MiParadox

Inception Explained : Cobb, Mal, Dreaming, Trust

2010-07-20T23:53:00.000-07:00

[Greetings! This is my explanation of Inception, but I bet you have a good one too! Go to MyInceptionExplanation.com and let me hear what you think.]

Okay, so Cobb was dreaming. The fact is that the entire movie was about the concept of trust. Cobb was being chased by an evil firm, just like all the other dream sequences in which the subconscious comes for the dreamer. Cobb also made use of Mal's totem, the spinning top, which only Mal knows how to use (because it is her totem), but Cobb adopted it for his own use.

I think that this is a really subtle point that one may forget about during the course of the movie, because we only see Cobb handle the totem (so we believe that the totem is his - when it is actually Mal's) and a lot of effort was put into explaining how significant it was for only the maker of the totem to ever handle it; the totem is the only way that someone in the film can know the difference between a dream and reality.

So, given that the totem actually belongs to Mal and isn't Cobb's and our experience of Cobb in the 'real world' is very similar to the types of experiences dreamers had in dream world's with the subject's subconscious, I have to believe that Cobb was dreaming.

I think that the movie is primarily about trust, specifically, the trust between Mal and Cobb. Mal and Cobb lived with one another in Limbo for 50 years and lost track of reality; what was real and what was a dream. However, even though they had both lost track of what was real or not, Cobb was somehow aware that his reality was not real.

Cobb had the idea that he was living in a dream, and he wanted Mal to wake up from it. That is why Cobb convinced Mal to commit suicide under the train.

Mal shows Cobb a great deal of trust by being willing to believe that she is living in a dream state and that the only way to wake up from this fake reality would be to commit suicide.

Imagine being in Mal's position. She believes her reality and she trusts that it is real. But, the most important person in her life, Cobb - the only person alone with her in Limbo, is telling her that it is all fake and she will need to commit suicide in order to come back to reality. Can you imagine how Mal must feel?

But, Mal trusted Cobb, and when the train ran over them in Limbo they woke again. Yet, we assume that this state that they awake into is 'reality' and we are tricked throughout the movie by Mal's totem (which Cobb uses), which spins infinitely in the dream world and falls over in reality.

When Cobb returned home, you could tell that he knew something was wrong, because he was perceiving what he was creating based on a memory (which is the definition of a dream). The house looked exactly the same and the kids were dressed the same. Even though Cobb is elated to see his children, it is at this moment that he ought to realize that he is still dreaming. Recognizing Cobb's realization, Mal makes herself know to Cobb from his subconscious by making the top spin infinitely.

If we accept the premise that Cobb is still dreaming, then Mal could still exist in his subconscious and appear in Cobb's dream (what Cobb actually perceives to be reality). However, she does not appear to him in the world that Cobb believes is 'reality' (until the ending scene) because she wants Cobb to trust her; she wants Cobb to take the 'leap of faith' that he asked of her while they were in Limbo together.

Therefore, at this point in the movie (the ending scene), Mal controls her totem once again, which only she knows how to use because it is her totem confirming that Cobb is in a dream (also based on this, we can explain the previous spinning top falls earlier in the movie - Mal is actually taking control of her totem and making it fall over to test Cobb and see if he will actually trust her by committing suicide and joining her in the next world).

The Tiger Woods Effect

2010-06-20T15:09:00.000-07:00

US Open Statistics

Wine Tasting: Testing Perception vs. Reality

2010-02-27T08:16:00.000-08:00

The other night I had a small get together at my place. The theme of the evening was wine and cheese. I had decided to coordinate a wine tasting, so I gave my guests six different varieties of wine that I wanted them to sample.

However, I also thought this would be a phenomenal chance to collect some interesting data. What possible data could I collect during a wine tasting?

Well, I thought it would be particularly interesting to see if people could predict the value of a wine based on its taste without being told its value ahead of time. Though I am certainly no wine expert, I find it very challenging myself to distinguish whether a wine is "expensive" or "cheap".

But then again, I am just one person. There is evidence that suggests that there is some sort of wisdom that is inherent to a crowd. An entire book was actually written on this subject.

So, what would happen if you put a crowd of people together with six somewhat arbitrary wines and asked them to taste them and predict how much each cost? Would they be able to predict the value of the wine on average or would they be just as clueless as I am?

Motivated by seeking out the answer to these questions, I organized my wine tasting party - for social purposes and for science purposes!

The Wine Tasting

My data set is made up of 10 participants. During the wine tasting, participants were given the option of filling out a survey that I had prepared for them. The survey consisted of an empty table that allowed participants to fill in with values.

The first column on the survey table indicated the number wine that each row in the table corresponded to. Wine numbers were listed along with actual wines that could be tasted, and participants were responsible for putting their predicted value for each wine with the correct wine number on their surveys.

There is a chance then that some data points could have been marked incorrectly, but I do not foresee this altering the data significantly.

The data table was also made up of a nominal value ($) column in which participants would place their predictions. To the right of that column was a Location column, which was used as a dummy variable (but also interesting). Finally, participants could also rank their wines and write notes in the right-most column. Figure 1 depicts the survey before it had been filled out.

FIGURE 1

Each participant was uniquely identified by an ID that was written on the back of the survey. IDs were randomly assigned before the wine tasting party commenced. The unique IDs are given in figure 2.

Each column in figure 2 labeled "Wine _" represents a different wine variety and value. It goes from "Wine 1" to "Wine 6" when scanning the table from left to right.

The mean, median, and mode of the individual's responses are calculated at the bottom of the table and are labeled as such in the left most column. Finally, at the very bottom of the table is the actual value of each wine. The listed values are in currency units which are not depicted in the table. The currency is 2010 US Dollars.

FIGURE 2

The most significant comparison that I wanted to make was between the mean (the average) predictions of the group against the actual value of the wine. Comparing the average predicted values with the actual values effectively tests my general question regarding how perception coincides with reality (at least with the value of wine tasting).

I have depicted the average predicted value versus the actual value in figure 3. The x-axis is segmented by corresponding wine number and the y-axis is the value of the wine in 2010 US Dollars.

FIGURE 3

Discussion

Taking a look at the data, I am quite impressed with how the group performed. If we take a deeper look at figure 3 and qualitatively describe it in terms of the general trend, I see that as actual values fall so do predicted values, and as actual values rises, so do predicted values. This is strong evidence to suggest that people, on average, can distinguish the value of a wine simply via taste.

If we compare Wine 1 to Wine 2 for instance, we see that the actual value declines by 35% while predicted value similarly declines by 55%. While the degree is comparatively larger in the decline of the predicted value, the overall trend of rising or falling value is remarkably similar and is the case for five out of the six wines.

I think that even beyond predicting actual value of the wine, this trend following of the actual value of the wine is striking.

The only wine for which this was not the case was the final wine sampled, Wine 6. Wine 6 was in fact the least "valuable" wine but was ranked as the second most "valuable" wine. I think that this was the case because of the cognitive bias of anchoring. The most valuable wine, both actual and predicted, was sampled just prior to having the sixth wine and this anchor may have biased the participants overall when making their predictions of the value of wine 6.

Overall, it was a pretty rad wine tasting party and I think fun was had by all.

Summary

Participants were asked to predict values of different wines. On average, the group of participants was able to fluctuate their wine prediction in tandem with the actual value of the wine in all but one case. The results indicate that a group of individuals are able to discern the nominal value of a wine simply based on taste.

Twaxed.com Feature

2009-10-10T12:35:00.000-07:00

We don’t care that you are "having a busy Monday," you just "ate a meatball sandwich for dinner," or you "dropped the soap in the shower three times this morning." And we really, really don’t care which “Sex in City” character you most resemble.

Here's where we all went wrong: We took our friendships online. First we began communicating more by email than by phone. Then we switched to instant messaging and texting. Now, we "friend" each other on Facebook, and communicate by "tweeting" our thoughts—in 140 characters or less—via Twitter. We humiliate ourselves by sharing regrettable, often embarrassing text messages late at night while drunk. Until finally, we realize that we have shared way too much, say FML, and tell the world about it.

All this online social networking was supposed to make us closer. And in some ways it has. Thanks to the Internet, many of us have gotten back in touch with friends from high school and college, shared old and new photos, and become better acquainted with some people we might never have grown close to offline.

But there's a danger here, too. If we're not careful, our online interactions can hurt our real-life relationships and our most powerful tool: communication.

“We’re not communicating and using the words we’ve been given in a constructive and effective way,” Tyrone Schiff, creator of Twaxed.com, said. “We must use our words wisely.”

In August, Schiff launched the new social media entertainment site Twaxed.com. Here ridiculous, inappropriate or simply entertaining tweets are showcased. In addition, users have the opportunity to vote on the tweet by selecting “thumbs up” or “thumbs down”; one may also comment on particularly amusing posts.

The idea for Twaxed came about last summer while 22-year-old Schiff was working in Ann Arbor after graduating from the University of Michigan in May. Behind a graffiti-covered door, at the end of the alley next to the Michigan Theater and one floor below street level, a handful of entrepreneurs brainstormed in the TechArb. With 18-foot ceilings and no natural light, the room glooms from the hubbub of Liberty Street, just one story up. Google opened up the space over the summer and invited intelligent computer programmers and entrepreneurs to focus on building their businesses.

“When you put those two groups [programmers and budding entrepreneurs] together you just make a lot of stuff,” Schiff said. “It’s the kind of place where you just show up if you want to do something cool with your life.”

It was early August 2009 when one of Schiff’s friends sat hunched in front of his computer, astounded. He had just posted something on Twitter, and within minutes, had dozens of people following him. Then he offered the words that inspired Schiff: “You just have to beware what you share.”

“Out of that instance, I wondered, are we really thinking about what we’re saying?” Schiff said. “Because when you say something today it’s out there, in the open, and people can and will see it.”

But let's face it; the problem is much greater than which tools we use to communicate. It's what we are actually saying that's really mucking up our relationships and our communication skills.
By creating Twaxed.com, Schiff hopes to show the world that amidst all this heightened chatter, we're not saying much that's interesting. “The only way we can become a better society is to reexamine what we’re doing,” Schiff said.

With the tagline, “Beware what you share, you will get Twaxed” Schiff hopes that the website will not only entertain, but also inspire people to be more profound and more prudent with what they share online.

“I don’t even use twitter,” Schiff said. “I find it quite strange.”
For instance, a recent Twaxed post by CharliDDS reads, “Every time I write "thesaurus" I imagine the best dinosaur ever. THEsaurus.” The hope is that Charli will find herself on Twaxed, realize how absurd her comments are, and think twice before typing her next tweet.

And it’s working. Since Twaxed launched in August, the website has grown by 4,000 percent and is averaging 2,500 visitors a day. Schiff hopes to see that number rise to 10,000 visitors by the end of October.

“I don’t think Twaxed will ever be as large as Facebook,” Schiff said. “But my goal is to hit half a million visitors a day and I think that can be achieved.”

Twitter projects to have 18 million users by the end of 2009. And in the next sixth months, Schiff hopes that Twaxed will have reached 25 percent of those users. While Twaxed has no revenue stream yet, the goal is that it will be a “freemium” that is advertising and merchandise-based.

“The future is unknown so I might as well see what happens,” Schiff said. “If it doesn’t work, I’ll just create something else.”

This story was produced by Lauren Rosenblum, senior at the University of Southern California's Annenberg School for Communication.

Sunday Comics for the 21st Century

2009-10-06T21:30:00.000-07:00

I've been a little sidetracked at the moment with another project, Twaxed.com. It has unfortunately kept me pretty occupied and I haven't had that much opportunity to think of many other things outside of the realm of Twaxed.com. This new endeavor is going well though. Each day it gets larger.

The concept of the website is to aggregate the most ridiculous, inappropriate, and overall entertaining tweets on one site where users can vote and comment on the fresh material. So, I've been devoting a lot of my time and creative resources to establishing it over the past two months. It has been well worth it and I look forward to see how it grows in the next couple of months.

Anyway, lets talk about the idea I want to share with you today. Similar in scope to Twaxed.com, it uses a "Twitter-esque" framework in order to achieve its outcomes. I'll say that one of my biggest gripes with Twitter is that the service itself is pretty useless. I don't mean this negatively, but the actual entity itself does not do anything that has not been done before.

Surely, some can extrapolate that Twitter aggregates the wisdom of the commons into "Trending topics" and this is like a real-time expression of what is going on in the world. Sure. That is a pretty neat feature. Others will say that it has revolutionized communication. And I think that it has and will continue to do so.

But, ultimately, Twitter doesn't really do anything. It provides users with a platform to communicate what is on their minds in real-time with people who want to hear what they have to say, also known as followers. In essence, I view Twitter as a mass text message to all the people in your life that you want to connect with on this service.

That is wonderful and all, but it just sounds like a lot of words to me. And it is. There are so many words. In 140 characters, people convey their deepest desires, funny stories, or news from around the world. But, ultimately, its just a bunch of words and that isn't really doing anything constructive.

Twitter is cool because it has started to branch out and there are several other ways outside of a web interface in which you can send messages through the Twitter service (great TechCrunch Article on Twitter). I think that is a feature that makes Twitter remarkable. It is so open that every sort of communication device, whether it be phone, web, or whatever, can be funneled into the Twitter service, which essentially just aggregates all of these words (which I contend is rather meaningless).

However, I think there is a tremendous amount of meaning and use that can be driven from the Twitter service. Take Twaxed.com for instance. Using some of Twitter's funniest tweets, one can create an internet property that is a source of social media entertainment. That's actually doing something...not a whole bunch of words.

Twitter has an infinite number of applications as I see it. I think if you want to try and draw an analogy, a great place to start would be with Facebook applications. When Facebook allowed people to start developing applications for their service, thousands of things popped up. I think to a large degree, Twitter is going through that same process right now.

My primary thought process in regards to Twitter at the moment is, "how can I utilize 140 characters of text in creative ways?"

Thinking this thought is uniquely human and it has probably occurred to a lot of you as well. Let me explain what I'm suggesting a little further. Humans possess the wonderful capacity to do what is called generative computation. This means that we can create limitless varieties of expressions. Generative computation can be broken down into two types. There is recursive and combinatorial computation. The question that drives me to think about how to create meaning for the Twitter service (which I perceive to lack meaning) is due to recursion.

Recursion is the repeated use of a rule to create new expressions. Therefore, I am essentially using Twitter, which I feel houses units of 140 character comments, in a variety of different expressive ways. I truly believe that the applications are limitless, because the Internet and language are both limitless, and when you combine them, you get limitless squared (wow). If you would like to read more about generative computation and recursion, check out the September 2009 edition of Scientific American - Origin of the Mind article.

Anyway, I hope you explore the possibilities of what may become of Twitter in the future. I know that beyond communication, there are so many really fun and cool ways we can use 140 characters of text.

I'm going to give you one example here now. It is based on a Quirky.com model. Quirky is a really awesome website that creates products based on open-source development. Everything is created by users. Ideas for products are submit to the site, people vote on which they like most, then a logo is designed by users, voted on by users, a tag line is developed, voted on by users, etc., etc. The entire concept is the result of pretty effective market research. With a model like that you pretty much couldn't create a bad product. So, Quirky.com is brilliant, so why not apply its model to a Twitter application model.

Another really good reason to use a Quirky.com model is based on this TED lecture by Dan Pink on the evolution of motivation:

Okay, so now that we have a model (Quirky.com) and pretty solid rationale behind why we ought to build a service in this fashion, what can we possibly do with 140 characters that can be easily submitted from anywhere in the world on any device you can think of?

How about make a comic? (Hence the title of this blog post, comics for the 21st century)

I love comics. I think they're funny, and the only reason I'm happy to get the paper on Sundays anymore is so that I can strip away the colorful comic section and read them and giggle to myself. I imagine there are hundreds if not thousands of people out there who like comics too, and if it were as easy as I'm about to make it, would try contribute to making it.

Comics are beautifully simple. They are made up of a couple of still frames that are drawn together, and contain a small amount of usually witty text that is able to convey the meaning. If I were to guess, I'd imagine that most of the speech bubbles that one would find in a typical section of the Sunday newspaper comic section contain around or less than 140 characters of text each.

Isn't that a wonderful coincidence?

So. We can use Twitter to create open source comics. Here is how the design works and I'll get into a little more detail about how it all comes together.

At the beginning of the week, lets say, Monday, a website opens itself up to (1) submissions of comics. The comics are between 3 and 5 panels each, and contain no words. They have speech bubbles in place where text can go, but otherwise, they are just drawings made by artists.

Wait? Artists? I think one of the wonderful things about creating Twitter applications is that it can bring together people who have various talents, and we should also work on harnessing talents of individuals in the information age by giving them specific assignments that they are proficient at.

So, in this case you are bringing together artists with people who can write witty snippets of funny text. I think that makes the world a happier and smaller place for people, and heck, we might as well be happy.

So, artists submit their comics and they are voted on by the users of the website. This voting process can probably go on for about 3 days. Ultimately, one of the comics per week will be selected. Cool. So now we have a comic for the week. I don't know how people will determine which comic to use, but I think that's what makes it fun.

Okay, so now that we have the comic, we have to (2) insert text into those speech bubbles in order to make this comic really really funny. Over the next 3 days, open the comic up to people on Twitter. Do it one panel at a time or the whole thing at once. For instance, you could have people fill in the first panel of the comic, and then off of that information, create the text for the second speech panel.

Or you could allow people to come up with entire strings of funny text that would go throughout the comic. These are issues that can be dealt with later, but are pretty interesting to resolve.

So, now, you just get people to vote on the funniest. Every Sunday, you can publish a open-source comic that was made by artists and Twitters.

And why would people do something like this? As the Ted.com video suggests, its because we're motivated by something deeper than money when there is ambiguity and cognitive thought involved in any situation. Also, I think that the website could easily pay the people who have their artwork and text selected (stemming from the Quirky.com framework).

For an aspiring artist, this would be tremendous exposure. For a comic writer, it would have a similar impact on their career, and I think that a site like this could easily generate $50-$500 of revenue for each of the people who make the contribution to the final version of the comic.

And there, you have it, a Sunday comic for the 21st century.

Schiff Curve of Creativity

2009-08-05T09:59:00.000-07:00

Watch What You Eat

2009-07-21T20:48:00.000-07:00

Here's a pretty solid idea: eat well. Seems easy doesn't it? Well, you'd be quite mistaken when you realize just how messed up the food industry has become in the United States, and the world for that matter.

I just watched the film Food Inc., which is a documentary about the industrialization of food in the United States. Though parts of it were grotesque and truly horrifying to watch, I'm glad that I experienced the film and am now more aware of the types of things I'm putting into my body.

The movie starts out claiming that the concept of food has changed more in the last 50 years than it has in the last 10,000. What I find alarming about that statement is that I'm not at all familiar with the process in which I get the food I eat (when you think about it, a caveman had a lot more authority over what sorts of things he put into his body than you or I do today).

But that certainly doesn't have to be the reality. We all have a choice.

However, there are a lot of entities in our world that are against full disclosure, which is absolutely disgusting and horrible. Essentially, it all comes down to dollars and cents. Food giants have grown to such enormous sizes that they have amassed incredible power; power in the form of money (perhaps the root of all evil). Four companies control 80% of the meat industry.

This means that even when we go into our supermarkets, it is very hard to know what came from where and what things contain. For instance, food distributors won't disclose whether or not an item has any sort of genetically engineered food in it. Bills have been brought to various state legislatures in order to release the information to the public, but with little success (California governor Schwarzenegger even vetoed such a bill).

But why does it even matter? Why is this movie even being made? What's the difference if I were to buy my own produce locally or from one of these mega-corporations?

As it turns out, a lot of the mechanisms that these corporations use in order to process food as quickly and efficiently as possible are hurting our world terribly. And what does that mean?

It's hurting the world in terms of pollution. Mega-corporations use millions of gallons of fuel in order to produce the food you eventually buy. Not only that, because these corporations are so dependent on gas and oil, when the price of one of these commodities go up that effects how much you have to pay for the item. Who needs that sort of instability?

Furthermore, the way we are eating is starting to hurt our ecosystem (the interaction between living organisms on the planet). These corporations have started to overproduce cattle, and have begun feeding them corn as opposed to letting them feed on grass. They give them corn because it is a far cheaper alternative. However, the corn can have an adverse effects on the cows. If this happens, a cow can develop a bacteria like e-coli. Then, due to the processing techniques used in handling livestock, it can spread through the entire factory contaminating all the meat. There are several instances in which there have had to be recalls of beef products (usually enough to feed millions of people).

Additionally, the stranglehold that these large corporations have on the growers is immense. Take for instance this situation. A chicken grower is forced into buying new equipment by the large poultry corporation, or else they will no longer extend their contract. The grower feels pressured to do so, or else they won't be able to put food on their own table. So they give into the corporation's demands and purchase the new equipment (probably from a company the poultry executives are on the board of). The startling fact you can derive from this is: growers have an average debt of $500,000 and typically earn $18,000 a year. That is messed up.

But, every cloud has a silver lining, and the movie showed that angle too. What we can learn from this movie is that we truly have a choice. As a consumer, it is the corporation who works for you, not the other way round, and the movie put your power very poetically, "you have the opportunity to vote three times a day."

Referring to the amount of meals we have in a regular day, we have a choice with each one to determine where we are getting our food. And don't think that this is just some sort of pipe-dream, ridiculous, fantastical notion that the director of the movie wanted to leave me with. There is solid evidence that change happens.

Recently, Wal-Mart, the biggest store in all the world, switched from milk with human growth hormone to milk without human growth hormone. Why did they do this according to the head of dairy procurement at Wal-Mart? Because the customer asked for it. He was very insistent on that message. If the customer asks for something, Wal-Mart will deliver on it.

But now you may be wondering, why would I want to support another large corporation like Wal-Mart? The difference being that Wal-Mart is not in the production of food, but rather in the business of finding supplies of stuff consumers want. If Organic and healthy, local food starts finding its way into Wal-Mart, it is still that organic, healthy, local food, it just becomes that much more accessible to the general public.

I'd highly recommend going to see the movie if any of this resonated in you. Or perhaps, go to a farmer's market the next time you want to go shopping. The end of the movie is filled with really great ideas of taking the lessons learned in the film and using them in your life. I'm going to try.

And The Beat Goes On

2009-07-06T13:07:00.000-07:00

The world is change. Today is not yesterday, and tomorrow is greatly unknown. There are few certainties in life, but one of them (aside from death and taxes) is the concept of uncertainty. Consider a world that was 100 years ago. Then think about it 50 years ago. It will likely stun you just how different the world was 5 years ago. But each day, the world predictably spins on its axis giving way to day and night. In these short bursts of light that shines onto our planet, the human species is very busy. Hard at work making minor changes that over a period of time amount to significant differences.

If you've ever heard of the futurist, Ray Kurzweil, you may be familiar with his theory called the law of accelerating returns. Essentially, he postulates that we're living in exponential times. What does that mean? Well, if you've ever seen an exponential graph before, you will recognize that during the beginning phases of the graph it is mostly a flat line that doesn't increase all that much. But with each subsequent step the graph takes, its quantity begins to increase incredibly rapidly. After a while, the graph almost begins to move vertically.

What does this theory suggest about our world? Kurzweil is expressing our species as a function of this mathematical principle.

Consider human existence. To focus our thinking, I'll start about 200,000 years ago, which Wikipedia sites as the emergence of modern humans. 200,000 years ago man lived in caves, had limited ability to communicate, and struggled to feed and clothe himself. This sustained for approximately 198,000 of those 200,000 years. Within the last 2000 years man has made significant strides.

We have begun to organize, utilize language to communicate, express ideas in writing, institute education, take part in agriculture and industry, construct structures like castles, bridges, houses, develop transportation, and even travel the wide expanse of space. These are remarkable changes that have all happened in a relatively short time when one considers the extent of the human species.

Kurzweil is suggesting that we are currently living in a time where those enormous increases in quantity that occur on an exponential curve, are occuring all around us every day.

This is complex notion to wrap one's mind around. The reason being is that a human's function individually on a daily basis, which is defined by the phases of light and dark that the sun shines on our planet as it rotates on its axis. However, due to the fact that there is a large number of humans on the planet these days (exponentially more so than thousands of years ago), and we have improved our ability to communicate and organize, the small actions that we perform daily combine to make enormous strides that were not possible hundreds of thousands of years ago.

I want to apply this notion to the music industry. And I don't want to just apply the notion of exponential progress, but rather, the change that accompanies it.

In order to understand music more fully, I decided to consult a text called Human by Dr. Michael Gazzaniga, the director of the University of California-Santa Barbara's SAGE Center for the Study of the Mind, as well as its Summer Institute in Cognitive Neuroscience.

Chapter 6 of the book addresses why humans have art (music being a form of art). Cultures all over the world display various type of art, whether it is through song, dance, storytelling, or painting. This supports an evolutionary theory of art being a part of natural selection. The fittest individuals were likely to be able to find food, shelter, and clothing, and have enough extra time to be creative.

Music has also been viewed as a social bonding system that assisted in synchronizing mood amd prepared various groups to act in unison, which helped with building coalitions. Music also has the ability to enhance our thinking abilities. Glenn Schellenberg, at the University of Toronto, found that music lessons in children were associated with small but long-lasting increases in IQ.

This makes sense because learning music requires "focused attention, abstract and relational thinking, and what is known as executive control in the brain" (242).

Above all, however, music is pleasurable for humans, and this is apparently a unique quality that our species possesses.

So, what does all of this suggest about the music industry? I think that the music industry is going to change. It is going through one currently. It used to be that major record labels were the only way to "make it" in the music business. However, the information age has changed the playing field.

Music will always be around, because we enjoy it. Yet, the vehichle through which music will be disseminated to the world will likely evolve as all things on the planet have. We ought to be open to these new avenues as they present themselves, because they can only be beneficial. Nothing ever moves backward, only forward in a new direction.

MyBandStock: Defining Perk

2009-06-24T13:38:00.000-07:00

MyBandStock is a revolutionary website that enables fans to support musicians through a process, enabled by the Internet, known as crowdsourcing. The idea is that fans buy "stock" in a musician, which is a monetary investment, which the musician can use to complete a project such as recording an album or touring the East Coast. Rather than receiving a financial reward for their investment, fans receive exclusive perks from the musician only available through the MyBandStock web service.

I recently had an opportunity to think about the wide variety of perks that fans may want to receive in order to induce them to purchase "stock" in a musician.

Along with two other interns working for MyBandStock this summer, we were instructed to devise as many realistic and feasible perks as possible. These two qualifiers have a drastic impact on the potential list of perks available. For instance, having these constraints eliminated the possibility of a flight to the moon or a lifetime supply of Aero chocolates (my favorite) as a perk for an investing fan.

This was no obstacle for the three music-teers (an ill-witted play on the three musketeers).

In preparing the group for this project, I proposed an interesting technique in order to develop our many ideas. I suggested that the less we think about the ideas, the easier they will come to us.

In Dr. Elizabeth Lloyd Mayer's book, "Extraordinary Knowing," she investigates some of the theories and science behind clairvoyance, ESP, and telepathy. She asserts that some of our clearest thinking occurs when we do not focus on thinking. By relaxing the posterior superior parietal lobe, deep levels of meditation can occur in which a sense of connectedness and intuition may be attained. Therefore, by opening our minds, I believed that we would best populate our perk ideas by utilizing this technique of knowing without knowing.

The results were phenomenal. Not only did this strategy allow us to come up with an ample list of perks that could be feasibly and realistically added to the current MyBandStock web service, but it also gave us new perspective on how to think about perks in general.

It occurred to us that perks come in three different, yet distinct forms. Recognizing the difference in perks will enhance the MyBandStock web service's ability to market to the appropriate demographic and will also add clarity to which sort of perk fans are most willing to invest in.

The way that our team distinguished between perks is by looking at them as:

Access
Merchandise
Experience

Perks that deal with access involve exclusive insider information about the musician that can only be provided by the relationship between MyBandStock and the particular musician. By purchasing "stock" in a musician that gives one access to the perk, the fan is being admitted into an exclusive club of knowledge that they can only be admitted into by means of the MyBandStock web service.

Perks that deal with merchandise involve tangible objects that the fan can receive that relates to the musician. The extent of merchandise is limitless and musicians can determine any sort of object to personalize in their image.

Finally, perks that deal with an experience relate to opportunities that fans can engage in directly with the musician that they are a fan of. Experiences may vary, but the way that this is different from access, is that the emphasis is on the relationship formed between fan and musician, whereas, access is exclusive information.

Thinking about perks in these terms gives new scope and meaning to what a perk truly is. I think that by using this framework, MyBandStock will be able to grow their perks in the future in an organized, effective, and efficient manner that will enhance business functioning.

It was a fun assignment that I hope will add valuably to the MyBandStock web service as time progresses.

Music For Thought

Tuition Intuition

2009-06-17T11:12:00.000-07:00

How does one possibly offset the high cost of tuition to top-tiered academic institutions these days? After conducting a brief analysis of the top 25 ranked academic institutions based on U.S. News and World Report, the average tuition for one year is approximately $34,960. This is a remarkable sum of money to expend on education for a financially well-to-do family, but for a family who is impoverished, a sum of this magnitude is incomprehensible.

Education is the human right to derive knowledge and consume information about one's livable Universe. Ideally, it should be free to all of mankind. However, the rates at which academic institutions are raising their tuition is unfortunately keeping some individuals out of the academic mix. The cost of education has reached a point where it has begun to deny the inherent right of education to those who do not have the financial means.

In order to alleviate the financial burden placed on individuals attending academic institutions, I have proposed a strategy that may be worthwhile if explored further.

The idea that I propose is rooted in a University's Development Department. In University lingo, Development is a sophisticated word meaning "to raise funds from alumni and all individuals associated with the institution." University's have gotten this process down to a science, and that makes good sense seeming though a University is an academic institution that seeks to unveil the hidden mystery of the human condition.

Development departments usually structure their attacks by focusing their efforts on donors who are willing to give at various amounts. There are certain individuals who give millions of dollars away, likely attributing their present success to the foundation provided to them at their University. Other individuals give hundreds of thousands of dollars probably for very similar reasons. But then there are the smaller donors. The ones who typically give less than one thousand dollars a year. And it is these donors who perplex me.

I have to wonder, why is it that these people, the vast majority of the alumni of any academic institution, feel compelled to give small sums of money that on a personal level make little to no dent at all to the University's bottom line?

First, I could consider that these individuals have a strong tie to the academic institution. Most top-tiered academic institutions are four year engagements, and it makes reasonable sense to me that any institution that one devotes his or her life to for four years would seemingly harbor some sort of connection. Sure, this is a reasonable reason for giving a small donation.

Second, could it be that the individual was particularly connected to their field of study, and it is not in fact the anonymous institution that motivates these individuals to give their small donations, but rather the faint recollections of classmates, professors, lectures, and events that are truly at the core of the giving? I think this is highly likely as well.

Third, perhaps the individual does not even care or think of their academic institution, but just out of being asked for a donation they are willing to part ways with even a small amount of money, because they have more than enough to survive on? I think that if people don't have any specific hatred towards the institution based on something "it" did to them "personally", it is quite likely for a donor to give even a small amount of money if they recognize that they can do without it.

Fourth, maybe it is the donors understanding that the money that they give, although a small amount, will be utilized together in a pool of donor money in order to help the academic institution realize its greater goals.

Finally, perhaps the means through which the donor was asked for a donation to the institution plays the largest role in their willingness to give. It is a challenge to get donations out of donors at these small levels of contribution. This makes sense intuitively. If you are a large donor, it is likely that your large donation will take up a larger portion of your thoughts. If you are a small donor, it is likely that your small donation will take up only a small portion of your thoughts (I like the symmetry here).

Donors at these small levels of contribution are typically found either through phone or mail solicitations. Obviously, with the help of the Internet, donors could instinctively go to the donation website, but it is unlikely that they will do so without being prodded. People generally don't feel the need to do something unless being specifically asked to do so or unless they are highly intrinsically motivated for some reason or another.

The final method that I suggested that may drive a donor's motivation is particularly compelling to me. For the past couple months I have worked for a University's Development Department, and my job entails calling and soliciting donations from these smaller donors.

I have been doing this work for long enough that I am already considered a veteran. There is hardly anyone on the calling floor who has been there longer than myself. In my time, I have seen people come and go; the turnover rate is incredible. But, what I have also recognized, is that there are people who are remarkably good at the job and those who just cannot get it right.

Over a short period in time, it is quite difficult to assess the quality of a caller, but over the longer term there is a marked difference in those people who either work very hard at improving their solicitation technique or just have a knack for the job. Some people are so skilled that they can get the smallest amount of money out of an individual connected to the institution even after they spend a couple minutes berating it. I propose that this isn't luck, but rather a reflection of the individual's ability to solicit money for a cause.

With that being said, I consider my own case again. For the past couple of months I have worked around 250 hours doing this sort of work for my academic institution. For my time, I am compensated at around $9.25 an hour which is a tremendous sum of money for a college student, and I am grateful that I was able to secure this job and receive the compensation I do. Doing a couple simple calculations, I've netted around $2,200 for my time after taxes.

However, in the exact same stretch of time, I have brought in around $20,000 for the academic institution for which I have called. I feel proud of this achievement and I'm glad that the money that I have raised is going to a worthy institution that I do in fact feel quite connected to.

Yet, in just a few months from now I will need to repay the massive student loans that I took out in order to finance my education here. The sum I will have to pay back is daunting and will take a calculated 15 years minimum (that is roughly 68% of my current age to this point).

I think that academic institutions ought to consider expanding their Development Department to include individual financing. This can be done in one of two ways as I see it.

The first way would be to allow students to call alumni (as they do already), but enable the student to raise money on their own behalf to offset the high cost of tuition. The call would be very similar, but the donor would know exactly who the donation is going to and for what purpose, exactly. That is a step up in transparency from the current method.

The second way would be for students to work together collectively to create a tuition endowment of sorts. This could be structured for each individual academic institution or perhaps institutions could even work together in order to enhance the size of their endowment. The interest paid on this endowment would go towards assisting students with tuition. As the endowment grows, and it will do so exponentially (due to compounded interest), tuition will find itself either leveling off or even decreasing.

Individual's expressing concern about this idea will posit that if money goes toward this tuition endowment or towards an individual needing tuition assistance, then the University loses out on that potential money which deteriorates the greater good that the University provides (research, art, etc.). While this is a completely fair assessment, I would contend that small donors could likely match the donations they give without any significant impact to their way of life.

Therefore, I believe it is just a question of effective reasoning and solicitation on behalf of the student making the call (a primary reason why I think small donors give over the long term). So long as the message is framed correctly, individuals will act. It is our nature.

MyBandStock at the Blind Pig

2009-06-14T18:20:00.000-07:00

I've gotten myself involved in a truly revolutionary enterprise that is set to send waves through the music industry. As we find ourselves moving deeper and deeper into the information age, it is becoming harder and harder for musicians at the start of their careers to find funding in order to get them to the next level. Fortunately, for music bands and fans alike, there is finally a resource that uses the power of the Internet to harness rather than hinder these musicians progress.

Enter My Band Stock (MBS). MBS is a revolutionary website that uses the power of crowdsourcing in order to empower musicians at the brink of their careers find the monetary funding to accomplish projects that set them on a road a path to stardom. The idea is that fans buy "stock" in a musician that they enjoy (one that they are likely a fan in to begin with) and the band uses that money to fulfill various goals that they think would be most helpful to their success.

When a fan purchases "stock" in a band, they are not tying that investment to monetary increase or the potential explosion of a particular artist, rather, fans get perks from the band that they are supporting. This may be things like a free CD, signed drum sticks, cool t-shirts, or exclusive merchandise only available through the My Band Stock website.

My Band Stock is motivated by leveraging the personal relationship that one stands to gain in buying "stock" in a musician that they are a fan of. My Band Stock facilitates this relationship cultivation through entitling those who invest to the aforementioned merchandise, as well as, recognizing those fans for supporting music.

The website was launched in January of 2009 by students at the University of Michigan.

This past Friday, my duties as a music revolution intern included going to the Blind Pig in Ann Arbor, Michigan in order to market this revolutionary website as well as promote Charlene Kaye, a featured musician on the website.

The experience can best be described as fun-filled. We arrived early in the evening with My Band Stock merchandise and marketing materials and began setting up. Soon thereafter, the musicians who were going to perform began to arrive. The Blind Pig was featuring three wonderful female vocalists this evening and aptly called the event "Super Women."

The night started off with Anna Ash who has a soothing, pleasant voice, that I would liken to Yael Naim, who gained popularity through her Apple Macbook Air commercials.

She was followed by Laurel Premo, who incorporates a double bass into her act, which I was particularly fond of. The headlining act was performed by My Band Stock's very own Charlene Kaye. Charlene's voice and music are both exquisite, and I encourage you to listen and purchase "stock" in this up-and-comer.

Marketing for My Band Stock was not only fun but relatively easy. We were set up right next to the merchandise area for the respective musicians, and people would typically look at the CDs they could purchase, and then happened to glance over at what all this My Band Stock stuff was alongside it.

This is where I was able to engage with the various attendees of the event and help showcase this phenomenal concept. The dialogue was varied for each individual, but typically began by enthusiastically asking if the person had ever heard of My Band Stock. Most of the people who attended this event, even though it featured MBS's Charlene Kaye, were unaware of this remarkable music service.

This gave me an opportunity to enlighten people about the features of the website and why it is vitally necessary to the music industry. I found that people were highly receptive to the idea and were more than willing to check out the website. One individual was so impressed by it that he signed up there and then and even bought some "stock" in Charlene Kaye.

Overall, the event was a complete success and enjoyed by all who attended. I'm glad that I have the opportunity to help spread this phenomenal idea and interact with musicians and fans.

I hope I get a chance to share more details with you about my internship with My Band Stock as the summer progresses. Please be sure to check out the website, listen to some music, and buy some "stock"!

Trading

2009-06-02T09:54:00.000-07:00

Several weeks ago I ran a survey through Those Answers Inc. which sought to look at the correlation between a person's likelihood of investing in the stock market if they engaged in a market based system in their younger years, trading cards.

The first thing to address when tackling this question is to define what a market is. A market is merely just a conceptualized form in which one good or service is traded for another good or service. There are countless forms of markets in today's modern world. There are more formalized markets like the stock market or the currency market or the futures market. But then, there are also far less formal markets, such as a yard sale or craigslist or even kids trading baseball cards (or any sort of cards) on the school yard.

The purpose of my survey was thus to verify whether informal markets had the propensity to lead to individuals partaking in formal markets. The particular type of informal market that I studied was the last example that I gave, that of young children trading cards with one another, and the formal market that I hoped to correlate these findings with was the stock market.

The underlying theory that gives me reason for this connection to exist is based on socialization. Sociologists use this terminology in order to describe the "process of learning one’s culture and how to live within it" (Source). I think that bartering is a human behavior that individuals must learn in order to survive. Therefore, I gathered that if individuals were exposed to market environments at a younger age in an informal setting, they may be more likely to participate in markets when they are older through socialization and conditioning.

It also may be more natural and intuitive for individuals to participate in formal markets when they have already taken part in informal markets.

That was the first objective of the survey I gave. The second objective was to seek out something far more psychological about the thought processes of individuals partaking in formal markets based on their socialization from informal markets. I sought to find whether or not individuals were likely to hold similar beliefs about the value of items with the influence of time.

Results

The results are based on the survey results of 34 respondents. 19 of the 34 (56%) of the respondents were male and 15 of the 34 (44%) were female. The average age of a respondent was 22.6 years and ranged between a low of 19 years and a high of 42 years.

The first thing that I wanted to know from my survey participants was whether or not they had ever collected any sort of trading card. 65% of individuals (22 of 34) said that they had collected some sort of trading card.

Then I wanted to see whether the intent of the individual collecting the trading card was similar to the intention of formal market speculators. The way I did this was to ask whether the individual when collecting their trading card anticipated selling that trading card at a later date.

The answer to this question reveals a great deal about human behavior psychologically and culturally. A high percentage of individuals willing to sell their trading cards at a later date indicate that people instinctively collect belongings recognizing that they will part with them at a future date. This seems odd doesn't it? If I know that I am going to have no use for a particular item in the future, what is my motivation to horde that item now? I think intuitively it comes down to exclusivity.

When an item is highly desirable and highly exclusive the value of that item is inflated. This isn't because the item itself has gotten any better, but rather, the psychological drivers of desirability and exclusivity make an individual perceive a particular item to be more than it is worth. It is based on this premise that people will opt to collect items today in hopes that their perceived value will be greater later on (in effect, attempting to horde an item that has "stable" value, money).

Of the surveyed individuals, 63.6% (14 of 22), anticipated selling their trading cards at a later date.

Next, I wanted to figure out what those individuals who anticipated selling their trading cards at a later date thought would happen to the value of their trading card over time. I gave them the option of the value increasing or decreasing over time. A staggering 100% (14 of 14) believed that by adding time to the equation, the value of their item was surely to increase.

This reveals something quite compelling about the natural tendency of individuals partaking in informal markets. It illustrates that perceived value over time increases. If this is instinctive in informal markets, can the same be said about the value over time of objects in formal markets? If the socialization effect appears to hold, this could be a reasonable deduction to make.

Now, I began my inquiry into the interaction with formal markets of our surveyed participants. I asked respondents if they had any capital invested in the United States stock market (our formal market).

Out of all respondents, only 38.2% (13 of 34) had money currently invested in the stock market as of May, 2009. According to 2002 data by the Investment Company Institute, 35.9 million households, which represent 33.7% of the households in the United States owned either stocks or mutual funds or both (Source). Based on the close proximity of these two percentages, I can conclude that we are looking at a pretty representative sample of the United States stock ownership community.

This is where I can finally get at what I was really after. At this point, I can determine if there is a significantly higher percentage of individuals who traded cards when they were younger (in informal markets) who participate in the stock market (our formal market).

In order to perform my statistical tests, I used a one-proportion z-test for the four particular conditions that I had. The first condition was yes informal - yes formal (YIYF), the second was no informal - no formal (NINF), the third was yes informal - no formal (YINF), and the fourth was no informal - yes formal (NIYF).

YIYF

After conducting the one-proportion z-test for this condition, a z-value of 0.55 was achieved which has a p-value of 0.2088. This is not considered a statistically significant value, and thus one cannot conclude that if an individual was involved in informal markets then that would predict for their involvement in formal markets. (A larger sample is needed to truly verify this result).

NINF

A z-value of 3.4 was achieved which has a p-value of 0.0003. This is considered a highly statistically significant value, and thus one can conclude that if an individual was not involved in informal markets then that would predict for their non-involvement in formal markets. (A larger sample is needed to truly verify this result).

YINF

A z-value of 2.27 was achieved which has a p-value of 0.0119. This is considered a highly statistically significant value, and thus one can conclude that if an individual was involved in informal markets then that would predict for their non-involvement in formal markets. (A larger sample is needed to truly verify this result).

NIYF

A z-value of -0.59 was achieved which has a p-value of 0.7224. This is not considered a statistically significant value, and thus one cannot conclude that if an individual was not involved in informal markets then that would predict for their involvement in formal markets. (A larger sample is needed to truly verify this result).

These findings truly get at the crux of the survey. It appears as though there is no correlation between involvement in informal markets and formal markets.

The survey also sought to verify whether the beliefs held about perceived values were still consistent between informal and formal markets. Recall that in informal markets individuals believed, with a 100% success rate, that the value of their good would increase over time. When it came to formal markets, it appears as though beliefs mirror that of the informal market. 92.8% (13 of 14) respondents believed that the value of an investment is likely to increase rather than decrease over time.

This seems to be highly correlated. Beliefs seem to remain embedded regardless of the market type, and that belief is that value increases over time.

With the belief structure that value tends to increase over time it was not that surprising to find that only 59% (20 of 34) of respondents knew the difference between a long position in the stock market and a short position. Long positions are based on the belief that investments will increase, whereas, short positions take the stance that investments will decrease. A short position is probably counter-intuitive to a lot of people's thinking based on the results of this survey.

Thanks to all participants!

Stroke of Insight

2009-06-01T15:16:00.001-07:00

Reflect Inc.

2009-05-30T13:19:00.000-07:00

Feeling good is all a state of mind. There is a great poem that I was exposed to when I was in high school called the Optimist's Creed. Essentially, the poem suggests that one's attitude is what makes your life. I think there is a great deal of truth to this idea. If you feel good, then you it shines through your work, your interactions, everything that you do.

Recognizing this, I was introduced to a phenomenal online shirt company called Reflect Inc. The concept of the website is brilliant and practically mirrors the invocation to this post that I just gave.

Reflect Inc. provides transformational clothing. What is transformational clothing? Well, the shirts that they create contain simple affirmations on the chest written in a cursive-like script and on a black shirt. However, if they merely just had some sort of affirmation on the chest of the shirt, I probably wouldn't take the time to write about it as I am. What Reflect Inc. does differently that truly separates them from other shirts I've seen is the unique way in which they convey their message.

The affirmation that is written across the chest on the shirt is written in such a way that it is read normally only by looking into a mirror. This type of script is referred to as mirror writing and it was employed by people like Leonardo Da Vinci.

This isn't to suggest that the only good purpose of the shirt is to wear it in front of a mirror. Hardly. The way that the writing looks across the chest is pretty eye catching and makes one hell of a conversation piece. However, it also happens to double as a wonderful affirmation that can get you in the right mindset to take on the world.

There are a variety of affirmations that the company provides on a number of different topics. There are affirmations relating to one's Life, Relationships, Health, Self Confidence, etc.

They are currently running a promotion where they are shipping items for free.

Great concept. Unique idea. Implemented and ready to soar.

Understanding Animal Spirits

2009-05-29T10:16:00.000-07:00

Thompson Creek Metals Company, Inc.

2009-05-19T12:48:00.001-07:00

I have just started utilizing a new trading strategy that is based on a study done at a highly accredited University based somewhere on the planet. Based on the study's findings, my own investment knowledge, pure intuition, and good old fashioned luck, I thought that I would start blogging about some of the ideas that I have on this front. I guess it is a little bit of a risk putting my stock ideas down in writing due to the fact that both you (hopefully there is someone out there) and me will know if we got the stock pick right.

I will also let you know that if I will never blog about a particular stock I am invested in. This doesn't necessarily mean that I will never invest in the stock, but I think that my own portfolio is my own business.

Anyway, the first stock that I am going to pick is Thompson Creek Metals Company, Inc (TC). As of May 19, 2009 at market close it is currently trading at $9.00. It has just had an incredible day as well, but that is hardly why I am pitching it. I'm actually going to first make a case why the buying price right now is overinflated and that if you're wise you will wait to it pulls back before getting in.

First, a little about the company. According to Google Finance, "Thompson Creek Metals Company Inc. is a Canadian molybdenum mining company with vertically integrated mining, milling, processing and marketing operations in Canada and the United States."

Okay, a couple interesting things to point out here. First, they are Canadian. That means that they are subject to Canadian laws and all that jazz. Second, they are a mining company that mines this substance called molybdenum. Excuse me, molybdenum? After further analysis, I learned that molybdenum is a pretty incredible substance.

If you're familiar with the Periodic Table, it is atomic number 42. The applications of molybdenum is really what we're interested in though, seeming though a company's livelihood is contingent on its usage. Molybdenum is able to withstand extreme temperatures, which make it helpful in "the manufacture of aircraft parts, electrical contacts, industrial motors, and filaments" (Source).

They have plants in Northwest Canada, Idaho, Colorado, and Langeloth.

What drives me to pick this stock is based on the following. Although we're in a recession, molybdenum is a substance that is necessary to the ongoing growth and expansion of the world. And, as the world becomes more globalized, we're finding it easier to transport materials for usage. With that in mind, consider China and India. These two countries are still going to develop a great deal over the next 20 years and they are going to need molybdenum in order to satisfy their growth needs.

TC also happens to be one of the world's largest producers of molybdenum. When you consider anything in the world that is the largest (outside of economic collapse), these companies tend to perform very well because they have a solid foundation and are able to use those economies of scale very nicely. They have an entrenched network that can grow rapidly as well, so when this recession does come to an end they will be first movers.

TC was also hit badly by the economic downturn. They fell all the way to $2.44 before starting to recover. It would have been nice to get in that low, but there's a saying and it goes, "woulda, shoulda, coulda."

TC has been on this ascent since November, 2008 and has shown that they're a solid company that was hit hard by a psychological attack on the market (see Robert Shiller for further information). They're recovery over the past month, however, has been far too rapid (they are up 70%).

My grandfather explained to me that as the market goes up it also has to come down. The reason for this is primarily profit-takers. Think about people who got in at $2 or $3. They're ready to cash out, because they've tripled their profits. The greedy ones will be hit hard though. Due to the fact that the stock market, like any market, is reliant on supply-and-demand, a percentage of share owners will leave the stock creating an overall increase in supply and further downward pressure.

You may notice that I'm not referring to any sort of Stochastic Indicator when I walk you through my reasoning. The reason being that I look at the stock market as a market like any other. People have just had a little too much time on their hands over the past 150 years to create these mathematical models that, I would contend, got us into the current mess we are now. If we are just conscious and think about our reality, it starts to make a great deal of sense.

One metric that I do focus on is the P/E ratio. This is one of the only financial metrics that makes valid sense to me. It takes the price of the current stock and normalizes it based on its earnings. Stocks that have lower P/Es typically outperform stocks with higher P/Es (see Irrational Exuberance - Shiller). TC has a P/E of 8.28 which is ridiculously low. This reveals to me that their stock is trading at a premium.

However, as I mentioned earlier, the stock is overinflated and needs to come down. It is hard to say what it will come down to exactly, but at the current price, I wouldn't buy it before it got down to at least $7.50. At which point I am a buyer and in for approximately 3 months or until my pockets get full enough for me to be happy. This stock has high momentum and so I wouldn't be surprised if it went down to $7.50 and up to a price objective of roughly $20 by the end of 2009.

There you have it.
TC - Thompson Creek Metals Company, Inc.
Current Price - $9
Recommended buy at - $7.50
Price objective - $20
Investment time - 3 months or until the end of 2009 if slow

The Next Big Sound

2009-04-23T12:56:00.000-07:00

The world is changing dramatically. In Detroit, Michigan, the motor industry is having to evolve due to competition and the necessary minimization of oil consumption in the United States. Along with that, the general philosophy on energy consumption is shifting gears. We are starting to look into new technologies like solar power, bio-diesel, wind power, and hydroelectric power in order to meet and sustain our energy needs. A lot of the methods are still highly experimental and uncertain, but the fact of the matter is that there is change coming and we are readying ourselves for it by testing out all different elements.

In a similar way, the music industry has been going through a change. I would contend that the music evolution began with the establishment of Napster in 1999. Napster was a truly revolutionary service that harnessed the Internet in its purest form. Using the intrinsic communicability of the Internet, Shawn Fanning, a then Northeastern University student, began the largest scale music sharing platform the world had ever known.The image above describes, in its simplest form, just how Napster worked. Essentially, the Internet worked to connect all of our computers together into one central mainframe. Then through a simple system of sharing files with one another, people were able to transfer music on their own system to other systems that tapped into the same network. To be perfectly honest, Napster is brilliant due to its simplicity and ease of use.

Similar to using Google, individuals would merely search a song that they wanted and the system would show all of the files available in the system. The user then just selected the file that they were most happy with and the download began. Unfortunately at the end of the 20th century, download speeds were still relatively slow for individual users, and thus a 5.0 kbps/second rate was considered optimal (we've certainly come a long way since then).

Anyway, the emergence of Napster was the inflection point -- or as Malcolm Gladwell would tell us, the Tipping Point -- of the musical industry. No longer was music truly in the hands of large record labels or even the artists themselves. The musical power had been transferred to the user. We were free to share music and essentially make all of it available to the whole world through the Internet.

Since then, music has had to deal with a great deal of transformation. Steve Jobs and Apple have worked hard to legitimize the public dissemination of music through their program iTunes which allows users to purchase songs at a rate of $0.99 a song and typically $9.99 for a full album. Downloading music for free is still very much available. If you prefer a little more of a risky approach you could try using Kazaa, but this illegal downloading program is full of viruses and I personally don't like the system very much. Another approach is to use Pirate Bay, which is a search engine full of torrents. This program is working very hard to legitimize its downloads and does well due to its comments section and a rating system of safety associated with trusted torrents.

However, the concept of music and its dispersion is still being determined. As NPR reports, in time people may pay for music based on the bandwidth that is used. Furthermore, consider websites like Pandora that allow individuals to listen to music of their liking for as long as they want as though a radio, while Pandora pays a fee to the artist each time their song is played.

Considering all of these different elements and recognizing that we are truly still in the midst of understanding how music will evolve with the Internet, I present a revolutionary concept called The Next Big Sound.

The Next Big Sound

The Next Big Sound might in fact be the future of music on the Internet and the world. The concept of The Next Big Sound is that individuals, people just like you and me, "sign" musical artists to our very own record labels. Rather than waiting for DefJam, Columbia, Jive, Zomba, Universal, or Arista to come along and throw the musical artist a bone, this system circumvents that process by getting listeners who already enjoy the music to micro-finance the band (in a sense).

The concept of micro-financing is brilliant and is really only possible due to the power of the Internet. In a sentence, micro-financing allows bands to request $10 for 1,000 rather than $10,000 from one person. Due to the connectivity of the Internet and the ability to expose oneself and one's product or service, the Internet is an unbelievably conducive environment to allow this sort of transaction to take place.

Anyway, the website is also a place where individuals can expose themselves to new music. In fact, a person using the website (the Next Big Sound calls these people Moguls) is encouraged to sign musical artists that they think will gain enormous popularity. This is incentivized on the website by a Mogul Score, which is based on how many people sign the same musical artist after you. So, if I invest in Band X and they blow up and 20,000 other people sign them, my Mogul Score will be huge and I can gain a reputation on the site for spotting talent early.

The Next Big Sound also only allows individuals to sign a maximum of 10 bands at a time, which adds an added element of strategy into the mix. I like this component of the website, because it makes an individual think carefully about how they use the service and further augments the meaning of the Mogul Score due to the fact that it becomes slightly more challenging to gain a good score and thus more impressive when a person on the website does so.

There is a great deal of benefit to the musical artist who signs into The Next Big Sound. First, users of the website are looking to follow and invest money into bands in order to increase their own Mogul Scores. This will help the bands attain money if their music is perceived to be good by the user on the website. Second, the website provides free streaming music of songs to individuals before investment. Therefore, musical artists are likely to increase their exposure even in the event that they are not invested in.

The Next Big Sound has already received a great deal of press from the New York Times, Mashable, Daily Candy, Decision Factory, and The Guardian. The reviews generally speak to its innovative nature and its new way of approaching the music industry. After reading excerpts from these publications, I cannot agree more with them.

The Next Big Sound is a phenomenal concept that is a necessary wave of change that the music industry needs. It is fresh and cutting-edge. The idea has been worked through logically and the management has clearly considered it from several different angles in order to attain the desired effect that they set out to achieve. I look forward to seeing great things from this website and general concept in the future.

iTunes Play Count

2009-04-07T10:38:00.000-07:00

I recently ran a survey on Those Answers in order to measure how accurate the number one played song on an individual's iTunes reflects that persons preference for their current favorite song. There are several reasons that drew me to make this conclusion and thus seek out the necessary data to verify it.

First, I considered that when people enjoy something, they tend to expose themselves to it more. For example, consider a person who is a vegetarian. This person has consciously made the choice to not eat meat. They might choose to do so because they are against animal cruelty, are trying to save the environment, or are just opposed to the taste of meat products. As a result, they don't expose themselves to any meat.

I feel like this is true for most other things in a person's life. If they enjoy it, they will continue to expose themselves to it, if not, they will likely avoid it all costs. Therefore, a person would probably choose to expose themselves to their favorite song as much as possible, thereby increasing the number of play counts on their iTunes.

Second, I consider the psychological theory of the mere exposure effect. This theory states that as an individual is exposed to a stimulus more and more, they will gradually begin to like that stimulus. This reasoning is the reverse-logic of my first point, suggesting that exposure drives favoritism, rather than favoritism driving exposure.

I ran this survey without the intention of determining which principle is truly driving the amount of times a song is played on iTunes, but rather to check whether the top song played on a person's iTunes is in fact an individual's favorite song. In order to test either of my inferences about iTunes, I needed to determine whether if the top played song was in fact a favorite for people on average.

The results that follow provide both a visual and analytical attempt at answering the question: Is the number one played song on iTunes considered a person's current favorite song, on average?

Results

The results are based on the responses by 61 participants. 28 Females, 32 Males, and 1 Unidentified. The average age of a respondent was 21.24 years with a standard deviation of 3.82 years. The youngest respondent was 14 and the oldest respondent was 45. The data was compiled between March 3, 2009 and March 8, 2009.

Respondents were first asked to sort their iTunes so that it was ranked by Play Count, which is easily ordered by clicking on the tab at the top of the iTunes program. Participants in the study were asked to list the artist and the name of the song that came up as their most frequently played. The list to the left summarizes the 61 respondents' songs and artists that are the most frequently played song on their iTunes.

I'd like to point out the diversity in music tastes exhibited by this list. There is only a few artists that are featured more than one time. These include: Radiohead, Jack Johnson, Wilco, and The Fray. Part of my motivation to perform this survey was to increase the variety of music I am exposed to, and this list certainly has helped.

Following these questions, I found out how many times the individual had played their number one song. Respondents averaged 90.51 times played for their number one song on iTunes. This had a standard deviation of 91.80, with a high of 465 times played and a low of 5 times played. The median was 67 times played. With these amount of times played, on average, I think that this sample is pretty generalizable. I recognize that some people listen to their iTunes and music a lot more than others, but there is a wide diversity in the range of times played, which make the results of this study interesting to a large demographic of people (those who listen to music a lot, and those who do not).

The image to the right reveals a histogram of the number of times the most played song has been played on iTunes. As you can see, the majority of respondents have listened to their number one played song on iTunes less than 150 times. There are some individuals who have listened to their number one played song more than 150 times, but this makes up a vast minority of the respondents.

The next question I ask really gets at the crux of the question that I posed. I asked participants if the number one played song was their favorite song right now. According to the results, only 8 participants (13%), said that the number one played song on their iTunes was their favorite song right now. That is countered by 52 participants (87%) who said that the number one played song on their iTunes was not their current favorite song.
In the previous question to participants, I suggested that the top played song was their favorite song right at this moment. I anticipated that some people may have liked that song in the past, played it a lot, and have perhaps moved on to other musical endeavors. Therefore, I also asked if this song had ever been their favorite song in the past. The following graph reveals that there is a general spread as to when people liked their number one played song on iTunes.

There certainly isn't any prevailing time period at which this was their favorite song. It is important to note, however, that five individuals stated that they actually never liked their top played song on iTunes. There is a minor trend to take away from the respondent's answers; that being that the song that is most played was their favorite sometime within the last year. A good majority of participants agreed that this song was their favorite at some point within the last year.

I was also curious as to where the top played song on a person's iTunes ranks in terms of their all time list of favorite songs. This question gives participants a wider degree of freedom in terms of how much they enjoy their top played song on iTunes. Only a small number of individuals revealed that their number one played song on iTunes was their favorite. An even larger number revealed that they didn't even like the most played song on their iTunes.

A majority of respondents ranked their top played song on iTunes as one that would fall in their top 25 favorite songs of all time. There was also a relatively high frequency of individuals who ranked their top played song on iTunes as one that merely falls within their top 100 songs of all time.
Finally, respondents were asked to list characteristics about their second most played song according to their iTunes Play Count. The second most played song was played on average 70.14 times with a standard deviation of 70.08 times played. The most amount of times the second most played song was played was 380 and the least amount was 4 times played. The median amount of times the second most played song was played was 56 times.
Respondents were then asked to make a determination about whether they considered their number one or number two played song on their iTunes their personal favorite. This is another very good way of measuring the extent to which the number one played song is the current favorite of the person being surveyed. The results indicate an almost perfect split. 31 of the 61 participants (51%) indicate that their favorite song of the two is the most played song on their iTunes. This means that the other 30 participants (49%) chose their second most played song on iTunes as their favorite song.

Conclusion

The purpose of this survey was to test the validity of the Play Count function on iTunes as a measure of an individual's favorite song. According to the results, this measure's validity seems unlikely.

Only 13% of individuals considered their number one played song their current favorite. Additionally, when individuals were given the opportunity to decide between their most played song and second most played song on iTunes, the preference was almost perfectly split, which does not suggest that the top song on iTunes necessarily holds any extra clout in measuring a person's favorite current song.

However, the number one played song on an individual's iTunes may suggest certain generalizable attributes. First, it appears as though the most played song was the individual's favorite song at some point, but not necessarily at the present time. Additionally, the most played song on an individual's iTunes at least makes the top 25 list of all time favorite songs for a majority of people.

Though, I cannot assert that the most played song on iTunes is an individual's favorite song now, it certainly can indicate the musical preference of that individual at some point in time.

Change Management

2009-03-16T19:29:00.000-07:00

During a consulting interview, it is likely that a potential candidate will be given a brain teaser in order to assess the individual's ability to logically work through a problem.

With this in mind, I thought I'd attempt to unearth one of the most intriguing questions of all time and perhaps the greatest brain teaser ever given to a potential consultant candidate.

Some brain teasers include: Why are manhole covers round?, How many pennies would it take to reach the top of the Empire State Building?, How many golf balls fit into a Boeing 747? (Vault.com)

As you can see, the questions are quite abstract and probably would tell an interviewer a great deal about how that applicant works through ambiguous problems. But, after a while, these same brain teasers can become boring. Therefore, I wanted to work through my very own brain teaser that I find particularly interesting.

How much time does the average person engage in sexual intercourse during their lifetime?

In order to answer this question we have to consider many things, but it will be necessary to break down one's lifespan into sizable chunks that can be dealt with in a logical way, due to the fact that people are engaging in more or less sexual activity depending on their age on average.

First, some background information. I am only going to figure this out for the United States population. Other countries may be having more or less sexual intercourse over a lifetime. The average lifespan for an individual living in the United States is 78.06 years according to Wikipedia. This ranks as tied for 30th place in the whole world. The life expectancy is slightly different for males and females, but for purposes of this brain teaser, we will just take the average age.

Now we have to consider when people actually start having sexual intercourse. According to a publication by American Sexual Behavior, an individual's first sexual experience will occur around the age of 17 years. I will then assume that once an individual starts having sexual intercourse they will be able to continue to do so. Therefore, there are 61.06 years of life in which sexual intercourse is possible on average.

However, the frequencies of sexual intercourse are different depending on the phase of life you are in. Consider the frequency of sexual intercourse individuals will typically have when first starting to have sexual intercourse versus when someone gets married versus when someone is a lot older.

To uncover the frequencies of sexual intercourse in one's life I drew research done from the 2005 Durex Global Sex Survey. The results are based on a responses from almost 317,000 people worldwide. This is considered one of the most comprehensive sex surveys in the world.

According to the survey results, people aged 16-20 are engaging in 90 sexual experiences a year compared with 108 sexual experiences for 25-34 year olds, but the highest frequency of sexual intercourse is occurring for individuals aged 35-44 years with 112 sexual experiences a year.

Based on this data, I constructed a graph that would express the average amount of times per year an individual was having sexual intercourse at each age between 0 and 78.

Looking at the graph, I want to explain a couple features. First, the solid blue line is based on factual data that was attained and the black line is a polynomial function that best fits the data provided. The blue line is at 0 until age 17, because this is the first time that people engage in sexual intercourse on average according to documented research. Then, I graph the levels attained by Durex's Sex Survey for ages 16-20, 25-34, and 35-44. According to Durex, 35-44 year olds are having the "most" sex. Therefore, I consider the amount of 112 sexual intercourse experiences a year as my maximum and projected the data after the age of 44.

In order to make these projections, I found out that "Among 60- to 70-year-olds with partners, 46 percent of men and 38 percent of women have sex at least once a week" (HealthyMe). Therefore, I assume that at age 65 individuals are having 50 sexual experiences a week on average, which is a decline of 2.95 sexual experiences per year from 45 years old to 65 years old.

I then assume that at age 78 there are no longer any opportunities for sexual intercourse, on average, and therefore find the rate of decline from 50 sexual experiences at age 65 to 0 sexual experiences at age 78. This is a decline of 3.85 sexual experiences per year, on average.

Using the Trendline tool in Excel, I fit the graph that I had constructed with a binomial function that could generally explain for the amount of sexual intercourse an individual has per year, on average, based on the research I had collected.

The binomial function is equal to:

Where x is equal to the age of the individual. Using this formula, I was able to figure out the amount of times per year an individual has sexual intercourse from age 17 through 78, on average, for each year.

In order to figure out how many times during a lifetime an individual will likely have sexual intercourse, I find the sum of the frequency of sexual intercourse episodes a year for each year from 17 through 78. This is expressed as:

Performing this calculation, I arrive at a total of 4835.05 instances of sexual intercourse over the average lifetime for the average individual in the United States.

But, I am not done yet. I now need to find out how much time this equals. According to the Durex Global Sex Survey, "Americans spend 35 minutes on foreplay and sexual intercourse each session" (Source).

Therefore, by simply multiplying 4835.05 by 35 minutes, I arrive at the total amount of time having sexual intercourse in minutes for the average American. The amount of time spent having sexual intercourse over the average lifetime is therefore: 169,226.8 minutes.

This value is equal to 2820.4 hours and 117.5 days. In terms of an individual's average lifetime, the amount of time having sexual intercourse only equates to 0.41% of total life activities, on average.

Conclusion

In order to figure out the amount of time an individual has sexual intercourse over a lifetime in the United States on average, I found out when people start having sexual intercourse and what the average life expectancy is. This gives an average "window of opportunity" for sexual intercourse.

Then by researching the frequencies of sexual episodes per year for various age segments of the population, I was able to determine a binomial function that expresses the amount of sexual experiences had for each year during the "window of opportunity."

I then added these to arrive at the average amount of sexual intercourse experiences had in a lifetime. I found that it was approximately 4835 sexual intercourse experiences in an average American lifetime.

I then found out the average length of time a sexual intercourse experience lasts, 35 minutes, and multiplied this number by the amount of sexual intercourse experiences over an average lifetime.

This calculation gives us our answer to the brain teaser, "How much time does the average person engage in sexual intercourse during their lifetime?" The determined value is 169,226.8 minutes or 2820.4 hours or 117.5 days or 0.41% of the average person in the United States' life.

Bar Lines

2009-03-11T08:00:00.000-07:00

Recently, I surveyed several college students to get a gauge of how significant the length and time involved in waiting in line to get into a bar is on people's preferences to go to that bar. I think that there are implications for bar owners and the people who work their doors in order to maximize positive feelings relating to their bar, even if only from the experience of waiting in line.

My findings suggest that people are most definitely waiting in line and have a threshold in terms of both people waiting in line and time devoted to waiting in line at which a person becomes deterred from the establishment entirely. This is obviously on the average and doesn't necessarily explain the behaviors of all individuals, everywhere.

Results

The results of the survey are based on 82 respondents. The respondents varied in age from 19 to 27, with a mean of 21.6 years. The respondent's genders were evenly distributed (Males = 41, Female = 40, No Response = 1).

Generally, it appears as though the wait time in lines is generally pretty quick, however, there are some individuals who feel as though they spend lengthier amounts of time in line ranging from around 15 minutes to 25 minutes. These are quite significant time investments in order to experience the inside of a bar. There was no statistical finding that indicated that female respondents wait in line for a different length of time than male respondents, which is surprising.

Here are the results of one of the questions in the survey. It reveals that the respondent's in this survey are definitely influenced by the length of the line in terms of going to a bar. The majority of respondent's indicated that between 20 and 30 percent of the time they would not go to a bar purely based on the length. Several respondent's had even higher frequencies of this preference.

The preceding distribution of respondents is even further warranted by the finding that the length of a line outside of a bar is quite a deterrent to those individuals who would like to attend a bar. Taking a look at the results from this chart, one can see that a majority of respondents felt as though the line outside of a bar to be quite a large deterrent, measuring an 8 out of 10. A very small number of respondents felt as though the length of a line had a small degree of deterrence, heavily outweighed by larger degrees of deterrence.

The importance of the length of a line outside of a bar to an individual also tells an interesting story. Based on these results, it appears as though lines are generally quite important to individuals in evaluating which bar to go to. A high frequency of individuals had this ranked very high in importance, while other individuals had this ranked as only moderately high. However, it is important to note the lack of low importance that a bar line plays in the minds of individuals going to bars. It is clearly something that they think about.

The number of people also seem to have an influence on the willingness of an individual to wait in a line to get into a bar. It appears as though there is a definite threshold at which individuals become deterred from waiting in line based on the perception of how many people are in line. At the point the line reaches 45 people, individuals are just not willing to wait anymore in that line. While the majority of individuals begin to be deterred from a line that has 25 people in it, this is not yet the point at which people completely give up on the line. At 45 people, or at least the perception of 45 people, becomes far too daunting to the person waiting to get in line and he or she thus removes him or herself from it.

People also tend to go to bars mainly because they have friends that are there. As the results of the pie-chart above indicate, a large portion of people choose a bar based on the fact that they have friends there. Other competing elements to this are the atmosphere of the bar and drink specials there.

Finally, I looked into whether or not people were even inquiring about the length or size of a line outside of a bar before even getting to the bar. I feel like this is another suitable gauge of indicating how important the line outside of a bar is in determining an individuals choice and behavior. A large majority (70%) have inquired about the line ahead of time, therefore, suggesting that the line is something that people are thinking about even prior to actually arriving at the bar.

Taking all of these findings together, I propose some thoughts in my conclusion.

Conclusion

The length and size of a line outside of a bar has significant influence on our preference to enter into that bar or even wait in line. There are several reasons that draw me to make this conclusion. First, people are inquiring about the size of a line to a bar, either by texting or calling friends already at the bar or in some cases asking cab drivers whose typical routes may take them to and from the bar, which suggests that this is important information in the process of personal decision making. Most people also rank the length of the line outside of a bar as a very important determinant in going to a bar.

Based on the frequency that individuals don't attend bars based on the length of the line alone, it is clear to see that bar line length ought to be considered by management of the bars.

Alternatively, it may be management's prerogative to keep a longer line outside of the bar in order to feign that the inside of the bar is very cool. This adds an element of exclusivity to the bar, which is a concept that I chose not to test in this current survey. Exclusivity is important, perhaps in bigger cities and when individuals have more money to spend, but in a college town, exclusivity loses its appeal the moment people have to wait in line for too long or there are too many people in line to begin with.

There is a tricky balance to be struck by people moderating lines outside of a bar and the choice of management in terms of how exclusive he or she would want the bar to be.

However, there can also be services that bars may want to provide to their customers in order to keep them in the loop as much as possible, seeming though the line is an important determinant for individuals attending bars. Bars could look into broadcasting the length of their line over the Internet and making it extremely accessible via iPhone or Blackberry so that the knowledge can be portable. This will help keep customers informed and content.

Do Not Raise Taxes: Letter to Stabenow and Levin

2009-03-05T22:09:00.000-08:00

I have been watching a great deal of programming regarding the current economic crisis. I couldn't help but stop myself from sending this letter to the current Senators of the state of Michigan about what a mistake it would be to raise taxes on the richest portion (those individuals who earn higher than 250K a year) of the United States. It would be madness and President Obama would destroy the essence of this country. Please read the letter to further understand why this cannot happen.

Senator Levin,

I must admit, this is the first time I have ever written you. While there have been several incidents over the past couple years that have disturbed me to such a point that I have thought to seek out higher powers in order to alleviate their effect, I have decided that I finally must say something.

There is no way that taxes on the richest families (250K+) in the United States can occur as President Barack H. Obama has proposed.

I understand that Treasury Secretary Timothy Geithner has suggested that the tax increases are, "necessary to make a down payment on health care reform and to limit future budget deficits (AP, Key Democrats oppose Obama's tax deduction plan, http://news.yahoo.com/s/ap/20090305/ap_on_go_ca_st_pe/obama_taxes).
While I support health care reform, we must consider our priorities considering the current economic situation. The establishment of health care reform would be ideal, but it is not the time to do so, and President Obama and Congress need to understand this. Our economy, our livelihood, our way of life, and our stature as a Superpower in the world is at stake if our economy fails us.

We must prioritize our economy now. It is very sick. It is afflicted with what financial pundits refer to as a "Credit-Crunch." The system has stopped flowing. Money has no velocity.

Consider a river that doesn't flow. It is no longer a river, but a still-pond. We cannot allow our economy to go from a river to a still-pond; money must flow in order for the United States of America to function.

By taxing the richest portion of the United States, we are sucking more of that money out of the system. We are further "crunching" the worst Credit-Crunch that has ever occurred. These individuals will breathe life back into the Credit markets by helping the velocity of money. These individuals will be the first ones to go back to banks and get loans that will be wise investments for the banks themselves, because they are loans to intrinsically wealthy people. They will likely not default (what has led us to our current financial mess) and will thus spur the velocity of money and life back into the overall system. These are wise people to handle money for the United States economy. I trust them and you do too.

I am currently a student at the University of Michigan - Ann Arbor. I am a senior majoring in Organizational Studies and am weeks away from graduation. I work at the Michigan Telefund, in which I call alumni and student's parents soliciting donations to fund the University of Michigan's $7.5+ Billion endowment.
Soliciting donations from the American people today is laughable. People have been laid-off, are getting divorced, and don't have a cent to give to the University or anyone for that matter.

I told a parent tonight that I didn't choose the job because it was going to be easy, I chose it because I knew it was going to be hard.

Regardless, if people funding the education of students at the University of Michigan (where tuition is $47,000 a year) can't part with $25, who possibly can?

If we take more money away from the richest demographic of the United States, they will literally have nothing. We will destroy this country from the inside out as all great empires have done through the ages. We can error as they have, or we can learn from our mistakes.

Thank you,
Tyrone Schiff

Identity

2009-03-02T09:04:00.000-08:00

Mathematics is a complex and beautiful science. It is a logical poetry that can be to some just as majestic as the writings of Shakespeare, Cummings, Emerson, or Blake. Several years ago I was introduced to this Identity riddle of sorts.

In mathematics, each value, whether it is an integer or a decimal or a fraction or anything really, has its own value that is unique to it. The number "5" is the number "5." There isn't a lot of argument in this. Surely you can depict the number 5 in several different ways, but there is only one value for that number. 5 is not equal to 7, nor is it equal to 0.673, nor is it equal to the Sin (60 Degrees).

By now, I hope you get the idea that numbers have their own identity. But the proof I am about to show you may alter your view of mathematics and perhaps even reality in general.

The sequence is quite simple really. I'm going to show you several variations of the same fraction and then I am going to suggest that if patterns hold, and in this case they most certainly do, then there is a discrepancy as the value approaches the number 1.

Enough of this abstract jibber-jabber. Let me work through the problem with you now. This problem involves the fractions and decimal values when a number is divided by 9.

When a number is divided by the value of 9, a really interesting pattern seems to emerge in the decimal value that results. I'm going to give you a couple examples and I'm going to see if you are able to decipher the pattern.

For instance, when the number one is divided by 9, the result in decimal form is .111 repeating. This means that until infinite the number 1 will reoccur. Visually it is depicted as follows:
Great. So, just so that everyone is up to speed, there are essentially two things that we learned from this one fraction. First, that the decimal reoccurs until infinite, and that the decimal number is the same number that is being divided by. In this case that would equal 1.

But, lets look at a couple other examples of numbers divided by 9 to see if there is an emerging pattern that we may be able to formulate.

Consider the fractions and decimal results from the number 4, 7, and 8:

As you can see, there is most definitely a pattern that is beginning to emerge when values are divided by the number 9. In all of these cases, the result is a recurring decimal until infinite and the number that is recurring is the same value as that being divided by. Excellent.

Well, with this in mind, that the number that is being divided by creates a decimal that is recurring until infinite while also being the same number as the value being divided by in the decimal, a minor problem arises when one considers the case of the number 9 divided by itself.

Any number divided by itself is 1. This is the result of the multiplicative identity which proves that all numbers that are divided by itself render the same number, 1.

However, this is slightly disconcerting given our current pattern involving numbers that are divided by 9. If we notice that 1 divided by 9 is 1 "repeating," and 4 divided by 9 is 4 "repeating," and 7 divided by 9 is 7 "repeating," then surely the same must hold for 9 when divided by 9 is 9 "repeating." According to the multiplicative identity this just isn't the case.

This strikes me as a little perplexing, and the desired effect of this blog post would be to elicit similar feelings in you. There is a definite conundrum here. There are two numbers that can be proven separate ways that equal the same thing, but are just not the same. In my opinion, this defies most of what mathematics is, a proof of why something is as it is. And though in math you can prove things several ways and arrive at the same result, the result here is different.

I hope you enjoy pondering this complexity as I have.

Menlo Innovations

2009-02-22T20:41:00.000-08:00

I get so impressed with ideas that just seem to make absolute sense. They are a lot rarer than what may be expected also. But recently, I was exposed to a business that has chosen to shift the paradigm. They are doing things far differently than what other companies do, but they are executing their approach and are achieving phenomenal results.

The company I am referring to is Menlo Innovations which is located in Ann Arbor, Michigan. Being a student at the University of Michigan, and always keeping an eye and ear out for great ideas, it was nice for me to hear of such a cool company around my neck of the woods.

Menlo Innovations is a software company that provides solutions to their customers. But they do so in a way that is not at all the prescribed method by the industry, and for that very reason, I think they are succeeding.

The origins of Menlo Innovations can be attributed to the economic decline following the tech-bubble burst of 2000. The CEO of Menlo Innovations, Richard Sheridan, was layed off at his prior job as a vice president of software development and needed to look for something to do. While he tried very hard to find a new job, his attempts were unsuccessful, and therefore, he decided to get together with a few other people and begin his own company: Menlo Innovations.

The name Menlo Innovations came from the invention factory initially established by Thomas Edison in 1876 located in Menlo Park, New Jersey.

Similar to the images of Edison's invention factory, the office of Menlo Innovations is set up as an open space in which communication and collaboration is maximized. The atmosphere is relaxed with a majority of the workers in their younger ages just post an undergraduate or graduate degree. The entire essence of the company evokes a similar feeling to the general state of Kerrytown, Ann Arbor, where the office is located.

If you know anything about Kerrytown, you already know it is the home of the famous Zingerman's Delicatessan, where people come from far and wide to buy sandwiches that cost $15 and balsamic vinigrette from Italy for $100. Across the street is Sparrow Market, yet another staple of Kerrytown. Sparrow Market is a fresh produce market that provides the inhabitants of Ann Arbor with high quality, fresh food. Just next to Sparrow Market is Monahan's Seafood which has been around for ages and has lovely fish and chips for a reasonable amount. Finally, you will find Kosmo which has some of the greatest B-Bim-Bop and original hot sauce you will likely ever have.

All of these elements combined create an atmosphere that is so unique to Kerrytown, it is hard to truly convey in words. But, amidst all of this, Menlo Innovations runs its factory just upstairs from Sparrow Market, the company itself adding to the Kerrytown atmosphere.

What makes Menlo Innovations so unique in my mind is their approach to dealing with software issues. They have established a method called High-Tech Anthropology, which aside from its excellent name, also adequately describes their method unbelievably well.

In a recent presentation I went to at their offices, a monthly "Taste of Success" meeting, in which Richard Sheridan describes why the software industry is going about their business all wrong and why Menlo Innovations has truly narrowed in on the correct approach, I was able to learn about the intricacies of High-Tech Anthropology and why it seems to work so well.

To begin, its important to understand what an anthropologist is. In the simplest sense, an anthropologist studies culture and studies individuals in that culture. One of the things that Mr. Sheridan talked about initially was how one goes out and finds information these days. He asked the crowd at his discussion, and every seat was filled, and some of the best suggestions included going to Google, the Internet, or reading about it in books.

Mr. Sheridan then took it a step further and asked how we would learn about animals. Would we go to the zoo to do so. Many of the audience members agreed, but Mr. Sheridan was quick to show the downfalls in this approach.

He explains that its important to go and study something in its natural state. See how it functions, and you have to do that up close and personal. He cares very deeply about truly getting to know his customers, how they live their lives, and what would be most beneficial to them. This is where the anthropology of Menlo Innovations comes into play, and it is such a critical element to their success.

Then, what he has done is bridged the gap between the lives of his customers and the software designers, who he has aptly named "homo logicus" because of software designers propensity to do things logically and sometimes forget about the end user in the process.

To combat this, Menlo Innovations uses a "persona web" that is designed based on a marketing approach. It focuses on targeting the largest potential user of the software. In so doing, it also personalizes the software for the developers, which makes them think twice about adding features that may be unnecessary or consider how to present those features in order to make the software as effective as possible. When dealing with projects, software developers actually refer to an individual's name who has been given a biography with certain behaviors associated with their software usage and things that that ideal person would like to accomplish.

The people that are created are fictional, but it is a really innovating means of making the project personal. Software developers are encouraged to ask themselves, "How would this feature benefit Jim or Jack or Jill" depending on the particular project at hand. Therefore, these "personas" become a decision making tool as well as a personalizing tool.

I think Menlo Innovations has really taken an innovative approach to the software industry and it really just makes a lot of good sense. I expect their company to continue to perform well as it has done so already and perhaps even shift the industry standard in the years to come.

You can read more about Menlo Innovations in this Forbes article.

Committee Proposal

2009-02-09T15:54:00.001-08:00

Sharing knowledge is how learning happens. Therefore, I thought up a way in which I could innovate the capabilities and capacities of my own concentration at the University of Michigan. I concentrate in a discipline called Organizational Studies (OS) which is run through the College of Literature, Science, & Arts. There are two other departments that I think are very similar to OS, but the University of Michigan has not exploited and harnessed their information as best as possible.

Below is a proposal I sent to the Organizational Studies department to consider in the future:

I propose some sort of committee, group, or body of either faculty members or students (or both) that draws together the disciplines of Organizational Studies, Industrial and Operations Engineering, and Operations and Management Science.

In my opinion, these three different departments tackle very similar goals but take their own unique perspective. To elaborate, I think that all three of these fields are in pursuit of making organizations more efficient and work more seamlessly.

Organizational Studies takes a psychological and theoretical approach to this problem. Students from this discipline think about the external and internal levers of organization and what strategies to employ in order to maximize efficiency. Organizational Studies students think about the “culture” of an organization and the “environment” in which it operates.

Operations and Management Science in the Ross School of Business takes a far more structured and business-oriented approach. I envision their methodologies of analysis to be “bottom line” related and in terms of how changes in operations or management affect the balance sheet and income statement. Decisions are not based on feel but rather numbers.

Finally, Industrial and Operations Engineering are involved in how the systems within an organization work, and the ways in which we can measure them as to achieve maximum results. This discipline makes individuals think about the processes that organizations perform.

Looking at this very brief description of these three departments, it is clear to see that all of them emphasize the organization. However, their approaches are significantly different to one another.

I think it would be beneficial to the academic community, as well as, the students at this university if we brought these three groups together and tried to share knowledge. I think that each one of the departments could benefit greatly from hearing a perspective different to their own, but essentially directed to the same result.

It is worth considering in the years to come.

Streak For The Cash Analysis

2009-02-08T14:42:00.000-08:00

ESPN is the Worldwide leader in sports. They are the absolute behemoth when it comes to sporting entertainment. The enterprise, which is owned by Disney, is a multi-conglomerated, multi-faceted sporting portal that sports fans from around the world use. To begin, their website is the 65th most visited on the entire Internet (Alexa.com). This is all websites, in all languages, for all countries around the entire world. That is absolutely staggering and there is no other sporting portal even close to its Internet rank.

In addition, ESPN also provides an almost sickening array of television channels. A brief list of their channels include: ESPN, ESPN International, ESPN 2, ESPN News, ESPN Classic, ESPN Deportes, ESPNU, ESPN Plus, and ESPN Star Sports. Note that this is an abbreviated list. There are several other ways in which ESPN has figured out for you to consume their sports media.

They have their own magazine, their own award show, their own cell phone, their own line of books, and even a restaurant chain devoted to ESPN.

Some of the prominent sporting rights that they have contracts for include: Monday Night Football, the Fifa World Cup, Major League Baseball, Major League Soccer, The NBA, Arena Football, Various PGA tour events, NASCAR, BCS College Football games, lots of college basketball.

The reason for sharing the scope of ESPN with you before I get into the Streak For The Cash is to evidence the empire that ESPN has created. Sports can occur at any time and at any place, but ESPN has worked so hard to differentiate their product and bring it to the fans that want to see it no matter where in the world you are, no matter what you're doing. They are a truly incredible organization, and I commend them for continually being one step ahead of the curve and truly seperating themselves in the market.

Streak For The Cash

Now that we're done understanding just how amazing ESPN is, I wanted to look a little closely at one of the more incredible accomplishments of this sports entertainment giant. Several months ago, ESPN launched the "Streak For The Cash" competition on their website.

The idea behind the game is simple. All one has to do is select the winner of a particular outcome that ESPN provides you with. All different types of sporting events are included in the Streak For The Cash. Often times, the game will ask the participant to predict the outcome in terms of a simple win-lose scenario, but other times, it asks, for example, who will score more points, when will this scenario occur in the game, etc.

The idea behind the game is to predict as many outcomes in a row correctly, as if to create a streak of wins.

There is a massive incentive for getting to 27 consecutive correct predictions and that is the grand prize of $1,000,000. In simple math terms, the probability of correctly predicting 27 outcomes with two possible choices each time is 1 in 134,217,728. That is an absurd probability. Frequently, you will see participants with a streak of 18 or 19 on the Leaderboard which is displayed on the front page of the site, but this is still a long way off from 27.

Anyway, the Streak For The Cash website also provides some interesting participating metrics along with each possible pick. They show the percentage of participants who have selected each outcome and they also indicate to what degree that outcome is being selected by categorizing the scenario into one of four different categories: cold, warm, warmer, hot.

I wanted to find if there was any sort of relationship between the percentage breakdown in each scenario and the probability of success. One would assume that those scenarios that have close to 100% picking one particular side in a scenario would be more accurate. The results I found are most definitely surprising.

Methods

In order to perform this study, I went back through all of the scenarios available on the Streak For the Cash website since January 1, 2009 up until January 24, 2009. There were a total of 263 scenarios in this time frame. I then set up a simple Excel document which chronicled the percentage picking the winner and the percentage picking the loser. In the same document, I kept track of the degree to which that scenario was being picked and which sport the scenario took place in.

Results

The following results were found based on my study of the Streak for the Cash:

Distributions - Percentages
In 73 cases (or 27.8%) of the game the percentages have been 90%-100% and 0%-10.

In 52% of the cases, the majority, i.e., the 90%-100% have been accurate, while 48% of the time the minority, or between 0%-10% of the players have been correct

In 66 cases (or 25.1%) of the game the percentages have been 80%-89.9% and 10%- 19.9%

In 52% of the cases, the majority, i.e., the 80%-89.9% have been accurate, while 48% of the time the minority, or between 10%-19.9% of the players have been correct

In 52 cases (or 19.8%) of the game the percentages have been 70%-79.9% and 20%-29.9%

In 48% of the cases, the majority, i.e., the 70%-79.9% have been accurate, while 52% of the time the minority, or between 20%-29.9% of the players have been correct

In 40 cases (or 15.2%) of the game the percentages have been 60%-69.9% and 30%-39.9%

In 60% of the cases, the majority, i.e., the 60%-69.9% have been accurate, while 40% of the time the minority, or between 30%-39.9% of the players have been correct

In 32 cases (or 12.2%) of the game the percentages have been 50%-59.9% and 40%-49.9%

In 37.5% of the cases, the majority, i.e., the 50%-59.9% have been accurate, while 62.5% of the time the minority, or between 40%-49.9% of the players have been correct

Distributions – Degree
There were 80 cases of “Cold"

The majority, i.e., percentage equaling 50% or greater was correct 46.25%

There were 65 cases of “Hot”

The majority, i.e., percentage equaling 50% or greater was correct 55.4%

There were 59 cases of “Warm”

The majority, i.e., percentage equaling 50% or greater was correct 52.5%

There were 59 cases of “Warmer”

The majority, i.e., percentage equaling 50% or greater was correct 49.2%

Distributions – Sport
There have been 11 opportunities with Tennis

The majority has been accurate 45.5% of the time

There have been 11 opportunities with Golf

The majority has been accurate 72.7% of the time

There has been 1 opportunity with Mixed Martial Arts

The majority has been accurate 0% of the time

There have been 61 opportunities with the NBA

The majority has been accurate 54.1% of the time

There have been 84 opportunities with College Basketball

The majority has been accurate 44.0% of the time

There have been 10 opportunities with College Football

The majority has been accurate 70% of the time

There has been 1 opportunity with Women’s College Basketball

The majority has been accurate 0% of the time

There have been 13 opportunities with the NFL

The majority has been accurate 38.5% of the time

There have been 48 opportunities with the NHL

The majority has been accurate 60.4% of the time

There have been 22 opportunities with Soccer

The majority has been accurate 36.4% of the time

There has been 1 opportunity with Boxing

The majority has been accurate 100% of the time

Conclusion

Understanding this information together, in order to maximize one’s probability of success in forming a streak the ideal scenario based on Streak For the Cash data would be a distribution of participants between 60%-69.9%, where the degree of Hot or Not was set to “Hot”, while selecting the sport of Golf or NHL.

New York Teaching Fellows Essays

2009-02-04T22:06:00.001-08:00

I am applying to the New York Teaching Fellows. I think I would make an incredible, dedicated, and inspiring teacher. This essay that I wrote for my application is perhaps one of the best pieces of writing I have ever done. I am so proud of it that I decided to share it with you. I hope you enjoy.

Why do you want to be a teacher? What experiences have led you to want to teach in a high-need school in New York City?

I have always wanted to make a difference. When I was in middle school, I joined student government, because I wanted school funds allocated more responsibly. When I was in high school, I raised money to donate a car to a cafeteria server who had fallen on hard times. When I got to college, I took on the Ann Arbor city council and demanded increased lighting in the darkest and most crime ridden areas of off-campus student housing. And here I am at the end of my undergraduate career, waiting for the next chapter of my life to begin, and I am still not satisfied. I have not grown tired of facing a daunting obstacle and overcoming it. I am not ready to give up on changing the world for the better. Quite simply, I want to become a teacher, because I know I can make a difference.

I want to bring a fresh approach to teaching. To do this, I plan on using my natural ability to innovate. I think this is the most important aspect of teaching in a high-need school currently. Why? Because something is wrong! The disparity between the have and have-nots is overwhelming. Education can either work to perpetuate this gap, or it can be the much needed solution. Something must change if we are to correct the injustices and inequalities currently inherent to the system. This is why the role of the teacher must be to innovate. My concentration at the University of Michigan, Organizational Studies, has equipped me with the tools necessary to pinpoint organizational failure and then mold it from the inside and out so that it may succeed.

One way that I hope to innovate is by using and making technology a significant part of my student’s curriculum. Personally, I have a passion for technology and a fascination with the Internet. I have designed my own websites, write my own weblog, and read about new technologies. There is a great deal of importance in making this a priority in education. I think that all productive citizens use technology in their daily lives, and therefore, if these students are to be productive they must be well versed and keep pace with current technologies.

I recognize also that innovation is not always as structured and strategic as my abovementioned paragraph makes it out to be. However, I feel confidently in my ability to deal with ambiguity. When presented with the task of strategically mapping out the future growth of an air filter company to the year 2020, I did not retreat or back down from the challenge. Rather, I excelled and logically and rationally approached the situation and handled it maturely and professionally. I expect the classroom to throw ambiguities at me, but I know I am well prepared.

Finally, I want to be a teacher because I think it will be a good fit for me and a profession that I will succeed in. I think that aside from being a great educator, I will also be a role model and mentor to my students. I am proud of who I am and what I am becoming. In high-need schools, sometimes the most valuable commodity is a positive male role model.

And I make this decision to teach knowing that I will likely meet a challenge and test of a lifetime. But I am up for it. I am ready.

Describe something you have accomplished that makes you proud. What did you learn from this experience that might help you to ensure high academic achievement for all of your students?

Have you ever watched a chameleon change color? It is quite a remarkable thing. Just based on its surroundings, it has the ability to adjust its appearance in order to make it blend better to its background. This has made the chameleon particularly good at adapting to its environment. In this regard, I feel like a chameleon and I are quite similar.

You probably would not notice it at first by my appearance or even if I opened my mouth and chatted with you for a short while, but I was born and raised thousands of miles away from the United States of America. In fact, the first twelve years of my life took place on the southernmost point of the African continent in the Republic of South Africa.

While in South Africa, my capacity to adapt and change was cultivated. I witnessed the fall of apartheid first-hand, which altered the dynamics of the country in several ways. I, along with the rest of the country, felt like we were part of a transition, and we all worked together to adapt to the new way of life. Though I was very young, I thank my mother for placing me in front of the television to view the release of Nelson Mandela and to watch the news coverage of the 1994 free election, explaining to me that I was watching history unfold.

Immigrating to America brought on another set of challenges that tested my adaptability. At first, I had a thick South African accent which made communicating slightly awkward. When friends decided to get nostalgic and refer to cultural references from their childhood, I felt lost and out of place. For the longest time, I felt as though I was carrying around this label of being from South Africa and nothing more.

But rather than getting frustrated and refusing to accept my reality, I persevered and let my natural ability to adapt and to change take its course. And even though it did not happen overnight, today I feel accepted and pleased with the way I am perceived.

This is an enormously powerful insight that I get to live with everyday, and I think would be equally powerful in promoting the success of my students. The lesson I learned is rather than resisting change and giving up because of my frustrations, I learned to embrace change by adjusting to it and being persistent until I found the right way.

I feel like these are fundamental qualities in order to ensure high academic achievement. Learning is a grueling and arduous process that needs patience and commitment. I believe that I embody these traits and want to help my students realize them.

Deliciousness to Cost Index

2009-02-02T08:56:00.000-08:00

It has been a while since I posted last, and I suppose that may be the result of my laziness or just inability to sit down for a long enough period to write something. Since my last post, which was very early on in December, (and here we are already at the start of February), I have traveled to New York and Washington, DC. Both trips were phenomenal and I enjoyed my experiences there and the people with whom I shared it.

Either way, the reason I share that information regarding my trips is while I was in New York, a really interesting thought occurred to me and some of the people I was with. To give context to what I'm about to share with you, it's incredibly important to understand that New York's cost of living is astronomical. According to InfoPlease.com, the cost of living index for New York (Manhattan) was 212.1 in 2005. The next closest was San Francisco at 177. This should provide some sort of measure as to how unbelievably absurd it is to live a daily life in New York.

However, people still live in Manhattan and love the place. They say, "Who cares if it's really absurdly overpriced, this is the greatest place in the world to be." And you know what, I agree with them. New York is a fantastic city. Each street, each alleyway, each little neighborhood has its own unique feel, and there are so many of them that you may be able to spend a lifetime exploring this tiny island. After spending just a short time there, I can understand the allure.

Yet, there has got to be some way to objectively judge quality. Due to the fact that all goods and services are inflated in price, one may not recognize a good deal when he or she first sees it.

In order to combat this discrepancy, it is a must to create the Deliciousness to Cost Index. I attribute the name of this index to a fellow I met while in New York. We were walking around and thinking about places where we could eat. He suggested that we go to a place called Mamoun's Falafel, which he posited had the highest deliciousness to cost index in all of New York City.

Obviously, it is hard to verify his claim that Mamoun's has the highest deliciousness to cost index, considering that there are over 16,700 restaurants in Manhattan (which equals one restaurant a day for 46 years apparently). However, the food was definitely delicious, and it did not cost a bundle of money. Two critical factors in determining the index.

I suppose I've provided an example in which the Deliciousness to Cost Index may come into effect, but I haven't really provided any means through which one calculates this value. I provide the analyses here.

Deliciousness to Cost Index

In order to arrive at the most sophisticated and accurate portrayal of the Deliciousness to Cost Index, I consulted with an acturial scientist at the University of Michigan - Ann Arbor. My conversation with him relating to the index was arduous and lengthy but our result is flawless.

The determination of the Deliciousness to Cost Index is based on the following equation:

Record the value (in Dollars) of the good (or service if edible)
Determine the amount of value (in Dollars) you feel that good (or service if edible) was actually worth
Divide the number from process 1 by the number from process 2
The quotient of process 1 divided by process 2 is the Deliciousness to Cost Index

As you can see, the process by which one arrives at the Deliciousness to Cost Index (DCI) is rather simple, yet it represents something very meaningful to the individual. In order to illustrate this point, I can provide an example.

Johnny is in Manhattan and enters into a restaurant called The Smith. While in The Smith, Johnny decides to order an Ahi Tuna Salad. This dish includes: mesclun greens, french beans, black olives, cherry tomatoes, and roasted peppers (according to The Smith). According to The Smith's online menu, the Ahi Tuna Salad costs $17. Johnny eats his meal and is pleasantly surprised by the rich taste, smooth texture, and is filled with content by his last bite. As a result, Johnny leaves The Smith happy and thinks that he would have easily paid $25 for such an experience. Therefore, The Smith would have a DCI rating of 1.47 ($25/$17).

Very simple measure, but it expresses how the individual feels about their purchase. It would be ideal to always have a DCI above 1.00. That would mean that the food, and its respective deliciousness, is consistenly beyond your expectations based on the price point originally given.

I think that a tool like the DCI could be enormously valuable to restaurants, bakeries, or any establishment that sells goods for consumption at a price. By getting an average of the DCI for consumers of a particular establishment, owners can determine at what price the public values their goods. If a restaurant sees that their DCI is on average 1.50, or consistently above 1.00, they may want to consider raising prices to that price point, because they are exceeding their consumers expectations.

A DCI of less than 1.00 is cause for concern, however. This means that people are consistenly unsatisfied with what they are eating. This can be counteracted by lowering prices of the goods being sold or by improving the quality (aka deliciousness) of the good.

Conclusion

In this blog post, I propose the Deliciousness to Cost Index (DCI). The method to arrive at the DCI is to take the actual value of a good and divide it by an individual's perceived value of the good. Though the arithmetic is simple, it conveys an enormous amount of information that can be used effectively by owners of restaurants and other establishments that provide goods for consumption at a price. This is only truly achieved when the DCI is found on average amongst most or all consumers.

The next time you walk out of a restaurant, calculate your own DCI. You may be surprised.

Motive Imagery and The Spread of Ideas

2008-12-04T15:54:00.001-08:00

A couple weeks ago I ran a quick survey on my website, Those Answers, in order to gather data about the affect (if any) that motive imagery may play on the spread of ideas. I was interested in finding out if there was one particular class of motive imagery that people are more or less likely to disseminate.

Motive imagery is a psychological phenomenon that is rooted in the Thematic Apperception Test (TAT), in which a person tells a fantastical story about anything or may be guided by the use of images, sounds, or ideas. Based on the language and tones that people use to elicit their thoughts, whether they are stern or sweet, hopeful or sad, angry or happy, can indeed tell you about the current psychological state of that individual.

Motive imagery is then broken down into three core categories (there is actually a fourth dimension to motive imagery, but that will not be explained in this post). The classifications of motive imagery are rather simple, but are phenomenally complex when one explores their intricacies and how they were originally determined.

There is achievement motive imagery, which is based on positive evaluations, a desire to do better, positive goal oriented performance, or unique acts performed. There is affiliation/intimacy motive imagery, which is based on the longing for togetherness, sad feelings about separation, or the desire to help in a genuine way. Finally, there is power motive imagery, which is based on force and regulation and a need to impress others.

Motive imagery was established in the early 1950's by a famed psychologist at Harvard named David McClelland. McClelland asserted that by categorizing and collecting data on these TAT tests, one could establish deep, underlying motivations that people possessed. His work has been built on further by David Winter at the University of Michigan and Richard Boyatzis at Case Western Reserve University.

I am currently conducting an in depth research study on the role motive imagery plays in the corporate world. As I go on this adventure, my mind wanders, and I felt like gathering some data on another aspect of human psychology that motive imagery may be responsible for, and that is the dissemination of ideas.

When people hear information, they need to interpret that information for themselves, process it, store it, and then if they engage in social activities in which they can share that information, disperse it if they decide it is worthy.

I think that the concept of the transfer of ideas is mind blowing. Essentially, an idea is birthed in someone's mind, is uttered in a usable form of language to another organism that can go through the process described above, and then that other organism, feeling so compelled by the information they received makes a conscious decision to seek out and share other organisms with which it can spread the idea or information further.

There is a great deal of relevance to this dissection. In today's world where information is readily available and accessible at all times almost anywhere on the planet (newspapers, phones, Internet, television, etc.), one ought to wonder how human's decide on which ideas are the most pertinent, important, and really, worthy of our own cognitive functioning.

As a result of this inundation of information and knowledge, advertisers and news media have started to rely more heavily on Word of Mouth Marketing (WOMM), which is considered the best form of sharing ideas because it has the greatest impact and lasting effect on the individual with whom the idea is being shared.

Thus, are there ways to ensure that this information is disseminated more frequently? How do you encourage your idea or information to be spread via Word of Mouth? Is there a way to improve the odds?

With these questions in mind, I conducted the following study which I explain here:

Idea Dissemination Study

Starting at 6:00 am on November, 19 2008 until 9:00 am November, 24 2008, a group of 36 individuals were randomly sampled and were asked to take a survey. The individuals were sampled from my current Friends list on my Facebook account.

I feel the sample is validly random just based on the mere nature of the demographics of my friends, but in order to further substantiate the validity, I cross checked the locations from which the survey was accessed via Google Analytics over the November 19 to November 24 time period, and there were 83 unique visits from 40 cities around the United States. A majority of the visits came from Ann Arbor, Michigan, but there were several from: Bloomington, New York, Ypsilanti, Chicago, Northbrook, Palo Alto, Ft. Collins, Greencastle, Manhattan, etc.

The 36 individuals who filled out the survey were given the following information when filling out the survey, "Provided are some 'News Headlines' pulled from the same news source. Please determine which one of the three options provided in each case you would most likely share with another person."

The news source (newspaper, television, magazine, etc.) was left up to the individual. Future studies may want to classify which news source the participant is reading the "News Headline" from because there may be some variability between sources.

Participants were then asked to select a single headline from a list of three options. The three options provided headlines in one of each of the three forms of motive imagery (achievement, affiliation, and power). News headlines varied and were on several different topics from energy, to the Big Three, to the Economic Crisis, to Shrimp and Picnics.

Individuals were then asked, "Why?" after each selection, in which they could write down anything they wanted. Most of them made comments relating to their choice in picking the headline. It was an optional field for all five questions, and some fields were indeed left blank.

The participants then submitted their answers and were taken to a screen that explained the nature of the study and further reading that they could do on the topic.

The information that the participants submitted was then collected in a database and then converted into an Excel document. The number of times each motive imagery category was then calculated as a proportion of the total amount of responses. There was one question left blank by the 36 participants, which means that there were 179 (instead of 180) responses.

Results

To analyze the data, I used a one-proportion z-test (equation seen below) in order to test each motive imagery category against the null hypothesis that there is an equal likelihood that each motive imagery category would be selected. Therefore, I expected each motive imagery category could be selected one-third or 33.3% of the time.

A z-score allows you to attain a standard score in which you can then determine the p-value, or the probability of obtaining a result at least as extreme as the one that was actually observed, given that the null hypothesis is true. The p-value is defined by the area under the curve in a normal distribution, seen below. The maximum area of a normal distribution with a z-score is 1. The z-score is found on the x-axis of the graph. Based on this z-score table, the p-value is found by subtracting the z-score from 1, essentially subtracting the shaded area from the whole graph, which gives the probability of observing as extreme a result as the outcome observed.
In order for a result to be considered statistically significant, it ought be at least below 5%, which is quite a liberal p-value. In this experiment, I consider results below 5% to be statistically significant.

The results of the survey were:

Achievement Motive Imagery Sentences Selected: 60/179 or 0.335 (33.5%)
Affiliation Motive Imagery Sentences Selected: 73/179 or 0.408 (40.8%)
Power Motive Imagery Sentences Selected: 46/179 or 0.257 (25.7%)

By doing the one-proportion z-test for each of the three motive imagery categories, I arrive at the following z-scores:

Achievement Motive Imagery: 0.05
Affiliation Motive Imagery: 2.11
Power Motive Imagery: -2.17

By using a z-score table, provided here, I find the p-values:

Achievement Motive Imagery: 0.5199 or 51.99%
Affiliation Motive Imagery: 0.9826 or 98.26%
Power Motive Imagery: 0.015 or 1.5%

These are very fascinating results that need a little further discussion.

Discussion

Based on the findings of this study, it appears as though there is a significant relationship between affiliation and power motive imagery and dissemination of ideas. This can be deduced by the relatively high and low p-value scores. The score of 98.26% indicates that in only 1.74% of the cases would I expect to find an equally extreme result as those found in this study. That is well under 5%. Additionally, the 1.5% from power motive imagery reveals that in only 1.5% of cases would I expect to find the results that I found for power motive imagery and idea dissemination, which is also below 5%. Unfortunately, achievement motive imagery cannot reject the null hypothesis that it would be equally distributed because of its p-value of 51.99%, well above 5%.

These results indicate to me that ideas that are framed with affiliation motive imagery in mind are most likely to be disseminated, while those ideas that are framed with power motive imagery are least likely to be disseminated.

There are several shortcomings of this research that counter these statistical findings. For instance, the survey just asked individuals which statements they "would most likely share" with another person, and doesn't test it practically. The actual act of telling has not yet occurred, and is thus just the best guess on the behalf of the participant.

Furthermore, and building on the previous idea, participants may have selected headlines that just interested them and not one's they would necessarily take the time to spread to others. Several people cited in their "why?" statements that the article interested them, however, many also made reference to the fact that the headline interested people they knew, which leads one to believe that the idea was generated with the other people in mind. These conflicting points are irreconcilable in the scope of this study, and I urge others to address this in the future.

It is counter-intuitive that ideas that are warm and fuzzy, the type that are common to affiliation motive imagery, would likely be disseminated. Studies have shown that the news is filled with violence and negative stories, and people are more likely to spread that kind of news (Source). These findings go against that notion, especially when power motive imagery headlines, more common for force, control, and regulation was least likely to be disseminated. Perhaps the issues and characters involved in the headline is more significant. That idea is beyond the research question of this study.

Conclusion

The purpose of this study was to investigate the impact of the three categories of motive imagery on the frequency in disseminating ideas. In order to evaluate this, a short survey was given to 36 randomly sampled individuals in which they selected headlines that they would most likely share with others.

The findings indicate a statistically significant result for affiliation motive imagery and power motive imagery. Affiliation motive imagery headlines were shown to be most likely to be disseminated while power motive imagery headlines were shown to be least likely to be disseminated. Both were statistical at the 5% level.

Deciding on which issues are most important to us may indeed be a function of motive imagery, but these findings need to be further substantiated with more testing. There are several alternative hypotheses that were not addressed in this study that may impact the validity of the results.

Maybe it is just all about the words we hear and how we hear them that makes a subconscious decision about what is most important to us and what we choose to tell others. These results are but a a first step in finding the answer.

Reciprocity of a Drinking Game

2008-11-09T11:52:00.000-08:00

Yesterday evening, my friends played a drinking game before heading out to the bar. Because I wasn't planning on going out, but still wanted to enjoy their company, I decided to monitor the tendencies of their drinking game.

The rules of the game were pretty simple. It is a game that involves cards and decisions by the players. When cards are dealt, players will either have to "take," or drink for a specified amount of time based on the round, or "give" a specified amount of time to drink based on the round.

The first couple rounds go swiftly. Cards are dealt one-by-one to players in a counterclockwise order. The cards are dealt face up and in each round a player receives only one card.

During the first round, players are asked

to guess whether the card is red or black. If they guess correctly, they can "give" the value associated with the first round (2 seconds) to another player, but if they are wrong, then they have to "take" those 2 seconds. In the second round, players are asked if their next card will be higher or lower than the card they already have. The same rules apply if they are right or wrong, except now it extends to 4 seconds.

The third round asks players to determine whether the card will be inside or outside of the range of cards that they have. For instance, if a player has drawn a 7 of spades and an 8 of hearts, it is likely that the next card will be outside of the range, whereas, a player with a 2 of diamonds and a king of clubs would probably guess inside. The same rules apply for being right or wrong, except now it is 6 seconds.

The fourth and final round of the preliminary rounds asks players to guess which suit their card will be. If players are correct, they can "give" 8 seconds, but have to "take" 8 seconds if they are wrong.

After the preliminary round, the game enters into a phase called, Fireworks. The picture above gives the breakdown of how Fireworks is setup. As you can see there are several cards used in Fireworks, all face down to begin with. There are two columns of cards, one "take" and one "give" that increase in their intensity from 2 seconds to 8 seconds, similar to the opening rounds (this is represented in the illustration by the number following the word Card). On the wings are four more cards that raise the level of intensity. On the left side, there are two cards, one "take" and one "give" for half a beer. On the right side, there are two cards, one "take" and one "give" for a whole beer. The order in which Fireworks occur is by starting with "Card 2" in the Take Column, and then "Card 2" in the Give Column. This continues through "Card 8" for both Take and Give. Then Take and Give is done for Half and then Full.

The way in which this portion of the game works, is if any of the four cards you received during the preliminary round match in value (8's, Kings, Jacks, 4's, etc.) to those that get flipped, you must "take" or "give" depending on the card's designation.

It's a phenomenal game and a lot of fun to play or watch.

I thought it would be interesting to map out some of the decisions that were made in terms of "giving" drinking quotas to other people. Though this is a friendly game, harsh decisions have to be made at times as to who has to drink. I've also considered that as the game progresses, participants are most likely becoming further inebbriated, which may effect their decision-making processes, but this effect is inherent to the system. I was interested if any patterns would emerge based on some sort of reciprocity, and as I expected, something quite concrete can be deduced from this very simple but telling game about social networks.

Explanation

Above is a visual representation of the decisions made by participants in their first game of play recorded. There were five total participants, each depicted as a "Smiling Face." The boxes either above, below, or to the side of the faces are how I will make reference to distinctive actions made by that player. The visual representation is supposed to give scope as to the actual seating arrangements of the individuals playing the game, which I assert makes significant impact on the decisions of the players. I was seated between JG and SS and was not participating in the game.

I propose that seating is the most important factor determining decisions in the game. Starting from the left side: ZS was sitting on a chair by himself. JG, Tyrone Schiff, and SS were sitting on a couch together. MK and MB were sitting on a seperate couch perpendicular to JG, Tyrone Schiff, and SS, facing ZS. There is a rectangular table between the groups.

There are clear trends that can be noticed from the outset. SS and ZS engaged in a "war" during the game, consistently being given decisions (which is based on luck), and consistently "giving" the designated value to one another. SS and ZS were also seated quite far away from one another, at least on opposite sides of the table.

SS was given several opportunities to "give," but made them consistently towards ZS. He could have just as easily "spread the wealth" by "giving" to JG, MK, and MB, but chose to direct his efforts to a member farthest away from him.

There are several underlying causes of this. One consideration is mere comradary. ZS and SS may be good buddies and want to get each other "wasted" to have a fun night at the bar. However, all the individuals playing the game are all trying to get "wasted" and are equally good buddies. This is not a qualifying argument.

Another cause could possibly be based on the Feedback effect. As SS makes more decisions to "give" to ZS, ZS comes back at SS and "gives" to him in order to "level the score." This argument has slightly more merit. However, one must realize that the players are all reasonable people and wouldn't intentionally engage in "war" with another if they had other options available. "War" is undesirable, and none of the players at the table would choose to wage it rationally.

This leaves us with the prevailing theory that decision making was based on seating arrangements. This is well evidenced by SS's decisions. While SS had 5 decisions to make, more than any other person, he directed his "giving" to only one person, and that person was farthest away. He did not "give" to MK, who was very close but on another couch, or MB, slightly farther away, but not the farthest, nor did he "give" to JG, a member of his same couch. SS clearly looked for a member of an outgroup in which he could get others to gang up on.

And they did. In closest proximity to SS was MK. MK, with only 3 decisions, decided to spend one of them on ZS, influenced by the actions of SS and feeling comfortable with the distance between them.

The distance and seating argument is further evidenced by actions of MK and MB on JG. MK and MB are members of the same couch. MB, with only 1 decision, chose to spend it on JG, and MK spent 2 out of 3 of his decisions on JG. MB and MK were located equally as far away from JG as SS and ZS were. The fact that they were working together and the "extreme" distance between the parties made it okay to gang up on this one player.

MK and MB also attacked each other by "giving" one decision to each. However, once the decision was reciprocated, the two never "gave" to one another again, indicating a truce of sorts, and an understanding of using their strength elsewhere on farther targets.

The decision by JG may seem a little incongruous with the proposed theory of distance being the most important factor, but a brief analysis makes sense of his decision.

JG had no reason to "give" to SS. They are members of the same couch and SS had never targeted JG before. It is then likely that JG would attack either MK or MB, because they "gave" to him and JG would like his revenge. However, JG was only provided with 1 decision, and it would have been futile to "give" to either MK or MB. There are two reasons for this.

First, by "giving" to only one of the members, MK or MB, the revenge isn't sweet at all. JG can only make one of his attackers suffer. The full effect of the decision is thus inconsequential; there is no statement made by JG's decision. Second, JG, realizing that he was a target of attack, didn't want to further annoy or anger MK or MB by "giving" to them. JG was already being targeted for being far away from MB and MK, an attack on them would just motivate MK and MB to "give" to JG more frequently.

Thus, JG "gave" to ZS, a fellow member of attack. There are several reasons why this may be the case. JG could try to win support from SS or MK, so they would both view JG as an ally. JG does this for MK so that he would no longer attack him, based on their mutual agreement to attack ZS. JG does this for SS so that if ZS, MK, or MB "gives" to JG, SS may counterattack on behalf of JG, due to the fact that they have a mutual understanding of attacking ZS and because they are members of the same couch.

Conclusion

The object of this study was to try and understand the decision making processes involved in playing a drinking game.

After excluding alternative hypotheses, decision making during this drinking game can most accurately be attributed to the location in which someone sits relative to the other players.

ZS was thus a "sitting duck" from the start. He was farthest away from three of the four players, not including himself, and also sat in a chair with no other person. SS and JG were "members" of the same couch, just as MK and MB were "members" of a different couch. This team-like or shared experience as "members" of the same couch is remarkably strong in shifting decisions. Allegiances were tested, as MK and MB reveal, but ultimately, the majority of the decisions were based on how far someone was located away from the decision maker.

Word Frequency Measurement

2008-11-08T18:20:00.001-08:00

I came across a fascinating product today that Google operates. The product is Google Trends and visually displays information relating to search queries that could be entered into a Google search. It's unbelievable comprehensive. Aside from providing a line graph of the relative search volume since 2004, it also provides you with the ability to narrow your search to particular regions of the world or even singular countries. For a person who wants to use Google as their advertising medium on the Internet, this feature is without doubt a must. Understanding where and why people are searching for the terms they are is a critical feature that sets Google apart from the rest.

You can also localize your search term trend for a particular span in time. So, if you are only interested in how people have been searching for these words within the past 30 days, you can set that option very easily. If you are particularly interested in how many times that search term was queried in a particular month since January 2004, Google Trends will allow you to set that.

The graph has an interesting dependent variable called Search Volume Index. On Google Trend's About page they define it as "how many searches have been done for the terms you enter, relative to the total number of searches done on Google over time."

Just below the graph are three columns at are unbelievably helpful in understanding how exactly the search term you're looking at is used. There is a column for regions, which specifies the rank of usage by country. Then, next to that column is an even more specific look at where the search term is being queried by ranking the cities by usage. As you will see later, the city in which the search term is queried the most is quite intuitive. Finally, the last column is what language that term is most queried in. Most of the tests that I've performed have had the most usage in English, however, it is fascinating to see how the rest of the queries not in English relating to the search term rank by language.

Probably one of the coolest features about Google Trends is its pairing with relevant news articles. Below the primary graph that reveals search volume there is a another graph called New Reference Volume. "This graph shows you the number of times your topic appeared in Google News stories." When there are spikes in the search term volume, Google Trends automatically flags the occurrence and links the spike to an actual news article, which probably explains the spike in search term volume.

It's an amazing feat of computational engineering. When it comes to understanding how people are using the Internet in terms of what their searching, I cannot think of a better source than Google Trends. Google has approximately 60% market share of all search queries, and this data is contigent on that sample. Google Trends is comprehensive and provides the user with the relevant information that he or she is looking for.

In order to gain further understanding of Google Trends, I ran a quick study in order to familiarize myself with the options and processes available.

Google Trends Study

This study was conducted on November 8, 2008 at approximately 7:30pm. The purpose of the study was to gain familiarity with Google Trends and make comparisons of search term usage for a randomly sampled set of search terms across regions.

The study sampled three words from three randomly sampled individuals living in my house. Participants were asked to, "provide three words that could be possible search queries in a well known search engine, like Google." The individuals choosing the words sat together and were asked to recite them aloud. This would ensure that participants didn't provide duplicate words.

After the participants gave me three randomly selected words each, they were asked to, "provide a country somewhere in the world aside from the United States." Each participant then selected the country in the same fashion that they provided the words. Some participants took longer than others; one participant was still selecting words while another had already provided both their words and country. The time length in which the participants finish their selections is not terribly important, however, it should be done in a reasonable amount of time.

Participants were also asked to predict the relative search volume of their three words from highest to lowest across the world.

The following table summarizes each participant's selections and the order in which they expect their search volume to be from highest to lowest:

As you can see, there was a rich diversity in the words that were selected. Participant 2 focused on more Proper Nouns than regular nouns like the other participants involved, yet, still a sufficiently random sample.

Participant 1

[To see worldwide results please click each of these respective words: Drugs, Cowboy, Cardboard]

Upon requesting search volumes for the three words provided by Participant 1 in Djibouti, Google Trends was unable to provide search volume information citing the following:

Your terms - ????? - do not have enough search volume to show graphs.
Suggestions:
Make sure all words are spelled correctly.
Try different keywords.
Try more general keywords.
Try fewer keywords.
Try viewing data for all years and all regions.

The subsequent 6 search terms provided by Participant 2 and 3 were then also searched for in the Djibouti database rendering the same message. Unfortunately, there does not appear to be sufficient search queries of these provided words from Djibouti to elicit graphs. This is an unfortunate finding based on our study. It appears as though Google Trends, while comprehensive, is indeed fallible.

After trying to insert search queries that I thought would have sufficient volume to represent graphically (United States, Barack Obama), I eventually input "Djibouti," which finally elicited results. The search term, "Djibouti" is most commonly searched for in Djibouti, Djibouti, when narrowing the results to just Djibouti results. The most common language that Djibouti is searched for in Djibouti is French. There was a spike in search volume for "Djibouti" in Djibouti on June 12, 2008 when an article was published entitled, "UN council condemns Eritrean attack."

This can be compared to search queries for the term "Djibouti"

from all regions around the world. "Djibouti" is most commonly searched for in Regions like Djibouti, United Arab Emirates, Morroco, and France. Some cities where "Djibouti" is most commonly searched for include Dubayy, UAE, Ottawa, Canada, and Rennes, France. French, English, Swedish, and Dutch are most common languages when searching for "Djibouti."

Participant 1 correctly predicted the order in which the search terms provided would be relative to one another across the world. It is interesting to note that the order the participant gave the words is the same order that was predicted for highes

t to lowest search volume. The graph visually depicts the relationship between Drugs, Cowboy, and Cardboard in terms of their worldwide search volume.

Participant 2

[To see worldwide results please click each of these respective words: Synthesizer, Rex Grossman, Mr. Feeney]

Similar to the Participant 1, the words provided by Participant 2 did not have enough search volume in Malta for a graph to be displayed. This is again another unfortunate occurrence. The same technique was used for Participant 2 as was for Participant 1 in attempting to find some sort of graph. The other 6 search queries did not provide any sort of graphical depiction either.

In order to gather some results, I input the search query, "Malta" to elicit some sort of results within the Malta Google Trends database. Fortunately, this was able to provide some sort of graph with relevant news articles that coincided with spikes in the volume.

In Malta, the search term, "Malta" is most frequently searched for in Msida, San Gwann, and Valleta, all cities in Malta and in that order. The most common language "Malta" is searched for in Malta by frequency is German, English, and Maltese. One of the highest peaks in News Reference Volume within the Malta database when searching for the query "Malta" was on November 20, 2007, when an article entitled, "Queen to Celebrate in Malta," was published on News24.com.

Compare these results to worldwide trends for searching "Malta." Some of the most popular regions searching for "Malta" are Malta, Ireland, United Kingdom, Italy, and Austria. Some of the most popular cities are the three Maltese cities already mentioned, followed by, Poznan, Poland, Dublin, Ireland, and Thames Ditton, United Kingdom.

Participant 2 was correct in the predictions made about the order in which relative search volume would occur. Synthesizer has a higher relative search volume to that of Rex Grossman, and by virtue of there not being enough data on Mr. Feeney, one can deduce that Rex Grossman has a higher relative search volume than Mr. Feeney. This is visually represented below.

Participant 3

[To see worldwide results please click each of these respective words: Arsenic, Stencil, Magician]

Similar to the past two participants, all word choices by Participant 3, arsenic, stencil, and magician elicited no graphical results in the Belgium Database of Google Trends. Upon further review, some words provided by Participant 1 (Drugs & Cowboy) elicited results, but for fairness to each participant, I will conduct the same analysis as I have done for the prior two.

Therefore, I will share results from quering the search term "Belgium" in the Belgium database. The most prominent subregions that query the search term "Belgium" are Flemish Brabant, East Flanders, Brussels, and Luxembourg. Major cities querying "Belgium" include Leuven, Gent, and Brussels. The language that "Belgium" is usually queried in is English, Dutch, and French (in that order).

Recently, there was a surge in the News Reference Volume relating to the search query of "Belgium" within Belgium that linked to a story entitled, "First Industrial to Invest in New State-of-the-Art Logistics Facilities in Belgium." The story was published on October 6, 2008 and led to the highest New Reference Volume in the Belgium Database of Google Trends for the search query "Belgium" ever.

Compare this to worldwide searches for the search query "Belgium." The major regions in which "Belgium" is searched for occur in Belgium, Luxembourg, Ireland, the United Kingdom, and the Netherlands. Cities outside of the Belgium that most frequently query the search term "Belgium" include London, United Kingdom, Amsterdam, Netherlands, Syndey, Australia, and New York, New York. Around the world, the most commonly used language to query the search term "Belgium" is Dutch, French, English, German, and Italian (in that order).

Participant 3 incorrectly predicted the relative search volumes of the three randomly selected words provided. Based on worldwide Google Trends data, the relative search volumes of the words Arsenic, Stencil, and Magician are correctly ordered as Stencil, Magician, and Arsenic. Stencil is relatively searched for 2.65 times more than arsenic, and Magician is searched for approximately twice as much as arsenic. The graph below reveals this relationship.

Conclusion

The purpose of this study was to gain familiarity with the product Google Trends and make comparisons between the relative search volume of randomly selected words.

While Google Trends contains a wide breadth of data on search volumes, there is desperate need for its regional databases to contain more comprehensive data. Search queries in the Djibouti, Malta, and Belgium databases hardly provided any results when inputting some randomly selected words. Either these databases should not be provided to begin with, or they need to be more comprehensive in nature.

Two of the three participants in the study were correctly able to predict the relative search volume of their provided terms. This suggests that Google Trends provides intuitive knowledge. However, it is well evidenced by Participant 3 that the relative search volumes for particular words may be harder to predict.

Overall, Google Trends is a phenomenal resource that provides superb measurements of the relative search volumes of typical search queries performed on the Internet.

Sustainable Stadium

2008-10-29T15:17:00.000-07:00

Everything is going green. Trying to conserve, harness, and make the most of our resources is the newest trend sweeping across the world. It was probably a long time coming, and I hope it doesn't turn out to be a fad, but figuring out ways to be self-sufficient and efficient are definitely the ways to go at the moment. A lot of the craze is fueled by fuel itself.

Seeking out alternative energies like wind power, solar power, coal, and my favorite, biodiesel (see Syntroleum), are pushing some of the greatest minds of our generation to the brink. The McKinsey Quarterly, a publication by McKinsey & Company exploring current and future market trends, has a really fascinating article on how money could be invested over the next decade to realistically establish sustainable energy.

A couple weeks back, a buddy and I were standing in the Big House, the appropriate name given to the Univeristy of Michigan's football stadium which has an overwhelming capacity of 107,501, and discussed how the sheer size and magnitude of the stadium could be used to produce something of worthwhile value.

We wondered why it wouldn't be possible for the stadium to essentially sustain itself with the energy necessary to power the lights, scoreboard, and loudspeaker. We figured that you put 110,000 people in one place, you're bound to be able to derive a little bit of energy (at least enough to power those elements).

Anyway, my friend and I were perplexed as to how to harness the energy of the stadium. We figured that the vibrations that people made when cheering would be enough to power some of the things used in the stadium, but how to harness this energy was the true question. At first we talked about turbines, as that is how most energy is harnessed, but didn't figure out a practical application for it. We were pretty much stumped and for some time have allowed our idea of creating a self-sustaining stadium to die.

But then, the New York Times came through (as it typically does), and revealed some of the incredible technological advances that are going on in our world every day.

In the October 23, 2008 Europe Edition of the New York Times, there was an article entitled, "Partying Helps Power a Dutch Nightclub," and seemingly our quest to power the Big House had some shimmering hope. We now had some sort of benchmark, which we could try and follow.

Apparently, a Dutch nightclub has just installed a revolutionary dance floor that utilizes a technology called piezoelectricity to help power the lighting in the facility. By harnessing the vibrations of people dancing on the floor, the nightclub is able to use the energy generated by the people dancing. This video shows how piezoelectricity works and its application in the nightclub in particular:

According to Wikipedia, the most elementary definition of piezoelectricity is, "the ability of some materials (notably crystals and certain ceramics, including bone) to generate an electric potential in response to applied mechanical stress. This may take the form of a separation of electric charge across the crystal lattice. If the material is not short-circuited, the applied charge induces a voltage across the material."

To understand this concept graphically, Wikipedia further presents this image which I think is quite intuitive and depicts the nature of piezoelectricity and why it would be useful in the context of a nightclub or in our case, the Big House.

As you can see there is some sort of crystalline structure that when compressed creates an electrical voltage.

I would love to calculate the potential energy that could be produced in the Big House on a football Saturday, but the Wikipedia article lost me in all of the complex algorithms and mathematical identities necessary to calculate strain, stress, and compliance. My friend who I was chatting with at the football game happens to be an actuarial mathematics major, and perhaps he will be better equipped to do that sort of arithmetic.

According to the New York Times article about the piezoelectric dance floor, the cost of installation was approximately $257,000 which the owner of the club does not believe will be recouped by energy savings due to the inefficiency of this relatively new technology. This is very unfortunate, and will make selling the University on this idea even harder.

Yet, like all technological progress, I assume that piezoelectricity and its applications will follow the guiding principles of Moore's Law, which suggests an exponential advance in the capabilities of a technological process and thus dramatic drops in price and spikes in efficiency.

Currently, the Big House at the University of Michigan is undergoing some major repairs that will increase the capacity of the stadium as well as intensity of the noise. According to the Michigan Stadium Renovation Website, "The expected cost of $226 million will be funded through private donations and Athletic Department resources, primarily the revenues generated by the new seating."

If the University of Michigan is truly still the "leaders and the best," as their fight song suggests, then they will take the steps necessary to make the Big House not only the largest stadium in the country, but the first ever self-sustaining stadium in the world.

Deeper Than South Park

2008-09-30T14:25:00.000-07:00

The impetus for this blog post comes from an unlikely source in my opinion. I was watching an episode of South Park about a week ago. I have to admit I find South Park unbelievably entertaining and think that Trey Parker and Matt Stone have really developed quite a brilliant show. Anyway, the show that I was watching in particular was an episode called Tonsil Trouble. This episode debuted the 12th season of South Park, and my goodness, what a start to a season.

The plot of the episode is as follows. Cartman, the loud, obnoxious fat character on the show has to get his tonsils removed. During the procedure he is accidentally infected with HIV. The idea of this happening is utterly ridiculous. Throughout the show Cartman is then trying to gain sympathy from all the people around him, his classmates and his friends, but because Cartman is typically mean to everyone else, they find it hard to pity him.

The plot obviously gets far more ridiculous at this point as most South Park's usually do, but underneath it all is an amazing underlying message that we can all walk away with. The long and short of it is that they go to visit Magic Johnson, because Cartman is aware of how long he has lived with HIV but has not yet passed away, as is the unfortunate case with HIV patients.

While on the trip to Magic Johnson's home, there is a commentary on the state of HIV in today's society. Nobody appears to take HIV seriously anymore, and rather it's all about Cancer these days, HIV is a "retro" virus made popular in the 1980s. I'll explore why this is the case later.

When they get to Magic Johnson's they see that his room is filled with money. Magic Johnson claims that he sleeps with all of the money he has made in his room. Cartman therefore deduces that the reason that Magic Johnson was able to live so long with HIV is due to a chemical intrinsic to money.

Cartman and his friend Kyle, who Carman malliciously infected with HIV, then go back home and begin research on the effect of money on containing HIV. All the researchers are absolutely amazed when you take a large stack of money and blend it up into a liquid and inject it into the body that it is capable of suppressing HIV. Ultimately, they realize that all it takes to cure HIV is a "$180,000 shot directly into the bloodstream."

This brings a lot of ideas to mind that I think should be addressed. Therefore, I went out and did a little bit of digging around the Internet to see if there was any truth to what South Park was suggesting. I broke their claims down into two assertions:

HIV is a "retro" virus. Today we are more concerned with Cancer.
In order to control HIV, you would need around $180,000.

I'll tackle both of these assertions one at a time.

Findings

HIV and Cancer are equally scary illnesses and it is an absolutely horrendous thing to afflict anybody. Based on Avert.org, which has worldwide statistics on AIDS, I found out that the current trend in relation to HIV aids patients follows an increasing number but at a decreasing rate. The graph below summarizes the statistics relating to HIV since 1990.
Currently, there are an estimated 33 million people around the world who are suffering from HIV/AIDS. This has grown by a steady rate since 1990, but has slowed significantly in recent years. Along with the above graph, there is a trendline that expresses the rate of HIV infections worldwide. The equation for HIV infections worldwide can be summarized as: -0.0653x^2+2.7956x+4.2083, where x is equal to the amount of years after 1990. Under this assumption, I project that HIV/AIDS could be completely contained and eradicated by the year 2034. See graph below:
This is quite an idealist and optimistic perspective to take on the current state of HIV/AIDS, however, it is merely based on current trends. Furthermore, 2034 is 26 years from now in which there is ample time for education to take the forefront in combating this disease. Teaching people about contraception and means of avoiding this disease is truly the way that we can eradicate this disease. The most important region to focus on is sub-Saharan Africa, where 59% of all infected cases live. The world will most definitely be a different place in 2034, so why not make it a world free of HIV/AIDs.

In comparison to Cancer, however, HIV/AIDs has begun to take a backseat and therefore this verifies the claims made by South Park that HIV is perhaps a "retro" virus. According to the American Cancer Society, there have been 1,437,180 new cases of Cancer reported in 2008.

In 2006, there were only 36,187 new cases of HIV reported in the United States, barely 2.5% of the same number of new cases of Cancer. The peak of new HIV cases occurred in 1984-85 in which there were 130,000 cases reported. This really puts the magnitude of Cancer in perspective. South Park, while making a satire of this situation, is accurate in their assessment that Cancer is truly the big killer disease at the moment.

One of the things about Cancer is that there are so many different ways that it can get you. For men, it appears as though Prostate cancer is the most prevalent, affecting 25% of all cases, whereas for females it is Breast cancer, which infects 26%. However, it should be noted that for both genders, the number one killer is lung and bronchus cancer. Then behind this type of cancer the two most prevalent cases for each, prostate and breast, respectively, are the next most serious killers.

Cancer is definitely a very scary and looming disease. There is still a lot more that we need to figure out about this deadly disease and ways to avoid it. We have made huge strides with HIV/AIDs in a very short time and I feel similarly optimistic about humanity's ability to take on Cancer.

The second assertion that South Park made is that through the aid of $180,000 "injection" you could live with HIV. South Park was making the statement that if you have $180,000 to spend on antibiotics, medications, hospital visits, etc. in the amount of $180,000 you can live with HIV, not actually inject yourself with money.

I did some research about that. I found an article written on November 2, 2006 published by CBS News citing that people with HIV can get an extra 24 years of life on average using modern treatments that will cost $618,900, or $2,100 per month.

This is far higher than the estimate given in South Park. The findings are based on a "Cornell/Johns Hopkins/Harvard/Boston University research team that analyzed the costs and benefits of modern HIV treatment." These costs are made up of the 24 available drugs available on the market that in tandem with one another could add up to 24 years on a life.

The costs of keeping someone alive who is infected with HIV is astronomical. At the end of the South Park episode when they figured out that they could save someone by injecting them with money, the scene cuts to a poor village probably somewhere in Africa, and a man jumps out of a car and yells over to a gaunt looking native, "Hey! They found the cure to HIV! All you have to do is inject yourself with $180,000!" He jumps back in the car and drives off leaving the native with nothing.

That is one of the biggest issues with combating these diseases, especially HIV. A lot of people who are afflicted with the disease are very poor and can't pay for this sort of medical treatment. That is why education is truly the key to keeping the numbers of infections down.

Conclusion

HIV/AIDs and Cancer are two deadly diseases that infect millions of people around the world. The purpose of this blog post was to verify the assertions made by South Park in the season 12 opener, Tonsil Trouble.

Based on my findings, South Park is mostly accurate in their assertions.

South Park alleged that HIV was a "retro" virus that was prevalent mainly during the 1980s. This true based on the level on infection rates both worldwide and in the United States. However, millions of people still live with HIV everyday. Cancer, however, does afflict more people a year.

The second assertion related to the cost of maintaining life when one is infected with HIV. South Park suggested that this was $180,000, whereas evidence shows that it would cost more on the order of $618,000. Both of these sums of money are astronomical though, and the point was made in my opinion.

The key to fighting HIV/AIDs and Cancer is education. Knowing the signs, knowing the ways to avoid it, knowing anything that can help you stay away from these terrible diseases is the best thing one can do.

Have You Ever Wondered if Volume and Percent Stock Change Correlate?

2008-09-03T22:16:00.000-07:00

I thought about an aspect of the stock market this evening that I thought I'd quickly decipher for myself, and my devoted blog readers. It appears as though every time I look at a stock that has a small volume, there also appears to be equally negligible movement in the stock. As a result, why would anyone want to invest in stocks that have volume of 10,000 or less; it wouldn't make sound sense. However, people invest in stocks regardless of volume. I wondered why nobody really cared about the particular volume of a stock and why this isn't a determining factor when firing off a trade.

By looking at the opening and closing prices of every single stock on the New York Stock Exchange on September 3rd, 2008 (3,243 current listings), I was able to determine the association that volume of a stock has with percentage change.

I had to locate every stock on the New York Stock Exchange for an assignment at school, and obviously with such a surplus of information, I did a lot of cool things with the Excel document that I found. One of them was to determine this correlation.

In order to figure this out, I merely performed the equation for percentage change, (New-Old)/Old. So in our case that would be (Closing Price - Opening Price)/Opening Price. By graphing these two variables on the X and Y axis accordingly, one is able to determine an association between the two variables.

The best association between two variables equals 1.00 after performing a regression analysis that Microsoft Excel takes care of when adding a trend line for a given data set. 1.00 represents that the X and Y coordinates create a perfect line together. On the other hand, a regression analysis of 0 indicates that there is absolutely no association between the variables and is typically seen as a haphazard cloud of points completely in disarray.

Based on this information, we can analyze just how close the relationship is between the two variables.

Results

As the graph above indicates, based on the data accumulated (courtesy of EOData.com), on September 3rd, 2008 the New York Stock Exchange had a 0.0322 r-squared value describing the association between volume and stock percent change.

This is a tiny number and unbelievably close to 0, which is indicative of little to no association between these two variables. As you can see, the points look like a cloud of information with some random outliers. If the correlation between these two were stronger, one would see the points follow the linear trend line inserted in the graph.

Conclusion

Although further sample days are probably needed, I think the association between volume and stock percentage change can be put to rest. While I may encounter stocks with low volume having low or no percentage change at all, there is absolutely no rule of thumb for these two variables.

A stock with high volume may have a low percentage change, while the exact opposite of a stock with low volume might have high percentage change. Both statements are unavoidably the case based on empirical research done on September 3rd, 2008 for the New York Stock Exchange.

The Flood on South Forest

2008-08-31T14:01:00.000-07:00

Unfortunately, my first days back at the University of Michigan were tainted with some unfortunate occurrences. When I got back to Ann Arbor, I needed to turn my water back on. In order to do so, I had to go to the Ann Arbor City Council and pay them directly. Little to my knowledge, as soon as I paid for the water at the Ann Arbor City Council they turned it back on and the pressure forced all of the faucets in the house to open.

This ordinarily would not have been a problem, except for a single drain on the second floor that happened to be clogged. All of the other drains in the house were able to drain the water that was rushing into them fast enough so that it would not overflow. However, this one drain on the second floor obviously had some issues and therefore, water ended up overflowing from this drain and flooding the second floor.

If this wasn't enough, the water from the second floor then fell through to the first floor and then eventually to the basement below it. As a result, our house has had to undergo intense maintenance. They had to rip out the drywall and dry the inside of the house on the first floor due to concerns of potential warping of the wood in the interior of the house. Wood also takes a while to dry, so it has been a lengthy process, almost two weeks now.

However, what I was interested in, and the reason for me writing this post in the first place, was to explore the volume of water that caused all of this damage. It is really quite amazing to me that a job that will cost around $4,000 and has taken almost two weeks was the result of just a couple hours of not being at home. I wanted to know what volume of water created such damage.

Therefore, in this post, I intend to explore the amount of water that escaped the faucet on the second floor.

Results

In order to figure out the rate at which water was coming out the faucet, I went directly to the second floor bathroom and timed how quickly the water at full blast would fill a 2.2 liter container. I performed this task 11 times to get an average. I threw out the longest and shortest time that it took to fill the 2.2 liter container, which gave me 9 samples to average.

I found that the faucet at full blast takes 10.18889 seconds to fill a 2.2 liter container. In other words, the rate at which water leaves the faucet is equal to 0.21592 Liters per seconds. The rate is displayed graphically below.

The next step in the process was then to determine how long this occurred for. I went into the Ann Arbor City Council at around noon and then arrived home at 3pm. This means that three full hours passed before I got home.

Due to the fact that I won't ever truly know when they turned on the water, I'll assume that they did it as I paid for the bill, which was 11:49am and I'll assume I arrived home at 3:08pm, because I answered someone's text message at 3:03pm and said I would be back at the house "in five." This means that I was away from the house for 199 minutes total.

If we then understand that there are 60 seconds in a minute, all we have to do is multiply 199 minutes by 60 seconds, which equals 11,940 seconds total that passed.

With this information we can then find out the total volume of water that escaped the faucet in the 199 minutes (11,940 seconds).

If we take 11,940 and multiply this number by the rate of 0.21592 liters, we arrive at a total amount of 2,578.097 Liters (681.06 gallons). We can see the volume of water entering our house in Ann Arbor graphically by the graph below.

Conclusion

Overall, there was 2,578.097 liters that entered into my house on South Forest in Ann Arbor. This occurred over a span of 199 minutes and was the result of a single faucet that had a rate of 0.21592 liters per second.

To put this in perspective, however, at this rate, in order to fill up an Olympic-size swimming pool (2,500,000 liters), it would take 11,578,308 seconds which equates to 134 days.

The World in 2020

2008-08-26T12:00:00.000-07:00

I recently ran a survey on my website, Those Answers, in which I intended to gain some insight into how people view various World issues and their potential status in the year 2020. The survey asked people about some of the most significant threats affecting the World, issues and people, the evolution of energy, corporate impact, and how to make a difference. I found the results extremely interesting.

The survey was taken by 47 individuals who ranged in age from 18 to 63. The average age of a respondent was 22.51 with a median of 21. Of those 47 individuals who chose to report their gender, 22 were male and 20 were female.

The rest of this post will be a graphical display of the results that I found, in addition to some of my thoughts as to why the results may appear as they are. I hope you enjoy.

Results

What is the greatest threat to humanity?

According to the results, Nuclear Weapons and Biological Warfare is the greatest threat to humanity and as we get closer to the year 2020, it will become a bigger problem. It was the only one of the choices available that had a higher percentage of respondents (40% vs. 49%) agreeing that it would be a greater threat in the year 2020.

I think that this choice is a rational one and most definitely something that needs to be addressed. Nuclear proliferation means that countries have the capacity to retaliate with weapons of mass destruction. At the push of a button cities can be destroyed.

Other threats to humanity that several respondents agreed upon were Poverty and Natural Disasters. Both of these issues show declining trends as the primary threat to humanity in the year 2020, which indicates an optimistic view of resolving the issues as well as confidence in the current measures in place.

Drugs and Alcoholism and Random Acts of Violence received a very small percentage of the total respondents primary threat to humanity. Additionally, Sexually Transmitted Diseases (STD's) was only seen as the greatest threat to humanity by approximately 10% of respondents. STD's like HIV/AIDS, herpes, or gonorrhea affect millions of people around the World, and I found it surprising that people didn't consider this a very big threat, even when compared to Nuclear Weapons, because it impacts so many people already, whereas, the use of Nuclear Weapons is not even a reality aside from the bombings at Hiroshima and Nagasaki at the conclusion of World War II.

63.8% of respondents maintained their choices from the year 2008 to 2020. This implies that some of the greatest challenges already facing the World today will still be of primary concern in the year 2020.

Who/What is the most dangerous force on the planet?

The most dangerous force on the planet was determined to be the US President. This was a surprising find in my opinion, and I can't really determine one thing in particular that would make this the case. I suppose the US president has enormous power militarily due to his (or her) ability to attack other countries and a massive collection of nuclear warheads. In many ways, the US President dictates World policy.

I was further suprised to see the low percentage of respondents that believed Mahmoud Ahmadinejad (Iranian President) was the most dangerous force (18%). Further, the percentage of people who believe Osama Bin Laden (14%) and Kim Jong-Il (7%) combined was less than the percentage of people who believed the President of China was the most dangerous person in the World (23%).

What resource will be most depleted by 2020?

According to the results of this survey, the most depleted resource by 2020 will be Clean Air. This is by an overwhelming margin as well. Its closest competitor was Drinkable Water which lagged behind by 23%. This was followed by Arable land with 20% of the respondents votes and finally Agricultural Produce with 9%.

Clean air is becoming an enormous problem, especially as the World population continues to grow at an exponential rate and as cities around the World become more densely populated. A McKinsey Global Institute report on China in 2025 indicated that the air quality in several Chinese cities could become noxious and unbearable due to pollution.

According to the McIlvaine Company, the air pollution reduction market will grow by an approximate rate of 17% compounded annually through 2015, becoming a $20+ billion per year industry.

I think that our respondents are spot on with their assessment of this particular issue.

Between 2008 and 2020, what energy resource will be most utilized?

The energy resource most utilized by 2020 was spread out and indicates the uncertainty of the alternative energy market as it stands currently. There are several alternatives and based on the even spread by respondents, it appears as though there is no clear sign of which alternative energy resource will be used most.

Leading the charge was Solar Energy, Ethanol, and Coal. I think that all of these show significant benefit and means to channeling resources away from Petroleum. Coal will most definitely be used in greater excess, as the United States has the most significant World share at 27.1% (Source).

I was surprised about the low amount of respondents who chose Environmentally Friendly Biofuels, as I am a huge proponent of them. I think that this type of fuel uses resources most effectively while also being least harmful to the environment overall.

Which country will have the highest per capita GDP by 2020?

The country that is projected to have the highest per capita GDP by the year 2020 was China. They received 49% of the votes. China was followed by the United States with 28% and Japan with 15%.

The question asked was about per capita GDP, which gives an idea as to the personal wealth of an average individual in a particular country. This does not necessarily relate to total GDP, which can be massive for a country, but when looked at through the scope of each person, may become very small.

That is why the choice of China by such an overwhelming percentage is surprising. Accordining to the Wikipedia article of Per Capita GDP, China currently ranks 99th according to the IMF, and 105 according to the CIA. This essentially means that an individual in China compared to the rest of the World is poorer than around 100 nations. While China will probably have the highest overall GDP by the year 2020, their per capita results are dismal.

The United States is currently ranked 6th by the IMF and 8th by the CIA. This makes sense when you think about a common person in the United States versus a common person in China. The standard of living is far higher for the average individual in the United States.

Small percentages went to Saudi Arabia and the United Arab Emirates even though they are both ranked far higher than China (Saudi Arabia = 37 & UAE = 15).

What industry shows the greatest potential for growth through 2020?

By an overwhelming margin, the industry that shows the greatest potential for growth through 2020 was determined by the respondents to be Alternative Energy with 67% of respondents agreeing. This was followed next by Information Technology, 19%, and Financial Services and Energy tied at 6% each.

Even though it is the dawn of the information age, people are overwhelmingly agreeing with the fact that alternative energy will trump technologies rise in the coming decade. These results may be skewed by the current situation with oil prices, yet, they are not unfounded as these issues need to be addressed.

The need to seek out Alternative Energy goes hand-in-hand with the fact that people are conscientious about the environment.

Which of the following corporations will have the greatest impact through 2020?

There are two prominent corporations that were chosen by the respondents that will have the greatest impact through 2020, and the results relate to the emerging industries over the next decade. The highest percentage was given to Exxon, 40%, but was closely followed by Microsoft with 36%.

These two companies are metaphors for energy and information technology, and it makes sense that they would be most prominently chosen.

There were several companies that received no votes by respondents at all. McKinsey & Company received 0% of the votes, which raises questions about the value of service industries. Caterpiller received 0% of the votes, which raises questions about the value of construction, and 3M received 0% of the votes, which raises questions about innovation and development of newer technologies not only related to information.

How do you tackle complex World issues?

Finally, respondents were asked how to tackle complex World issues. This was intended to give insight into how people think some of the problems that were discussed in the survey are best dealt with. Most people, 36%, believe that tackling complex World issues are done by use of Grassroots Movements. This essentially means that things are started locally and expand from there. This was in stark contrast to Governmental Intervention that received 17% of the votes by respondents.

Following Grassroots Movements, respondents also believed that a Societal Paradigm Shift, 30%, was the most effective way of tackling complex World issues. This means thinking in a new way about issues, and in this context, it means an entire society agreeing to think a new way about something.

For instance, I can see this beginning with LED (light emitting diode) lights versus incandescent lights. People are all starting to change their light bulbs due to energy and environmental concerns. It just takes a long time, but it is very effective.

Thoughts?

There was a final area where respondents could write down their thoughts if they wanted. Some people wrote that they enjoyed the survey, which was very nice feedback. A lot of people made reference to how the survey was vague or too general, or that I left out certain "issues."

The fact is that I was just trying to take the temperature of perspectives on the year 2020, not necessarily make a full blown diagnosis. Additionally, the year 2020 is very far away, and it's hard to be specific about something that is so distant.

Conclusion

The results of the survey are compelling and interesting. I think one of the most interesting things to note about the first couple of questions asked relating to threats, both issues and individuals, is that most people worry about problems that aren't even a reality, and forget about those already afflicting us.

While Nuclear Weapons are scary, poverty, sexually transmitted diseases, and random acts of violence affect people every day, and impact most likely 2/3 of the World's population.

We need to keep perspective on issues that are already needing our resolve.

Alternative energies are springing off in so many directions at the moment that it is hard to tell which will be most utilized. The varied choices by respondents indicate the lack of direction.

While most people believed China to have the greatest per capita GDP by 2020, they will probably be alarmed to realize that China ranks 99th in the World when it comes to per capita GDP. Just because a country as a whole makes a lot of money by volume doesn't necessarily mean that its average inhabitant is reaping those benefits. With 1.3 billion people it would make sense for China to have the highest total GDP, but we have to remember how that wealth is spread amongst that enormous amount of people.

Finally, of the respondents surveyed, 23 of them believed that "The World will be a 'better' place than it is in 2020 than 2008." This represents exactly 50% of the responses for this question, revealing that the other 50% of respondents do not believe the world will be a "better" place in 2020.

This is unfortunate split, as most respondents were in their early 20's, and at the start of their independent lives. One would hope that the younger generation remains idealistic and optmisitc about the future, because in the year 2020, it is a majority of this survey's respondents who will be combatting and trying to contribute solutions to the various issues raised in this survey. There are a lot of issues that need to be dealt with over the coming decade; that is for certain.

An Olympic Return

2008-08-19T15:31:00.000-07:00

The Olympics are an incredible event that is hosted once every four years and it brings together nations from all over the World in friendly competition to measure human achievement. These Olympics in Beijing, China have seen some of the most impressive feats capable by all of mankind. Take for instance, Usain Bolt, who ran the 100 meter dash in 9.69 seconds blowing away the rest of the field and establishing a new World Record. How can you talk about the Olympics without mentioning Michael Phelps and his 8 gold medals in swimming? How about the impressive performances by US gymnasts Nastia Luikin and Shawn Johnson in the women's all-around competition.

After just 11 days of competition, I've been truly impressed by the Olympics and think that this one in particular will have significant long-term impact on the World and I feel like it is already changing it in just a short time.

Anyway, aside from the remarkable performances by the athletes and the most amazing opening ceremony probably in the history of the Olympics and perhaps the history of mankind, I wanted to delve into the financial impact that the Olympics has on the World. A huge reason why the Olympics have become the show that it has is due to large investments for big multi-national corporations around the World.

Take for instance the Olympic logo. In order to become an "official sponsor" of the Olympic games and therefore be able to market your company as such, it will cost approximately $50 Million. If companies don't want to spend this enormous amount of money over a 17 day span, they can also become a "partner" of the games in which they can display the logo of the Olympics in their marketing campaigns, but they will need to also put the "USA" or any other country along with it. This typically will cost companies around $25 Million.

As you can see there is a significant investment that companies who decide to involve themselves in the Olympic games undertake. However, it really wouldn't make much sense for these companies to spend exorbitant amounts of money if there weren't any payoff involved.

Intuitively, it makes good sense to sponsor an event like the Olympic games. For example, sponsors get an enormous amount of global reach in their advertising campaigns during the course of the games. This is true of television commercials, internet advertising, as well as, advertising at the Games themselves. This gives companies a great deal of exposure to a World market.

Additionally, the advertising campaign makes sense if you believe that advertising actually works. What I mean by this is that the Olympic games are a fun event that people have positive connotations connected with it. By linking those positive connotations of the Olympic games with the corporation that decides to sponsor the games, people become more likely then to associate positive images with a particular corporation. Ultimately, this is intended to drive revenues and eventually increase profits.

Increasing profits is the name of the game and Olympic sponsorships are a huge investment and it would thus only make good sense for companies to back this event if it ends up benefiting the company.

Therefore, I did an analysis of the 2004 Summer Olympics held in Athens, Greece and looked at 9 companies in particular that sponsored the games. Each company were primary "official sponsors" in varying categories. I looked at various financial indicators since 2004 through 2008 including their revenues, EBITDA, stock price, current ratio, and leverage ratio. I wanted to evaluate whether an Olympic sponsorship effort had any significant return or increase in growth over subsequent years.

In order to do so, I compared my 9 companies that sponsored the 2004 Summer Olympic games in Athens, Greece with 48 of the top 50 Fortune 500 companies in 2008. I consider these companies to be a sufficient benchmark on which to gauge economic progress.

Methods

The first thing I decided was which Summer Olympics to look at in particular. I chose the 2004 Athens, Greece games, because I think that the sizable investment that companies have to make in sponsoring the games ought to have quick returns, defined as those that significantly impact financial data of a company within 4 years.

Next, I found the companies that sponsored the Summer Olympics in Athens, Greece. I found a website called, INVGR.co m (Invest in Greece), which itemizes the companies that sponsored the Olympic games in Athens. According to the website, the sponsors invested over $600 million in the games.

Based on this list, I then picked companies that were publicly traded and had readily available financial data. This ended with our current list of 9 companies and their category which include:

Hellenic Telecom (Telecommunications)
Heineken (Brewery)
Coca-Cola (Non-alcoholic beverages)
Kodak (Film/photography and imaging)
McDonalds (Retail Food Services)
Samsung (Wireless Communications)
Time Warner (Periodicals/Newspapers/Magazines)
Xerox (Document Publishing, Processing, Supplies)
Shell (Petroleum Products)

After determining these companies, I then looked up their financial data since 2004. All financial data is courtesy of Google Finance and all stock quote information is courtesy of Yahoo! Finance. Samsung's financial data was taken directly from their Annual Reports for 2004 through 2007.

The financial data includes measures for the current ratio of each company and leverage ratio for each company. The current ratio is found by dividing the current assets by the current liabilities and is a measure of a company's ability to pay its short term liabilities and its capacity to turn products to cash. The leverage ratio is a measure of the financial leverage of a company and gauges its ability to meet financial obligations. This ratio is found by dividing total assets by equity.

After performing the initial analysis of Olympic Sponsor companies, I then needed to benchmark my results against an average. I decided to use the top companies in the Fortune 500 List as my benchmark because of its inherent diversity of companies. In addition, the companies on the Fortune 500 list typically perform well and if I wanted to see if companies perform unusually well this would be a good group to compare it against.

I took the top 50 companies of the Fortune 500 List in 2008 and compared their revenues and stock prices since 2004. My sample included only 48 of the top 50 companies due to mergers and acqusitions that had occurred since 2004. I decided to leave these two companies out, because the merge may have inflated or slowed growth.

Results

Compound Annual Growth Rate (CAGR) Revenue

Since 2004, the 9 companies that sponsored the 2004 Athens Summer Olympic games had an average CAGR of 5.4%. The company with the highest CAGR was Samsung. Their CAGR was 17.7% and went from revenues of $55.2 billion in 2004 to $106.0 billion in 2007. The company with the lowest CAGR was Kodak. Their CAGR was -6.6% and went from revenues of $13.5 billion to $10.3 billion.

Compared to our benchmark of the top 48 of 50 companies in the Fortune 500, these results are dissapointing. The Fortune 500 companies had an average CAGR of 11.0% since 2004. The company that had the highest Revenue CAGR since 2004 was The Goldman Sachs Group, 30.1% and went from revenues of $23.6 billion to $88.0 billion. The company with the lowest Revenue CAGR since 2004 was General Motors, -1.4% and went from revenues of $195.6 billion to $182.3 billion.

Additionally, if we evaluate each sample's standard deviation we can determine a range in which we would most likely find 68% of the companies in each sample by looking at +/-1 standard deviation.

The Olympic sample had a standard deviation of 6.3%, which determines a range for Revenue CAGR for companies sponsoring the Olympic games as between -1.0% and 11.6%. The Fortune 500 sample had a standard deviation of 7.5%, which determines a range for their sample of 3.5% to 18.5%.

CAGR Stock Price

Since 2004, the 9 companies that sponsored the 2004 Summer Olympic Games in Athens had an average CAGR for their Stock Price of 7.5%. The best performing stock was McDonald's which had a CAGR of 17.9% and the worst performing stock was Kodak who had a CAGR of -5.4% for their Stock Price.

The top 48 of 50 Fortune 500 companies had an average CAGR for their Stock Price of 7.1%. The best performing stock was Valero Energy which had a CAGR of 35.6% and the worst performing stock was The Ford Motor Company who had a CAGR of -12.9%.

To determine a range in which we would most likely find 68% of our sampled companies we take a look at standard deviations. The standard deviation for the sponsoring companies was 8.2%, which defines a range of -0.7% to 15.7% CAGR for stock price. The standard deviation for the Fortune 500 companies was 10.1%, which defines a range of -3.0% to 17.2%.

For further comparison, we can look towards three widely used indeces in the United States Stock Exchange, the Dow Jones Industrial Average (.DJI), NASDAQ (.IX IC), and S&P 500 (.INX). Since 2004, the Dow Jones Industrial Average has had a CAGR of 3.8%, the NASDAQ has had a CAGR of 3.0%, and the S&P 500 has had a CAGR of 4.0%.

CAGR EBITDA

CAGR for EBITDA was only evaluated for the sponsoring companies. On average, the group's EBITDA had a CAGR of 2.9%. The highest performing company in terms of EBITDA was Time Warner, who achieved a 12.0% CAGR for EBITDA. Time Warner went from an EBITDA of $6.1 billion in 2004 to $9.6 billion in 2007. The worst performing company in terms of EBITDA was Kodak at -22.0%. Kodak went from an EBITDA of -106 million to -235 million.

Revenue Percentage Growth and Year over Year

The 9 sponsoring companies of the 2004 Summer Olympic Games grew on average by 7.5% from 2004 to 2005, 5.7% from 2005 to 2006, and 8.7% from 2006 to 2007. Between 2004 and 2006, Samsung grew the most each year. In 2006 to 2007, Coca-Cola had the highest percentage growth in revenues. Kodak was consistently the company that performed the worst from 2004 to 2007. Aside for a -0.1% growth by Xerox between 2004 and 2005, Kodak was the only company that had negative growth over this period.

By keeping the 2004 revenue of each company constant, it can give an idea as to how much the company grew over the four year period. On average for the group, revenues increased by 7.5% in the first year, by 14.4% by the second year, and by 25.2% by the third year.

Current and Leverage Ratios

In order to evaluate current and leverage ratios it is best to take a look at them as they deviate over the four sampled years. Overall, the average for the group's current ratio deviated by 0.146. The largest deviation in Current ratio was 0.491 by McDonalds. The smallest deviation was by Shell which was 0.079. The average current ratio for the 9 sampled sponsor companies over the four year period was 1.20.

The average deviation for leverage ratios was 0.515. The largest deviation was by Kodak, 2.912, and the smallest deviation was by McDonalds, 0.046. The average leverage ratio for the 9 sampled sponsor companies over the four year period was 2.83.

Conclusion

Companies will pay a tremendous amount of money in order to sponsor the Olympic games. Marketing campaigns and rights to the Olympic rings can cost in excess of $50 million. With such a large investment, it would seem strange for companies to not profit from it.

Based on the financial research of 9 sampled companies that sponsored the 2004 Summer Olympic games held in Athens, Greece, there is no significant benefit to sponsoring the Olympic games.

In terms of revenues, it appears as though those companies that sponsored the Olympic games actually lagged behind. Olympic sponsors had a CAGR of 5.3% since 2004, whereas the benchmark for this research (48 of the top 50 Fortune 500 companies) had a CAGR of 11.0%. This would suggest that the investment in the Olympics is unfounded.

However, when comparing stock price CAGR, Olympic sponsors outperform the benchmark slightly, 7.5% versus 7.1%. This, however, is very close and shouldn't be seen as a significant difference. EBITDA gains for sponsoring companies, 2.9% CAGR, further indicates the lack of impact that the Olympics has on the profitability of a company.

Current and Leverage ratios practically stay in line and there is no significant jump in these financial categories.

However, it is interesting to note that companies that invest in the Olympics typically have a strong stock return. As of January 1, 2008 the 9 sampled companies were up 50.8% on average, with the highest returners, McDonalds and Hellenic Telecom, up 127.5% and 117.4% respectively. It is also important to point out how companies who sponsor the Olympics have strong revenue growth. Although our sampled group didn't outpace our benchmark, the revenue growth after four years (without Kodak) is on average 31.3% with the highest growth coming from Samsung, 91.9%, Coca-Cola, 32.7%, and Shell, 33.6%. These are extremely strong numbers and 6 out of 9 companies had in excess of 20% revenue growth.

It's important to remember the larger picture and purpose of the Olympics in general. It's a momentous occasion that brings together the finest athletes in the World to compete together and promote good-will. Companies have the opportunity to benefit from the immense audience that is drawn to the Olympics, but there is certainly no proven formula.

Alternative Modes of Transport: Bus

2008-08-11T18:23:00.000-07:00

Several weeks ago, I ran a survey relating to modes of transport between Ann Arbor and Chicago. The impetus for this survey was the result of the spiking oil prices, which have receded since then, but are still staggeringly high. Oil has been creeping up for quite some time. Starting from October of 2007, when oil was $92/barrel, the vast increase started to alarm people (Source).

Since then, it has topped out at $141.71/barrel on June 27, 2008. This is the highest price that oil has ever reached, even in real and inflation-adjusted terms. As of today, August 11, 2008 the NYMEX Crude Futures are at $114.68/barrel, a decrease of 19.1%. With this extreme spike in oil prices has come a lot of other baggage along with it.

For instance, while oil was spiking the economy was also dealing with the ongoing subprime mortgage woes that have truly and utterly paralyzed the American economy in my opinion. The growth outlook for the rest of 2008 is projected to be 0.7%, which is a snails pace when you consider the long term growth trends of the US Economy, and especially now when it is trying to keep stride with China and the growing World economy.

Additionally, the rise in oil prices have effected all things from apples to transportation. The price of food has increased along with oil prices, and transportation costs have spiked because they are linked to oil prices, which has meant that all goods that need to be transported (and that's pretty much everything you consume unless you go to the Farmer's Market in Aurora, Illinois) have risen with it.

Increasing oil prices are never a good thing and compounded on the rest of the economy's troubles, this hasn't been the best economic years in recent time for the American economy.

However, with every cloud there is always a silver lining (or at least I remember hearing that in Kindergarten and I hope and pray that this adage holds up). With rising oil prices, one of the major shifts that could occur is in how people commute. National gas prices for a gallon were in excess of $4 at one point, and this severely hurt demand. For the first time in many registered years, the demand for oil in the US declined as a result of the high price of oil. For the first time this century, OPEC has projected a decline in demand for oil by the year 2020 according to their 2008 World Oil Outlook.

People are simply not driving as much, because they just couldn't afford it. It made sense to me that if people weren't going to drive their own vehicles, they would have to turn to some other means in order to get around (I assume that people are productive and will continue to get out of their homes even if they can't drive their own cars).

So, in order to make this idea a little more tangible for me, I broke it down to a lengthy commute that I typically go on and wondered if people would change their habits due to the rise in oil. I wanted to see whether people would consider taking a bus as an alternative mode of transportation from Chicago to Ann Arbor, where the University of Michigan is, or vice-a-versa.

I often perform this commute. It takes about 4 and a half hours to get from one place to the next and its a pretty simple and easy drive to do. However, with the rising oil prices, the cost of the journey each way was amounting to around $54 (I'm assuming a car that can go 20 miles per gallon at a rate of $4.50/gallon). Anyway, that's a lot of money to have to pay, and that only gets you there. You have to pay another $54 on the way back. So a trip from Chicago to Ann Arbor is going to cost the average person $108 automatically.

There's got to be a better way. That led me to think about alternative modes of transportation. I was immediately led to the idea of starting a bus service that goes between Ann Arbor and Chicago. I hadn't really heard of too many before and I thought the idea to be quite novel. Since thinking this idea up, however, I have come to learn that bus services between Ann Arbor and Chicago is not only plentiful with different bus services but also highly competitive. It was a great idea in principal, but its already been explored. However, I wanted to see what people's propensity towards alternate modes of transportation were as a result of the rise in the price of oil.

Results

I received 17 respondents for this survey. Therefore, I can't call my results statistically significant, but I like to consider them at least an indication of what people may generally do.

The respondents were composed of 10 males, 6 females, and 1 unknown. The average age of respondents was 24 years of age with a mode of 21 years of age.

I first wanted to gauge how many times people actually frequented Chicago from Ann Arbor during a typical school year. Therefore, I asked them how many times they made the trip in a given school year. The average amount was 2.25 times, with a median of 1.5 and a mode of 1. The most times a person traveled to Chicago was 6 times, and the least amount was 0 (answered by 3 different respondents).

The following graph indicates how these people who traveled to Chicago typically get there. As you can see a number of them Drove there, 80%, and the rest of the 20% was split between bus and train. I find it surprising that none of the respondents replied that they take the plane to Chicago. I realize that the journey is only 4.5 hours by bus, train, or drive, but I have taken a plane in the past and its quite pleasant and very fast.

I then wanted to gauge how the price of oil had affected peoples habits in their everyday lives and how it had specifically affected their mode of transport. According to my results, only 6 out of 17 people had had the price of oil affect any of their spending habits. Quite similarly, the proportion of people who responded "yes" to the rise in oil affecting their habits as they relate to their mode of transportation, 7 out of 17 people, agreed that the price of oil was affecting their habits of transportation.

When I first considered these proportions, they didn't seem all that significant, but both are very indicative of the climate and the present state of the economy. I would contend that people don't typically think about the price of oil when they're picking out their Cheerios at the grocery store, or buying a song on iTunes, but apparently that is the case with 6 of 17 of our respondents. Even more significant, is the fact that 7 out of 17 people have changed their habits when it comes to modes of transportation to accommodate the rise in oil prices. If humans are creatures of habit, oil is mighty powerful in changing those habits.

I also wanted to know what price it would take for people to change their spending habits (if they hadn't already). My results indicate that at a price of $5/gallon (mode), people's habits would most likely change when it came to their respective modes of transportation. Our oil prices came very close to making that number a reality, but as of right now they are most certainly on the retreat, and I believe the national average has dropped well below $4/gallon.

I then gauged whether or not people believed that as prices continued to increase for a gallon of gas, if "alternate methods of transport would actually become a realistic alternative to driving their personal vehicle." My results indicate that 10 out of 17 people believe this to be the case. That is a solid majority, and although these results are statically significant, that is an interesting idea to say the least.

Finally, I presented the respondents with a scenario in which I asked them to consider going to a location called Zanzibar, which was a mere cover for Ann Arbor from Chicago (I'm sneaky). The trip was planned on short notice, and I provided them with time, distance, and cost variables for plane, train, and bus. I then wanted to see what most people would do considering these various constraints.

As it turns out, a huge percentage of people would opt for the bus. According to this study, 76% would take the bus, 18% would fly, and 6% would take a train. I find these results a little overwhelming. I want to attribute these results to bias, but I truly believe that if there was an affordable and enjoyable service that got people from A to B in the same amount of time as driving but at a cheaper cost, I really see no reason why they wouldn't go for it.

There are similar services in New York City that go from Washington, DC to New York or vice-a-versa, and that seems to do very well. It is a comparable distance between Ann Arbor and Chicago as it is from New York City to Washington, DC, and I have taken that bus and I enjoyed the ride.

I calculated that a competitive rate for a ticket from Ann Arbor to Chicago could cost anywhere in the range of $20-$30 for a one way ticket on a bus. I'm not sure what competitors are currently offering, but after factoring in bus rental (or lease), paying the driver, insurance, and cost of fuel, a pretty hefty margin can be attained if you charge a person $20-$30 each way. This kills the rate of $54 if you were to drive your own personal vehicle.

However, when giving the option of using one's own personal vehicle as the mode of transportation to Zanzibar, 9 out of 17 people still would opt to drive. This draws on the habit that people have to drive their cars to get around. There are definitely other ways though, and they can be a lot more cost effective, especially today when the economy is slumping and oil is going through the roof.

Conclusion

The results indicate that people would be willing to take a bus from Chicago to Ann Arbor in order to satisfy their transportation needs on short notice trips. I am not sure as to how this statistic would vary if time were taken out of the equation.

Although the bus became the number one choice of transportation, the advent of one's own personal vehichle still loomed and was far more widely accepted if given that as an option.

In order for people's transportation habits to change, the price of gas will have to soar to extreme heights, probably in excess of $180/barrel for oil and $5/gallon. The bus transport industry can be very effective and profitable if managed properly.

The Standardization of Time

2008-08-09T14:19:00.000-07:00

I've recently gained new and lasting respect for the power of time. I've come to realize that time is my most important and valuable commodity, because it is limited and ever-fleeting. I really started to gain a true appreciation for time when I was traveling around Europe. When I was over there, I realized that the things that I chose to do with my time were important and I had to choose carefully.

At any given moment, I could have decided to be in Prague, Amsterdam, Copenhagen, Budapest, or anywhere else. All I had to do was decide where to be and make it happen. Additionally, while being over there, I realized that no matter where I went, there was always something interesting and fantastic going on that I enjoyed and loved taking part in.

This indicated that no matter where I decided to be in the world at any given moment, I was going to have a great time, so the most important thing to decide was simply where to put my time.

It's a very empowering feeling to know that anything is possible. Anyway, I really feel like I have a greater realization of time and how important it is to my life.

Therefore, I wanted to write about the accomplishment of strandardizing time. I think about how many things a day that are contingent on me coordinating activities with other people, and I think that without a standardized method of discussing our places and locations in the universe (aka, time), then I'm not sure how productive or how much humans could get accomplished.

I think that much of the reason why humanity has progressed as it has over the past couple million years is due to the fact that we have not only figured out a very sophisticated and impressive linguistic understanding of one another, but we've also been able to coordinate our activities based on an agreed standardization of time.

Surely there will be counterarguments from people who can't understand the bigger picture of what I'm trying to convey. You may contend that people don't really agree on the standardization of time because of various things like daylight savings time, especially the case of Indiana in the United States. They didn't agree to daylight savings time until 2005, around 120 years after daylight savings time was first initiated.

However, when you consider humanity's entire existence and then fathom that we only began to think about standardizing time aroung 120 years ago, we most certainly have come a long way in just a couple years.

As for a little history lesson, standardized time in North America was the result of issues relating to train schedules. On October 11, 1883, the heads of the major railroads met in Chicago at the former Grand Pacific Hotel to adopt the Standard Time System. The new system was adopted by most states almost immediately after railroads did so and finally officially adopted by the U.S. government almost fifty years later.

In 2007 the United States enacted a federal law formalizing the use of Coordinated Universal Time as the basis of standard time, and the role of the Secretary of Commerce (effectively, the National Institute of Standards and Technology) and the Secretary of the Navy (effectively, the U.S. Naval Observatory) in interpreting standard time (Source).

Anyway, I feel like so much hinges on this ability of ours to coordinate activities. It makes us work together as a species, which has allowed us to progress rapidly and reap the benefits of this universe.

I think about how the whole world was watching the opening of the Beijing Olympic games last night. This event had been seven years in the making, and everyone knew exactly when and where it was going to be, even though in Chicago, Illinois (where I was), being thousands of miles away from it didn't make a difference.

I think about how I caught a train yesterday. I got there a little earlier than I normally do. I had to sit around for about an hour and a half before the first train came to where I needed it to go. What I found remarkable was that while I was sitting in the train station, for the first hour and twenty minutes before the train came, I was practically by myself. There was the odd person who walked through the train terminal, but for the most part I was just there sitting by myself.

However, within 10 minutes of the train arriving, hundreds of people began showing up. Their actions all coordinated by a simple time mechanism. It was no coincidence that all of these people showed up at the same time. They had all taken into account when they needed to be somewhere, and because humans have generally agreed on a standardization of time, hundreds of people could simultaneously coordinate their activities independently.

It just boggles my mind. Your time is special, use it the best way you know how.

The Search is On

2008-07-29T19:42:00.001-07:00

I want to make reference to the sudden resurgence in the online search engine market that I am finding quite titillating at the moment. Within the past two weeks I have become aware of two equally impressive and significantly different search engines.

The first one that caught my eye was referred to a friend of mine who attends the University of Illinois (who is typically on the cutting edge of most technological innovations which I am continually in awe of). The website is called Scour and as the name suggests the website is a search engine that in effect “scours” the Internet combining the powers of Google, Yahoo!, and MSN. Who cares! You may think that this a show of hubris, attempting to topple Google and Yahoo! using their own technology.

Well, where Scour is slightly different is in that it pays you to search. I’m not sure of how this works exactly, but the best understanding I have of it is that you search enough times, accumulate enough points, and then they set you up with an online American Express card. Some people were weary that they didn’t ask for an address, but just because you don’t have an address doesn’t mean you can’t surf the Internet (at least these days).

There are several problems with this search engine, however, that I think will stop it from becoming the next big thing. First, the search itself is quite a lengthy process. When I say lengthy I mean it takes around 3 or 4 seconds to find the information you’re looking for. In the age of Google and Yahoo! blasting at relevant results in mere split-seconds, 3 or 4 seconds turns into an eternity very quickly. If they want to really compete with the big boys, they’re going to have to drastically lower this wait time.

Second, getting paid for search is great, but in order to reap any of the benefits you have to attain something ridiculous like 6400 points. In order to get a point you can do several things. You can search, this will result in 1 point being added to your total. So, getting to 6400 searches won’t take that long I guess, at around 20 searches a day for a year that’s an American Express card. Then again, when I look at my own Google search history (a very nice feature if you ask me), I’ve searched 4923 times in the past year. So, I suppose it is possible.

Aside from merely searching, however, you could also do two of the other options. You can vote on the relevance of your search by clicking the thumbs up or thumbs down icon. This will generate 2 points. Wow, now we’re talking. That’s going to cut my time in half in order to get that American Express card!

Another feature you’re definitely going to want to make use of if you’re on the 6400 point track is the comment section for each search result. By inputting a comment for a particular search this will yield 3 points. My goodness, this American Express card doesn’t seem so far off anymore.

I have some theories about these additional features that Scour has made use of. If you recall back to my post about Doogle, in which I explored ideas about creating the next generation search engine, I made it clear that the next generation search engine would have both the analytical capabilities of Google’s algorithm and also the compassionate understanding of humanity. The search engine must be both flawless in its approach to digging up data on the Internet, but it also has to have a human component.

I think that if Scour were smart, and the more I think about this the more I realize that they must be doing what I’m about to explain and are indeed smart, they would start compiling a database of the information that is being input into it at the moment. For instance, when someone searches “cat” using Scour, people can vote on and comment on the most relevant.

However, how often does someone actually search for something as trivial as “cat”? I’m not saying there is anything wrong with this search term, rather that searches are becoming more complex, and typing in the string, “how can I get from Memphis to Cincinnati by taking a plane and then a bus,” are probably becoming far more commonplace.

Google has excelled in simplifying search, and perhaps that is where it will find its limits. Typing in more complex strings don’t need algorithms, but rather human input to reach and arrive at an answer. At this point in our computing ability, no computer can truly answer some complex human queries in the most relevant way.

That is why I think Scour is smart to begin using everyone’s favorite search engines. Anyone who is anyone, literally almost anyone on the planet with access to the Internet, has used one of the three search engines that Scour employs. This makes people feel comfortable when they are searching. They see those happy symbols of accurate searches and feel warm on the inside.

Every time Scour gets a really complex search query and users put a thumbs up or thumbs down and comment on why the search they went to was more or less accurate, they can put another coin in the piggy-bank.

I think what they will eventually do after probably a year of compiling enough data is release another search engine that they claim to be the most accurate in the entire world, and you know what, they’re going to be right.

They’ll have both elements to the next generation search engine. Not only will their searches be faster (because it will be their own technology and draw from their own servers, etc.), but it will also be absolutely incredibly relevant, especially when it comes to asking it insanely hard questions.

I think that there is a tremendous amount of potential to Scour and they may not topple the giant that is Google and Yahoo!, but heck, I think that they’re going to give them a run for their money.

The second search engine, which I have done considerably less thinking about and know far less about is Cuil.com. Apparently it was just launched within the past couple weeks and is doing fantastically well.

From the little I know about it, it was started by someone Google Executive who started their own company with what they perceived to be a better product.

After searching on it for a little, I can see why some may perceive it to be a little better. It provides the results in a far more stylish way. The layout is a little different with three columns of search results that have pictures associated with them and a little more description than the two-liner than Google typically provides.

I have to admit, the website is fresh looking and it is fast and semi-reliable. It will probably have to work out a couple kinks in the next couple weeks if it has any chance of competing.

I also have to commend the designer of the search engine for their idea about grouping information that is relevant to a particular search term. For instance you can type in “University of Michigan” and then the results will provide you with some categories that you can look into deeper if that was perhaps what you were really referring to when you typed in “University of Michigan.”

There are several problems with this. First, it is attempting to predict what you’re searching for and I think that’s a bad strategy for search engines. People typically know what they want, they don’t want to be led down random roads where they fall into an abyss of the Internet garbage that is out there.

Second, who and how is the determination made for particular categories that certain search queries get filtered into? I don’t like people to make decisions about my search habits and Cuil.com is attempting to do this. Not clever. Not Skoda.

Here is why I think Cuil.com is just Google with a pretty dress on, except now Google is more annoying and doesn’t give you what you want.

Cuil.com has nice pictures next to their search terms and sweet descriptions. Wow, these are all wonderful features, but Ask.com tried the same technique and they haven’t move an inch after their initial marketing push to gain market share when they made their changes at first. People want simplicity when they’re searching (unless they’re searching for really complex things, in which you need a more complex search engine like Scour).

The problem with entering into the search engine market right now is that if you’re not significantly better at doing something than Google, you’re not going to be able to take any market share away from them. They have a stranglehold on search. That is because they consistently provide relevant results in a quick and timely manner. That’s a tough practice to leave.

Cuil.com does the same thing. They provide search results quickly. It just looks a little different. It doesn’t really do anything much better.

Then again, I still need to do some searching with Cuil.com, and I could be wrong about all of these things. But, I just don’t know why I would stop using Google to use Cuil.com, there isn’t really anything in it for me. I’m so comfortable with my sweet sweet Google, for me to use anything else would take something drastic (or do something far better like solve my complex search needs).

Conclusion

Scour.com is a search engine that uses the powers of the three largest search engines on the Internet to find the most relevant search results. However, through their implementation of voting and comments they are adding a human element to search, which I believe they will direct into a future enterprise that will be unbelievably helpful when dealing with complex searches. They also pay you for your hard work, so that’s not bad.

Cuil.com is a new search engine that has a fresh look and apparently the largest database of archived Internet pages within its system of any search engine, even Google. While this is a mighty feat, the Internet was big enough as it is, and having a couple hundred million more pages doesn’t really impress me all that much. Additionally, the interface is far “fluffier” than that of Google, which I don’t think provides it with a competitive advantage of any kind.

I think that Scour.com has a huge chance of stealing a ton of “complex” search market share in the coming years. They are building the foundation at the moment. But, like most thinks that attempt to take on Google, both of these search engines will probably be eaten up and fed to one of Google’s many spiders that scour the Internet.

Nobody outsearches the Googmonster!

Simply Syntroleum

2008-07-21T19:26:00.000-07:00

I'm a big fan of the stock market. I enjoy following its movement, the stories behind the companies, and the people involved. I'm not sure what has made me the avid stock fiend that I am today, but I thought its a combination of a love of numbers, money, and suspense. The stock market has all of these bundled into one happy little 6 and a half hour session, typically five days out of every week.

For more esteemed reasons, I enjoy partaking in the stock market because it keeps me informed as to the pulse of the American economy. The American economy is a significant, if not the most significant player in the whole world when it comes to the economy. The stock market is a barometer of where America's economy is and by virtue of its power and enormity, where the rest of the world's economy is likely to head.

These are all fascinating things. I also find the ways in which stocks are picked just marvelous. There are two particularly different trains of thought that I'm aware of. The first is fundamental analysis, in which stock brokers and institutional investors (you know, the guys who all had to writedown billions upon billions of dollars in wake of the sub-prime mortgage crisis, which I read totaled a whopping 12 trillion dollars (92% of US GDP)) look at financial data for publicly traded companies and make judgments based on the current economic climate.

They take factors like the balance sheet and income statement into account, as well as, management practices. I'm a huge proponent of looking at management practices. I believe that with the right team and suitable actors in the correct places, a capable management team can make even the most desperate company rise from the depths.

Anyway, another way to look at stocks is through the lens of technical analysis which emphasizes the stocks historical data as it relates to price and makes its judgments based on these metrics. I've always loved deciphering charts and trying to gain a further understanding of them especially for various stocks in the market.

Recently, I've become enthralled with a particular type of technical analysis called Point and Figure Charting, which you can read about on Those Answers Inc. website. The main idea behind it is that it charts the price movement of the stock in terms of supply and demand, the main driver underlying all economic thought. Simply by creating a vertical column of X's or O's, a tremendous deal of information can be gathered about the buying or selling habits of a particular stock.

Another nice feature about it is that it doesn't take time into effect, which can often distort the movement of stocks. On the surface, Point and Figure Charting may look very simple, but there is a tremendous amount to it that has fascinated me and led me to one of the best looking and most promising stocks I can see available at the moment.

Syntroleum (SYNM)

According to Google Finance, "Syntroleum Corporation is engaged in developing and employing technology to produce synthetic liquid hydrocarbons that are free of contaminants normally found in conventional hydrocarbon products. Syntroleum’s Bio-Synfining Technology processes triglycerides and/or fatty acids from fats and vegetable oils with heat (thermal depolymerization), hydrogen and catalysts to make renewable synthetic fuels, such as diesel, jet fuel (subject to certification), kerosene, naphtha and propane. Syntroleum has quantified in excess of 80 different fats and oils, for conversion to synthetic fuels via the Bio-Synfining Technology, which is a flexible feedstock/flexible synthetic fuel technology."

In a nutshell, Syntroleum has developed a new and special technology that is capable of creating diesel fuel using fat. This means, that instead of using corn to make ethanol gas, which ends up hurting us either way because then it makes corn really expensive, we can use the stuff we don't even want in the first place, fat, to make fuel through this incredibly innovative and breakthrough technology.

I have never felt a stronger buy in my entire life. I first saw this stock when it was wallowing in the sub $1 range, almost being thrown off of the NASDAQ, because it just couldn't keep up with regulations. Since then it has returned in excess of 400%. It is currently at $2.24 a share and shows me no signs of slowing down whatsoever.

Let's get back to the process though. They make diesel fuel. This is spectacular for several reasons. First, the price of diesel fuel, along with petroleum, has skyrocketed recently (I believe the price of diesel fuel has actually outpaced petroleum percetage-wise). This spike in prices has begun a paradigm shift to move away from oil and to some sort of alternative energy.

Last summer, the push to alternative energy happened with solar energy. Companies like First Solar (FSLR) grew impressively. Their stock is now trading above $200, up from around $5 early last year. Different alternative energies are getting their shots, its just a matter of picking the right company. There are several other solar energy companies that did not see the massive gains that First Solar did (however, they were still sizable).

With these high oil prices and no one really knowing when they will ever come down, alternative energy, especially that which produces diesel fuel, is ripe for investing. People want to believe in an alternative energy source, and Syntroleum seems to continually have the answer.

For instance, their Bio-Synfining Technology needs fatty acids in order to occur. So, Syntroleum has recently struck a partnership with Tyson Chicken, the largest chicken farm in the World (#88 on the Fortune 500 List), to use all of their chicken fat. Not only does Syntroleum have the greatest supply of fat on the planet, but it is an unending supply.

Chicken fat, or any sort of animal fat, is completely renewable. There is no end to how much of this stuff we can use, and for the most part, there aren't many other uses for chicken or animal fat, so this takes something worthless and makes it pure profit. Pure genious really.

But heres where things really get good. Syntroleum and Tyson, their joint-venture called Dynamic Fuels LLC, just received $100 Million worth of GO Zone Bonds. GO stands for Gulf Opportunity, and is a program that was established post hurricane Katrina by the State of Louisiana. The bonds are tax exempt are meant to promote investment in the area.

In late June, Dynamic Fuels LLC was approved for $100 Million, the maximum amount paid out in the program. Their plan is to build a synthetic fuel facility in Geismar, Louisana by 2010.

This was well received by Jeff Bigger, Senior Vice President of Business Development at Syntroleum, "We thank the Bond Commission for their decision to approve this application. Their timely action enables us to maintain our project schedule, creating new domestic fuel production capacity, high-quality operations and technical jobs, with initial production planned for early 2010.”

Everything is going absolutely right for this company. What's more is that now that it's above $2, stock brokers are legally allowed by the SEC to promote this stock to investors which will drive the price up as demand increases. As the price goes up, mutual fund managers will want to add this stock to their portfolios, and several institutional investors have already added Syntroleum, Goldman Sachs, Vanguard, Scott and Stringfellow Financial, etc.

On July 22nd, 2008, Syntroleum plans on holding a conference call for investors to discuss all the positive news that has been circulating around this company of only 24 employees. They will probably make reference to the GO Zone Bonds, Dynamic Fuels LLC, their joint-venture, and the approval of their synthetic fuel plant in Geismar, Louisana.

Syntroleum seem to be on the right track. They've got the capital they need, they have a mammoth partner on who to piggyback, an original technology that makes one of the most sought after commodities, and plans to build a facility in which all of this wonderful Bio-Synfining can occur. All this company spells out to me is growth and profits, over and over.

Conclusion

At $2.24, Syntroleum is not only a buy, but highway robbery if you can steal it at this price. Over the next 12 to 18 months this stock is going to explode. They have the technology, capital, and partnerships they need all necessary to create a profitable endeavor.

What's more, the economic climate is just right at the moment. Oil prices are surging. People are looking for alternative ways to create energy and seeking out those that are the wisest investments.

Syntroleum has taken the necessary steps to get them to where they are, and I feel as though they will continue to meet and exceed the market's expectations.

If stock price is indeed the perceived future valuation of a company, Syntroleum truly has no limit. Happy investing!

Corporate Knowledge

2008-07-11T21:01:00.000-07:00

I'm continually fascinated by companies. I think that if you look close enough, you will find that they can be as unique and interesting as people. All of them have personalities of their own, however, that personality is constructed by the collective unit of people that work to move that company forward.

Companies have identities. A large portion of this identity is presented via the media, especially advertising and the news. So, in a sense, corporations are similar to celebrities. You see them on the news now and then. Once in a while they do something stupid that gets them in trouble. You typically don't get the opportunity to actually meet the CEO of the company or visit its headquarters.

So, if you enjoying keeping up with the life and times of Brad Pitt, Paris Hilton, George Clooney, or perhaps even Eva Longoria, realize that my passion when it comes to following companies is in the same context. I find the story that they tell and the impact that they have on the world equal to that of prominent movie actors and actresses in Hollywood.

In an attempt to learn more about companies and how people perceive some of the most notable companies, I recently ran a survey on Those Answers Inc. website.

The goal of my survey was to compare how corporations from a wide spectrum of activities in the United States economy were perceived. I looked at four separate criteria, each composed of two diametrically opposed descriptors, that I eventually plotted against one another in order to see if there was any correlation. The four criteria were:

Success and Failure
Knowledge and Ignorance
Innovating and Stagnating
Good and Evil

By creating a x-y scatter plot or histogram comparing the scores that each company received for the four different criteria, I was able to make an assessment of whether or not there was a legitimate correlation between various combinations. In this study I looked at the correlation between, Success and Knowledge, Success and Innovation, Success and Ethics, and Knowledge and Innovation. I will address all of these different scenarios shortly.

Survey

I sent the survey out via Facebook to a number of my friends. The survey began with a brief description of the definition of a corporation, "a legal entity that is used primarily to conduct business." This is a very generic and broad definition. I then explained my choice for using the companies I did. I picked the 10 companies in this survey for notoriety sake, they are all within the Fortune 100 and are generally well known, as well as for their diversity in corporate activities. I didn't want the bias of conflicting businesses to alter my survey results.

There were 10 companies used in this survey. They were:

Boeing
Comcast
CVS/Caremark
FedEx
General Motors
Goldman Sachs
Home Depot
Microsoft
PepsiCo
Walmart

My instructions for the survey were to order the list of 10 companies used in the survey between the two diametrically opposed descriptors (i.e. Success and Failure) as though they were placed on a continuum. Therefore, the "most" successful company in the responders opinion would be closest the Success side of the input area, and as the companies moved further away from this side and closer to the failure side would thus be considered the "biggest" failures.

Companies would receive a score of 5 points for being the "most" Successful, Knowledgeable, Innovating, or Good, gradually moving to -5 points for being the "biggest" Failure, Ignorance, Stagnating, or Evil. Between these two extremes, companies would score points between 1 and 4 points if closer to the Successful, Knowledgeable, Innovating, or Good side, and -1 and -4 points if closer to the Failure, Ignorance, Stagnating, or Evil side. The continuum did not include the score of 0.

Based on the respondents ranking of the companies points were assigned for each criteria. The points were then averaged. Finally, the points were then plotted against one another for the varying criteria to see if there was a correlation between the two.

A correlation was determined by adding a trend line to the data that expressed and assisted in performing regression analysis. According to the Kellogg School of Ma nagement, "Regression analysis is a statistical technique for studying linear relationships." This type of analysis is beneficial, because it provides a goodness of fit for selected data points and compares two seemingly unrelated criteria that may indeed correlate to one another.

A further step is required. In order to determine the, "proportion of variability in a data set that is accounted for by a statistical model," a coefficient of determination needs to be assessed (Wikipedia). According to Duke University, a good value for the coefficient of determination is generally equal to or greater than 50%, but in most cases it just depends. We will make note of the coefficient of determination when presenting the results.

Results

I was, at first, primarily concerned with the relationships of the three criteria plotted against the Success-Failure criteria, but I ultimately ended up comparing all the various relationships to find the strongest correlation. My original hypotheses were that Companies scoring highest in:

Knowledge have a high correlation to Success
Innovating have a high correlation to Success
Good have a high correlation to Success

Now, I think we can take a look at the results and I'll try and explain what they are and possible reasons for why they turned out as they did.

Knowledge - Success

Based on the findings in this survey, the coefficient of determination representing the correlation between a company's knowledge and the perception of a company's success is 0.603. This is a positive indication of a link between these two criteria if we draw on the assessment of Duke University.

As you can see in the graph, there are many companies within the first quadrant (Microsoft, Boeing, Walmart) that are all considered both successful and knowledgeable. Then there are several companies within the third quadrant (Comcast, General Motors, Home Depot) that are all considered failures and ignorant (or less successful and less knowledgeable than their counterparts in quadrant I).

You may also notice a lack of companies in Quadrant II and IV. Companies falling within this range would represent highly knowledgeable companies that are failures and ignorant companies that are successes.

Intuitively, the results make sense and the coefficient of regression further warrants this. Companies that are considered "knowledgeable" ought to be "successful." If we draw on my analogy from the beginning of this post (companies are like people), one would also believe that a knowledgeable person would become successful. Companies that are not as knowledgeable are therefore not as successful. The lack of companies within the II and IV quadrant also further prove this correlation.

Innovating - Success

The coefficient of determination that represents the relationship between Innovation and Success is seen to be 0.2377. This is a lot lower than the first correlation that we looked at, Knowledge and Success. This is a relatively weak indication of correlation.

The reason that Innovation and Success may not be as strongly correlated is due to the fact that there is no direct link between Innovation and Success. Companies can be unbelievably innovative, developing new ideas everyday, but those ideas may not convert into revenue and ultimately profit.

In this scenario, there are companies that are seen as highly successful, Walmart and PepsiCo, but are stagnating at the same time. This is very accurate, especially when you look at the case of Walmart. While I would contend that Walmart's processes and supply chain integration are some of the most innovative in the world, as far as their product is concerned (consumer goods) they are relatively the same. This doesn't mean for one instant, however, that they are losing any bit of revenue or being any less of a successful company.

Ethics - Success

The coefficient of determination representing the relationship between corporate Ethics and Success was a disappointing 0.0811. This is a very weak correlation.

By looking at the chart, you can see that the companies are generally spread out showing no real signs of following any sort of linear relationship. This ultimately leads to a weak coefficient of determination.

You may also notice that even though the coefficient of determination is weak, the linear trend actually has a negative slope, indicating that the more successful a company is perceived to be the more evil it becomes. When one stands back and thinks about this correlation, it tends to make sense logically.

Consider highly successful companies; Walmart (#1 Fortune 500 List), Nike (Top Shoe Sales in the World), and Coke (#1 Soft Drink in the World). While all of these companies are considered extremely successful, they are also often questioned for their ethics and morality when it comes to how they treat their workers, smaller distributors, etc. Therefore, even though the trend isn't strong it makes sense.

Innovation - Knowledge

The coefficient of determination representing the relationship between a company's Innovation and Knowledge was the strongest, 0.6436. This is our highest correlation and well within the bounds proposed by Duke University.

Similar to our scenario of Knowledge - Success, companies are generally found within the First and Third Quadrant, indicating a link between innovation and knowledge and stagnation and ignorance.

Similar to our other scenarios, just by thinking about these two criteria logically it clearly makes sense that there would be a strong correlation between them. Companies that have a lot of knowledge probably have the ability to innovate well. At least, one's perception of corporate knowledge must lead to a belief in that company's ability to innovate.

The reverse is also true. Companies that innovate are probably thought to be very knowledgeable about their particular field, because they can continually adapt and work out new possibilities with it.

Conclusion

The object of this survey was to determine the relationship of various diametrically opposed criteria that included: Success and Failure, Knowledge and Ignorance, Innovation and Stagnation, and Good and Evil. Respondents were asked to rank the 10 companies in this survey on a continuum in which they were later assigned a point value. These point values were then averaged and then plotted against one another.

Regression analysis was performed in order to evaluate coefficients of determination. The coefficient of determination indicated a value between 0 and 1, 0 being least determinant and 1 being most determinant.

Based on the findings of this survey, the correlation between Knowledge and Innovation was highest, 0.6436. This was then followed by Knowledge and Success, 0.603. These two figures meet our Duke University criteria of being greater than or equal to 50% and can be considered legitimate correlations.

Our two other studies, Ethics and Success, 0.0811, and Innovation and Success, 0.2377, fall short of the generally accepted standard, and therefore, I cannot deduce any sort of correlation between these two criteria aside from logic.

Overall, I thought this was a really interesting and enjoyable study to perform. I was surprised at how well the results actually turned out. I feel like I learned a lot about companies and some ways in which they relate.

Ocean's 14?

2008-07-05T22:43:00.000-07:00

About a week ago, I had the chance to go to the Arlington Park Racetrack, which is a venue quite close to where I live, in which you can watch and bet a little bit of money on the ponies. It was my first time I had ever been to a horse racing track, and I have to say it was quite a lot of fun to put down some money. I can see how a lot of people can get addicted to it and gambling in general.

Unfortunately, I wasn't able to come away the big winner for the day. I probably ended up losing around $20 or $30, but over a stretch of about 5 or 6 hours, I don't think thats too bad. Either way, I had a lot of fun.

I was with some of my friends and I'll tell you the story of one guy in particular. I have to admit that this is one of the most improbable scenarios I've ever seen, and I guess it part of the motivation for my most recent idea.

A friend of mine was betting some money before a race. He was putting $10 down on various types of bets. He put down a show, in which he had to pick a particular horse who will come first, second, or third, a win, in which he had to pick the horse who is going to win in order to succeed, but after this had about $1 left to put down on a bet. He didn't really know anything about the horses or the race in general, so he decided to go with this particular type of bet called a superfecta.

I came to learn that a superfecta is a particular type of bet in which you have to correctly predict the first four horses that come in. That is, you have to pick the first, second, third, and fourth horses in the exact order in order to make any return on your wager. This is by far and away one of the most ludicrous, outrageous, and downright improbable things to ever occur in my opinion.

I had hard enough trouble correctly predicting a horse to come in the top three, a show, and now here was this most ridiculous bet called the superfecta. Regardless, my friend decided to make the minimum $1 wager (and in my opinion, it's pretty much throwing away that $1). So, we were revved up and looking forward to the next race. I had a couple bucks on the race and was hoping to see my combinations come in.

And then, before you knew it, the race had finished. It's a quick burst of excitement, and then it's over. Yet again, none of my horses came in the order I would have liked to see them. However, my friend sitting right next to me was looking over his betting receipts and was frantically looking up at the television screen with the results and then back again at his receipts. I asked if any of his combinations came in.

Apparently, after needing further verification from about three other people, my friend had correctly predicted the superfecta. We were all speechless. How is it possible that my friend who knew absolutely nothing about betting on horses came through with the mother of them all?

The superfecta ended up paying out huge. The payout is dependent on the odds of the four horses that you predict, but due to the severe unlikely nature of this actually occurring, the payout is typically always a large amount. In this case my friend made a quick $125 by simply making a $1 bet. Not a bad day at the races.

The first thing that this got me thinking about, and I'm a little embarrassed to say it, is how on earth it would be possible to fix such an event such as horse racing? I was just thinking that with such an immense payoff, figuring out a way to fix one event could make a bundle of cash very quickly. However, very soon into my thought process, I started to think of more effective, and legal, ways in which to capitalize on the coolness of horse racing.

This is what led me to my idea of Ocean's 14. The Ocean's series has all revolved around very slick, cool, and fun ways of stealing money from Las Vegas or valuables from museums. Each movie has been really entertaining and has a blockbuster cast to go along with it. I thought what might be interesting is if they altered the theme slightly and entered the realm of horse racing.

In all of the Ocean Movies, there is always some ingenious plan that works flawlessly. Half of the time, you think they're all about to get busted, and even when they do get busted, it was all seemingly part of the plan. It would be really cool to see what sort of awesome strategy they could come up with to fix a crazily unpredictable event such as horse racing. They have already exhibited quite a competency in fixing Vegas, so why not move into a new realm, the realm of horse racing?

Yet, I also realized that there wouldn't be a good enough reason to make a fourth movie in a series if it wasn't necessarily going to be profitable. This led me to investigate the benefits of actually creating a fourth Ocean's movie.

Explanation

My sample was made up of movies that have a minimum of four in the series. My results include 9 movies that have had four parts in their series. This list includes:

Harry Potter
Rocky
Indiana Jones
Star Wars
Star Trek
Rambo
Superman
Saw
Die Hard

For each of the 9 movies, I gathered information relating to the Gross Box Office Revenue each part in the series brought in, the Budget for each movie in the series, and then, based on this information, evaluated the Net Box Office Revenue for each movie in the series. For all of the movies, I made sure to adjust for inflation. In order to accomplish this, I used WestEgg.com, which is an inflation calculator that dates back to 1800. All the figures are therefore based upon 2007 dollars.

After compiling all of my data, I then made a determination about each movie in the series return on investment (ROI), which is easily calculated by taking the gain from an investment and subtracting the cost of an investment and dividing this difference by the cost of investment.

In our scenario, the mathematical equation is depicted as:
ROI = ((Net Box Office Revenue - Budget)/Budget)

I thought ROI would be a good measure to evaluate going forward with a fourth Ocean's movie, because it represents the benefit and rate of return that the large investment for the movie would necessitate.

Finally, at the end, I averaged my data from the 9 different movies with a minimum of four parts in the series to determine whether the intent of creating a fourth movie truly had any merit.

Results

The data that I gathered can be summarized in the following chart:

First, let us take a look at some of the data. The highest grossing film in this sample of movies was the original Star Wars from 1977. When you adjust for inflation, the film grossed over 1.163 Billion dollars. That came from a measly investment of just 46.86 Million dollars. On the opposite spectrum of that, the lowest grossing movie was the fourth sequence in the Superman series. I am personally a big fan of Superman, and am unsure as to why this film did so poorly in 1987.

According to Imdb.com, the Internet Movie Database, the tagline for this movie was, "Nuclear Power. In the best hands, it is dangerous. In the hands of Lex Luthor, it is pure evil. This is Superman's greatest battle. And it is for all of us." It only grossed 29.32 Million dollars, and actually ended up losing 2.43 Million.

These two movies help contrast the impact of the first movie in a series and the fourth movie in a series. The highest grossing movie, Star Wars, was the first in the series, whereas, the lowest grossing movie was the fourth in the series. This is a general trend, as the average gross for the first movie in a series was 308 Million, and the average gross for the fourth movie in a series was 167 Million (a reduction of %).

However, in order to truly get to our desired valuation of ROI, it was important to seek out information regarding to the budget of each movie as well.

As you may notice, there is a wide array of budgets used on movies. However, to try and organize some of this data, it is best to look at what the overall average of budgets do as another movie is made in a series. My data leads me to the following deduction: the more movies one makes in a particular series the larger the budget gets. On average, I found that the first movie's budget was around 69 million, while the budget of the fourth movie was typically around 89 million (or an increase of 29%).

The largest budget was used in the original Superman movie. It had a budget of 186 million. The smallest budget was used on the original Saw movie. It cost a mere 1.35 million. The Saw series has consistently had the lowest budget in the group and thus has helped their ROI tremendously.

Next, it would be helpful to look at the Net Revenue that is associated with movies in a series with a minimum of four movies. To find net revenue, you just take the gross revenue and subtract the budget requirement for the movie. This will also be helpful in determining ROI.

Our chart of Net Revenues for these 9 movies reveal that as another movie is added to the series, the variance in the net revenue becomes less substantial. For instance, in the net revenue amongst the first movie in the series, the net revenue varies by 94% (1163.33M to 60.78M). However, by the time the movie gets to the fourth in the series, this variation decreases tremendously. The upper and lower bounds of Net Revenue have shrunk from 400.3M to -7.3M, a far tighter space. This ultimately means that there is far less uncertainty when it comes to how well the movie should fare.

On average, the Net Revenue from these 9 movies varied from 333M, for the first movie in a series, to 119M for the fourth movie in a series, or a decline of 64%.

The final piece of the puzzle was to determine whether or not going ahead with producing and investing in the fourth film in a series was indeed profitable. The mechanism through which this was evaluated was based on our model of return on investment (ROI).

The results of this are well summarized in the following graph:

Your attention may first be drawn to the extreme spike in the ROI for the first movie in the series of Rocky. This is valid observation. The first Rocky movie was unbelievably successful, but only needed a budget of 4.2 million to produce a net box office revenue of 442.81 million. This is a ROI of 10,443%. The following Rocky movies were successful, but not nearly in the same stratosphere.

As a general trend, I was able to determine that on average, the first film in a series of a minimum of four returns 1,782%, the second, 403%, the third, 175%, and the fourth, 35%. These are significant declines, but the ROI is still quite decent even in the fourth movie.

Additionally, it is important to add that just because the overall average shows a positive ROI, this is certainly not always the case. For instance, Die Hard, Superman, Rambo, Indiana Jones, and Harry Potter have all had instances in which they have had negative ROI.

Ocean's Movie Recommendation

Based on my analysis, I have the following recommendation for the potential creation of a fourth movie in this series.

According to Imdb.com, Ocean's Thirteen (the most recent movie in the Ocean's series), grossed 117.2M, had a budget of 85M, and therefore netted 32.2M. The ROI on Ocean's Thirteen was dismal, -62%. According to Those Answers Inc. estimates on the change in average gross, average budget, and average net revenue earned between the third and fourth movies in a series, Ocean's 14 can expect the following results:

An 11.2% decline in Gross Revenue
A 16.3% increase in budget spending
A 21.4% decline in Net Revenue

Therefore, Ocean's 14 should expect to gross 104.1M, have a budget of 98.9M, and therefore net 5.2M. This predicts a ROI of -94.7%. Additionally, both Ocean's 12 (2nd in the series) and Ocean's 13 (3rd in the series) had negative ROI's which does not predict any more favorably for a positive ROI in the 4th movie in the series.

The series of Harry Potter, Rambo, Superman, and Die Hard have not achieved positive ROI since falling into negative territory. There is no direct evidence to support the possibility of Ocean's 14 having this capability.

Therefore, although it would be a really fun movie and very entertaining to watch, Those Answers Inc. does not recommend a fourth motion picture in the Ocean's series.