The Times Online has a terrific article about Nicholas Taleb's reaction to the market crash.  Taleb is the author of The Black Swan, a very fun read about his theories of unpredictable events.  (It's interesting that the ideas in the book come across as much more attractive than their author, who presents himself as unconscionably arrogant for someone whose strongest arguments are about the limitations of human knowledge!)

I found several things enchanting about the article. First, it's amazing to an American that a professional athlete in Britain writes and thinks like Ed Smith does.  Our athletes mostly get in fights with their bodyguards in bars; they certainly don't write with insight about major economic events.  Second, there are a number of wonderful quotes that strike at the heart of Taleb's arguments.  We'll go through those individually.

So is Taleb really against expertise, or is he simply pitting his own against that of the experts? He got this call right. The fall was forecast-able and he forecast it. It was not really a black swan.

This problem grabbed my attention while reading the book.  Taleb keeps attacking the ability of "experts" to know what they're doing, all the while arguing that he himself knows exactly what he's doing, because of his analysis of the limits of knowledge ... but how can he -- or we -- know that he knows what he's doing?  What evidence can be trusted, given the limits of all evidence to predict the future.  Taleb comes back to this point when he says:

But Taleb's victory today is a pyrrhic one. “I wake up every morning at 2am, scared. I have made money on my bet that the financial world will go under. But now, if the banks go under, I can't cash my money. If I follow my logic all the way through, I get scared.”

This point is the critical one for his reader: how far ought we to follow the chain of logic in predicting that astonishing disasters will occur with (unpredictable) regularity?  Ultimately some of the disasters will be ones we can't recover from.  What about those?  It's impressive that Taleb made lots of money by betting the economy would crash, but how does one short sell an ecological disaster, for instance?

A phoney meritocracy of people who got massively lucky and think they did it all themselves is a recipe for social disaster.

[later]

There is surely, for Taleb, an uncomfortable irony. Much of his present notability is due to his having made one devastatingly accurate prediction. Had he got his forecasts for the fall of banking wrong, the error would only have strengthened his general theory of black swans. But it would have undermined his popular reputation, which has never been higher. Now that really is luck. I leave him hoping that it may prove contagious.

Lovely writing about lovelier thinking.  Taleb is powerfully convincing about the limitations of human knowledge to predict outside of their sphere of understanding.  However, his theories aren't powerful ones, like, say, chaos theory, that give us rich meta-theories from which to predict the overall structure of likely events.  Instead, they just tell us that very, very bad things are going to happen, and that their happening is completely unpredictable.  Fascinating ideas ... but what should we do about them?

John

Cute cartoon that reminds me of Nathan Good's paper with Joe Konstan (and others) on the timing of software license agreements.  It would be very nice if we could reliably change our mind, perhaps after the monster shows up.

John

Read/WriteWeb has a list of 10 Micro Trends for your next startup.  Many seem plausible or likely, and Read/WriteWeb folk are usually spot on, but a few seem off-base to me.  Let's talk about those, since that's more fun than cheering the wins.

4. Micro-trend Slopes replace Chasms.  Seems to me this mistakes what is happening in startups with what is happening in the world.  In the world large organizations matter (5!), large organizations are slow to move, and large organizations try to make decisions hierarchically (6!).  Crossing the chasm is tough enough even if you aren't pretending it's not there!

5. Small is the new big (my cutesie phrase).  The problem is that there are economies of scale, and accumulations of power that are only easy in large organizations.  There are lots of benefits to an economy to having lots of small organizations be where the action is -- but lots of benefits to the organizations to be large.  Until there's more pressure put in place to prefer small, the dinosaurs are going to continue to roam.

6. Self-organizing networks beat command and control structures.  Hard for a scientist not to like the "evolution beats intelligent design" argument ... but I think this technique works best when you have time to make millions of mistakes on the way.  Designed structures with lots of flexibility for cross-pollination seem the more likely winners in the short term.

John

Lessig has yet another interesting article on Remix culture, this one adapted from his new book.  The key take-aways we've already heard.  In my view, the most important of them is the need to simplify the automatic generation of copyrights for the wide variety of remixes that have no commercial cost to the copyright holder.  Yes this would reduce the power of the copyright holder, but to the benefit of our society, which, after all, ought to be served by the copyrights.

John

There's a very interesting story on Hot Hardware (of all places) about how two news robots interacted to help kickoff the (false!) rumor that UAL was going bankrupt, leading to a huge selloff in the stock.  Apparently the news bot for a newspaper moved the story to the front page because someone read it during a "low news time" -- during which even a single read was a lot.  Google News saw the story on the page, and picked the date up from the top of the page, since there was no date on the article.  This date was the current date, not the six years ago date of the original story.  An analyst saw the story on Google News, and a billion $ later, the rest was history.

As a recommender researcher, the scariest part of the story is the inference drawn from that single view of the article, which looked at the time -- in the wee hours -- like a statistically significant indicator that the article was becoming interesting.  This problem reoccurs in recommenders all the time: if we're looking to make recommendations of items that are not popular, we'll often be recommending based on not very much data. 

John

Read/WriteWeb has an article about a fascinating new browser plugin called SpinSpotter. The idea is that readers of journalism on the Web can mark it up as "spin", and propose alternative edits to the text that was in the original article.  For instance, if a journalist writes "Most observers believe that ...", the reader might change it to "Some observers believe that ...".  (If the reporter doesn't have a study to cite, it's spin for him to suggest that he knows it's "most".  He might be right, but journalism demands that he either cite a source or leave the opinion out.)  Other readers can then choose to see the original text, the original text with symbols marking the "spin", or the edited text.

Two studies that would be fascinating to do: (1) Does the presence of the spin markers change the messages that a reader takes away from an article?  Are readers able to judge articles more carefully because of the markup?  (2) Do different users agree on the appropriate spin markers?  If not, should a recommender system be used to show users spin marks that they agree with?  What effects does that have on the messages readers take away from articles?

John

Interesting article on Read/WriteWeb about how YouTube is thriving despite the fact that much of its content is copyrighted by others. The basic business model is simple: if a content owner finds its content on YouTube, it can ask for the content to be removed -- or it can choose what ads should be shown next to it, and presumably take a profit from the ads. Apparently many content owners are choosing to let YouTube keep their content live, because they benefit more by having it seen by the YouTube crowd than be preventing its borader sharing.

This development is exciting for the file-sharing crowd, because it offers a potential path for broad sharing of information, in increasingly creative ways. However, there are important limits to the potential benefit. The simplest to understand is that mashups are likely to not thrive under the advertising business model. In most collaborations everyone thinks they're pulling more than their share of the load. Thus, the owners of the content in a mashup are likely to each individually want more than their share of the advertising profits. (This problem is exacerbated by the fact that profits in this model are mostly shared after the popularity of a video is known; as founders of startup companies know, doing a deal before you know how much value you're splitting is easier.)

The deeper problem is that this approach to enabling creativity only works in an ad-supported content model. There are cultural risks to offering large companies the most access to people's attention. Over the long term, it might be healthier for people to directly pay for the media they wish to consume, but the YouTube approach is continuing us along the ad-supported path.

John

Read/WriteWeb has an interesting article about a new phone service called fonolo. 
The basic idea is that the fonolo web site provides a navigable
interface for a bunch of different companies that have deep phone menus
("press 1 for ...").  You select the part of the company you want to
speak to on fonolo's web site.  Fonolo then calls the site, and calls
you back once they've reached the part of the company you want to talk
to! 

Sounds like a cool hack ... but the long-term solution is to have much
better navigation and naming in the phone system.  This solution
reminds me of the early days of the Web, when Gopher -- developed here
at the University of Minnesota! -- was a significant competitor.  One
of the problems with Gopher is that it had no naming system beyond the
site.  To tell someone how to find a Gopher resource, you would tell
them the location of the site, and then tell them a bunch of menu
choices to make to get where they wish to go.  By contrast, of course,
the Web has a rich namespace in which nearly every accessible page has
a unique name.  You can direct someone to a Web page by just giving
them the URL -- which takes them directly there, with no navigation.

The phone system is still in the bad old days: each company has a phone
number, and then you need to follow a path from that phone number to
the resource you wish to access.  Companies like fonolo (and GetHuman)
will do the navigation for you.  But this is window dressing on a
broken system.  Really, once we've looked up the resource we wish to
access, we want the equivalent of an URL that will take us right
there.  Re-engineering the phone system to support such a service will
likely be difficult; perhaps internet telephony can get us there first.

Note that there is no financial conflict here between the companies and
their customers.  It is true that the companies prefer to use phone
menus to get people to information, rather than have a human
representative read the information (because it's much cheaper to have
the customer navigate the phone menu than to have a human
representative do the navigation for them).  However, the company would
be happy to have its customers connected to their information more
quickly.  Doing so would just reduce phone costs further.

Of course, an alternative would be for the phone system to stop being
used for this sort of information.  For instance, on an iPhone,
customers can access the web site rather than dial the company.  There
are many situations, though, in which a voice interface is more
convenient than a screen interface.  For these situations, a better
"PhoneURL" would be useful for everyone.

John

Fascinating article on the limitations on running J2ME apps on the major US cell phone carriers. The bottom line:

• Verizon makes J2ME impossible
• T-Mobile makes standalone J2ME easy, but requires a signature from T-Mobile or a more expensive plan if you want to write a networked app
• AT&T is the most open: apps that wish to use HTTP can use it. (Lots of other apps that also interact with handset data, like the address book, must be signed)
• Sprint is similar to AT&T, though rumor has it that getting your app signed may be easier
• Nextel (which is owned by Sprint, but is a different network) requires that the app either be on the Nextel portal, or that you download it through a cable.

Overall, this means that experimentation with the really interesting J2ME apps that are likely to change the world is difficult to do outside of companies that have marketing relationships with the phone companies. This approach to a closed platform seems likely to cramp creativity. Why not turn the platform loose, and let millions of apps develop, ala Facebook? (There are serious concerns here about security: the first phone virus to wipe out a carrier's network is going to be intriguing. But: it seems important that we think carefully about how to provide sufficient security without sterilizing the platform.)

John

Scientific American has some fun examples of people who have been doing spamming the blogosphere. They create an identify that in some way conceals their ulterior motives, and then post blog comments or posts that push their agenda.