Is anyone else interested in making bets on how long a system like this will take to be hacked? But then, it will be OK -- the politicians can crow about how much they've reduced carbon emissions, as "proved" by the large decrease in miles driven!
100 physicists dropping an apple will all find the same result for the accelleration due to gravity. 100 bankers buying CDOs will find that their mutual presence alters the risk profile.
Exactly. The model, as used, didn't take into account the effect on the market of using it.
Some of that was going on, too. My point was just that, even if everything had been otherwise above board, there was a flawed assumption in the underlying model.
The problem is that the quant's model is in its self an input to the reality
You are right, this is one important source of problems. I started out in quantitative finance back in the 1970s. (I worked as a research assistant for Fischer Black when I was in grad school.) The initial application of many of the quants' techniques were in markets like US equities, or listed options, where the assumptions that one participant couldn't affect the overall market much and that there were reliable sources of information were probably reasonable.
But if you look at one of the key "villains" in this last mess, the credit-default swap [CDS] market, it's an entirely different story. I have read Li's paper on the Gaussian copula function, and had a look at an implementation. What it is essentially doing is using a statistical sampling function to estimate the expected lifetime to failure (= default) for a population of debt instruments. Now, there is nothing wrong with the math per se; similar approaches are used in manufacturing for quality assurance. However, there is big difference: estimating the failure rate of, say, light bulbs does not in itself have any effect on that rate. But in the case of the CDS, the failure rate is being used as an input to the model that is used to price the swap. If the default rate estimate is too low (too optimistic), the prices will be too high -- and that, in turn, will lead to lower estimates of the default rate. In essence, there is a built-in feedback mechanism that can act as an error amplifier, a problem that is exacerbated by the lack of transparency and liquidity in the CDS market.
There's plenty of blame to go around. The managements, who should have known better, were bedazzled by the dollar signs floating out of their economic perpetual-motion machine. The quants knew the math, and their hubris led them to think that nothing else was needed. And the investors, while proving the truth of P.T. Barnum's Law of Applied Economics, forgot that there ain't no free lunch.
It is bound to bear out in the minds of many Prof. Richard Feynman's assertion, which we may modify to say that giftedness and IQ are not inherent but conferred by accidents or benefits of culture, or at least via mechanisms that are not obvious.
-
As it happens, I have just finished reading Outliers, and I liked it a lot.
(I've also liked Gladwell's two previous books, The Tipping Point and Blink.)
I would summarize Gladwell's conclusion slightly differently.
I think he would accept that some people are inherently gifted -- in several places, he is careful to say that people like Bill Joy and Bill Gates were very talented.
It seems to me the kernel of his argument is that they had inherent talent, but became truly exceptional owing to a combination of favorable circumstances. In other words, their talent was a necessary but not sufficient condition for great success.
It's perhaps similar to what has been said about sex: to turn out really well, it requires both experience and enthusiasm, and no amount of one can compensate for a complete lack of the other.:-)
I'm also in Virginia (Loudoun County, an outer suburb of DC), and I voted this morning at about 10:30. There was a sizable line, but it moved along pretty well.
(The lines are always organized alphabetically by the first letter of one's surname. Since mine begins with 'G', I'm always in one of the longer lines. I wonder if someone at the Board of Elections will ever have the wit to spend five minutes looking at the telephone directory, and realize that the distribution of names across the alphabet is not exactly uniform.)
We also had the choice of paper (optical-scan) ballots or voting machines. While I was waiting, I was trying to estimate the proportions of voters choosing each. I would say at least 75% of people chose paper ballots. I thought that was kind of interesting, since this area is home to a lot of hi-tech firms and their employees.
Still waiting for one of the campaigns to ask for my endorsement, which is totally available to whichever campaign offers me the better cabinet seat.
So am I. I mean, Sarah Palin claims to understand foreign policy because she can see Russia from Alaska. I've actually lived in a couple of other countries -- even one where (gasp!) they don't speak English.
So I certainly should be Secretary of State -- or Ambassador to the UN, at the very least.
Or maybe I can be Secretary of Agriculture. After all, I know how to ride a horse, and I milked a cow once.
The late Richard Feynman had an appropriate comment for this, I think:
There are 10^11 stars in the galaxy. That used to be a huge number. But it's only a hundred billion. It's less than the national deficit! We used to call them astronomical numbers. Now we should call them economical numbers.
Perhaps they can get a new model that displays the debt in scientific notation -- it could be named the "Cheney Memorial Clock".
I also liked his comments about writers that always want to put in something about clouds. This is a paraphrase, from memory:
"Always they have to talk about clouds... 'The clouds hung low and gray over the horizon, like huge, loosely-formed gorilla turds.'...
Enough... skip the clouds and get to the fucking."
Yes, it's been up for a while. I know this kind of project always takes a while, but I do hope they can get it / keep it moving. I got my first copy of the original Handbook of Mathematical Functions, often referred to as "the AMS-55" for its catalog number, at the end of 1970, just after its 9th printing. (I was an undergrad at the time.) It's one of a handful of books that's always been handy on my office bookshelf, along with Don Knuth's Art of Computer Programming and a few others.
Random aside from the You-Know-You're-Getting-Old department: After a recent office move, I was sorting through some boxes of old stuff, and found my K&E slide rule. One of our young guys was really fascinated; he said he had never seen one. He was even more amazed that I knew how to use it.;-)
I don't think geeks are much more skeptical than other groups of people.
I'd question that assumption, too.
It seems to me there are two "geeky" areas where the ability to have a skeptical viewpoint is important: debugging and security.
Both require you to be able to think, not in terms of, "Well, let's see, will this work?" -- a perfectly natural perspective when you're trying to solve a problem -- but in terms of Murphy's Law: "How can this be made to fail?"
I suspect anyone that's spent any significant amount of time with geeks knows that some are a lot better in these areas than others.
Is it even a teachable skill, or is it just an innate part of the geek personality?"
I think it's some of each. In some cases, at least, I think
I've managed to teach a few people how to think more
skeptically / critically.
It's easier with people that have a basic grounding in some kind of
scientific or mathematical discipline, I think because that tends to
teach you that your intuition is not always a trustworthy guide.
On the other hand, anyone committed to an ideology, whatever the flavour, is usually uneducable.
One of the author's suggestions in TFA is that functional languages have a hard time succeeding because of their concise, "math-y" syntax.
Speaking as someone who has been in software development since the System/360 days, and also a sometime math teacher, I think he's absolutely right.
Expressing things in mathematical terms is powerful, elegant, and concise; what is isn't is intuitive, at least for the majority of people.
Consider a much earlier example of a math-like language: APL.
It allowed concise programs and elegant expression (especially of mathematical ideas, like matrices); it ran in the then-mainstream environment (IBM mainframes); and, it was sponsored by the industry's 800-pound gorilla.
And it was the best language for creating write-only programs that I have ever encountered -- think Perl with an extra helping of math and a non-standard character set thrown in.
The worst programming assignment I ever had (although I did complete it successfully) was debugging and fixing a financial modeling package written in APL.
My take on it was that the programmers who had written it originally fell mainly into two categories:
Those who were confused by the syntax and concepts
Those who used the syntax in a contest to see who could be "cutest"
Neither is really what you want going on in an important enterprise-level project.
Looking just at the "headline" statement, you're right. The underlying idea, here as in many other places, is that security is a binary thing, like pregnancy: either you are or you aren't.
That is, of course, nonsense. A rational defender proportions his precautions to the expected threat. The front door and locks on my flat are doubtless less secure than the vault door at the Bank of England, but that doesn't mean they are worthless or a waste of money.
To be fair to Mr. Stewart, reading the whole article show that his position is a bit more nuanced.
In particular, I think the idea of using "white lists", where practical, is a good one.
There is an often-repeated old story that is pertinent here:
Two guys are out on a hike in the forest. They go around the corner of a rock outcropping, and are confronted with a grizzly bear, not far away, who immediately springs toward them. The first guy
starts running away. The second yells after him, "You damned fool, you
can't outrun a grizzly bear!" The first says, over his shoulder,
"I know -- but I can outrun you."
Your house doesn't have to be impossible to break into; it helps quite a bit if it's just harder than your neighbor's.
Although the Computer Science course is obviously the one that most Slashdot geeks will care about, the College Board also cut Italian, French Literature, and Latin Literature. The figures cited in TFA for these three indicate that there were fewer than 4000 students in each -- not very many for a country the size of the US. (Unfortunately, they didn't give numbers for the CS course.) So I don't think anything insidious is going on -- they're just trying to direct limited resources to the places they think the resources can be most effectively used.
The article also mentions the possibility, in the context of the Italian course, of the program being continued if a sponsor could be found. Perhaps Mr. W. Gates and the other hi-tech moguls who are always bemoaning the lack of US workers, and crying for more H1 visas, could pony up a few bucks to support the CS course. I'm sure it would be chump change for Bill.
Like the people in the RIAA, Microsoft just doesn't get it.
The fundamental issue is not about whether software development is a charity (although sometimes I think that is a motivation),
but about Economics 101 and prices in a competitive market.
If they had paid attention in class, they would remember that, in a competitive market, the equilibrium price is found
where price = marginal cost.
The marginal cost of an additional unit of any digital work is very close to zero.
So MS, the RIAA, and many others are engaged in an attempt (futile in the long run, IMO) to construct an economic
perpetual motion machine by legal schemes and other rent-seeking behavior.
Thanks for the suggestion. I have actually looked at the customizable Google page, and have played with it a bit.
That's probably where I'll end up, but I've had the My Yahoo! page since 2000.
I also have a Yahoo! home page that I look at many times a day.
(I like it as a way of aggregating news headlines from different sources,
along with market indicators, exchange rates, etc.)
Although I don't have a very high opinion of
Microsoft, I won't necessarily abandon it just because the deal goes through.
But my expectation is that it won't be long before Microsoft manages to screw up the
good parts of Yahoo!
MS doesn't know how to run a Web site (of course, using Windows does give them a considerable handicap) --
try comparing the response times of ???.microsoft.com to Yahoo!, never mind Google.
And the idea that somehow a combined Yahoo! and Microsoft will be able to take on Google in search and
advertising must be one of those faith-based initiatives. Two times clueless is still clueless.
After all the revelations of Microsoft's attempts to poison the standards process by buying votes, to accuse someone else of some dirty campaign is so hypocritical and immoral that one has to stand in awe of the kind of twisted mind that could produce it.
You've got to give them credit for one thing: they have more nerve than a one-legged guy in an ass-kicking contest.
I think my irony meter just exploded.
I have heard some folks say that, in an economic downturn, FOSS might suffer because some
firms and individuals that contribute resources (e.g., hardware, cash) might be less likely
to continue doing so. I think that point probably has some validity, but Bruce's point that
budget and other constraints can work as a positive for FOSS is definitely true. (And I can say from
my own personal knowledge that his comments on 9/11 and Wall Street are absolutely right.)
The other way that people can contribute to FOSS, of course, is by working on it.
And I don't think that those "in-kind" contributions would be adversely affected; others
have made the point that they were able to do more work when their "day job" didn't
require as much time and energy.
I don't know the conclusion, but it might be interesting to look at how volunteering, at charities
for example, varies (if it does) between good and bad economic times. Cash contributions
probably suffer during a recession; but historically, movie theaters tended to do relatively well during
recessions.
People couldn't afford fancy vacations and other luxuries, so they substituted less expensive ones.
It might be the case that more people volunteer when times are tough, because they
can't afford to chip in with cash.
Sticking to small-scale, well-defined goals ("limited and achievable objectives") is definitely the way to go, in my experience.
I was, for a few years, a volunteer training coach for a couple of the US AIDS Rides (Boston->New York by bicycle, for example). Everyone has heard people make grand resolutions about getting into, or back into, shape; these resolutions often don't amount to much. We asked people to make an initial commitment to a training program of about 6 weeks, and that worked out pretty well: it was short enough not to be intimidating or impossible-seeming, but long enough that they could begin to see tangible results.
I guess since the FBI has previously demonstrated its prowess in implementing technology projects, with (inter alia) the Virtual Case File fiasco, and the SirCam infection of their National Infrastructure Protection Center, it's time for them to move on to a higher level.
It's good to know we can still count on the Peter Principle.
Slashdot Mirror
Is anyone else interested in making bets on how long a system like this will take to be hacked? But then, it will be OK -- the politicians can crow about how much they've reduced carbon emissions, as "proved" by the large decrease in miles driven!
100 physicists dropping an apple will all find the same result for the accelleration due to gravity. 100 bankers buying CDOs will find that their mutual presence alters the risk profile.
Exactly. The model, as used, didn't take into account the effect on the market of using it.
Some of that was going on, too. My point was just that, even if everything had been otherwise above board, there was a flawed assumption in the underlying model.
You are right, this is one important source of problems. I started out in quantitative finance back in the 1970s. (I worked as a research assistant for Fischer Black when I was in grad school.) The initial application of many of the quants' techniques were in markets like US equities, or listed options, where the assumptions that one participant couldn't affect the overall market much and that there were reliable sources of information were probably reasonable.
But if you look at one of the key "villains" in this last mess, the credit-default swap [CDS] market, it's an entirely different story. I have read Li's paper on the Gaussian copula function, and had a look at an implementation. What it is essentially doing is using a statistical sampling function to estimate the expected lifetime to failure (= default) for a population of debt instruments. Now, there is nothing wrong with the math per se; similar approaches are used in manufacturing for quality assurance. However, there is big difference: estimating the failure rate of, say, light bulbs does not in itself have any effect on that rate. But in the case of the CDS, the failure rate is being used as an input to the model that is used to price the swap. If the default rate estimate is too low (too optimistic), the prices will be too high -- and that, in turn, will lead to lower estimates of the default rate. In essence, there is a built-in feedback mechanism that can act as an error amplifier, a problem that is exacerbated by the lack of transparency and liquidity in the CDS market.
There's plenty of blame to go around. The managements, who should have known better, were bedazzled by the dollar signs floating out of their economic perpetual-motion machine. The quants knew the math, and their hubris led them to think that nothing else was needed. And the investors, while proving the truth of P.T. Barnum's Law of Applied Economics, forgot that there ain't no free lunch.
-
As it happens, I have just finished reading Outliers, and I liked it a lot. (I've also liked Gladwell's two previous books, The Tipping Point and Blink.)
I would summarize Gladwell's conclusion slightly differently. I think he would accept that some people are inherently gifted -- in several places, he is careful to say that people like Bill Joy and Bill Gates were very talented. It seems to me the kernel of his argument is that they had inherent talent, but became truly exceptional owing to a combination of favorable circumstances. In other words, their talent was a necessary but not sufficient condition for great success.
It's perhaps similar to what has been said about sex: to turn out really well, it requires both experience and enthusiasm, and no amount of one can compensate for a complete lack of the other. :-)
I'm also in Virginia (Loudoun County, an outer suburb of DC), and I voted this morning at about 10:30. There was a sizable line, but it moved along pretty well.
(The lines are always organized alphabetically by the first letter of one's surname. Since mine begins with 'G', I'm always in one of the longer lines. I wonder if someone at the Board of Elections will ever have the wit to spend five minutes looking at the telephone directory, and realize that the distribution of names across the alphabet is not exactly uniform.)
We also had the choice of paper (optical-scan) ballots or voting machines. While I was waiting, I was trying to estimate the proportions of voters choosing each. I would say at least 75% of people chose paper ballots. I thought that was kind of interesting, since this area is home to a lot of hi-tech firms and their employees.
The CPSC notice page is here, and it makes no mention of Lenovo or Acer.
So am I. I mean, Sarah Palin claims to understand foreign policy because she can see Russia from Alaska. I've actually lived in a couple of other countries -- even one where (gasp!) they don't speak English. So I certainly should be Secretary of State -- or Ambassador to the UN, at the very least.
Or maybe I can be Secretary of Agriculture. After all, I know how to ride a horse, and I milked a cow once.
Perhaps they can get a new model that displays the debt in scientific notation -- it could be named the "Cheney Memorial Clock".
I also liked his comments about writers that always want to put in something about clouds. This is a paraphrase, from memory: "Always they have to talk about clouds ... 'The clouds hung low and gray over the horizon, like huge, loosely-formed gorilla turds.' ...
Enough ... skip the clouds and get to the fucking."
Touching. I'm reminded of a sign I once saw on the door of a bank branch, some years ago while I was living in Boston:
For my convenience. Heartwarming, isn't it, how these folks are always looking out for us.Random aside from the You-Know-You're-Getting-Old department: After a recent office move, I was sorting through some boxes of old stuff, and found my K&E slide rule. One of our young guys was really fascinated; he said he had never seen one. He was even more amazed that I knew how to use it. ;-)
I'd question that assumption, too. It seems to me there are two "geeky" areas where the ability to have a skeptical viewpoint is important: debugging and security. Both require you to be able to think, not in terms of, "Well, let's see, will this work?" -- a perfectly natural perspective when you're trying to solve a problem -- but in terms of Murphy's Law: "How can this be made to fail?" I suspect anyone that's spent any significant amount of time with geeks knows that some are a lot better in these areas than others.
Is it even a teachable skill, or is it just an innate part of the geek personality?"
I think it's some of each. In some cases, at least, I think I've managed to teach a few people how to think more skeptically / critically. It's easier with people that have a basic grounding in some kind of scientific or mathematical discipline, I think because that tends to teach you that your intuition is not always a trustworthy guide. On the other hand, anyone committed to an ideology, whatever the flavour, is usually uneducable.
Consider a much earlier example of a math-like language: APL. It allowed concise programs and elegant expression (especially of mathematical ideas, like matrices); it ran in the then-mainstream environment (IBM mainframes); and, it was sponsored by the industry's 800-pound gorilla. And it was the best language for creating write-only programs that I have ever encountered -- think Perl with an extra helping of math and a non-standard character set thrown in. The worst programming assignment I ever had (although I did complete it successfully) was debugging and fixing a financial modeling package written in APL. My take on it was that the programmers who had written it originally fell mainly into two categories:
- Those who were confused by the syntax and concepts
- Those who used the syntax in a contest to see who could be "cutest"
Neither is really what you want going on in an important enterprise-level project.I do realize that -- the "where practical" in my earlier comment is an important qualifier.
That is, of course, nonsense. A rational defender proportions his precautions to the expected threat. The front door and locks on my flat are doubtless less secure than the vault door at the Bank of England, but that doesn't mean they are worthless or a waste of money.
To be fair to Mr. Stewart, reading the whole article show that his position is a bit more nuanced. In particular, I think the idea of using "white lists", where practical, is a good one.
Two guys are out on a hike in the forest. They go around the corner of a rock outcropping, and are confronted with a grizzly bear, not far away, who immediately springs toward them. The first guy starts running away. The second yells after him, "You damned fool, you can't outrun a grizzly bear!" The first says, over his shoulder, "I know -- but I can outrun you."
Your house doesn't have to be impossible to break into; it helps quite a bit if it's just harder than your neighbor's.
The article also mentions the possibility, in the context of the Italian course, of the program being continued if a sponsor could be found. Perhaps Mr. W. Gates and the other hi-tech moguls who are always bemoaning the lack of US workers, and crying for more H1 visas, could pony up a few bucks to support the CS course. I'm sure it would be chump change for Bill.
Like the people in the RIAA, Microsoft just doesn't get it. The fundamental issue is not about whether software development is a charity (although sometimes I think that is a motivation), but about Economics 101 and prices in a competitive market. If they had paid attention in class, they would remember that, in a competitive market, the equilibrium price is found where price = marginal cost. The marginal cost of an additional unit of any digital work is very close to zero. So MS, the RIAA, and many others are engaged in an attempt (futile in the long run, IMO) to construct an economic perpetual motion machine by legal schemes and other rent-seeking behavior.
Thanks for the suggestion. I have actually looked at the customizable Google page, and have played with it a bit. That's probably where I'll end up, but I've had the My Yahoo! page since 2000.
I also have a Yahoo! home page that I look at many times a day. (I like it as a way of aggregating news headlines from different sources, along with market indicators, exchange rates, etc.) Although I don't have a very high opinion of Microsoft, I won't necessarily abandon it just because the deal goes through. But my expectation is that it won't be long before Microsoft manages to screw up the good parts of Yahoo! MS doesn't know how to run a Web site (of course, using Windows does give them a considerable handicap) -- try comparing the response times of ???.microsoft.com to Yahoo!, never mind Google.
And the idea that somehow a combined Yahoo! and Microsoft will be able to take on Google in search and advertising must be one of those faith-based initiatives. Two times clueless is still clueless.
After all the revelations of Microsoft's attempts to poison the standards process by buying votes, to accuse someone else of some dirty campaign is so hypocritical and immoral that one has to stand in awe of the kind of twisted mind that could produce it.
You've got to give them credit for one thing: they have more nerve than a one-legged guy in an ass-kicking contest. I think my irony meter just exploded.
The other way that people can contribute to FOSS, of course, is by working on it. And I don't think that those "in-kind" contributions would be adversely affected; others have made the point that they were able to do more work when their "day job" didn't require as much time and energy.
I don't know the conclusion, but it might be interesting to look at how volunteering, at charities for example, varies (if it does) between good and bad economic times. Cash contributions probably suffer during a recession; but historically, movie theaters tended to do relatively well during recessions. People couldn't afford fancy vacations and other luxuries, so they substituted less expensive ones. It might be the case that more people volunteer when times are tough, because they can't afford to chip in with cash.
I was, for a few years, a volunteer training coach for a couple of the US AIDS Rides (Boston->New York by bicycle, for example). Everyone has heard people make grand resolutions about getting into, or back into, shape; these resolutions often don't amount to much. We asked people to make an initial commitment to a training program of about 6 weeks, and that worked out pretty well: it was short enough not to be intimidating or impossible-seeming, but long enough that they could begin to see tangible results.
I guess since the FBI has previously demonstrated its prowess in implementing technology projects, with (inter alia) the Virtual Case File fiasco, and the SirCam infection of their National Infrastructure Protection Center, it's time for them to move on to a higher level. It's good to know we can still count on the Peter Principle.