Archive for March 15, 2009

This Wired article is about the world of finance, a famous mathematical formula that created (and lost) trillions of dollars of wealth, and that in the end was an over-simplification of reality and in addition was confused with the real world by people who don’t understand mathematics but are addicted to money. But while the article suggests that the problem was that bankers and investors deluded themselves in thinking they could model just a few years’ worth of data and come up with probabilities for things that may happen only once every 10,000 years, I think it overlooks the real motive behind the market collapse: GREED.


Article

Mathematician David Li’s Gaussian copula formula will go down in history as instrumental in causing the unfathomable losses that brought the world financial system to its knees.

wallst-briefcaseA year ago, it was hardly unthinkable that a math wizard like David X. Li might someday earn a Nobel Prize. After all, financial economists—even Wall Street quants—have received the Nobel in economics before, and Li’s work on measuring risk has had more impact, more quickly, than previous Nobel Prize-winning contributions to the field. Today, though, as dazed bankers, politicians, regulators, and investors survey the wreckage of the biggest financial meltdown since the Great Depression, Li is probably thankful he still has a job in finance at all. Not that his achievement should be dismissed. He took a notoriously tough nut—determining correlation, or how seemingly disparate events are related—and cracked it wide open with a simple and elegant mathematical formula, one that would become ubiquitous in finance worldwide.

For five years, Li’s formula, known as a Gaussian copula function, looked like an unambiguously positive breakthrough, a piece of financial technology that allowed hugely complex risks to be modeled with more ease and accuracy than ever before. With his brilliant spark of mathematical legerdemain, Li made it possible for traders to sell vast quantities of new securities, expanding financial markets to unimaginable levels.

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Umbrella Bloom

Posted: March 15, 2009 in creativity
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[Urban Prankster via Inspire Me, Now! – Photo by Jessica Rolland]

Choe where reminisces his start with spraypaint, the importance of technique and the necessity of having good ideas as a foundation.

Choe where discusses making and throwing Molotov cocktails, napalm and his take on the finer points of Korean culture.

Choe talks about the power of prayer.

Interview features with David Choe, filmed by Alexander Tarrant and Michael Langan from Walrus TV/Upper Playground.

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The Proceeds of Crime

By George Monbiot
George Monbiot’s ZSpace Page/ ZSpace

The US and British governments have created a private prison industry which preys on human lives.

It’s a staggering case; more staggering still that it has scarcely been mentioned on this side of the ocean. Last week two judges in Pennsylvania were convicted of jailing some 2000 children in exchange for bribes from private prison companies.

Mark Ciavarella and Michael Conahan sent children to jail for offences so trivial that some of them weren’t even crimes. A 15 year-old called Hillary Transue got three months for creating a spoof web page ridiculing her school’s assistant principal. Mr Ciavarella sent Shane Bly, then 13, to boot camp for trespassing in a vacant building. He gave a 14 year-old, Jamie Quinn, 11 months in prison for slapping a friend during an argument, after the friend slapped her. The judges were paid $2.6 million by companies belonging to the Mid Atlantic Youth Services Corp for helping to fill its jails(1,2,3). This is what happens when public services are run for profit.

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LaCie USB keys

Posted: March 15, 2009 in science & technology
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LaCie offers a range of of USB sticks that would perfectly fit on my keyring; one of them even does have a Micso SD card reader built in.

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Vodpod videos no longer available.

more about “Snake Farm Makes Venom, Thrills“, posted with vodpod

Snakes really are magnificent creatures, and by and large they are quite harmless – even the most poisonous ones: if you leave them alone that is. Here in Australia we have many of the most dangerous snakes in the world, and though some of them live in our garden, I’ve hardly seen any in the last 12 years of living here. If you are careful, they’ll get out of your way long before you spot them – and why wouldn’t they given we as a species are not only physically much bigger than they are but also much more lethal. We have neighbours on both sides who unfortunately always kill a snake when they see one – a disgusting practice we haven’t been able yet to talk them out of. And while snake bites of course can be at least highly dangerous and debilitating, as this video shows, it is also great to see the respect and admiration shown by the snake handlers towards these beautiful creatures.

[Video by National Geographics]

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Hot New High-Tech Energy Source Is … Wood?

Mason Inman
for National Geographic News

Burning trees for power may seem backward, dirty, and environmentally hostile. But a high-tech new way of wood burning holds great potential to save energy, cut costs, and even fight global warming, a new study says.

For example, in the United States wood could sustainably supply “enormous amounts of energy, comparable to power production from hydroelectric [dams],” says the study, to be published in tomorrow’s issue of the journal Science. Already, “advanced wood combustion” is powering a U.S. college and cities across Europe, such as Joensuu, Finland. Joensuu’s “air quality has improved greatly,” said city resident Antti Asikainen, a forestry expert at the Finnish Forest Research Institute. “It’s a really clean technology.” The city of roughly 58,000 “is heated with a wood and peat mixture, which has replaced small fireplaces and oil burners—they’re the worst generators” of pollution, Asikainen said.

To get these wood-burning benefits, cities can’t rely on ordinary furnaces. In advanced wood combustion power plants, intense heat and carefully controlled conditions ensure that nearly all the carbon in the wood is broken down into flammable gases. Then the gases are ignited, burning much more cleanly than a typical smoky home fireplace. The heat from burning the gas can be used directly for heating or to generate electricity. The power plants also have filters that remove many of the small particles that come from burning the wood, greatly reducing pollution.

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