Paul Kedrosky's Infectious Greed

I spoke a little about this today on Bloomberg TV, but it’s eye-opening who gets rich(er(est)) on the Groupon IPO. Check the following… [cont.]

[Full post at my Bloomberg blog]

Harrowing and depressingly post-apocalyptic:

In the first episode of this two-part series, Louis spends time in one of the most notorious sections of Miami County Jail: the fifth and sixth floor of ‘Main Jail’, where many of the most volatile inmates are incarcerated.

Held in large cage-like dwellings for up to 24 men, the inmates have developed a strange and violent jail culture. The men – who remain in the cells almost all the time and may only leave for yard time twice a week – live under the sway of a gladiatorial code. They fight each other for food, for status, and often just to pass the endless hours of confinement. Trips to the infirmary are a frequent occurrence as inmates are viciously attacked and beaten, but the guards say they are powerless to end the abuse.

via BBC – BBC Two Programmes – Louis Theroux, Louis Theroux: Miami Mega Jail, Part 1.

This is amusing: Venture capital, the game. Call it “venture crapital”, but you get to play VC and fund teensy companies to fame, fortune & bubbles.

Click to try.

[via TechCrunch]

New Taleb on error’s errors:

The Future Has Thicker Tails than the Past: Model Error as Branching Counterfactuals

Nassim Nicholas Taleb
NYU-Poly
May 23, 2011

Abstract:

Ex ante predicted outcomes should be interpreted as counterfactuals (potential histories), with errors as the spread between outcomes. But error rates have error rates. We reapply measurements of uncertainty about the estimation errors of the estimation errors of an estimation treated as branching counterfactuals. Such recursions of epistemic uncertainty have markedly different distributial properties from conventional sampling error, and lead to fatter tails in the projections than in past realizations. Counterfactuals of error rates always lead to fat tails, regardless of the probability distribution used. A mere .01% branching error rate about the STD (itself an error rate), and .01% branching error rate about that error rate, etc. (recursing all the way) results in explosive (and infinite) moments higher than 1. Missing any degree of regress leads to the underestimation of small probabilities and concave payoffs (a standard example of which is Fukushima). The paper states the conditions under which higher order rates of uncertainty (expressed in spreads of counterfactuals) alters the shapes the of final distribution and shows which a priori beliefs about conterfactuals are needed to accept the reliability of conventional probabilistic methods (thin tails or mildly fat tails).

via The Future Has Thicker Tails than the Past: Model Error as Branching Counterfactuals by Nassim Taleb :: SSRN.

Some Gulf petrol stations run out of fuel (Gulf News)Fusion-Io to Be Worth as Much as $1.17 Billion in Initial Public Offering (Bloomberg)Graphic of… [cont.]

[Full post at my Bloomberg blog]

In the spirit of tawdry financial inquiry for which Wall Street is rightly famous, I intermittently track the incidence of George Carlin’s… [cont.]

[Full post at my Bloomberg blog]

A friend of mine is looking at a life-changing job offer. It would require relocation, sectoral change, a personal clock frequency increase, and, of course new people. There are plenty of reason to take the offer, including lots of independence, challenges, and, it doesn’t hurt, buckets of money.

So, he’s taking the job right? Well, he’s not sure. Not, however, because he’s some nervous sort, afraid of taking risks, etc. It’s because of the people — because it’s a small group, and a few meetings, calls, and emails have only given him a limited sense of what it would be like dealing with them day after day.

He asked me what I thought he should do. I said, “Ask them for references”. Yes, ask his prospective new boss co-workers for references. It’s sort of surprising that you don’t hear about the idea more often, but I’m actually a fan of reverse references. You really sometimes need an independent sense of what employers are like, and one way to get there is via their references.

Sure, there are plenty of ways to game the system, just as prospective employees can, but when you’re faced with a life-changing decision there is nothing wrong with asking for references — theirs.

From my friends at Altos Research, the “catfish” housing recovery. Note that it helps if you blow the presentation to full screen.