This American Life on Healthcare

Many insights on the american healthcare system from the stellar NPR show, such as:

• Having more doctors raises healthcare costs (the supply drives the demand, unexpectedly - an upward sloping demand curve, egads)
  
• One third of medical spending is on procedures that do not make us any better ... (like that time when a doctor prescribed a CAT scan for me when I reported a blocked nose)
  
• Perverse incentives - doctors get paid more for prescribing more procedures, even when they might hurt more than help
  
• The Prostate Cancer PSA test - the issue with false positives. When you run a test across the entire population, you are going to identify a whole lot of people as positive who never would have developed the cancer.
  
• Patients as Plaintiffs - doctors reject guidelines and do not follow evidence based treatment, just to minimize the chance of getting sued
  
• Hospital monopolies are just as bad for consumers as insurance monopolies.
  
• Costs will keep rising until consumers make sacrifices (and they will not make sacrifices if part of the costs are not passed on to them).
  
• Patients unwittingly side with doctors when negotiating prices of procedures, even if if makes sense to side with the insurers as they are the ones representing us financially
  
• Medical facilities and insurers have similar levels of profitability. And if they are running on a fixed margin basis, there is no incentive to keep costs down.
  
• Costs are going up so fast that there is broad consensus that something has to change. Things are hopeless across the board, and that gives us hope that something will be done.
  

Not only is the earth flat, its also brutal.

Matt Taibbi takes some time out from burying Goldman Sachs to bury Tom Friedman. Hilarious, and with prose that is ... lets say, unrestrained.

Fisherman Bankers of Iceland

Michael Lewis with an ethno-analysis of Iceland crash, rather than the standard economic one. Vivid writing, and interesting conclusions. Reading it almost felt like watching a documentary. Definitely one of the best bits of journalism last year.

Link love

Just throwing reddit some link love so that they can unseat scientology for #1 rank for the query "is it possible to be happy".

Key Concept: Thought Terminating Cliche

The language of the totalist environment is characterized by the thought-terminating cliché. The most far-reaching and complex of human problems are compressed into brief, highly reductive, definitive-sounding phrases, easily memorized and easily expressed. These become the start and finish of any ideological analysis.
- Robert Lifton, M.D from book Psychology of Totalism

Goldman and AIG and Express Suicide

Hank Paulson was on Charlie Rose couple days ago claiming that Goldman Sachs did not see the housing bubble blowing - but this NYT article clearly shows that GS bet billions on the fact that the housing prices would go down.

Another strange thing in the article - AIG sold insurance that was, in part, contingent on its own financial health. That is, if it ever was in a compromising position, it would be required to pay out more. I would call it the Express Suicide clause. The consensus in this whole debacle seems like GS was able to find a trading partner who was rich and incompetent, and just big enough that it could be deemed too big to fail.

And now if the banks claim that they have returned the TARP funds, the follow up should be - has AIG? AIG is just as likely as GM to pay back anything. And those losses directly paid off GS ($12+ billion) and others like Societe General.

Healtcare - is more better?

Riveting piece of writing from New Yorkers' Atul Gawade. He parachutes into McAllen, TX and tries to find out why the county has the highest healthcare costs per capita in the country. I wont even try to distill what he has to say - worth reading every single word.

Free the markets? ... Now right now, not right now.

The housing crash has encouraged the government to get very hands on in managing the economy and put the free market principles on hold indefinitely. Calculated Risk has a list of government programs that are in place that impact the housing pricing.

The US government is now in the business of propping up house prices, and that is going to be bad for the economy and taxpayers in the medium and long run. The true price of housing is very hard to figure out right now - and certainly prices will be lower if these programs go away. And many of these programs are extremely inefficient, costing the taxpayers 10X more than the actual benefit delivered to the homeowners. And the artificially low interest rates are also wreaking havoc on many parts of the economy and causing a boom in risky assets - and that bubble will pop sooner or later. The quicker these distortionary policies end, the better off the economy is going to be. Until then, rational people will stay clear of investing in anything that has to do with housing - that puts your financial fate on the hand of the government, a risk that caclulates out to be not worth taking.

Steve Jobs Keynote Marathon

Watching a series of Jobs' keynotes at Macworld after he took over the reins in 1997. A summary of his presentations:

1997:
* Select a new board of directors
* Create meaningful partnerships (adobe, intuit, and MICROSOFT)
* Focus on being great, and not on competitors
* Key message in sober tone - focus on survival

1998:
* Kick off talk with Maslow's hierarchy of needs - survival, safety, social, esteem, self actualization - and how apple is progressing in these areas
* iMac
* Simplify product lineup (Pro/Consumer, desktop/laptop) - Classic!
* Transition from Os8 to OsX

1999:
* Quicktime streaming server (limited impact, but contributed to iTunes)
* Os9 (key feature: Sherlock). This was a stopgap anyways until OsX.
* iMac (new usb devices, software - including Halo, IBM Viavoice, MS Office 98)
* The big announcement is iBook - the consumer laptop. (Kodak Moment: It has a ... HANDLE. crowd goes nuts)
* And ONE more thing - Airport wireless networking (crowd goes nuts again)

2000:
* Mac OsX. Single OS strategy.
* Carbon, Cocoa, Aqua
* ... you spend months working on a button ...
* Red, yellow, green traffic lights for close, minimize, maximize.
* Key technique - set up a challenge for yourself and blow it away. (But how do you view the dock if its too small --- well we have something called magnification - crowd goes nuts)

2001:
* Retail stores
* powerbook titanium g4
* OsX launch in summer
* iTunes - more powerful yet simpler. And iPod. The shoots of apple's media strategy.

The story is pretty clear - Jobs focused on what was key at any given point in the company's history and put his all and his best people into that problem. He obsessed over it - and out thought everyone else. The results are nothing but spectacular.

The presentation technique is outstanding as well. No bullets. The projector is to show graphics, and not a mnemonic device. The audience is there to listen to you, and not to read stuff off the screen. His style is thoughtful and respectful - he makes the audience believe that he is in analysis mode and their feedback is valuable. The phrasing is precise - with emphasis on key phrases, which are reinforced on screen. The excitement comes through. There is very little focus on self, and everything is about the products.

California vs Texas

Couple of months ago Economist did a cover story comparing California and Texas, and now I noticed another article harping on the same topic.

The net migration out of the state is troubling. If it were not for the immigrants (both high tech and low tech), the state would be significantly shrinking. A few of the contributing factors are: budgeting by ballot, 60% majority required to pass budget, ceiling on property tax (which is pretty much older californians voting themselves a tax cut), and a mushrooming prison population. The high tech ecosystem is still well and alive, but with the education system falling behind, its not clear if we are going to be able to compete with the likes of bangalore and beijing. And unless there is a catastrophic crisis - things wont change.

Pinker on Decline of Violence

As we get caught in the constant focus on negativity in the media, its hard to lose track of the grander picture. Violence has been on decline over the ages, centuries, decades and years. Thanks, Professor Pinker for not limiting your talks to linguistics!

Eight Best Questions from Venture Capitalists

Great post on Techcrunch by Redfin's Glenn Kelman.

1. What’s your deadly sin?
Sequoia’s Roelof Botha said he only invests in companies that let consumers indulge in one of the seven deadly sins. He rattled them off with alarming familiarity. “You don’t want to be the site that people should use,” Roelof said. “You want to be the site they can’t stop using.”

... and many more.

Cautionary Tale of How Not to Respond to Critical Questions

When Michael Arrington (or any media rep) asks a tough question, its better to be transparent and respectful, rather than take the route of aggression and denial. The CEO in question here responded with french, and started a war of words with the TechCrunch head. It was quite futile really - as a friend of mine said - "People listen to Bloggers, not to bland CEOs".

It started out here:
http://www.techcrunch.com/2009/10/31/scamville-the-social-gaming-ecosystem-of-hell/

And ended with this:
http://www.techcrunch.com/2009/11/05/scamville-new-offerpal-ceo-admits-mistakes-makes-bold-promises/

Its all quite tragic really - a founder who probably worked years to build their company gets edged out because of a public faux pas. However, it was not just the outburst that led to the demise, but really shady business practices that were spotlighted because of the vehemence of the response. And most people, including investors, figured there must be something behind all of this.

In order for online advertising to gain legitimacy and share of budget proportional to attention share, there must be transparency across the whole value chain - all the way from the users, to the site publishers, to the ad networks, and advertisers. Thanks to Michael, this conversation has been initiated - lets see where it goes from here.

Vacation Stress Level

From Piled Higher and Deeper

Public Relations - Propaganda's Teenage Cousin

Interesting Google tech talk.

"People's perception of sizes of risks are based on emotional and not national factors"
"Managing the outrage is more important than managing the hazard"
"Marketing is a battle of perception, not products. Truth has no bearing on the issue"

What we have seen in the last decade, or even the last few weeks, is that we are still quite susceptibility to propaganda techniques. While people may think and claim to be rational and logical, they are inherently biased and tend do gravitate towards opinion sources that line up with their own. There is also the herd effect or the tipping point type behavior that still is stronger than ever. Framing tactics are still used frequently and effectively both by politicians as well as corporations.

Question authority and your own instincts, ask for facts, separate the message from the messenger - and encourage everyone else to do so. One day, we will, as a species overcome the shortcomings of our fish brain.

I Learned Everything About History From Cartoons

Somewhat less, lets say ... polished, than the Cartoon History of the Universe but equally enjoyable - World War One: Simple Version and World War Two: Simple Version.

Charlie Wilson's Movie

Re-watching Charlie Wilson's War on HBO. A movie that truly gets better each time you watch it, and its chock full of good quotes and WTF moments. Just in the last 15 minutes:
* Gen Zia gets introduced in his fete as "Zia didnt kill Bhutto"
* A bellydancing baptist girl entertaining an Egyptian minister
* Gust Avrakotos to Joanne Herring: "I dont see god within miles of this conflict, but if you sleep with me I may change my mind mighty quick" and
*"As long as the press sees sex and drugs behind the left hand, you can park a battle carrier behind the right hand and no one's gonna f***ing notice. "
* Israeli arms dealers shipping tanks to the Pakistani government
* A US Senator lecturing the afghans on how America is always on God's side and they respond with Allahu Akbar.
* Kovraktos to Wilson: "Youre not really stupid, just in congress"
Truth, as always, is stranger than fiction, and if a good storyteller presents it, a whole lot funnier as well. Related: Wag the Dog

Motivational Rewards - DONT WORK (well most times)

When it comes to complex cognition oriented tasks, rewards actually hinder progress rather than facilitate it. In the kinds of challenges we deal with in a knowledge based economy, pay for performance is precisely the wrong way to structure compensation. A better model to understand performance : Autonomy, Mastery, Purpose. Align your organization to these goals and values, and you are more likely to succeed. Case in point: Britannica vs Wikipedia (ie unpaid unmanaged yet self motivated hordes create a product that makes obsolete a product created by experts over many decades).

Warring Economists

The eighty years of peace and the great moderation is over, and the battleaxes are out - Paul Krugman reports that hostilities are breaking out among the Freshwater and Saltwater economists. Good overview of evolution of economic thinking over the past century, and how finance and economics play off of each other. Some choice quotes:

"...because a two-quart bottle of ketchup costs twice as much as a one-quart bottle, finance theorists declare that the price of ketchup must be right."

“the market can stay irrational longer than you can stay solvent.”

"Larry Summers once began a paper on finance by declaring: “THERE ARE IDIOTS. Look around.”"

Crowdsourcing Awesomeness

In addition to showing traffic on the highways, Google Maps now shows it for city roads as well. The awesome part is how they do it - they compute the speed of geolocation enabled phones to figure out what the average speed on a given stretch of road is. All this without needing to dig up roads and installing sensors - pure genius!