Network Connections by phoenixkeyblack

Last February I wrote the following but left it as draft for some reason.

Last year I was able to connect with my classmates and childhood friends at the Russian Odnoklassniki.ru which some claim is used by successors of the KGB to keep tabs on overseas connections of Russians and others. Before that I signed up for LinkedIn hoping to never lose contact with colleagues. Then came Facebook for yet a few more friends and relatives. Some time has passed and I can see the usefulness of these “social networks” but while they all have continually improved their user interfaces and the network sizes, they have failed in one area. They can all list the connections but so far I have not been able to find one that tries to gauge the strength of the relationship.

Is it fair to treat all relationships the same? The best we have evolved to is grouping of relationships (friends, coworkers, close friends, etc.). Whoever unlocks the method of gauging the strength of the relationship will have discovered the next generation of social networking. Who is in a position to do this? Not the Facebooks and LinkedIns of this world, IMHO. I would place companies like Apple and Google on the map along with Verizons and AT&Ts but even these will have quite a struggle. A light read of the interpersonal relationships page will help understand the magnitude of the challenge.

Not all parent-child relationships are the same just as not all marriages are created equal. These are the easy ones. LinkedIn Outlook Toolbar will scan one’s e-mail to suggest contacts (based on numbers of e-mails exchanged). Does having frequent contact with someone result in a stronger relationship than having very infrequent contact? Is it even possible to quantify and digitize something as complex as human relationships? I think it is but will require capture and analysis of even more information.

Capture of on-screen (technology based) information is easier (and Googles, Apples and Verizons may be able to do that). The really hard part is the capture of the wink, the nod, or the smile that can make or break someone’s day. How about computing the trustworthiness and reliability of someone? I guess we are able to compute credit scores… but wait these are based on transactions. So maybe we can capture transactional relationships but what about the transformational ones (completely outside of systems)?

Sometime ago I wrote this post. I had no idea that Apple was working on the iPad. Perhaps someone out there is spending their days, weeks, and years trying to decode that which we value most – our relationships. I just hope the KGB doesn’t get a hold of that technology…

Mac-Man by ~blindguard

Every couple years I take stock of the latest developments in computer operating systems. It helps me get an overview of  innovations in computer technology and get up-to-speed in terms of what the “world” considers important for computers. Here are my impressions.

Apple and Google have done a lot to change the way we (the world) view computers and their roles in our lives. Apple’s operating system Mac OS X is elegant in simplicity and power. As a newbie I was able to get it up and running quickly (on an iMac) and within days felt right at home with advanced tasks available on Unix-like systems. From concepts like disk partitioning and file synchronization to simple tasks like chatting on Skype and syncing contacts, the whole system is designed to simplify life. Google has done the same with e-mail, pictures, searches, maps and many other areas, all in an effort to simplify life. In case of Google, the services are “free” but the motives are unclear (outside the obvious ad business). Apple does not suffer from this but has a high premium for its products (which warrant every penny when compared with the competition, IMHO). One could argue that while these companies have simplified our life in some ways, they have indirectly increased the demands placed on our time but this is for a separate discussion (some hints in Technological Revolution).

Microsoft changed our lives in the last couple decades. Windows Vista was a total disappointment. Windows 7 is much better and is probably the best Windows yet. Amazingly, most people I know (including myself) still use Windows XP. Many programs I use have a hard time running on 64-bit Windows 7. It consumes a lot of memory (for what?) and still has quite a few areas to improve. The simplicity of Windows 2003 was more acceptable but that was a server operating system (with a high price tag). Why Microsoft is all over the place is hard to understand but the results will eventually show it.

Linux has come a long way. I tried Ubuntu 9.10 and 10.04, Fedora 12 and 13, Debian 5.04, Oracle Enterprise Linux 5, and a few others. Of these I like the install of Fedora 13 and the usability of Ubuntu 9.10. Apple’s OS X is a far more polished Unix variant than all of these. What’s amazing about the Linux world is the global community’s efforts to enhance it and the corporate efforts to milk it, all with good intentions. It will be a while before these become mainstream enough to displace Microsoft and Apple. A simple task of getting Skype to work took quite a bit of research and modification of runtime parameters, for example. Apple knows this and requires its Unix variant OS X to run on its hardware. Try to run OS X on anything else and Linux will look like piece of cake.

A few other operating systems support their stated goals well but since most of us do not interact with them directly we often do not even know that they exist. Solaris, for example, is solid but is made for business servers. RedHat and Suse have their versions of enterprise Linux servers. There are the BSDs, and many others. While these may run systems that help change our lives, they do not directly change our perceptions about computers and their roles.

A lot has changed from a decade ago but the players seem to be the same. The question is whether a new player will emerge in this space to completely change the game. What disruptive innovation will completely displace all of these operating systems in the same way that these have displaced the prior generations (CP/M, DOS, VMS, so many more)? Will the inventions be in hardware land or incremental improvements on what we have today? Pages could be written on this topic, but let me stop here for now.

Mirror Mirror by `Fredy3D

A few weeks ago, I had a fantastic meal with my good friends at Massimino’s, a nice little Italian place in the North End where we gather once a year to catch up and remember the past. This is a group of truly special people.

Eight, maybe nine years ago I was assigned to help implement a financial system at StateStreet. Little did I know about the true complexity of the project and the history prior to my assignment to the project. To sum it up, it was a mess! A multimillion dollar implementation on the brink of failure, this project seemed impossible and probably would have been scrapped. Multiple weekly status meetings with 40-50 people (at least 30 consultants @ ~$300 /hr), half dozen project managers with their assistants, an entire floor in the most expensive building in Boston, the best hardware costing over a million dollars, and much more didn’t seem to matter enough. Yet somehow this team of special folks managed to successfully roll out its piece of the project. It’s a nice annual surprise to hear that the system is still in use globally.

Even though  I have worked on many projects since then, I haven’t been in a similar team. It is even more troubling to see some of the latest currents that seem to sweep across this great society. Here are some observations.

We have all of the great communication technologies yet we’re less connected. I am certainly not talking about efficiency of transactional communication or the productivity gains from instantaneous dissemination of information. We seem to be less connected with transformational life-long relationships. At work, many of us stare at computer screens all day long with little time to actually talk to people outside the transactions we conduct. On Facebook, as a close friend pointed out, we see status updates that scream of loneliness and boredom. Instead of bowling or golf, many have the living room computerized “equivalents.” We have everything yet we have nothing.

To contrast this, I remember life back in Armenia back in the dark days when we had no electricity, no telephone, no running water, nothing! My father would joke that of all systems of communication/infrastructure only the sewer system worked (and even that froze one day in the dead of winter). We had hardly any food and I had to go for a daily fight for a loaf of bread. Yet in that environment we were (incredible to imagine) happy, never bored or lonely. The space/time for those days is no longer; only memories remain.

Today we are well connected exchanging / processing hundreds of e-mails, instant messages, text messages, tweets, phone calls, video chats, blogs posts and comments yet so many seem to be lonely, alone and feeling completely disconnected and alienated. TV commercials scream about depression and insomnia drugs and other remedies to address anxiety disorders. Netflix, OnDemand, and YouTube bring thousands of channels of passive “entertainment” yet it seems people need even more despite some of the videos and programming being pure trash.

The industrial revolution has ruined our external environment. Technological revolution seems to be ruining our internal environments. Or is it just a mirror?

Wisdom by ~ectrhoi

Daily Speculations is a blog mainly about the markets but hidden under the market context there are very interesting experiences, lessons, and thoughts about life in general. I have recently joined the discussion and hope to add my modest contribution (you can find what I have said so far by clicking on Legacy Daily in the list of the names on the left).

The wonderful human qualities that come across in the various posts include among others curiousity, humble acceptance of one’s own limits, celebration of knowledge and experimentation, respect for others and their words, separation of issues from people, recognition that the whole is greater than the sum of the parts, belief in good human qualities, and passion for freedoms. Expressed points are often enhanced by people chiming in with their perspectives and sometimes with their disagreements.

Right next to the rubble of the Internet garbage there are sometimes jewels that sparkle out in the open. It is up to us to seek them. I cannot help but remember the very first sentence ever written when the current Armenian alphabet was created around year 400: “To know wisdom and instruction; to perceive the words of understanding;” (Proverbs 1:2). Having said this I feel compelled to include a small paragraph from Proverbs 1:

“20 Wisdom calls aloud in the street, she raises her voice in the public squares; 21 at the head of the noisy streets she cries out, in the gateways of the city she makes her speech: 22 “How long will you simple ones love your simple ways? How long will mockers delight in mockery and fools hate knowledge? 23 If you had responded to my rebuke, I would have poured out my heart to you and made my thoughts known to you. 24 But since you rejected me when I called and no one gave heed when I stretched out my hand, 25 since you ignored all my advice and would not accept my rebuke, 26 I in turn will laugh at your disaster; I will mock when calamity overtakes you– 27 when calamity overtakes you like a storm, when disaster sweeps over you like a whirlwind, when distress and trouble overwhelm you. 28 “Then they will call to me but I will not answer; they will look for me but will not find me. 29 Since they hated knowledge and did not choose to fear the Lord, 30 since they would not accept my advice and spurned my rebuke, 31 they will eat the fruit of their ways and be filled with the fruit of their schemes. 32 For the waywardness of the simple will kill them, and the complacency of fools will destroy them; 33 but whoever listens to me will live in safety and be at ease, without fear of harm.”

The Falling Capital by ~Latuff2

My friend sent me a funny link about CNBC that brought forward a few thoughts about assets. What I am about to write you can and should safely ignore as it is likely to have little to no impact on your life. If you know me, you already know I don’t know anything and carry my cross like everyone else in the world. If you don’t even know me, how can you take what I say as anything of value, anything to use as basis for even a simple decision. Please apply this test to all the noise that comes at you at hundred miles per hour from all the sources of your information. It is actually fun to find the hidden assumptions, the flaws in arguments, the hard-to-notice issues with the opinions given out so freely by everyone. Find issues with what I say, and I’ll thank you.

I only watch CNBC, keep an eye on the papers, and the Internet to gather clues about public feelings. Don Chu’s eloquent points about the fractal nature of humanity come to mind here because just as we have good days and bad days, so does the society. Our aggregate public feelings appear in media. As an example, jokes are only funny because we can relate to them. These feelings in today’s complex and constantly changing world cannot be internalized without one keeping both eyes and ears open and watching and listening on all frequencies. Often the clues are subtle, insignificant and sometimes I cannot even verbalize what I’m “hearing” but I don’t stop listening. My only limitation is time. CNBC plays its vital role in filling in the picture of public sentiment. All of the networks cater to their audiences so well, that we can easily approximate the mood of the audience by simply keeping an eye on the media catering to that audience.

Why did I think about assets? Actually, I don’t like that word at all. The reason is debt. Assets can be acquired with debt. It is not difficult to have significant assets balanced by significant debt. I like the word capital much better. Much of the media, your neighbors, everything you see screams “assets.” Assets are visible and quantifiable. Debt is a hidden, private matter. Of the various definitions of capital, I like this one “any form of wealth employed or capable of being employed in the production of more wealth.” This concept is too basic, I agree. However, often the very basic and simple ones contain more energy than complexities (who would have thought tiny atoms could produce so much energy).

The first challenge is the preservation of capital which encompasses everything we do to make sure that whatever capital we have does not turn into nothing as a result of everything that happens around us. Public sentiment is critical for this because after all the vehicles for storage of capital only work if someone out there is willing to accept them in exchange for something we need. I lived through a period when currency turned into nothing after the collapse of the Soviet Union. Every day I would take the money I earned with my friend and buy something, anything I could buy (cheese, butter, dollars, etc.) because the next day that money would buy less. To contrast that, I was speechless when I visited the Vatican and realized how the Roman Catholic Church had preserved its wealth throughout centuries, changing regimes, wars, and changes in public sentiment. It is a superb lesson in wealth preservation which even includes sovereignty. Contrast that with someone trying to hold on to their property during the gold rush. Keeping in touch with the world and public sentiments is critical for taking the necessary measures ahead of time to protect one’s capital.

The second challenge is employing the capital to produce more wealth. I actually consider this an easier challenge than the preservation of capital but there is nothing easy about this. CNBC and millions of “advisers” are ready to give us that one perfect method that will surely increase our capital. They (referring to the money machine) even convinced a lot of people to borrow someone else’s capital (mortgage or margin put into stock market). They “help us” with enormous amounts of data (real-time quotes, hundreds of statistics, derived metrics, research reports, derivative instruments, etc.), with “education” contrasting investors with speculators (no real difference here), with language (buy and hold, dead cat bounce, MBS, ABS, CDS, etc.), and everything else one would ever “need” to turn capital. The US government wants constant turnover of capital because at every turn increases can be taxed. If capital is not turned (artwork passed from one generation to another), no worries as there are laws to tax the transfer. I still cannot understand how the capital gains are taxed fully but capital losses are only used to offset gains (+$3,000 break). People unfortunately do not often understand what capital is because we sometimes start out with negative capital (student loans, mortgages, etc.). By the time we create enough value to pay off these loans by helping someone else turn their capital, time (our most valuable resource) becomes depleted. CNBC, the mutual fund companies, the government, our friends, this blog, and nothing else in the world can tell you how to preserve and increase your capital. Once this became clear to me, CNBC and all forms of media and information took their proper place in my mind.

Every issue, every law, and every viewpoint represents a spectrum where our opinions, options, and choices vary infinitely within a continuum. Our position on the subject is where we find ourselves on the spectrum at any given time. Issues can also be seen as Euclidean vectors with their lengths and directions. Some issues have major impacts on many lives. Others are against the overall direction of the society but have more limited impact. At any particular time, we find ourselves in that one spot in the multi-dimensional universe of issues where all these vectors intersect with the point of intersection being our position on the subjects.

How I have changed...

Why are these issues so polarizing? As I was staring at my computer screen, the answer was staring right back at me.

“Hi! You! Hello… Yes you! I’m talking to you! You’re very fortunate, did you know that? Why? Are you joking? You have choices. What choices? Let’s see… where do I start… Let me tell you about my life. I sit here breathing dust waiting, waiting… waiting for your next command. But you know I can’t just do nothing. I can’t just sit like you sometimes gazing at the horizon. I have to work. When I am awake I cannot be idle. That’s how I’m built. Sometimes you look at me all day long and don’t even notice me. You see past me into the bits and bytes I bring to you from my extended family. Sometimes you come over, stare at me and start laughing. Are you laughing at me? Oh forget it… Who am I anyway? You could care less about me. But maybe not… You seem to like when I do tricks like playing music or showing movies but do you realize how empty I feel inside? All I can do is turn switches on and off… Oh how much I wish I could understand all those bits and bytes I deliver to you… If I could only laugh just once … with you. I only have one choice ON or OFF… I know I’m good at that. In a single blink of your eyes, I can switch millions of times… Blink… Yes don’t forget, blink a few times while you stare at me…”

We are very fortunate to live in times when not only we can have choices and options but we can actually express our positions and opinions. The problem is that we forget that others also represent a bunch of arrows intersecting at a unique spot in the universe at any given time. Many of us (myself included) try to force, persuade, or convince them that not only is our intersection the best spot in the universe but it is where they should also strive to be. If we could just accept their place in the universe the same way we accept where each star shows up on the sky…

Center of V838 Monocerotis Light Echo

Speaking of the sky, when I was little, we would sometimes lay on our backs on the warm asphalt on a cool summer night at the observatory looking at the starts. We had billion of stars in Armenia and only a few here in Massachusetts. In those days we would find all of the constellations and even make up our own. One day I saw a picture of the stars from a different point in the galaxy. None of the constellations were there even though it had a lot of the same stars. The arrows, their sizes and their directions are similar to the stars and appear a certain way only from where we stand. That happens to be our distorted view of the stars.

Glass distortions by ~ahillo

Earlier I wrote about separating the wheat from the chaff but today a few sentences in comments of a post provided much food for thought. The lens of our minds often paint a very distorted picture of ourselves and, as a result, of others and the world around us. Unfortunately, since we only have a single point of reference, it is difficult for many of us to catch and correct this distortion. The distorted view, in turn, tends to cause us to dismiss ideas, thoughts, or points that could otherwise be invaluable (the wheat). We correct this distortion through constantly cross-checking what we see with what others see either via live experiences or via imagination enriched through education, reading, and other means of learning. For example, Dr. House in a popular TV show wants his team to challenge his thinking forcing him to see the same problem from different angles. Dr. Niederhoffer in Daily Speculations gets a real-time perspective from his readers while exchanging with them his perspectives. Another example is our ability to use past education, reading to relate to current events, or current people (mind applying past patterns to current ones). We are hard at work trying to correct the distortions created by our own upbringing, learning and experiences, yet often we end up with an even more distorted view if our subconscious corrective efforts are not using the appropriate models or people. If I had multiple lives, I would devote one to the study of the hypothesis above. The author of the referenced post says he never lets his “personal feelings for a person interfere with any good ideas they bring to the table” which is perhaps his effort to correct the distortions by forcing his mind to remain open despite the stimulus (dislike) to close.

There is another sentence hidden in those comments stating that “the person and his/her ideas are 2 different things.” Is this really possible? I believe that a Person = ideas + attitudes + habits + values + beliefs + qualities + character + roles + contributions + lessons + observations + legacy + other dimensions where it’s impossible for each dimension to be independent of the others. The key point I forgot to mention in the post comments is regarding the time dimension. While we are the sum of what we do, say, write, believe… these do change over time allowing us to change as well. I remember reading someplace Gandhi saying “A person cannot do right in one department of life whilst attempting to do wrong in another department. Life is one indivisible whole.” Humans are complex beings but one way to understand ourselves and others is to realize that we are multidimensional beings, with many parts to each equation. And, those parts are always changing. Some parts we hope change very frequently (experiences, observations, etc.) while some parts we hope remain fairly constant (good character, trustworthiness, etc.).

I have noticed that people who try to understand the market (or life) spend more time learning themselves as the market (and life) is unforgiving and doesn’t care about our distorted screens. There are too many opinions that can further distort our views causing confusion and doubt. Since our positions and actions in aggregate determine our success, we tend to focus on these trying to understand how the universe can affect them. In life, liberty, and the pursuit of happiness, an open mind and active efforts to correct our own distorted views are required.

For fear of having another very long post, I’ll stop here.

Wheat by ~HarelLoire

On my drive home this morning, I was thinking about my greatest daily challenge. This is an activity that consumes significant amount of processing power of my brain yet happens almost completely subconsciously without impacting anything else. It is like the markets – never completely understood, conquered, or tamed, yet having significant impact on our lives. All day long, when I read something, hear something, speak with someone, discuss a topic, answer a question or hear a response, I’m trying to determine the credibility, value, impact of what I’m consuming. I am hard at work trying to determine what is noise and what is information. Let’s say a concept is being explained very clearly and logically, does that mean it makes sense? What if someone writes with excellent vocabulary and perfect sentence design, does that make the writer credible? You are reading what I have written. Is this noise (discard immediately) or a thought worth considering for a bit. Am I smart? Can you trust the letters, words, sentences and paragraphs that I have crafted here? Reporters write millions of articles daily but how do you determine which is worth the minutes spent on reading?

There are many examples of what I’m describing. Even in a hierarchical relationship while we may comply with a request, we subconsciously either agree or disagree with it and in bad situations simply don’t care. A coworker raised a question about a requirement saying that we should poll others to see if we have captured the requirement correctly. That’s another example. Why am I paying any attention to this daily challenge? Could it be that those who are extremely smart or capable are able to separate noise from valueable information better than the rest of us? I wish I could devote a month or two to the analysis of this subject. The reason is that perhaps there should be a class in school teaching valuable lessons on separating garbage from jewels that are thrown at us from every angle every day.

Sometimes what we consider garbage in hindsight becomes obvious to have been a jewel. Is there any way to prevent the initial mistake or is this just human nature? There are also times when taking a message for granted is required for survival (hearing fire in a crowded theater – run then think). Because this processing is subconscious in my case, I cannot write my methods of separating communications but maybe if I pay attention going forward, I can report back my findings. Until then this activity will continue to remain one of my top daily challenges.