Overconfidence in the "Framing and Other Decision Snags" chapter

I'm wrestling with this paragraph, but can't figure out what's bothering me about it.

One reason we're overconfident is we remember the hits and forget the misses--we often remember the times we're successful, and forget the times we fail. It's a bit more complicated, however, because sometimes our failures are our most vivid memories. It turns out that even when we remember our failure, we interpret them in a way that still bolsters our belief. Eileen Langer, a Harvard psychologist, calls it the "Heads I win, tails its chance" phenomenon. As we saw with gamblers' behavior, if we're successful, we think the positive outcome was caused by our knowledge and ability. If we're unsuccessful, we think the negative outcome was caused by something we had no control over. As a result, we reinterpret our failures to be consistent with an overall positive belief in our abilities (p 194)

The line that resonates with me most was "It's a bit more complicated, however, because sometimes our failures are our most vivid memories," but Kida doesn't cite any studies about that aspect.

I understand the phenomenon of attributing success to personal skill, and failure to an outside source. However, aren't there some individuals who consistently believe they will fail and consider all their past to be a completely failure? Does this have something to do with perpetual optimists and pessimists? Just as those overconfident shouldn't believe everything they think, neither should the underconfident or those with low self-esteem do the same. Maybe this paragraph is ok, because it's in the "Overconfidence" section of the "Framing and Other Decision Snags" chapter. Perhaps a corresponding section on "Underconfidence" would be a beneficial addition.

The Langer study Kida refers to is "Heads I Win, Tails It's Chance: The Illusion of Control as a Function of the Sequence of Outcomes in a Purely Chance Task," Journal of Personality and Social Psychology 32 (1975): 951.

Narita Airport in the 1970s

Discovered this lovely vintage looking photograph in a book called "Introducing Japan," which has many other nice photos also. Was struck by the realization I've been here, and the space is recognizable, but all the interior furnishings have changed.

I think it was called "New Tokyo International Airport" back then. Look at the awesome clear flight information monitor base, and the awesome standing lamps! Can you imagine a monitor that small fitting all the necessary info these days? It looks really uncongested too, with hardly any folks sitting in those chairs. The element I wish they'd kept most is the soothing striped carpet.

Photo by Goro Iwaoka in:
Introducing Japan by Donald Richie. Tokyo: Kodansha International. 1978. p 10.

ISBN 0-87011-833-1

20/20 Hindsight

In Thomas Kida's "20/20 Hindsight" portion of the Framing and Other Decision Snags chapter in his book, Don't Believe Everything You Think, this paragraph struck me for several reasons. The Paul Gallico revelation was stunning, and "the oppressed ethnic group of that time" reminded me of some conversations I'd had with a friend.

At one time, Jews dominated the game. Basketball was primarily an east-coast, inner-city game from the 1920s to the 1940s, and it was played, for the most part, by the oppressed ethnic group of that time--the Jews. Investigative journalist Jon Entine noted that when Jews dominated basketball, sports writers developed many reasons for their superior play. As he states, "Writers opined that Jews were genetically and culturally built to stand up under the strain and stamina of the hoop game. It was suggested that they had an advantage because short men have better balance and more foot speed. They were also thought to have sharper eyes . . . and it was said they were clever" (Entine Taboo: Why Black Athletes Dominate Sports and Why We Are Afraid to Talk About ItNew York: Public Affairs, 2000 pp 202-203). Paul Gallico, one of the premier sports writers of the 1930s, said the reason basketball appealed to Jews was that "the game places a premium on an alert, scheming mind, flashy trickiness, artful dodging and general amart aleckness" (Shermer,"Blood Sweat and Fears," Skeptic8, no. 1 p 47). Notwithstanding the insulting stereotype, I'm amazed how we think we know the cause for something after the fact--even if that presumed cause is quite absurd.

I discovered Paul Gallico's Mrs. 'Arris Goes to Paris in one of my used bookstore jaunts cutting high school and really enjoyed it. Later on, I picked up Mrs. 'Arris' New York adventures as well. Since I so thoroughly enjoyed these novels, I was caught off guard to learn about his sports writing on Jewish basketball players.

In the discussion with my friend, we were wondering about the stereotype of gay flight attendants. We thought of the long distance pullman trains in earlier america with black porters. There is an exhibit about them--the discrimination, their camaraderie, etc. in Boston's Back Bay Station. At the time, when there was so much discrimination, being a pullman porter was one of the "allowed" jobs for black men, and they gained prestige in their own communities because they could travel and earned a relatively high income with tips etc. Do gay flight attendants have prestige in the gay world as well? I know this might now be the same as Kida's basketball discussion but this is what came to mind.

Beliefs are like posessions

The last paragraph of Thomas Kida's chapter 5 entitled Seeing Things That Aren't there concludes:

As psychologist Robert Abelson has said, our beliefs are like posessions. We buy our possessions because they have some use to us. So it is with our beliefs. We often hold beliefs not because of the evidence for those beliefs, but because they make us feel good. How can we overcome perceptual biases that lead to faulty beliefs? It's difficult, but a good place to start is by asking three questions:

• (1) Do you want this belief to be true?
  
• (2) Do you expect this event to occur? and
  
• (3) Do you think you would perceive things differently without these wants and expectations?
  

If the answer is yes to these questions, you should be very careful in how you interpret your perceptions of the world. (Kida p 117)

This reminds me of my"Once Burned" blog post where Victor Niederhoffer recalls the no longer useful beliefs of some of his family members. The relative held onto the belief, because it protected him from another loss which he'd previously experienced during the depression.

Kida, Thomas Edward. Don't Believe Everything You Think: The 6 Basic Mistakes We Make in Thinking. Amherst, NY: Prometheus Books. 2006

Kida cites these two items in his concluding paragraph:

R. Abelson, "Beliefs Are Like Possessions," Journal for the Theory of Social Behaviour 16 (1986): 222.

Plous, Scott. The Psychology of Judgment and Decision Making. McGraw Hill: 1993. (p 21)

Awesome Exit Interview!

Glenn Mitchell's Shear Genius amazing exit interview is the best exit interview I've seen on Bravo since Emmett's on Project Runway Season 3. It starts at the 2:37 countdown mark on Blogging Shear Genius' site.

The one thing that I miss the most is the feeling you get after you know what the challenge is, but before you get started with the challenge. It's just very exciting -- it seems like the world is yours to conquer at that moment. And it's something that really makes you feel alive. That's what I'm gonna miss the most. (Part 2 of Glenn Mitchell's exit interview on Shear Genius Season Two)

You can also watch Part 2 of Glenn's exit interview directly on Bravo's Shear Genius site, but it's not as nice as watching it on the Blogging Shear Genius site link above.

I admire Glenn and her thoughts expressed in this exit interview. Best Wishes Glenn!

Pseudoscience, Skepticism, and Predicting Markets

The "Delphic Oracles and Science" section of Victor Niederhoffer's The Education of a Speculatory offers some good connections between the work of Martin Gardner, Irving Langmuir, and John Wheeler and market forecasters.

Irving Langmuir's Symptoms of Pseudoscience

1) The maximum effect that is observed is produced by a causative agent of barely detectable intensity, and the magnitude of the effect is substantially independent of the intensity of the cause.
2) The effect of a magnitude that remains close to the limit of detectability; or, many measurements are necessary because of the very low statistical significance of the results.
3) [There are] claims of great accuracy.
4) Fantastic theories contrary to experience.
5) Criticisms are met by ad hoc excuses thought up on the spur of the moment (p 77).

Victor Niederhoffer's Symptoms of Pseudoscience in Market Analysis

1) Appeal to authority.
2) An absence of counting.
3) A framing of predictions in a form that cannot be tested.
4) A tautological prediction guaranteed to be true under almost all conceivable circumstances.
5) No allowance for chance variations; any randomly formed groups exposed to varying conditions will show differences in means and variability. But the differences can be due to sampling variation rather than the true effects of the conditions. That's what statistical analysis is about.
6) A paranoid mien.
7) Disregard of alternative explanations.
8) Self-evaluation of accuracy.
9) Retrofitted systems (p 8).

Niederhoffer recommends

Martin Gardner and Christopher Scott in the Oxford Companion to the Mind
Fads and Fallacies in the Name of Science, by Martin Gardner.
Paranormal Phenomena: The Problem of Pro, by

Holding Onto Stagnation or Growth

Victor Niederhoffer hung out with his Grandmother, Birdie, after she'd retired to Florida. In "The Education of a Speculator," he recounts a conversation with her in his "Everyone Retures to the South" short story/mini-section, where Birdie kept stagnating companies and let go of growing ones.

We reminisced about some of Martin's stock market coups: Air Reduction, Allis Chalmers, American Can. These stalwarts of the early 20th century had been bequethed to her and, like most elderly people in this situation, she had sold the ones that were above cost, only to see them quadruple in the next few years, and had retained the ones that were below cost, such as Famous Artists, Four Seasons Nursing, and Levin-Townsend, which eventually sank into bankruptcy. I asked Birdie of Wolfie's should stock up on pastrami or ham. The pastrami moves briskly. Taking that perspective, it's easy to see which stocks to unload and which to hold or buy more of (pp 57-58)

Clinging to past stagnations and abandoning promising growth areas is easy to do in many areas of life, not just stocks and investment. There may be some residual hope that past disappointments can be revived into greatness. Or, an inability to acknowledge that it was a failure. These phenomenon can keep us from moving on to activities with more potential.

Once Burned . . .

In the "Once Burned . . ." short story/mini-section of Victor Niederhoffer's The Education of a Speculator, the Depression's lasting effect on some of Niederhoffer's relatives is explained:

I realized now that men of Martin's generation, who lost everything in the Depression, were traumatized by the vivid memories of their losses. In addition to their focus on the wrong companies, these men suffered from psychological maladies that had even worse consequences for their bank balances. (pp 48)

He goes on to explain how Depression's one-time event detrimentally influenced investing decisions much later on, even though nothing the scale of the Depression's magnitude ever occurred again.

Sometimes, gay people who have been traumatized by bullying in their childhoods truly believe and are terrorized by thoughts of being attacked again as adults. This valid and understandable thinking leads to great obstacles and impairment in everyday living and striving for personal goals.

Hojoki 方丈記

Various books and magazines on small spaces and simplicity have referred to a 12th century essay--An Account of my Hut or The Ten Foot Square Hut. I was finally able to locate a translation to read! It is very short and readable in one sitting.

My question: is this really only ten square feet? That would mean dimensions of 5 feet by 2 feet--like a one person hiking tent! I think 100 square feet is more likely--a ten foot by ten foot square, as Kamo no Chomei describes space for a small Buddhist altar, and a writing table. My bedroom is 10' x 8' or 80 square feet--containing a twin sized bed and small desk and chair.

The hermit-crab chooses a small shell and that is because he well knows the needs of his own body. The fishing-eagle chooses a rough beach because he does not want man's competition. Just as am I. If one knows himself and knows what the world is he will merely wish for quiet and be pleased when he has nothing to grieve about, wanting nothing and caring for nobody.

"The Ten Foot Square Hut" Hojoki 方丈記, attributed to Kamo no ChomeiKamo no Chomei translated by A.L. Sadler.

Play and Records

I've only just started reading Victor Niederhoffer's The Education of a Speculator (New York: John Wiley & Sons Inc.  1997), but he sure does seem to talk about sports a lot.  His parents played tennis during middle winter in a drained swimming pool, which his own young child insisted on practicing with a pan when a raquet wasn't available.  He believes characteristics essential for sports pros are also highly desirable for traders and speculators. 

But, in addition to play, keeping data notes can help one get ahead!

<blockquote>The whole purpose of childhood may be viewed as a window for play.  One beautiful thing about play is that if you have an inquiring mind and keep records, you can learn which techniques carry the day (p 25).</blockquote>

Similarly, here's an item google looks for in their recruiting process, taken from their recent blog entry at: http://googleblog.blogspot.com/2008/07/our-googley-advice-to-students-major-in.html

<blockquote>. . . [Item 1] analytical reasoning. Google is a data-driven, analytic company. When an issue arises or a decision needs to be made, we start with data. That means we can talk about what we know, instead of what we think we know.</blockquote>

So, google thinks data notes are important as well!

How can I apply the data-mining and usage more/better in my own life?

Games

Kazu's thoughts sound just like Eric Berne and Claude Steiner's games! It's like Jane Austen too!

Kazu had the utmost respect for her husband's character, but it was hard for her to see wherein lay the difference between his politics and those she had seen and heard at [her restaurant] the Setsugoan. Her glimpses of Conservative Party politicians at the Setsugoan had inculcated in Kazu a splendid notion of the nature of their work. Politics meant pretending to step out to the men's room and then completely disappearing, forcing a man's back to the wall while cheerfully sharing the same fire, making a show of laughter when one is angry, or flying into a rage when one is not in the least upset, sitting for a long time without saying a word, quietly flicking specks of dust off one's corner sleeve . . . in short, acting very much like a geisha. The exaggerated odor of secrecy clinging to politics confirmed its resemblance to the business of romance; politics and love affairs were in fact as alike as peas in a pod . . . (p 102)

Yukio Mishima. After the Banquet.

Fear of Failure Example

Nathan is describing a self-segregated elite coterie of Hollywood stars gathering separately from the many others present at Coppola's San Francisco house party for Akira Kurosawa.  Nathan wasn't initially part of this group until he got an "in" from Kurosawa due to their earlier conversation in the evening and his Japanese language ability. 

"Nothing came of the time I spent that evening in easy badinage with that celebrated company.  More properly, I never turned it into an opportunity, as each of them might well have done.  Was I afraid of failing in spite of efforts to succeed?  Or was it success itself that caused me to withdraw whenever it was visibly close at hand?  I suspect the latter was, continues to be, closer to the truth."  (p 209)

Nathan is describing the production of Summer Soldiers and the deterioration of his relationship with director Hiroshi Teshigahara, in which they had conflicting visions for the film.  Going through his journal entries from the production period, he notes:

"If there is arrogance in my observations and complaints [about Teshigahara] there is also an abjectness that troubles me.  Striving, and failing, to feel superior, I tumble into despair about myself, which blinds me to what I have achieved and prevents me from finding any pleasure in it."  (p 147)

This is a perfect example of the perfectionism and "all or nothing" phenomenon described by Burka, Yuen, and Ben-Shahar. 

John and Mayumi in Long Island

John Nathan describes an epiphany experienced while chainsawing young trees in Hamptons son at publisher Barney Rosset's new property. I'm sure I've experienced something like this before, as one of the items "in orbit" around someone more powerful in some way. It can be thrilling to feel accepted into their crowd, but unnerving. There is a sense of inferiority--or that you are a plaything or novelty for them . . .

. . . I felt ashamed: Why was I pretending to enjoy his obsessive craziness? The thought led me to a shadowy place. There was a large cast of characters in orbit around Rosset who struck me as ordinary except for some eccentricity that qualified them as offbeat. What if I were the same genus, ingratiating and mediocre? I had experienced the same disquiet with Mishima, though Barney and I were surely closer than Mishima and I had ever been, and it would trouble me again.

(p 111)

Fear of Failure Example

Here's an example of fear of failure from John Nathan's autobiography/memoirs.  It's what Jane Burka and Lenora Yuen mention in their work on procrastination, and what Tal Ben-Shahar mentions in his work. 

Nathan is describing early classes as one of the first foreigners admitted after the war to Todai, Japan's most prestigious university:

"Bihari [from Hungary] regularly interrupted the class to ask for explanations in his heavily accented Japanese.  I envied his freedom from inhibition without understanding it was modesty.  I wanted to be admired for my fluency and spent my time in class in dread of being exposed."

From: Living Carelessly in Tokyo and Elsewhere by John Nathan.  New York: Free Press. 2008.

Willie Suggs

This New York Magazine article on Harlem real estate broker Willie Suggs caputured my imagination.

She bought a house in the early 1980s for $50 000, but collected $1500 in rents every month! And her mortgage payment was cheaper than her own rent at the time! She really saw the value! Bill Greene and Robert Kiyosaki would've been proud of her =). I wonder if opportunities like this still exist . . .

Also, she grew up in Milwaukee, after her family moved up from the South. When I passed through, I thought Milwaukee was an absolutely beautiful town. It is right on the lake, and there is that stunning Santiago Calatrava waterfront art museum. Milwaukee is definitely a place I'd like to live for awhile, and I wonder how it influenced Ms. Suggs.

When queried by the New York magazine reporter "about the argument that blacks as a class have been economically discriminated against—and are therefore being disproportionately pushed out," this was Willie's response:

“Bull crap! That’s bull crap. Nobody stops you from paying 50 cents for the Post, 50 cents for the Daily News, $1.25 for the New York Times. Guess what they have? They have articles on real estate! They have a real-estate pullout section! If you simply read it, you say, ‘Oh, there’s a program. If I take four classes, a total of eight hours in this class, sponsored by Harlem congregational churches, right? I can get up to $70,000 free.’ It’s called a grant. Now, if you had $70,000, do you know what Willie could sell you? We sold a five-and-a-half-room co-op for $90,000. All he needed was $20,000. I’ve been privileged to speak to those classes in the last year, and there are black folks in there, there’s white folks in there, there’s foreign-born people in there. And I’m thinking, Well, why isn’t the class all black? Because a whole bunch of black folks, for whatever reason, just don’t bother to go. So what’s your excuse now? I just told you where you can get $70,000. You don’t need any money!”

Although I suspect I might be intimidated by her (her legal problems and community complaints are detailed in the article), Ms. Suggs is definitely someone I'd like to meet.

"Warning: Habits May Be Good for You"

Sunday's New York Times had an article on "marketers, the masters of creating habits" for things like washing hands and brushing teeth. The context was public handwashing campaigns in Ghana.

The Febreeze campaign for Proctor and Gamble is explained.

This made me think of Tal Ben-Shahar, author of "Happiness" and other publications on positive psychology. Ben-Shahar encourages use of "rituals" (or, habits), which can be created and developed, rather than "self-discipline," which can run out.

article

South Koreans want Cho to be considered non-Korean because of time spent abroad

Look at a portion of this article from the Washington Post:

And from Seoul, South Koreans and their government appealed to Americans not to let the carnage generate racial prejudice against the 2 million South Koreans who live in the United States.

At the same time, a number of South Koreans noted that Cho had lived in the United States for most of his life and said that he should not be considered a South Korean even though he carries a South Korean passport.

"a number of South Koreans . . .should not considered a South Korean even though he carries a South Korean passport"???? So, should emigrating South Koreans be rendered non-Korean after some threshold of being abroad? How long are these South Koreans thinking that threshold should be?


Look, if this guy really did come over when he was 8, then he probably had no choice in the matter, as it was up to his parents whether to bring him along, or leave him behind.

Cho could've naturalized if he wanted to, but I wonder if he even thought of these concepts of nationality and citizenship.

It's all annoying legalism, which people discard whenever convenient (see my post below), and trying to box people into these defined identities.

Here is the article:
http://www.washingtonpost.com/wp-dyn/content/article/2007/04/17/AR2007041701924.html

Chosun Ilbo: "Virginia Tech Shooter Was Korean"

Ugh, this article totally annoys me because of its two consecutive sentences that contradict each other!

The first two sentences of the article follow:

"The gunman behind the massacre at Virginia Tech University in Blacksburg, Virginia has been identified as Korean-American student Cho Seung-hui, police said. A permanent legal resident, Cho was a senior majoring in English and lived in Centerville, Virginia."

Hello!!! If he was a permanent legal resident, then he was Korean, not Korean-American. If he had naturalized and obtained US nationality, then he would be a Korean-American, or American.

Here is the link to the article:


I'm really sorry, but I can't get the "insert link" button to work right now on my computer, so the address is below:

http://english.chosun.com/w21data/html/news/200704/200704180010.html

Danny Coulson on Fox

This is my first try at using a blog to "catch" something in the media right away. There was just a live interview on Fox with the anchor (I forgot his name, but it's the one that has been accused of hiding his gay sexuality). Anyway, right after speaking with Paula or Greta, Danny Coulson came on via telephone (there was no image of him talking) to discuss the newly released video clips received from Cho's package by NBC. It said Coulson was a former FBI something.

The first error was Coulson saying Cho Seung-Hui was on a student visa. However, I read elsewhere that Cho was a permanent resident and moved here when he was 8. The anchor did not correct him. Coulson was saying this in the context that Cho should've been deported after being declared mentally ill and stalking the girls.

The interview ended and Coulson said it was a failure of the immigration system to all the victims. How could the immigration service have failed when this guy immigrated as an 8 year old child and never been charged with anything since?

If Cho indeed had a green card, and not a student visa, then I am annoyed that Fox did not correct Coulson (wouldn't the anchor be on top of all the facts at this point of exhaustively covering all the events?), and I am annoyed that somelike like Coulson even worked for the FBI in the first place. With Cho's accent in the videos, it would lead me to believe he was pretty much a native English speaker, or someone who had spent a lot of time here. It doesn't seem to match someone on a student visa who just came here their Freshman year of college. Aren't FBI people supposed to be good at that stuff? This just really reduces the FBIs credibility in my mind, although Coulson is a former employee and not a current one. I wonder what his position was.

Do green cards afford more rights than student visas with regard to this sort of thing? Did anyone else catch this on Fox and make a note of it? Do people record all this live tv on their Tivos to analyze it later? It all goes by so fast, and it's hard to keep track of the rapidly developing events. Just trying to use the blog to make a small record. I would love to hear from anyone else who caught this.