“Financial Conspiracy Theories”

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I generally ignore conspiracy theories. The more you know about history, probability, and human nature, the harder it is to seriously attribute malicious intent to things that happen by random chance, or as a result of public and well-known systems. The assassination of John F. Kennedy was (probably) a legitimate conspiracy. The claim that Kentucky Fried Chicken contains an ingredient designed to make black men impotent almost certainly isn’t.

Likewise, just about anything the stock market does can be explained by equal helpings of greed and fear, with the occasional dash of actual information about what a company is doing thrown in for flavor.

Just about anything.

Scott Adams recently made a case for an actual financial conspiracy (possibly tongue-in-cheek, his seriousness is rarely a given). Not a traditional conspiracy, in the sense of secret meetings and such, but a conspiracy of big investors manipulating the market to shake money out of smaller ones, with no more communication between them than a wink and a nod.

As with most conspiracy theories, its main attraction is that it can be made to fit the facts with minimal twisting, and that it “explains” an event that’s otherwise inexplicable by attributing it to the popularly-believed proclivities of a hated minority group (people with a lot of money). And as with most conspiracy theories, there’s a glaringly obvious logical hole in it, namely that the stock market is so big that it would be all but impossible to manipulate on any large scale, no matter who you are or what wealth you control. Even major governments, with the ability to print as much money as they want, gave up trying long ago.

Of course, if big investors could do such a thing, legally or not, you can bet your last dollar that they would. And it very likely would be your last dollar too, because they’d use that trick to make every dime ever invested in the market theirs.

And that’s exactly why I don’t believe it. It would require a real conspiracy, a huge one with secret meetings and all, to prevent that sort of thing from becoming extremely obvious, and nothing can stay secret when it gets that big. It couldn’t fifty years ago, and with the anonymity and easy accessibility of the Internet, it would be harder today by orders of magnitude.

No, this is another conspiracy theory that’s easily explained away by facts. Big investors are doing well in the market for the same reason they got to be big investors in the first place: they make it their life’s work to understand it better than small investors, and they can make money in any market so long as there’s price movement. The price fluctuations themselves are simply caused by the natural give and take of the greed/fear dynamic, with prices dropping as people panic about a particular company’s future, and rising as others snap up the now-discounted stock as a bargain. Sorry to have to burst your bubble, Scott.

(On the other hand, his final recommendation to buy stocks in broad market indexes and “hold them forever” is fairly sound advice for the average small investor, conspiracy or no.)

“The Growing Harm of Not Teaching Malware”

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This fellow (warning, PDF file) claims that all computer science graduates should take a course in writing Trojans, viruses, worms, and the like — “malware” — or at least that it should be offered as a regular part of an elective security course.

At first, I was taken aback by the suggestion. You don’t want to encourage people to write malware! But a second’s thought told me that that was foolish. In order to fight anything effectively you’ve got to know how it works (which is the author’s primary point), and people who would write malware would learn to do it regardless of whether it’s part of a course or not (a point he also addresses, near the end).

My opinion, for what it’s worth: he’s right. Teach computer security students how to write malware. Wider knowledge of it in that group can only help.

(Via Schneier on Security)

“Bacterial nanowire discovery could revolutionize bioelectronics”

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An exciting discovery:

[…] Similar to the flexibility of artificial nano-wires, the conducting properties of the Geobacter biofilm could be manipulated by simply changing the temperature or regulating gene expression to create a new strain, for example. By adding a third electrode, the biofilm can act like a biological transistor, able to be switched on or off by applying a voltage.

Another advantage Geobacter offers is its ability to produce materials that are more eco-friendly and less expensive than man-made versions, many of which require rare elements, says the team.

Lead microbiologist Derek Lovley quips, “We’re basically making electronics out of vinegar. It can’t get much cheaper or more ‘green’ than that.”

I don’t know how much cheaper it could be, but it wouldn’t much surprise me if it eventually reduced the cost of creating an electronic device by 90 to 95%.

“Increase Your Brain Power by Doing Things the Hard Way”

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It’s true. The modern conveniences are great, once you know how to do things the old-fashioned, by-hand way. But if you’ve always used the conveniences, and never bothered to learn the hard way of doing something, you’re cheating yourself.

I see it all the time in programming. People who started out with a high-level language and never bothered to learn how things work under the hood have no clue what’s really going on in the system, so when something goes wrong, they don’t know how to identify or fix it. Someone who learned the hard way can often look at the problem and instantly know what’s going wrong.

Intelligence is defined as the capacity for learning, reasoning, and understanding, usually measured by IQ, and people consider it a fixed number controlled entirely by genetics. I claim otherwise: actual intelligence might be fixed, but I believe that most people’s IQs can be raised by at least 50% because I see so many places where muddled and rigid thinking keeps people from intelligence. People can learn to be more flexible in the way they think about things, and they can learn logic — nobody is born with immaculate logic skills, those who have them have had to learn them too.

It would likely take several years of practice to raise your IQ by that amount, but you can start learning the needed flexibility in minutes, and it doesn’t have to be work. The best way to learn essentially anything is by play. GoddessJ and I have excellent spelling skills, for instance, and in talking with her I’ve found that both her parents and mine liked to play aloud with words. For example, in English, many words are pronounced in ways that that are completely different from their spellings. As a way of being funny, our parents would sometimes pronounce a word the way it’s spelled (“good night” would become “good nighut”), or with a very pronounced inflection (“are you clean?” became “are you kha-leeeeen?”).

Even something as small as that gives you a different perspective on language, and actively looking for amusing ways you can twist a word and still have it recognizable to others breeds more flexibility in the way you think — no only about words, but about things in general, which raises your IQ because you now have an additional mental tool to use on things. In the same way, increasing your IQ in one area affects many other areas as well, because a new way of thinking about one thing (how you can twist the pronunciation of words and still have them recognizable) affects others that might seem only tangentially related (learning excellent spelling skills) and more importantly, more general skills as well (how to twist problems to see them in a different way, to equate them to other problems that you already know how to solve).

This is very useful for anyone, but it helps children far more than you’d expect, because even a slight increase in the angle of learning gives a markedly different result after a few years. (Which is another example of applying a relationship that isn’t obvious — geometry and child learning.)

I’ve been studying learning and intelligence very intently for most of my life, especially in the last few years (those of you who know me well will immediately know why). It fascinates me in a way that few other problems can, for reasons that I’ll probably share here someday.

I’ll finish this entry with a quotation:

Everyone is a genius, but if you judge a fish on its ability to climb a tree, it will live its whole life believing it is stupid.
— Albert Einstein

Think about it.

“Are Some Evangelicals Beginning to Question the Existence of Adam and Eve?”

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This week, on the Colbert Report, I heard something that shocked me: some evangelical Christian scientists were beginning to publicly doubt that humanity could be descended from one man and one woman, as described in the book of Genesis.

The reason it shocked me is that I couldn’t believe that someone who identified himself as an evangelical Christian would ever accept evidence that his beliefs were mistaken, or publicly admit to it if he did. In my experience, that just does not happen. I had to dig up more information on it.

It looks like the original report was from NPR, but I found even more interesting information elsewhere. At the bottom of this article (on what appears to be a religious-oriented site):

Back in 2006, National Geographic provided some interesting information on the American public’s take on evolution. The U.S., when compared to other Western nations, is essentially much less inclined to accept evolution as fact:

In the U.S., only 14 percent of adults thought that evolution was “definitely true,” while about a third firmly rejected the idea.

More recent (2010) Gallup data shows 40 percent of the nation embracing the notion that God created man in his current form, with only 16 percent claiming that God played no part in the process of creation. While the scientific and Christian communities continue to grapple with internal disagreement, it seems the creationists are thus far winning the PR war.

The data presented there is factually accurate, but misleading, and I think it was deliberate. The 2010 poll actually had three options:

  • Human beings have developed over millions of years from less advanced forms of life, but God had no part in this process. (16%)
  • Human beings have developed over millions of years from less advanced forms of life, but God guided this process. (38%)
  • God created human beings pretty much in their present form at one time within the last 10,000 years or so. (40%, “down from 47% in 1993 and 1999”)

So 54% of people are actually professing a belief in evolution in 2010. The 2006 data seems to have a similar bias, but in a quick search I couldn’t find the hard numbers on it.

That gives me faith in humanity: if even in the US people are getting more inclined to look beyond the doctrines handed down from religious leaders — and doing so at a rate I find frankly astonishing — then we may actually be able to survive the current political crapstorm between intelligence and obstinate idiocy.

“And a Barista Will Lead Them”

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Scott Adams, of Dilbert fame, points out a Bloomberg article about the CEO of Starbucks Corp. urging other business leaders to suspend donations to political campaigns “until the Congress and the President return to Washington and deliver a fiscally disciplined long-term debt and deficit plan to the American people.”

Other than armed revolt, that’s likely the only thing that would make politicians sit up and take notice. I’m eager to see the results.