't be a good sign. Also, beware of the possibility of banks being operationally bearish but pedalling bullish research.

Nice, gloomy outlook from the WSJ Europe this morning (which I read on the tube every morning, if you wonder)

Gold as Currency more than Commodity - WSJ - H/T Big Picture - I've heard it before. Gold is different. But its really its own category, so lets stop putting the square peg in the round hole.

Long article in the NYT about PR missteps so far this year á la Toyota, Goldman, BP and LeBron.