Break up the megabanks already (#OWS)
For the past few months at Occupy we’ve been focusing more and more on having a single message and goal. That has been to break up the big banks.
What’s great about this goal is that it’s a non-partisan issue; there is growing consensus (among non-bankers) from the left and the right that the current situation is outrageous and untenable. What’s not great, of course, is that the situation is so easy to spot because it’s so heinous.
Yesterday another voice joined the Break-Up-The-Big-Banks chorus in the form of an editorial at Bloomberg (hat tip Hannah Appel). They wrote a persuasive piece on breaking up the big banks based on simple arithmetic involving bank profits and taxpayer subsidy. Even the title fits that description: “Why Should Taxpayers Give Big Banks $83 Billion a Year?”. Here’s an excerpt from the editorial (emphasis mine):
…Banks have a powerful incentive to get big and unwieldy. The larger they are, the more disastrous their failure would be and the more certain they can be of a government bailout in an emergency. The result is an implicit subsidy: The banks that are potentially the most dangerous can borrow at lower rates, because creditors perceive them as too big to fail.
Lately, economists have tried to pin down exactly how much the subsidy lowers big banks’ borrowing costs. In one relatively thorough effort, two researchers — Kenichi Ueda of the International Monetary Fund and Beatrice Weder di Mauro of the University of Mainz — put the number at about 0.8 percentage point. The discount applies to all their liabilities, including bonds and customer deposits.
Big Difference
Small as it might sound, 0.8 percentage point makes a big difference. Multiplied by the total liabilities of the 10 largest U.S. banks by assets, it amounts to a taxpayer subsidy of $83 billion a year. To put the figure in perspective, it’s tantamount to the government giving the banks about 3 cents of every tax dollar collected.
The top five banks — JPMorgan, Bank of America Corp., Citigroup Inc., Wells Fargo & Co. and Goldman Sachs Group Inc. – – account for $64 billion of the total subsidy, an amount roughly equal to their typical annual profits (see tables for data on individual banks). In other words, the banks occupying the commanding heights of the U.S. financial industry — with almost $9 trillion in assets, more than half the size of the U.S. economy — would just about break even in the absence of corporate welfare. In large part, the profits they report are essentially transfers from taxpayers to their shareholders.
Next time someone tells me I want to take money out of rich people’s pockets (and that makes me a free market hater), I’m going to remind them that every time I pay taxes, 3 cents out of every dollar (that I know of) goes directly to the banks for no good reason whatsoever except the fact that they have the lobbyists to support this system. They’re bullies, and I hate bullies.
So no, I’m not suggesting we take honestly earned money out of the pockets of those who deserve it, I’m suggesting we stop stuffing insiders’ pockets with our money. Big difference.
But it’s not just money I object to – it’s future liability. There’s now an established track record of discovered criminal acts that don’t get anyone at the big banks in trouble. We are setting ourselves up for an even bigger bailout of some form soon, one that we taxpayers really may not be able to afford.
I think of the too-big-to-fail problem as like having an alcoholic brother-in-law who not only sleeps on your couch every night but also knows the PIN code on your ATM card. The money is irksome, no doubt, but what if that guy fell asleep smoking a cigarette and me and my kids die in the resulting fiery inferno? And it’s not that I think all addicts could be magically cured, but I don’t want them to have access to my personal stuff. Get them out of my house.
So can we break up the megabanks already? I’d really like to stop worrying about them because I have better things to do.
NYC data hackathons, past and future: Politics, Occupy, and Climate change (#OWS)
The past: Money in politics
First thing’s first, I went to the Bicoastal Datafest a few weekends ago and haven’t reported back. Mostly that’s because I got sick and didn’t go on the second day, but luckily other people did, like Kathy Kiely from the Sunlight Foundation, who wrote up this description of the event and the winning teams’ projects.
And hey, it turns out that my new company shares an office with Harmony Institute, whose data scientist Burton DeWilde was on the team that won “Best in Show” for their orchestral version of the federal government’s budget.
Another writeup of the event comes by way of Michael Lawson, who worked on the team that set up an accounting fraud detection system through Benford’s Law. I might be getting a guest blog post about this project through another one of its team members soon.
And we got some good progress on our DataKind/ Sunlight Foundation money-in-politics project as well, thanks to DataKind intern Pete Darche and math nerds Kevin Wilson and Johan de Jong.
The future one week from now: Occupy
Next up, on March 1st and 2nd at CUNY Graduate Center is this data hackathon called OccupyData (note this is a Friday and Saturday, which is unusual). You can register for the event here.
It’s a combination of an Occupy event and a datafest, so obviously I am going to try to go. The theme is general – data for the 99% – but there’s a discussion on this listserv as to the various topics people might want to focus on (Aaron Swartz and Occupy Sandy are coming up for example). I’m looking forward to reporting back (or reporting other people’s report-backs if my kids don’t let me go).
The future two weeks from now: Climate change
Finally, there’s this datathon, which doesn’t look open to registration, but which I’ll be participating in through my work. It’s stated goal is “to explore how social and meteorological data can be combined to enhance social science research on climate change and cities.” The datathon will run Saturday March 9th – Sunday March 10th, 2013, starting noon Saturday, with final presentations at noon Sunday. I’ll try to report back on that as well.
Mathbabe t-shirts for sale!
Hey I’ve just gotten my first shipment of mathbabe t-shirts and I love them so much I’ve made them available to anyone to order from Zazzle.
Here’s me wearing my t-shirt (my new logo is courtesy of my buddy Julie Steele):
And here’s the back:
But if that’s too strident for you, don’t despair! There’s an alternative back:
I know it’s a pretty good design because my fashion-focused 10-year-old wants one.
Here’s what you do if you want your very own mathbabe t-shirt:
- You will have to go to zazzle.com and start an account if you don’t already have one. I’m sorry about this but the alternative was to buy them all for you and then send them all to you separately, which I don’t have time for.
- Then go to this page on zazzle.com to buy the first version, or
- to this page on zazzle.com to get the more subdued second version.
- I’m also selling a mathbabe coffee mug.
- I’m also open to other products, tell me what you think.
Good news for professors: online courses suck
If this New York Times editorial is correct, and it certainly passes the smell test, students are not well-served by online courses but are by so-called “hybrid” courses, where there’s a bit of online stuff and also a bit of one-on-one time. From the editorial:
The research has shown over and over again that community college students who enroll in online courses are significantly more likely to fail or withdraw than those in traditional classes, which means that they spend hard-earned tuition dollars and get nothing in return. Worse still, low-performing students who may be just barely hanging on in traditional classes tend to fall even further behind in online courses.
This is important news for math departments, at least in the medium term (i.e. until machine learners figure out how to successfully simulate one-on-one interactions), because it means they won’t be replacing calculus class with a computer. And as every mathematician should know, calculus is the bread and butter of math departments.
Five false myths that make liberals feel good
1. The U.S. has a progressive tax code
Actually, no. Not when you include all kinds of taxes. From this Economist column, which states “The fact of the matter is that the American tax code as a whole is almost perfectly flat.”
2. The U.S. is a land of opportunity
Actually, the mobility of the U.S. is worse than Canada’s or anywhere in Western Europe. From the NY Times article:
Despite frequent references to the United States as a classless society, about 62 percent of Americans (male and female) raised in the top fifth of incomes stay in the top two-fifths, according to research by the Economic Mobility Project of the Pew Charitable Trusts. Similarly, 65 percent born in the bottom fifth stay in the bottom two-fifths.
3. The bailout worked
Actually, the bailout is still happening, as we see from monthly discoveries such as this recent back-door bailout, and it hasn’t worked for the majority of the people it was intended for, namely people stuck with unreasonable mortgages (people forget this sometimes, but the first half of TARP was for the banks, the second half was for mortgage holders). From a NY Times Op-ed by Elizabeth Lynch (emphasis mine):
So a lender can forgive a second mortgage — which in the event of foreclosure would be worthless anyway — and under the settlement claim credits for “modifying” the mortgage, while at the same time it or another bank forecloses on the first loan. The upshot, of course, is that the people the settlement was designed to protect keep losing their homes.
4. Our private data is protected by our government
Although on the one hand the CIA recently admitted to full monitoring of Facebook using fake personas (h/t Chris Wiggins), the U.S. government does not in fact take great pains to protect the data they collect about its citizens. Moreover, government workers who complain about the porous data protection are punished instead of protected, as is explained in this Times piece. My favorite quote is this bit of common sense:
Susan Landau, a Guggenheim fellow in cyber security, privacy and public policy, says companies and agencies are unlikely to improve data security without the threat of penalty.
“What are the personal consequences for employees who allow data breaches to happen?” Ms. Landau asks. “Until people lose their jobs, nothing is going to change.”
5. We are recovering from the great recession
From 2009-2011, the top 1% captured 121% of all income gains (h/t Matt Stoller).
Who says you can’t perform at 121%? Turns out you can if other people are actually losing income while you’re getting increasingly rich.
Don’t get me wrong, corporate profits have done even better – a 171% gains since we’ve had Obama. But I’d go by things that matter to the 99%, so payrolls and jobs. Payrolls are flat and we still have 5 million fewer jobs, so I’d say it’s not much of a recovery.
Phenomenal woman
Today’s post goes out to all the phenomenal women I am lucky to know and to love. It’s a gorgeous song based on this poem by Maya Angelou (h/t Becky Jaffe).
Aunt Pythia’s advice
Readers, I was really close to declaring this the last Aunt Pythia column.
My explanation was gonna be this: I am finding myself surprisingly unqualified to answer most of the questions submitted. I thought I was a loud mouth and would have no problem, but when people ask me hugely philosophical questions about the existence of god, or ask me questions about how to change fields from physics to politics, it just makes me feel very unthoughtful and small.
So in other words, as a mode of self-preservation, I was going to discontinue this practice and go back to doing stuff that makes me feel smart.
But after doing the actual writing (which you will find below) I’ve changed my mind. It’s too much fun! But I have fired you guys from answering a question each week since you suck at that.
If you don’t know what you’re in for, go here for past advice columns and here for an explanation of the name Pythia. Most importantly,
Please submit your question at the bottom of this column!!
——
Let’s start out with the question from last time that remained unanswered:
Dear Aunt Pythia,
As a graduate student, I enjoy attending departmental teas, if only because it’s an excuse to get away from the books for a few minutes. However, my department recently started having some of our teas sponsored by a trading firm. As somebody who has concerns about the finance industry, I am bothered by this. I thought about dumping all the tea in one of the fountains on campus, but I’d like to find a more constructive approach. Any suggestions?
Tea Party Patriot
TPP,
Interesting. Let me ask you this. Is the money given with strings attached? Do they also expect to be able to recruit math people on campus? Do they advertise their firm in some way at the teas? How do you happen to know who’s sponsoring it?
If one of the above is true, then yes I’d say dump the tea in a fountain, and object to the blatant commercialization of your department. But if none of the above is true, and if I haven’t forgotten something, then the money is a kind of bribe, but it’s lower level.
That is, your department is psyched to not pay for cookies, but over time the money that it’s saving will be used for other things, and people’s taste in cookies will be inflated because of the extra fancy cookies that finance people can afford, and there will be this weird dependency set up. At that point they may try to advertise or recruit, which is in my opinion totally outrageous on a campus and deserves some fountain dumping. Hopefully you can band together with other outraged folk and make a big scene of it.
Another possibility: if they are recruiting on campus, tell me where in advance and I’ll come recruit for Occupy at the next table.
Good luck, Patriot!
Aunt Pythia
——
Dear Aunt Pythia,
Dear Aunt Pythia, after living for quite a lot time I think my life has been mostly erratic and not driven by myself but for random forces beyond my scope. I don’t mean I am in a bad position. In fact I am quite happy and own everything I and my family need to live comfortably. However a lot of people think of themselves as making long term plans and succeding (or failing) at them. Sometimes I think there are essentialy different kinds of people (with and without living plans speaking on binary mode), sometimes I think they just deceive themselves. What do you think about? Do you have a long term plan for yourself?
Rooted At Nothing Durable On My Living Years
Dear RANDOMLY,
First, let me speak of my gratitude for your excellently chosen fake name, which translates so beautifully into an appropriate word (see how RANDOMLY did that, people?). Thank you so so much.
Second, you have essentially described me twice, in different parts of my life. So when I was 15 and went to math camp, I decided to become a math professor. For twenty pleasant years I was one of those people with a plan. Actually, my life wasn’t consistently pleasant during those years, but having a plan was a consistently pleasant part of my life.
But ever since I quit my math professor job at Barnard College in 2007, I’ve been adrift in a world without a plan. I essentially don’t know what the future will bring, nor do I want to know.
Back to your question: are long-term planners deceiving themselves? Yes and no.
Yes because, by dint of it being such a very long time before your plan is fulfilled, you will be a very different person by that time, and who knows if you will still have the same goals and interests. Chances are you won’t, and you’ll be less naive about the negatives of your plan, and your role models will have disappointed you, etc. Long-term plans are filled with bittersweet consequences.
On the other hand, I do think it can be good to have some plan, especially if you’re a woman. I don’t regret getting my Ph.D. in math for a second, partly because I learned so much (about math but also about myself, as trite as it sounds) and because it’s a pretty flexible achievement – people respect that on your resume. So in fact I tell young math nerd girls all the time to make it a goal of theirs to get their Ph.D. and then decide what’s next. I suggest that people have a long-term plan but keep in mind they can always change it.
Having a plan helped me make decisions, so in that sense it acted as a crutch (“Should I do this? Do math professors do this?”). Not having a plan has been harder but I luckily waited until I was old enough to deal with the uncertainty. It’s not unlike the feeling I described in this post about learning to not understand tensor products.
One thing that has surprised me about not having a plan is that you might expect I’d have less interest in learning new things, since learning can be seen as investing in a new long-term plan. But actually, if anything I’ve learned more, more quickly, since giving up plans, because I’ve been following my instincts and curiosity rather than my idea of the what would be appropriate for the person I expect to become. So that’s an advertisement for not having a plan, at least for me.
I hope this rambling answer has helped, RANDOMLY!
Aunt Pythia
——
Aunt P,
What’s the difference between a hipster and a nerd? Aren’t they both purported minorities with fringe obsessional interests? One of them is sexy while the other is only ironically sexy. But which is it?
Nerdster
Dear Nerdster,
I have never compared the two groups until now, but I’d argue that hipsters are generally hyper aware of what’s “normal” and act in constant reference to that, whereas nerds are oblivious to what’s normal, or at least ignore it because they’ve got more interesting things to think about. That’s a big difference.
Personally I find almost everything sexy, but if I had to decide between nerds and hipsters, I’d go with nerds. Here’s why: if you think about it, nerds in groups commonly invent their own universes (think “Star Trek”), which light the way to aspirational societies, which are very sexy. Even the singularity stuff is exciting in that kind of nerd nirvana way.
Whereas if you take the hipster to the asymptotic limit of his philosophical mindset, you get artisanal pencil sharpening.
I am completely willing to believe my vision is biased because I’m a nerd, by the way. Hipsters, please speak up for your peeps and correct me if I’m wrong about your sexiness.
Best,
AP
——
Dear Aunt Pythia,
I’m a queer gal and last year for about 5 months, I worked with an amazing woman and we got really close. We connected so well, unlike anyone I’ve met before. She’s married (to a guy) with kids, and I have a gf of 8 years, so nothing happened between us, but the possibility was there.
I’m in a new location (unrelated circumstances), and tried reconnecting with her via email but she never responded, so obviously I get the message. Trouble is, I can’t get her out of my head a year later. And the kicker is I’m doing a presentation at the old location in a few months. I want to see her and maybe I’ll get over this serious crush. Also, there are others I want to reconnect with, so I want to send out an email letting them know I’ll be back for a day. Questions: 1. Is including her in the email stupid? 2. How do I stop thinking about her?
Gal Apparently Yearning
Dear GAY,
First, thanks for the great fake name, it brings tears to my eyes that you guys are on top of this shit.
Next, let’s do this in cases. Best case scenario she’s in love with you but can’t handle it because she’s got kids and doesn’t want to fuck up her family. In that case your plan has to be super sexy but also protective of her life, so in other words send her a brief email that you’ll be back and, if she dares to see you, spend the whole time holding her hand, looking into her eyes, and talking about how beautiful she is and how you know she can’t jeopardize her family but you love her anyway. That makes a great story and it’s true.
Worst case scenario she doesn’t acknowledge even to herself that she’s in love with you. In that case same plan since you’ll never know which it is unless you try.
Good luck!! Tell me what happens!
Aunt Pythia
——
Please please please submit questions, thanks!
HSBC protest yesterday (#OWS)
Here’s a picture from yesterday (thanks Pam!):
This was near the end when some people had already left. We met on the steps of the NYPL as above but in between we went across the street and marched in front of HSBC, which was barricaded by the police. Indeed there were as many police, or more, as protesters. We chanted things like, “Stop and Frisk HSBC!” or “The banks got bailed out, we got sold out” but my favorite chant was a song Nick and Manny made up during the event:
Bankers and drug lords sittin’ in a tree
K-I-S-S-I-N-G
First comes love, then comes prrofit,
Then comes a settlement from the Justice De-partment!
Here’s a pic from the marching part with an appropriate Valentine’s Day theme (note the barricades behind the protesters):
And here’s me with my sandwich board. The front (note the long line of police motorcycles behind me):
And the back:
Also check out Taibbi’s HSBC article from yesterday.
There should be a macho way to say “I don’t know”
I recently gave an interview with Russ Roberts at EconTalk, which was fun and which has generated a lot of interesting feedback for me. I had no idea so many people listened to that podcast. Turns out it’ll eventually add up to something like 50,000, with half of those people listening this week. Cool!
One thing Russ and I talked about is still on my mind. Namely, how many problems are the direct result of people pretending to understand something, or exaggerating the certainty of an uncertain quantity. People just don’t acknowledge errorbars when they should!
What up, people?
Part of the problem exists because when we model something, the model typically just comes out with a single answer, usually a number, and it seems so certain to us, so tangible, even when we know that slightly different starting conditions or inputs to our models would have resulted in a different number.
So for example, an SAT score. We know that, on a different day with a different amount of sleep or a different test, we might score significantly differently. And yet the score is the score, and it’s hugely important and we brand ourselves with it as if it’s some kind of final word.
But another part of this problem is that people are seldom incentivized to admit they don’t know something. Indeed the ones we hear from the most are professional opinion-holders, and they are going to lose their audience and their gigs if they go on air saying, “I’m not sure what’s going to happen with [the economy], we’ve honestly never been in this situation before and our data is just not sufficient to make a prediction that’s worth its weight.”
You can replace “the economy” by anything and the problem still holds.
Who’s going to say that?? Someone who doesn’t mind losing their job is who. Which is too bad, because honest people do say that quite a large portion of the time. So professional opinion-holders are kind of trained to be dishonest in this way.
And so are TED talks, but that’s a vent for another day.
I wish there were a macho way to admit you didn’t know something, so people could understand that admitting uncertainty isn’t equivalent to being wishy-washy.
I mean, sometimes I want to bust out and say, “I don’t know that, and neither do you, motherfucker!” but I’m not sure how well that would go over. Some people get touchy about profanity.
But it’s getting there, and it points to something ironic about this uncertainty-as-wishy-washiness: it is sometimes macho to point out that other people are blowing smoke. In other words, I can be a whistle blower on other people’s illusion of certainty even when I can’t make being uncertain sound cool.
I think that explains, to some extent, why so many people end up criticizing other people for false claims rather than making a stance on uncertainty themselves. The other reason of course is that it’s easier to blow holes in other people’s theories, once stated, than it is to come up with a foolproof theory of one’s own.
Any suggestions for macho approaches to errorbars?
The smell test for big data
The other day I was chatting with a data scientist (who didn’t know me), and I asked him what he does. He said that he used social media graphs to see how we might influence people to lose weight.
Whaaaa? That doesn’t pass the smell test.
If I can imagine it happening in real life, between people, then I can imagine it happening in a social medium. If it doesn’t happen in real life, it doesn’t magically appear on the internet.
So if I have a huge crush on LeBron James (true), and if he tweets that I should go out and watch “Life of Pi” because it’s a great movie (true), then I’d do it, because I’d imagine he is here with me in my living room suggesting that I see that movie, and I’d do anything that man says if he’s in my living room, especially if he’s jamming with me.
Not actually my living room.
But if LeBron James tells me to lose weight while we’re hanging, then I just feel bad and weird. Because nobody can influence someone else to lose weight in person*.
Bottomline: there’s a smell test, and it states that real influence happening inside a social graph isn’t magical just because it’s mathematically formulated. It is at best an echo of the actual influence exerted in real life. I have yet to see a counter-example to that. If you have one, please challenge me on this.
Any data scientist going around claiming they’re going to surpass this smell test should stop right now, because it adds to the hype and adds to the noise around big data without adding to the conversation.
* I’ll make an exception if they’re a doctor wielding a surgical knife about to remove my stomach or something, which doesn’t translate well into social media, and might not always work long-term. And to be fair, you (or LeBron) can influence me to not eat a given thing on a given day, or even to go on a diet, but by now we should know that doesn’t have long term effects. There’s a reason Weight Watchers either doesn’t publish their results or relies on survivorship bias for fake results.
Johnson Research Labs
I have exciting news this morning.
I’ll be starting a new job next Monday at Johnson Research Labs (JRL). It’s made up of a small group of data scientists, social scientists, and cloud computing people working on interesting problems that will hopefully have a positive impact on the world. JRL was founded recently by David Park and John Johnson and is backed by Johnson.
My first job once I’m there will be to finish my book Doing Data Science with my co-author, Rachel Schutt, who is also joining JRL from Google. The book is based on Rachel’s data science class from last semester at Columbia which I blogged about here.
Ian Langmore and Daniel Krasner, who are co-teaching another class at Columbia this semester in applied data science (along with Chang She), are also working at JRL.
Occupy HSBC: Valentine’s Day protest at noon #OWS
Protest with #OWS Alternative Banking Group
I’m writing to invite you to a protest against mega-bank HSBC at noon on Valentine’s Day (Thursday) starting on the steps of the New York Public Library at 42nd and 5th. Details are here but it’s the big green box on the map on the Fifth Avenue side:
Why are we protesting?
Like you, I’m sure, I’d like nothing more than to stop worrying about shit that goes on in our country’s banks.
We have better things to do with out time than to get annoyed over enormous bonuses being given to idiots for their repeated failures. We’re frankly exhausted from the outrage.
I mean, the average person doesn’t have a job where they get an $11 million bonus instead of a $22 million dollar bonus when they royally screw up. Outside the surreal realm of international banking, the normal response to screw-ups on that level is to get fired.
You might expect a company that has been caught criminally screwing minorities out of fair contracts might be at risk of being closed down, but in this day and age you’d know that big banks, or TIBACO (too interconnected, big, and complex to oversee) institutions, as we in Alt Banking like to call them, are immune to such action.
There’s a clear evolving standard of treatment in the banking sector when it comes to criminal activity:
- the powers that be (SEC, DOJ, etc.) make a huge production over the severity of the fine,
- which is large in dollar amounts but
- usually represents about 10% of the overall profit the given banks made during their exploit.
- Nobody ever goes to jail, and
- the shareholders pay the fine, not the perpetrators.
- The perps get somewhat diminished bonuses. At worst.
The bottomline: we have an entire class of citizens that are immune to the laws because they are considered too important to our financial stability.
But why HSBC?
HSBC is a perfect example of this. An outrageous example.
HSBC didn’t get a bailout in 2008 like many other banks, even though they were ranked #2 in subprime mortgage lending. But that’s not because they didn’t lose money – in fact they lost $6 billion but somehow kept afloat.
And now we know why.
Namely, they were money-laundering, earning asstons by facilitating drugs and terrorism. This was blood money, make no mistake, and it went directly into the pockets of HSBC bankers in the form of bonuses.
When this years-long criminal mafia activity was discovered, nothing much happened beyond a fine, as per usual. Well, to be honest, they were fined $1.9 billion dollars, which is a lot of money, but is only 5 weeks of earnings for the mammoth institution – depending on the way you look at it, HSBC is the 2nd largest bank in the world.
Too big to jail
And that’s when “Too big to fail” became “Too big to jail.” Even the New York Times was outraged. From their editorial page:
Federal and state authorities have chosen not to indict HSBC, the London-based bank, on charges of vast and prolonged money laundering, for fear that criminal prosecution would topple the bank and, in the process, endanger the financial system. They also have not charged any top HSBC banker in the case, though it boggles the mind that a bank could launder money as HSBC did without anyone in a position of authority making culpable decisions.
Clearly, the government has bought into the notion that too big to fail is too big to jail. When prosecutors choose not to prosecute to the full extent of the law in a case as egregious as this, the law itself is diminished. The deterrence that comes from the threat of criminal prosecution is weakened, if not lost.
National Threat
You may recall that there was an extensive FBI investigation of OWS before Zuccotti Park was even occupied.
Ironic? As the Village Voice said, “apparently non-violent demonstration against corrupt banking is subject to more criminal scrutiny than actual corrupt banking.”
Question for you: which is the bigger national security threat, OWS or HSBC?
We demand
HSBC needs its license revoked, and there need to be prosecutions. Those who are guilty need to be punished or else we have an official invitation to criminal acts by bankers. We simply can’t live in a country which rewards this kind of behavior.
Mind you, this isn’t just about HSBC. This is about all the megabanks. Citi or BoA are exempt from prosecution, too. Our message needs to be “break up the megabanks”.
I’ll end with what Matt Taibbi had to say about the HSBC settlement:
On the other hand, if you are an important person, and you work for a big international bank, you won’t be prosecuted even if you launder nine billion dollars. Even if you actively collude with the people at the very top of the international narcotics trade, your punishment will be far smaller than that of the person at the very bottom of the world drug pyramid. You will be treated with more deference and sympathy than a junkie passing out on a subway car in Manhattan (using two seats of a subway car is a common prosecutable offense in this city). An international drug trafficker is a criminal and usually a murderer; the drug addict walking the street is one of his victims. But thanks to Breuer, we’re now in the business, officially, of jailing the victims and enabling the criminals.
Join us on Valentine’s Day at noon on the steps of the New York Public Library and help us Occupy HSBC. Please redistribute widely!
Gender bias in math
I don’t agree with everything she always says, but I agree with everything Izabella Laba says in this post called Gender Bias 101 For Mathematicians (hat tip Jordan Ellenberg). And I’m kind of jealous she put it together in such a fantastic no-bullshit way.
Namely, she debunks a bunch of myths of gender bias. Here’s my summary, but you should read the whole thing:
- Myth: Sexism in math is perpetrated mainly by a bunch of enormously sexist old guys. Izabella: Nope, it’s everyone, and there’s lots of evidence for that.
- Myth: The way to combat sexism is to find those guys and isolate them. Izabella: Nope, that won’t work, since it’s everyone.
- Myth: If it’s really everyone, it’s too hard to solve. Izabella: Not necessarily, and hey you are still trying to solve the Riemann Hypothesis even though that’s hard (my favorite argument).
- Myth: We should continue to debate about its existence rather than solution. Izabella: We are beyond that, it’s a waste of time, and I’m not going to waste my time anymore.
- Myth: Izabella, you are only writing this to be reassured. Izabella: Don’t patronize me.
Here’s what I’d add. I’ve been arguing for a long time that gender bias against girls in math starts young and starts at the cultural level. It has to do with expectations of oneself just as much as a bunch of nasty old men (by the way, the above is not to say there aren’t nasty old men (and nasty old women!), just that it’s not only about them).
My argument has been that the cultural differences are larger than the talent differences, something Larry Summers strangely dismissed without actually investigating in his famous speech.
And I think I’ve found the smoking gun for my side of this argument, in the form of an interactive New York Times graphic from last week’s Science section which I’ve screenshot here:
What this shows is that 15-year-old girls out-perform 15-year-old boys in certain countries and under-perform them in others. Those countries where they outperform boys is not random and has everything to do with cultural expectations and opportunities for girls in those countries and is explained to some extent by stereotype threat. Go read the article, it’s fascinating.
I’ll say again what I said already at the end of this post: the great news is that it is possible to address stereotype threat directly, which won’t solve everything but will go a long way.
You do it by emphasizing that mathematical talent is not inherent, nor fixed at birth, and that you can cultivate it and grow it over time and through hard work. I make this speech whenever I can to young people. Spread the word!
Aunt Pythia’s advice
Aunt Pythia is excited by all the snow outside and has at least a couple of appointments with a sled this morning, but before she runs off she’d like to spread her words of wisdom to her good readers.
If you don’t know what you’re in for, go here for past advice columns and here for an explanation of the name Pythia, and most importantly, please submit your question at the bottom of this column!!
And… thank you for making your questions funny and/or outrageous. Extra points if your fake name is also funny before or after I shorten it into initials. For example, you could sign your letter “From A Rotten Town”. And when I say “funny” I could mean “puerile”.
From last time:
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Aunt Pythia,
How do you explain your work (and its importance/relevance to the world) to laypeople? I’m interested in your answers to this question for math, for finance, and for data science.
Pre-Expositor
Dear Pre-Expositor,
First, reader Mr. Exposition had this to suggest:
When non-mathematicians ask, I usually start off by describing something simple in my general area of math that has a cool real-life application. If and only if they then ask me about what I do in particular, I start breaking out the analogies and trying to give them an idea. (This gives the other person an escape valve if they wanted to be polite but don’t want to have an intense conversation.)
I’ll add a few words too. I think it helps to know a bit about the person you’re talking to. Are they wondering what math could be useful for at all? Or are they physicists? The answer is going to depend a lot on who your audience is.
Sometimes it turns out they want to be convinced that math can be interesting to someone in its own right, and why, but sometimes they might just want to knowhow the lifestyle of a mathematician is different from that of a high school teacher. I am happy to have those conversations and leave it at that. I especially love the “why is math important one” because people who ask it often answer it without my help.
If they really want to get into the details of what you think about on a daily basis, which is pretty rare, then as a data scientist I compare my approaches to something they are aware of, for example a Netflix-like recommendation system, or a Google search-like algorithm, or a finance-style trading algorithm.
If they want to talk about what I did as an academic mathematician, I talk about elementary diophantine equations and how they get increasingly difficult as you increase the degree, and if they’re still with me I talk about seeing solutions through the eyes of individual primes, and if they are still with me I talk about the local-global principle.
I don’t try to sell academic research math as important per se, just as fascinating and beautiful.
I hope that helps,
Aunt Pythia
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Dear Aunt Pythia,
You seem like a very un-neurotic person. What’s your secret? Do you have personal demons? What’s your go-to strategy for when they rear their ugly heads?
Wanna-be neuroses-free
Dear Wbnf,
I do of course have personal demons, as everybody does. I often find myself waking up at 3am thinking about things I’m behind on or things I wish had gone better. I have two pieces of advice for this kind of thing.
First, use suppression. I think suppression has a bad name. People think of it as a bad thing. They say stuff like, “oh you’re just suppressed” like that’s a crime.
But I say, use suppression to your advantage! If you can’t fix something that’s bothering you, agree to ignore it (which is an agreement you make with yourself, so nobody can even complain about it). And I don’t mean ignore it forever, either. Just make a plan to start thinking about it if and when you might have control over it. OWN your suppression and it will give back to you.
So for example, if you are stressing about your kid getting into a good kindergarten in New York City, then do what you can in terms of looking up schools and applying to them, and then after that, start up the suppression motors til you hear back. There’s absolutely nothing you can do in the meantime except fret, and you have better things to do with your time. Suppression is your friend!
Second, be pro-active. I know that’s a trite, overused phrase, but there may not be another word that means what I want to say – namely, do your best, to the best of your knowledge, on whatever it is, and forgive yourself in advance if that wasn’t enough. Of couse sometimes it wasn’t, and you have to live with the consequences, and sometimes you take notes on what would have been better. That’s ok, because the third thing is you gotta forgive yourself. It’s so obvious I won’t even make it a separate thing.
In my experience, being pro-active about something in advance, followed by 100% suppression mode, works a lot better than constantly putting something off and feeling guilty about it.
By the way, one more thing. I also let things slide. If I can’t get myself into enough of a froth to be pro-active about something, then I just let it go and I don’t look back (I do this via suppression, see above). It’s important to know when to do that too.
I hope that helps!
Cathy
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Dear Aunt Pythia,
I’ve decided to leave academia and become a research scientist in the tech world. In addition to my area of math, I know a bit of programming and machine learning. What else can I learn in the next few months to better prepare myself?
Rambling On
Dear Rambling,
Great question, but I’m not sure how many “research scientist” positions there are in the tech world. Most of them don’t want you to research, they want you to model! So I’m going to assume you meant something like “data scientist” if that’s ok.
First, learn python, for reals. Next, learn statistics, enough so you can explain to anyone what statistical significance is and mean it. Then, read the book I’m writing with Rachel Schutt, Doing Data Science. Oh wait, it’s not out yet. So for now, read the notes I took on Rachel’s Columbia Data Science class last semester.
And to test your new knowledge, implement the recommendation system using python. And send me the code! We’d love to have it for the book, thanks.
Good luck,
Auntie P
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Now it’s time for you guys to help me answer a question. I’ve got a juicy one for you:
Dear Aunt Pythia,
As a graduate student, I enjoy attending departmental teas, if only because it’s an excuse to get away from the books for a few minutes. However, my department recently started having some of our teas sponsored by a trading firm. As somebody who has concerns about the finance industry, I am bothered by this. I thought about dumping all the tea in one of the fountains on campus, but I’d like to find a more constructive approach. Any suggestions?
Tea Party Patriot
——
Please please please submit questions, thanks!
Looking for ideas for a mathbabe logo
Apologies for the self-indulgent posts two days in a row, but I’m looking for ideas for a mathbabe logo. I have a coffee mug and a shirt already, because for whatever reason zazzle.com already had a mathbabe logo when I checked, and it looks like this:
Mysteriously found on Zazzle.com
The problem is that I’m not exactly a pink frilly person, although I’ve made do with a black T-shirt background.
And I need this why? Because I’m thinking of making some mathbabe t-shirts and paraphernalia to give to people and/or sell (partly because I’m jealous of the stack project t-shirts I see all over the neighborhood).
Anyway, if anyone has ideas for a new graphic, or a designer friend who needs money (not too much I hope), or better yet a sample graphic, please get in touch with me, thanks! My email is on the “About” page.
It’s not that I don’t understand you, it’s that you’re wrong
Dear …..,
I’ve been meaning to explain this to you. It took me a while to get what was happening in our interactions, so it’s only fair for me to explain it to you now that I get it.
Namely, every time we meet, you try to explain the same thing to me, even though I already understood it the first time – maybe even before meeting you.
You see, it’s not that I don’t understand you, it’s that you’re wrong.
You obviously think that anybody who doesn’t agree with you must not understand you (because what you actually think is that anyone who understands your impeccable logic must agree with you), but take it from me, I don’t agree with you. At all. And I’m not interested in you explaining your logic to me again. Next time you try to do that, I will stop you.
Mind you, I don’t have huge hope for this plan, because I’ve tried it before. I spent one conversation with you very carefully giving you supporting evidence that I understood your points. I even did things like encouragingly rephrasing what you were saying in my own words to convince you that I understood. Then, after that, I explained to you that in spite of that clarity, your conclusions still held no sway with me. None whatsoever! They were based on naive and obvious simplifications! We might as well agree to disagree!
And yet… yet you seemed to have forgotten that episode entirely by the time we next met.
So, actually, here’s what’s gonna happen, next time we meet. I’m going to avoid you, and if that doesn’t work, I’ll avoid talking to you, and if that is impossible, I will nod and smile. I don’t want to have to resort to nastiness, and although I believe in being direct and I’m no conflict avoider, there are certain conflicts one can’t resolve, and one of them is you.
Thanks,
Cathy
Bad model + high stakes = gaming
Today let’s talk some oldish news about Michelle Rhee, the Chancellor of Washington public schools from 2007-2010, who recently appeared on the Daily Show.
Specifically I want to discuss a New York Times article from 2011 (hat tip Suresh Naidu) that is entitled “Eager for Spotlight, but Not if It Is on a Testing Scandal”.
When she was Chancellor, Rhee was a huge backer of the standardized testing approach to locating “bad teachers”. She did obnoxious stuff like carry around a broom to illustrate her “cleaning out the trash” approach. She fired a principal on camera.
She also enjoyed taking credit when scores went up, and the system rewarded those teachers with bonuses. So it was very high stakes: you get a cash incentive to improve your students’ scores and the threat of a broom if they go down.
And guess what, there was good evidence of cheating. If you want to read more details, read the article, then read this and this: short version is that a pseudo-investigation came up with nothing (surprise!) but then again scores went way down when they changed leadership and added security.
My point isn’t that we should put security in every school, though. My point is that when you implement a model which is both gameable and high stakes, you should expect it to be gamed. Don’t be surprised by that, and don’t give yourself credit that everyone is suddenly perfect by your measurement in the meantime.
Another way of saying it is that if you go around trusting the numbers, you have to be ready to trust the evidence of gaming too. You can’t have it both ways. We taxpayers should remember that next time we give the banks gameable stress tests or when we discover off-shore tax shelters by corporations.
HSBC Valentine’s Day action (#OWS)
We in the Alt Banking group are planning a protest against “too big to jail” bank HSBC for Valentine’s Day. As soon as we started the planning we realized they are utterly ripe for satire with their ridiculous airport posters like this one:
Here’s a new poster for them, courtesy of Nick from our group (and crossposted from the Alt Banking blog):
Readers, can you help us come up with posters and slogans for the event? Bonus if it has to do with a Valentine’s Day theme, along the lines of “You broke my heart, HSBC!” or if it riffs on their slogan, “The World’s Local Bank”. We will be making posters and flyers with this stuff next Sunday afternoon, if you’re going to be up near Columbia you should join us.
Thanks for your help! If you tweet this, don’t forget to use the hashtag #HSBC as a gift to those guys.
update: Public Citizen in Maryland is attempting to revoke HSBC’s bank charter.
Links to videotaped talks and pdf slides
Busy at work today but I wanted to share a few links coming out of talks I gave recently.
First the one I gave at Brown University at the Agnes Conference (October 2012). It’s called “How Math is Used outside Academia”.
Second the one I gave at Stony Brook’s colloquium (December 2012). It has the same title.
These two are videos of the same talk (although with very different audiences), so please don’t watch both of them, you will get bored! If you like friendly audiences, go with Agnes. If you like to watch me getting heckled, go with Stony Brook.
[p.s.: I pretty much never watch other people’s videos, so please don’t watch either one, actually.]
The third talk, which was the shortest, was at the Joint Math Meetings (January 2013) but I don’t think it was taped. It was called Weapons of Math Destruction and the slides are available here (I’ve turned them into a pdf).
Barry Mazur wins the National Medal of Science
Last Friday my thesis advisor Barry Mazur got awarded the National Medal of Science (hat tip Mike Hopkins).
President Barack Obama awards the National Medal of Science to Dr. Barry Mazur of Harvard University, Friday, Feb. 1, 2013, during a ceremony in the East Room of the White House in Washington. The awards are the highest honors bestowed by the United States Government upon scientists, engineers, and inventors. (AP Photo/Charles Dharapak)
One of many wonderful things about Barry is how broad his interests are (in addition to being profoundly deep). I remember that, in order to get time to talk math with him in grad school, he’d bring me to poetry readings so we could discuss math during the intermission. Last semester he taught a class with people from the law school about the shifting concept of evidence in different fields.
That guy is awesome.
mathbabe 
