Conned

Fighting the crusade against fake numbers, one utility van at a time.

Once in a while I’m asked “what makes you special?” It’s hard to give an honest answer other than “I’m not a snowflake, there’s nothing really unique about me”. Even my most esoteric pursuits form great tribes around them. The raison d’être of Putanumonit is that whatever peculiar idea I can write about, it will resonate with at least a thousand people somewhere in the world.

With that said, I probably have a pretty singular reaction to utility company vans.

ConEdison are lying about paper bills
Text: “If just 20% of all U.S. households paid their bills online, in one year we could save almost two million trees.”

Most people would pass by this truck and not think twice about it. Most wouldn’t even think once. I pass by this truck and think: 20% of household is like 20 mil, so 10 households per tree per year sounds completely made up and I’ll bet 5:1 that this number is off by at least a factor of 2 and ConEdison are lying because everyone is innumerate.

Then I get home and do some Googling:

  • There are 125 million households in the United States. Generously assuming that they all get electrical bills, 20% of them are 25 million households.
  • My own bill from ConEdison is 2 pages. If ConEdison cared about trees they’d use double sided printing, but let’s be generous again and assume 4 total pages of paper statement per household per month, including the envelope and the check.
  • A letter sized page is 8.5″ x 11″, or 216 mm x 279 mm, which comes out to 0.06 m2. Four pages have an area of 0.24 m2.
  • We needed the area calculation because paper weight is measured in GSM, or grams per square meter. Common printer paper weighs 74 GSM, so 0.24 square meters of that paper weigh 74 x 0.24 = 17.7 grams.
  • 17.7 grams of paper per month * 12 monthly bills = 213 grams of paper per year per household that refuses to pay their bills online.
  • With 25 million households, that’s 5.3 million kg of paper per year.
  • 24 trees make 1 ton of printer paper, so a single tree makes 41.7 kg.
  • 5.3 million / 41.7 = 127,000 trees.

Not “almost two million”, not even within an order of magnitude of two million. A mere 127,000 trees. For scale, that’s 0.25%  of the 50 million trees a single country can plant in a day.

By the way, did I mention that I worked for a major paper manufacturer? American paper companies practically never log new forests. They mostly own the tree farms, which are basically small private forests, that supply the timber they need. Also, a fiber of paper can get recycled around 7 times before it becomes unusable, but often get recycled less because paper is so cheap that some recycling isn’t worth it on the margin.

If 100% of American households switched to unrecycled paper bills tomorrow, the paper industry would react by increasing the recycled paper content in products like paper towels and toilet tissue and recycling paper more times. They’ll also plant more trees in the tree farms, and supply will catch up to demand over a few years. If 100% of households switched away from paper, the tree farms (which in the process of growing into paper do nice things like capture CO2 ) would be replaced by something else, like parking lots.

Here’s what ConEdison is really telling you:

ConEdison being honest about paper bills


I just wanted to remind you that Putanumonit is your only hope in a world that’s constantly using fake numbers to bamboozle you,  and since this post was really short you have enough time to take the Putanumonit survey and help make this blog even better.

Flip Flops, part 1 of ∞

Changing my mind about the value of the FDA and the sanity of the stock market.

When they change their minds it’s called “flip flopping”, when we do it it’s called “updating on evidence”.

As a rationalist, it bugs me to no end that changing one’s mind is considered a sin for politicians when it should count as a great virtue for everyone. I don’t know if it helped or hurt Hillary Clinton’s election chances, but it was painful to watch her pretend to have always supported gay marriage when she and her husband clearly opposed it in the early nineties. Would anyone have held it against her if she said that she spent a decade listening to LGBTQ folk describe their struggles and they changed her mind? I have seen people in my life update their attitude on gay rights and admired them for it, I would be proud to support a politician who did that.

Since I’m utterly unelectable as it stands I can admit freely: I change my mind all the time. Almost certainly, I don’t do it often enough. To encourage this process, the least I can do is get a blog post out of it whenever I flip flop. Here’s part 1, with many more hopefully to come.


Flip Flop #1 – I no longer believe that the FDA harms more lives than it saves

So put your matches away until further investigation. A lot of commenters on “EpiPenomenon” and on Reddit disparaged me for being a “101 economist” naively applying simplistic models to complex subjects. These comments did absolutely nothing to convince me. They neither offered a better model, nor told me something I did not know about drugs, nor refuted Economics 101 – that incentives drive decisions. Ultimately, these are genetic arguments – attacking the presumed source of my belief (a blind faith in markets) instead of the arguments themselves (that the FDA is incentivized to err strongly on the side of approving too few drugs too late).

What changed my mind was my mom, a chemist working in the pharmaceutical industry, who explained in detail the rules the FDA plays by and how they go about their job. In particular:

  • The FDA has fast track programs with hard approval deadlines for important breakthrough drugs.
  • The FDA relies on a global network of independent testing laboratories, which are subject to audit. These audits include FDA people physically looking over people’s shoulders and nitpicking their procedures. This network of labs requires a consolidated regulator enforcing a single standard, it wouldn’t work as well with the multiple competing xDAs I proposed.
  • I underestimated the damage historically caused by untested drugs, the worst of which do their damage over a long period of time (e.g. through birth defects). This prevents a quick public reaction to harmful drugs that would limit the number of victims.

There was clearly a lot of direct evidence regarding the FDA I was unaware of, but many people found it easier to assume that I’m a brainless libertarian than to google any of it. The hierarchy of ways to change my mind on an issue is quite clear. Please keep the chart below handy when trying to convince me of something:

  1. Direct evidence
  2. Large bribes
  3. Circumstantial evidence
  4. Authority
  5. Modest bribes
  6. Genetic arguments

Flip Flop #2 – I no longer believe in a weakish form of the Efficient Market Hypothesis, namely that prolonged market distortions are limited by the amount of money at stake

Election night didn’t change my mind about what is possible in politics. Besides having a different president, a country of 49% Trump voters is the same country as one with 51%. But a core belief of mine was shaken on election night: the efficient market hypothesis.

In the long-gone days of my carefree youth (2009-2010), I worked as a day trader for a hedge fund. My job consisted of reading economics news and clicking “buy” and “sell” as asset prices danced a merry jig on my five PC monitors. Then I read Nassim Taleb’s Fooled By Randomness, learned about efficient markets, realized that my trading returns are indistinguishable from random noise, quit my job and came to the US. Needless to say, the efficient market hypothesis played quite a role in my life.

A lot of my smartest friends work for hedge funds as quants and traders, and I understood that markets may be mistaken about a 0.1% discrepancy in the price of pork belly futures in Frankfurt and Chicago. Catching these mistakes is worth enough to keep my friends fed and clothed, but the amount of these mistakes is limited by the profitability of catching them.

I still believed that the markets are generally efficient with regards to common knowledge – that the current price of any traded asset (like a stock) completely reflects everything that is known to the public regarding that asset. I fully believed that all the way through business school, where every single finance professor endorsed weak form EMH and where I rejected several opportunities to go back to the investment management industry. I kept absolutely believing in weak form EMH up until 4 am on election night:sp500-futures-election

At least since October, the US stock market projected that a Trump victory would drop American stocks by 10%-12%. This wasn’t hot air spewed by talking heads on TV, it was reflected in the actual behavior of stock prices, in every buy and sell by a trading desk in Hong Kong or an algorithm in Greenwich. For this projection to be wrong meant that there was a pile of 2 trillion dollars, twice the GDP of Russia, free for the taking. The efficient market hypothesis doesn’t rely on all market participants being sane or even a majority of them, just enough sane people to grab 2 trillion dollars of free money.

The 10%-12% projection more or less matched the stock market behavior on election day, with stocks rising 2% as Trump’s chances dropped from 30% to 10% in the early afternoon, then crashing in the evening as Trump’s victory became likelier and likelier. And then, at 4 am, all the humans and robots who until that point believed that “Trump = 10% drop” changed their minds simultaneously and US stocks hit historical highs.

I have read several explanations of this, and they are all obviously fake in the sense that believing the “explanation” and knowing the election results ahead of time would not have caused you to predict the stock market movement that occurred. The stock market could not rise 10% on news of a Republican senate because the senate races were decided by 11 pm and the odds of a Republican congress given a Trump win were around 90% anyway. The stock market could not have risen on confirmation of a peaceful transition of power because Hillary was winning the popular vote and there’s no way that massive protests seemed less likely at 4 am than the day before.

A lot of very smart people built very complex models that had to account for all eventualities, from a recount in 5 states to a terror attack the morning of the election. The actual outcome (Trump win, Republican senate, Clinton concession, conciliatory victory speech) landed well within the anticipated range. And then, suddenly, everyone decided that the models were wrong after all and Trump is good for US stocks.

This leaves us with three options:

  1. Everyone trading US Stocks was collectively insane in their projection of the election’s impact, and there were indeed 2 trillion dollars up for grabs for almost a month, up until election night.
  2. All the models before the election were correct, and everyone is insane right now due to runaway optimism bias. This means that there are 2 trillion dollars available this very moment to anyone shorting US stocks.
  3. Everyone was insane, is insane, and in fact the stock market is not driven by the correct pricing of publicly available knowledge but by restless voodoo spirits flitting to and fro likes yo-yos in the hands of capricious gods.

Take your pick, and let me know if your hedge fund is hiring.

The Day After Tomorrow

America elected the person you hate most. What are you going to do about it?

Are you rooting for Donald Trump tomorrow? Please read the text in red. On Hillary’s side? Please read the parts in blue.

Imagine: it’s Tuesday night and the result is beyond doubt – a landslide for Crooked Hillary. What do you plan to do? Retreat in disgust from mainstream American discourse and retrench in your bubble? Claim that the “system is rigged” against you? You should be embarrassed, that’s what a leftist would do.

Imagine: it’s Wednesday morning and your next president fuhrer is Donald Trump. What do you plan to do? Scream that the American voters are idiots? Threaten violence and civil disobedience? How very Trump of you.

There are 324,118,787 people in America. The president is just one of them, and so are you. We all shape the kind of country we live in.

Do you hate Hillary’s corruption? Choose integrity. Pick your leaders based on their actions, not their promises. Did the person talking about working class problems spend a single day working a blue collar job? Is the person warning you of foreigners quick to use offshore labor when they can save a buck? This country will be saved by men of principle leading men of principle, not by making compromise with sin.

Do you hate Trump because he’s disrespectful? Choose respect. Learn to respect people from faraway lands, with different tastes and strange beliefs. And by these I mean: Oklahoma, Nascar, Jesus. In case you forgot, respect doesn’t mean letting them live somewhere out of sight. It means respecting their voice and their choice.

Do you hate the lies of the mainstream media? Choose objectivity. Does Breitbart make money when they report the unvarnished truth or when they they post outrage clickbait? Don’t consume just the media that feels good, broaden your view and you’ll see a truer picture. What use is free speech if one doesn’t freely listen?

Do you hate Trump’s bold-faced lying? Choose truth. Do you share articles that attempt to get to the bottom of issues, or memes that make your opponents seem stupid? Be wary of bullshit that promotes a cause you support. Bullshit in the service of a good cause isn’t virtuous, it’s corrupting.

Do you hate the Democrats’ betrayal of American culture? Choose the best of that culture. Promote the best of America: the collective values and individual freedom. Forget about the politicians and their petty fights, talk about the Americans who lead the world in every art, science and enterprise. Remind the world why this the greatest nation that ever stood.

Do you hate Trump’s ego? Choose humility. Don’t fall for simplistic narratives that describe the world how you want it to be, not how it is. Did you study the research on crime, educations, trade, guns, immigration, healthcare? Or did you read a tweet by Vox? These are complex issues, they involve hard trade-offs and unpredictable effects. Be humble when you opine about them.

Do you hate the intolerance of the social justice movement? Choose tolerance. SJ demands blind loyalty, but you believe in honest criticism. SJ hates white men, but you don’t judge people on superficial traits. SJ wants civil war, but you know that Americans aren’t your enemies, even the ones who voted for Clinton. 

Do you hate the intolerance of the alt-right? Choose tolerance. AR demands blind loyalty, but you believe honest criticism. AR hates foreigners and minorities, but you don’t judge people on superficial traits. AR wants civil war, but you know that Americans aren’t your enemies, even the ones who voted for Trump. 

You are better than them. They have no principles, but you can understand their worldview without compromising yours. They blame you for everything they don’t like about America, but you can listen to their challenges and offer them real solutions. In a country that’s going to shit, you can set an example. Fuck the president, you and 324,118,785 other Americans can make America great again.

Don’t be the Trump you don’t want to see in the world.

 

Welcome to Put A Num On It!

What’s Putanumonit?

People see some things as quantifiable, e.g. tax rates, and unquantifiable, e.g. love, charity, happiness, feminism and Chinese soccer. Personally, I have no idea how the American tax system works, but everything else seems quite easy to put a number on if you try.

For example, a simple mathematical fact can explain why the Chinese soccer team sucks  despite China’s huge population. I write often about other sports as well. Love and dating is also a popular subject, from guides on leveraging or “hacking” OkCupid to musings on feminism and Nice Guys. My best received post is Shopping for Happiness, one of my essays on the best ways to use money to make yourself happier and to improve the worldI call out people who use bullshit numbers, whether by mistake or with intent to mislead. Those include bad scientists, good scientists, and even FiveThirtyEightI fully encourage you to call me out in turn when I get something wrong. I occasionally dive into economics and public policy, I wrote about voting (bad idea), basic income (good idea, maybe) and inequality (complicated idea). My writing, in fact my entire life, is informed by the rationality community and the writings on LessWrong.com. A few of my posts address the study of rationality explicitly.

I also wrote a post about Pokémon. I hope that doesn’t become a category.

Putanumonit is a personal labor of love, free of ads and affiliations. The chronological archive is here, new posts arrive 3-4 times a month on a schedule unknown even to me. Please subscribe on the right sidebar, leave comments on any old or new post and write putanumonit at gmail dot com with personal missives, datasets you want me to analyze and invitations to beer.

Enjoy,

Jacob

Wisdom of Words

People will tell you some things are impossible

Climber

Trust their advice. Wishful thinking doesn’t change reality.


Follow your heart

follow.jpg

after aligning it with socially acceptable, meaningful and achievable goals.


The rush of wind in your face

wind-hair-8.jpg

is not worth the higher mortality risk of motorcycles.


Take life one day at a time

one day.png

as if you have any choice on the matter


Nothing is worse than not having friends

friends.png

with benefits.


Believe in yourself

believe.png

only as much as evidence dictates you should.


Teamwork

teamwork.png

is highly inefficient due to coordination, motivation and agency problems.


The best advice you’ll ever get

listicle.png

will be from an internet listicle.

 

Status: Iceland

Status 7/15

New post below.

I’m back from the arctic circle! Here’s a list of what’s cool and less cool about Iceland, from least to coolest:

#945: It’s literally very cool.

#890: Viking Ölgerd, AKA $7-a-bottle Bud Light Lime. There are actually a couple of decent craft breweries in Iceland, but most bars only carry the two big brands (Viking and Einstok) even though they cost the same but taste like watered-down disappointment.

#402: Rotten shark as a gourmet delicacy. To be fair, that’s probably a prank played on tourists and not actually something that Icelanders have been eating for centuries.

#3: Galloping along a picturesque black pebble beach on a sturdy Icelandic horse.

#2: A geothermal hot spring, next to a cool alpine lake, INSIDE A VOLCANO.

#1: Two decades ago, Iceland’s soccer team ranked 131st in the world. This makes sense for a country of merely 320,000 people with a climate that discourages poking one’s nose outdoors, let alone playing soccer, for 8 months a year. Then, a miracle happened. Someone in Iceland read a blog post explaining why a soccer team’s level doesn’t depend on it’s population and decided to give it a shot. A few small tweaks later, Iceland is ranked in the top 30 and sending mighty England Brexiting in shame from the European championship.

iceland_england
Source: The Telegraph

Since my own home country plays in blue but can’t sniff a major tournament, immediately upon landing in Reykjavik I looked for an Iceland national team jersey. The first store was sold out. So was the second one. The third one said that they’ll get a delivery on Tuesday morning. 11 am on Tuesday, they said that the delivery came early and people who camped outside the store bought all the jerseys within an hour. Iceland doesn’t have a lot of sports stores, in two weeks on the island I have probably visited most of them. None had a jersey for me, at any price.

And this got me thinking of one the humanity’s most confounding insanities: the futile struggle against the laws of prices.

 

 

 

 

Republicanagrams

Can you guess the candidate?

After months of posting, posturing and pestering; debating, berating and deliberating; the first electoral action of the 2016 US political cycle is taking place Monday in Iowa. As a responsible citizen, I am here to educate my readers about the fine details of each candidate’s policy platform so we can all be more informed voters.

Just kidding! Instead, we’re going to learn each Republican candidate’s actual name, using anagrams. Did you know that “Jeb” isn’t a name, it’s actually an acronym-nickname? A nickronym? Yes, this is what procrastination looks like while I’m working on a huge post that will (hopefully) be done next week.

You probably don’t know each candidate’s full name and middle name, but the common names (Jeb, Carly, Rand) should be enough for you to guess each anagram in red. Click on each one to see the answer.

An unexpected animal: a rare raccoon in a lift

The scariest pests of all: major Cheshire hipster tics

Pontius Pilate’s plea: adjourn, harm no Christ

Boxes that keep your candy quiet: jello hush bins. Alternatively, the place where you get your boat detailed: hull shine jobs 

Colorful sports punishment: red card azure flaw

Achievement of the Care Bears’ doctor: I healed a chuckle beam

Not the best known candidate, so you get three anagrams: get ram joust realism, just armor gleam sitego muster jail master

An embarrasing situation: rich shock, hind ajar

My favorite music party: hard lawn rap aloud

A medical emergency this candidate wants to outlaw: an ICU room abortion 

Migratory exercise program: do jump, land north 

And finally, some troubling news from Utah: Mormon ninja cases baloon

I sincerely apologize to everyone who clicked here today expecting astute analysis and captivating prose. I owe you one.