Category Archives: Internet Culture

When You Wish Upon a Star…

So, a good friend of mine recently posted the following meme:

Depressing thought...But is it true?
Depressing thought…But is it true?

“According to astronomy, when you wish upon a star….
You’re actually a few million years late.
That star is dead.
Just like your dreams.”

It’s a really depressing thought, perhaps even more depressing than the Nietzsche/Kubrick mashup: “God is dead, and you are alone in an uncaring universe.”[1]

At least with an uncaring universe, something with persist after you are gone. If all the stars are dead before you can even see them, would there even be anything left after we are gone?

But extraordinarily depressing statements require extraordinary evidence. So let’s take this sentence apart and define some things.

First: “According to astronomy” means that we get to (and have to) use astronomy in our proof or disproof. It also likely refers to modern astronomy, as it did not specify a time/technology period. (It may be interesting to see if any answers would be different under astronomy from a different time period, but that will be a secondary investigation.)

Second: “when you wish upon a star….” has a few different readings. The phrase seems to come (at least most recently) from the song written for Disney’s Pinnochio. In that movie, Gepetto says the following:


Look! A wishing star!

Starlight, star bright, first star I see tonight…

I wish I may, I wish I might have the wish I make tonight.

This is an ‘English language nursery rhyme’ first published in the late 19thC (Wikipedia).

Interestingly, it seems to refer to ‘shooting or falling stars’, or meteors. These would certainly be ‘dead’ (as they are vaporizing in the atmosphere during the ‘wish’, but not for ‘millions of years'[2], as the distance from the viewer to the meteor can be measured in tens or hundreds of kilometers, an insignificant time light distance[3].

But going back to “When you wish upon a star, the meme-maker seems to be clearly referring to the 1940 Disney song and film. Looking at the occurrences of this song in the film:

At 0:34, you can see the image of Gepetto wishing upon the star:

The star is clearly stationary, as can also be seen in the reprise at the end of the film, where Jiminy Cricket is looking upon the same star, still unmoving:

So, this restricts us to the realm of non-moving (or slowly-moving) celestial objects[4]. From the film, the star also seems significantly brighter than the surrounding stars, but the exact extent to which this is true could be dramatic license.

The rhyme mentions ‘first star I see tonight’, which also suggests that the celestial object seen is unusually bright.

So, non-moving (or slowly moving) celestial objects which are bright. This leaves us with comets, planets, and bright stars[4][5].

Comets are objects orbiting through the solar system, and unless they fall into the sun, impact another body, or otherwise breakup, they tend to go on ‘living’ after we see them. (Halley’s comet has been known since at least 240BC.)

Planets could easily look like stars, often like unusually bright stars. Venus was called the ‘evening star‘[6] since antiquity, and it would be bright enough (up to apparent magnitude -4.9) to be significantly brighter than anything else in the sky. Venus could be considered ‘dead’ because it may have once supported life before a runaway greenhouse effect millions of years ago, but this seems an unlikely metaphorical interpretation. Mercury (up to apparent magnitude -2.45) would also be significantly brighter than anything but Venus (and the moon and sun), but has never been ‘alive’, being too close to the Sun[7]. Mars (up to apparent magnitude -2.91) could have been alive at some point, in the same vein as Venus. One or more of the moons of Jupiter (up to apparent magnitude -1.61) or Saturn[8] (up to apparent magnitude 1.47) could have been home to life, under this same metaphorical definition. (The other planets and other bodies in the solar system are too dim to ever be a ‘bright star’.)

So, a planet could be a metaphorical source for this quote, but this seems unlikely, as the quote seems to be referring to the fact that the celestial object is no longer emitting the light itself.

This leaves us with bright stars. Looking at the brightest star in the night sky, Sirius (up to apparent magnitude -1.46), it[9] is only about 8.6 light years away, so we would know in less than a decade if something were to happen there.

The next 91[10] brightest stars are listed here:

https://en.wikipedia.org/wiki/List_of_brightest_stars

You will note that even the furthest among these, Deneb is still only 2600 light years away, much closer than the ‘few million years’ mentioned above.

Based on all this evidence, it would seem that the original meme:

“According to astronomy, when you wish upon a star….
You’re actually a few million years late.
That star is dead.
Just like your dreams.”

is false, which is good, because it would be super-depressing otherwise.

If you enjoyed this sojurn through astronomy, you may like the rest of my blog. Comment below with things you want me to talk about or investigate!

[1]If you have a better source for this, please let me know.

[2]If you want to be pedantic (and I know you do), you could say that meteors are the dead husks of possible (or tidally destroyed) planets, and their burning up in the atmosphere is hundreds of millions of years after they ‘died’.

[3]Much less than a second, even if you assume they impact the Earth’s atmosphere thousands of kilometers away.

[4]A close supernova might also qualify, as it could easily be brighter than anything else in the night sky, would last just long enough to be a ‘wishing star’, and would have been ‘dead’ for some time before it was seen by a human observer. This might indeed be source of this rhyme, where a ‘guest star‘ could inspire wishing and omens. However, looking at this list of supernovae, any supernova which would have been visible as a ‘bright star’ with the naked eye would be at most tens or hundreds of thousands of light years away, not qualifying for the ‘few million years’ mentioned above. I also personally see supernovae more as a seeding of the galaxy with heavier elements, and thus wishing upon one of these would be wishing that the spreading of heavier elements would inspire life to form elsewhere in the universe.

[5]I see no way that any reasonable person could confuse the Sun or Moon with a ‘wishing star’.

[6]Interestingly, the Babylonians had figured out that the ‘evening star’ and the ‘morning star’ were one and the same. It took the Greeks a significant amount of time to discover this themselves, calling them ‘Phosphorus’ and ‘Hesperus’. How many times have there been such dark ages, where knowledge needs to be rediscovered? Was there a Greek ‘renaissance’, or were the Babylonian star charts lost until modern archaeology? Did mere dregs survive to inspire subsequent scientific revolutions?

[7]…unless there was life along the terminator, at some point in the past…

[8]Or [spoiler alert]:

One of the planets themselves!

[9]They, really, as Sirius is a double star, but that is outside the scope of this post.

[10]93, including the Sun, Sirius and the next 91 of magnitude 2.5 or greater.

Trolley Problem Memes

Trigger warning: Conversation and possibly dark humour about fictional (and possibly not-so-fictional) people dying in car and train accidents.

How do you design a self-driving car to appropriately value human life? Can you use a Facebook group to speed the development of philosophical discourse?

The ‘Trolley Problem‘ is a problem in ethics, first known to be described in its modern form in the early 1950s. Basically, it boils down to the question:

If you have a choice between action and inaction, where both will cause harm, but your action will harm fewer people, is it moral to perform that action?

Interestingly, people answer this question differently, based on how active the action of harm is, the ratio of people hurt between the choices of action and inaction, and other reasons.

The astute will notice that this type of decision problem is a very common one, the most obvious being in military applications, but also vaccines (and invasive health procedures in general), firebreaks, and perhaps the canonical example, automobile design and manufacturing.

This type of decision making has become even more important with the advent of self-driving cars:

Would you drive a car that would choose to drive you into a brick wall rather than run over five pedestrians?

Overall, you would think that this would reduce your risk of fatality, but few people would choose that car, likely because it is a classic prisoner’s dilemma[1][2].

What is your self-driving car's ethical system?
What is your self-driving car’s ethical system?

Personally, I think that much of this conversation is sophistry[3]. If one is truly interested in preserving life, the solution is not to convince self-driving cars to kill different people, but perhaps to have more stringent driving training requirements, to invest in fixing known problem intersections, to invest in better public transit.

So, if these conversations are not useful for anything else, they must be useful in and of themselves, and therefore must be Philosophy[4]!

One of the places that these conversations are occurring is the ‘Trolley Problems Memes Facebook page‘[5].

Now, you can argue that this page is purely for entertainment, but I think there’s a lot more hidden there. There is a fomenting and interchange of ideas, much faster and more fluidly than at any time in history. The person who writes the next book[6] on the ethics of decision making could well be influenced by or be an avid user of a site such as this one.

They may have started with Rick-rolling, but image macros are helping the advancement of human knowledge. Stew on that one for a while.

And while you’re thinking about that, something which ties it all together[7]:

"The creator might argue that his robot is an 'individual', capable of his own decisions, while the opposition would say that he (the creator) is responsible for the algorithm that led to the action. Imagine this happening - it would give birth to one of the greatest on-court debates ever." From Patrice Leiteritz via Trolley Problem Memes
“The creator might argue that his robot is an ‘individual’, capable of his own decisions, while the opposition would say that he (the creator) is responsible for the algorithm that led to the action. Imagine this happening – it would give birth to one of the greatest on-court debates ever.” From Patrice Leiteritz via Trolley Problem Memes

[1]If everyone cooperates, overall they will receive a better result, but if any one of them betrays the others, they get an even better result, but everyone else’s result is much worse. This theoretically leads everyone to betray everyone else, leading to everyone having a worse overall outcome.

[2]People also like the feeling of control.

[3]Check out the article. Apparently, the Sophists were the first (recorded) right-wing think tanks.

[4]My undergrad Philosophy 101 prof. made the argument that because philosophy was not useful for anything else, it must be inherently be useful (and that that was better).

[5]Dark humour. You have been warned.

[6]And it might not even be a book! A blog post, even! 😀

[7]Not a deliberate pun.

“Of All the Things I Miss, I Miss my Cache the Most.”

She was in the zone. It had taken two hours, half a RedBull (she would be paying for that later), and pissing off that guy who always seemed to want to talk longer than a conversation.

Free, flying through the code. There really was nothing like it.

She was working on a new DB caching layer for their server-side app. It was one of those ‘augmented reality’ games, but for corporate training. It still felt good to work on it though, to coerce the bits to bend to her will.

“Achievement Unlocked: You have met five new people in one day!”

Ugh. It sounded terrible, having to meet so many people all the time. To have to spend all that time and effort to convince them that the correct answer to a problem was, well, correct. If only they would just *see*.

But she had given up hope of being able to open peoples’ eyes. Give her code, or a nice juicy math problem, and she’d be content for hours, sometimes days.

*rumble* *rumble*

“Time to eat”, she thought to herself. She gets up, to go to the kitchen. Nyancore streams from her discarded headphones. As she turns, you can see the t-shirt she’s wearing says:

“Of all the things I miss, I miss my cache the most.”

She looks towards you and says “You can’t fault me for that.”

She laughs to herself and continues on her way.

“Senseless Juxtaposition of Wildcards.”

He had to admire the the gall of the programmer who wrote the error messages.

“Senseless Juxtaposition of Wildcards.”

It might as well have said:

“Grow a brain!”

Or:

“Try listening to classical music.”

But then it got him thinking…

What would be a senseful juxtaposition of wildcards?

First, we would have to make a list of possible wildcards:

The ‘standard’ wildcard character, specifically referring to a character is the question mark, ‘?’. Generally standing in for any one of some set of things (or in Perl, 0 or 1 of a thing).

The ‘larger’ wildcard character, ‘*’, which stands for any number of something (including 0), sometimes expressed as ‘%’, if you’re speaking SQL.

The ‘even larger’ wildcard character, ‘…’, which is like a recursive ‘*’.

But could there be something larger still? Something which climbs the directory hierarchy in the oppsosite direction, perhaps? Something which can make it past all of the automatic filters, but is clearly wrong? Something like typing ‘NaN‘[1] into a number field box? Something which steps outside the usual boundaries, like Thiotimoline?

In a biological context, there are entire alphabets of more-and-less-specific wildcards.

So, knowing all of this, what would be a senseful juxtaposition of wildcards? Something like ‘**’, or ‘?*’, or ‘*?’ would be meaninglessly equivalent to ‘*’.

You could attempt to mix SQL with bash-isms: “WHERE ID LIKE ‘%*’ “, showing that you expect an SQL character string followed by a bash character string, but that is again non-sensical.

Maybe it would have to be something like ‘hello??????'[2], to say that there are 6 characters of some type after your ‘hello’.

But there it was. The senseful juxtaposition of wildcards… bash statements inside command-line SQL statements.

That was it! But he had to think. How would he use this?

[1]And like the link says, you really don’t want to confuse it with NaN3. You really don’t want to confuse *anything* with NaN3.

[2]Or ‘hello……’.

How do You Think Before You Speak?

I’ve talked a lot about the speed involved and possibly required for retorts and humour, but not all conversation is retorts and counter-retorts[1].

For example, you’re giving a speech or lesson, and someone asks you a question. Many of the same tactics are helpful. It’s helpful to know your audience, to have an idea of their background(s), which types of words will work best for explaining things, and to have an idea of what they perceive the relative level of hierarchy is between you and them.

But once you have an idea of these things, what do you do?

This trigger for this post was an article reporting on Jon Stewart talking about how Hillary Clinton pauses for a few seconds between a question and when she answers[2]:


…“It’s — look, there are politicians who are either rendering their inauthenticity in real enough time to appear authentic, and then their are politicians who render their inauthenticity through — it’s like, when your computer … if you have a Mac and you want to play a Microsoft game on it …”

AXELROD: Yes, yes.

STEWART: … and there’s that weird lag.

AXELROD: Yes. No, I mean …

STEWART: That’s Hillary Clinton.

AXELROD: … that’s a big problem. There’s like a seven-second delay and all the words come out in a perfectly …

STEWART: Right.

AXELROD: … politically calibrated sentence.

STEWART: Right. Now, what gives me hope in that is that there’s a delay, which means she’s somehow fighting something. I’ve seen politicians who don’t have that delay and render their inauthenticity in real time, and that’s when you go, ‘That’s a sociopath.’

So, when you’re answering a difficult question, do you pause? Why? For how long?

For me, it depends on the type of question. For emotionally difficult questions, some of it is finding a neutral[3] perspective from which to address the question, to speak to the person(s) asking the question in a positive and useful way. Sometimes it’s choosing the appropriate emotional outlet[4] for whatever I’m feeling at the time.

For technically difficult questions, it feels much more like assembling a mental model in my head, or choosing between different visualizations/places to start. Parts of this can feel similar to emotionally difficult questions (perspectives vs. visualizations), but to me they feel quite different[5].

So, how does this work for you?

[1]No matter how much bash.org would want you to think so. (Note that outside that page, bash.org is quite unfiltered internet. You have been warned.)

[2] Article is here. In a footnote because the editorializing in the article is outside the scope of this post.

[3]In the emotional perspective sense.

[4]This is often laughter for later when I’m alone. I mean, really, we’re just ape-like creatures who don’t know the first thing about ourselves. Why are we getting all angry about minutiae? This can only be funny.

[5]Now that I say this, I’ll have to watch next time. But something getting my back[6] up really feels different from trying to focus and assemble a visualization. Maybe being able to relax for all types of questions would make them more similar.

[6]Back hackles?

Picard: Is Truth More Lawful or Good?

So, I was reading some internet forums associated with one of my favourite webcomics, and an argument came up about Captain Picard’s ‘alignment’.

“That’s a really good one. (Although I don’t watch enough star trek to recognize the LN guy)It’s Captain Picard. You could make a case for him being Lawful Good, just not that friendly, but LN suits him just as well.”

(A brief aside. ‘Alignment’ in this context is from Dungeons & Dragons, where each character is considered to be aligned along two axes, ‘lawful-neutral-chaotic’ (respect for the rule of law) and ‘good-neutral-evil’ (good of the many vs. good of the few). This gives 9 ‘alignments’, from ‘lawful-good’ to ‘chaotic-evil.)

Some had him as ‘lawful-good’, or trying to do the best for the many while respecting laws. some had him as ‘lawful-neutral’, where adherence to laws is more important than the good of the many. I can see the ‘lawful-neutral’ interpretation, just from listening to one of his quotes:

“The Prime Directive is not just a set of rules; it is a philosophy… and a very correct one. History has proven again and again that whenever mankind interferes with a less developed civilization, no matter how well intentioned that interference may be, the results are invariably disastrous.”

It seems at first blush that here the law (the Prime Directive) is more important than any group of pre-warp civilizations[1].

Another famous quote:

“The first duty of every Starfleet officer is to the truth, whether it’s scientific truth, or historical truth, or personal truth! It is the guiding principle on which Starfleet is based, and if you can’t find it within yourself to stand up and tell the truth about what happened, you don’t deserve to wear that uniform.”[2]

So we have two questions here:

1) Is adherence to the Prime Directive more ‘lawful’ or ‘good’?

2) Is Truth more ‘lawful’ or ‘good’?

1) The Prime Directive ostensibly has the interests of the many (the inhabitants of a pre-warp planet) outweighing the interests of the few (those few people who would exploit them).

And indeed, when the Prime Directive does not have their best interests in mind, Picard tends to look for exceptions.

Although there are times when he seems perfectly willing to let a planet’s culture perish to avoid interference.

So, I would count this as the Prime Directive is a ‘law’ that is mostly ‘good’, and Picard usually tries to move it towards ‘good’ when there is wiggle room. At the same time, when the ‘law’ conflicts with the ‘good’, sometimes (but seldom) he chooses ‘law’, so ‘lawful-good’ seems appropriate.

2) Now, let’s look at truth. Another quote seems to be in order here:

“Journalism is printing what someone else does not want printed: everything else is public relations.”[3]

This would suggest that barring violating the Prime Directive above, truth should be ‘good’, specifically the speaking of truth to power. (I think that’s what actually necessitates the Prime Directive, else if truth was pre-eminent, interference to tell people the error of their ways would be a very convenient excuse.)

So, truth is probably ‘good’. Is it ‘lawful’? You could make the argument that adherence to truth is equivalent to a code of honour[4], and it’s just as important (or more important) to do things the right way as to reach your objective. So, truth can be either or both of ‘lawful’ and ‘good’. The quote above from ‘The First Duty‘ is speaking about the good of the many (Starfleet, the reputation of his dead friend, and the trust between Starfleet officers) outweighs the good of the few (Wesley’s year of school, his reputation), so I’d call this a meeting of ‘lawful’ and ‘good’.

I’d say Picard is pretty firmly ‘lawful-good’, with some ‘neutral-good’ leanings (bending the rules to help people) and some ‘lawful-neutral’ leanings (sometime rules are absolute).

Thoughts? Comment below!

[1]Leaving out the non-interference in the Klingon civil war as out of scope.

[2]That quote also appears here:

[3]Note that George Orwell is most frequently associated with this quote, as is William Randolph Hearst. The actual source seems unclear. I enjoyed a number of the humorous takes on the quote in that article.

[4]No, not the episode. And I’m not linking to it.

Running A Sprint Planning Meeting

It’s the little things that sometimes make a difference. When I was teaching standardized test math so many years ago, I noticed as I was drawing problems on the board, all the little habits that I had picked up. Habits which make solving problems easier, habits which reduce the chance for error.

Things like the curve on the leg of the lower-case ‘t’, so that it doesn’t look like a ‘+’. Curving your ‘x’ so it doesn’t look like a ‘*’ sign.

I think some of this (probably sometimes annoying) attention to detail had carried over to Sprint Planning meetings[1].

Planning Poker is a method for a group to converge on a time estimate for a task or group of tasks. There are a number of ways to do this. The ‘canonical’ way we were taught to do this was to use Fibonacci-numbered cards (1,2,3,,5,Eureka!). This involved a discussion of the task(s) to estimate until everyone had a reasonable idea of their complexity, then each person would choose a number estimate, all of which would be revealed simultaneously, to hopefully reduce bias. The discussion before estimation would not include estimates of how long things were estimated to take, to also try to reduce bias.

While we were running our planning meetings, I noticed that we would start to slip away from this ideal, perhaps because certain things were not important, perhaps because we didn’t see that certain things were important. For example:

We moved from cards to apps, and then to fingers. Using apps for estimation is less annoying than finding the cards each time, but fingers are even faster to find. I/we tried to get around the bias effect by having everyone display their fingers at once, and that worked reasonably well. Even making each person think about their estimate before display can help a lot with reducing the impact of what others might think of them.

One thing I tried which never really caught on when other people were running the meeting was saying ‘A,B,C’ instead of ‘1,2,3’, with the idea that it would be less biasing on the numbers people were choosing. (This may have mostly been an impression of mine, as the moving of the estimate from a mental number to a number of fingers may cement it in a slightly different mental state…)

If one is not careful, and perhaps somewhat impatient in meetings[2], one can start suggesting estimates before they are voted on. It can take considerable discipline and practice to not do this.

Another thing I noticed was how difficult JIRA was to use when one is not practiced in it, especially in a room with many people watching. Something that any experienced[3] demo-giver would know like the back of PowerPoint’s hand.

That’s all I have for now. For more minutiae, tune in tomorrow!

[1]For those of you who have not had the pleasure, these are the meetings at the start of an iteration, where the team sits down in a room, estimates a bunch of priority-ranked tasks, and decides (generally by consensus) how many of them they will commit to getting done in the next two weeks. Like all meetings, they can be good or bad, and the meeting chair (I feel) can make a large difference.

[2]I am probably as guilty of this as anyone. I would recommend Randy Pausch’s ‘Time Management‘ for those who feel similarly.

[3]Read: ‘Battle-scarred’

Liveblogging the Berkshire Hathaway Annual Meeting: II

Yesterday, we watched the first half of the Q&A at the annual Berkshire Hathaway meeting. We ‘live’ blogged the first quarter of yesterday. Today, here’s the second quarter:

Q10: Negative rates, and how they affect Berkshire:
Charlie:
1/4 to -1/4 is not very different. Both are ‘painful’ interest rates for investing $60 billion

Charlie Munger looks like a sea turtle.

Charlie seems to drink a lot of Coke, don’t know if Warren does, but that could just because Warren is the one talking most of the time.

Q11: BNSF Decline in commodity prices, and how that might change how much freight is shipped
“We don’t mark up and down our wholly-owned businesses based on motions in the stock market.”

Q12:Harry Potter(?!?) question? (The question asker compared the situation to Hogwarts, etc…)
How should children look at stocks when time horizons for ‘investing’ so short, and IPOs are making so much money?

(On IPOs)
‘If they want to do mathematically unsound things and one of them gets lucky and they put the one that’s lucky on television…’
Think of stocks as a business you own…
Charlie:
‘American business will do fine’
‘But not the average client of a stockbroker.’
‘The stockbroker will do fine’

Q13: NV lobbying against solar (rooftops) where the utility was forced to pay the increased rate to the homeowner instead of the government?
‘Who pays the subsidy’ is the issue… (‘A political question’)
‘If society is the one benefiting, then society should pick up the tab.’

Q14: Low oil prices influence BRK more now (because of various effects on various subsidiaries)?
Warren:
‘We don’t think we can predict the price of commodities.’
Charlie:
‘I’m even more ignorant than you are.’

Q15: Would philanthropic establishment of new universities help with the cost of tuition, possibly by supply/demand?
Charlie:
‘If you expect financial efficiency in american higher education, you’re howling at the wind’
‘Glory of civilization’ (universities)
‘Monopoly and bureaucracy’ (description of universities)

We (USA) spend a lot of money on higher education. Being cheap is not our issue.
Charlie:
‘I’ve made all the enemies I can afford.’

Q16: On effects of Donald Trump on Berkshire
‘That won’t be the main problem’
Charlie:
‘I’m afraid to get into this area.’
Warren:
‘Business in this country has done extremely well for 200 years.’
Returns on tangible equity have not suffered while those on fixed income have suffered.
GDP/capita has gone up in real terms
‘System works very well in terms of output per capita, as far as distribution (inequality), there are often more issues.’
‘Charlie, give something pessimistic to balance me out.’
Charlie:
‘I don’t think the future is necessarily going to be as good as the past, but it doesn’t need to be.’
‘You’re making free choices that you couldn’t 20 years ago.’

Q17: Norfolk Southern/CP failed merger fallout?
BNSF: Certain tests needed to be passed before a large railroad merger would happen (good for public interest, good for shareholders, etc…). That merger may have been good for the shareholders, but did not meet the overall criteria. Next round of mergers will occur when population makes transportation more scarce.

Q18: How do you feel about investment banks not being able to make as much money?
After 2008-9, regulations to increase capital requirements, particularly on larger banks….
‘You can change the math of banking and profitability of banking by changing capital requirements.’
100% capital requirement means not very profitable, 1% capital requirements causes huge problems
Investment banking not a thing we invest in.
Charlie:
‘Generally, we fear the genre more than we love it.’

Q19: Activist investor targeting if BRK trades at a discount to intrinsic value?
Defend by size, and by having money to buy shares at less than intrinsic value.
‘The numbers involved would be staggering.’
Mid-America does better by not being split up.
1973-1974 very good companies selling at a steep discount to what they’re worth… (When stocks at a discount, money is hard to come by)
Charlie:
We don’t worry about this and others do, they can get attacked by hostile takeovers/etc, and we can’t
‘…and you want a strong ally, how many people would you pick in preference to BRK?’

Q20: Leasing?
Train cars… Bank has lower cost of funds than we do
‘A trillion dollars, at 10 basis points’
Aircraft leasing not interesting…
‘We’re well located now, but I don’t think we have new opportunities.’

Q21: Which competitor would you take out and why
Charlie:
‘I don’t think we have to answer this one.’
‘Widening the moat’ is the goal.
‘Not trying to target competitors, just trying to do the best everywhere.’
Warren:
‘Spoken like an anti-trust lawyer’

Q22: Sequoia, and Valeant position
The guy we trusted and recommended passed away in 2005.
The manager involved is no longer in charge.
‘If you have a manager, and doesn’t have integrity, make sure they’re dumb and lazy.’
‘Pattern recognition is very important in evaluation of humans and business.’
‘Frequently come to a bad end, but frequently looks good in the short term.’
Charlie:
‘Valeant of course was a sewer.’ (And they deserved what they got.)

Just before lunch, they put up the interim results of a wager between Buffet and a money management firm.

Hedge Funds vs. S&P 500 Index Fund results
Hedge Funds vs. S&P 500 Index Fund results

Protege Partners Wager Results (longbets.org)
Hedge funds of funds vs. S&P500 index funds
‘That might sound like a terrible result for the hedge funds, but it’s not a terrible result for the hedge fund managers.’
‘180 million dollars a year, merely for breathing.’ (If Berkshire compensated 2&20.)
‘They can’t believe that they can’t hire someone to make them more money than average.’
‘Consultants can’t change too much year to year, because it looks like they don’t know what they’re doing.’
‘Charlie, do you have anything to add to my sermon?’
‘A tiny group of people.’ (Who can manage money consistently better)
‘Far far far more money made on Wall Street by sales abilities than investment abilities.’

Liveblogging the Berkshire Hathaway Annual Meeting

I’ve been following Berkshire Hathaway’s Warren Buffet’s annual ‘Letters to Shareholders‘ for a number of years now. Amongst other things, he avoided the 1999-2001 tech bubble, and predicted the crash of 2007-08. We were lucky enough to go see him in ‘person’ at the Berkshire Hathaway annual meeting last year. This year, we decided to watch his Q&A on livestream (through Yahoo! Finance). Below are some of my thoughts as the meeting progressed. The format is various people (analysts, journalists, and audience member, in that order) ask questions in rotation until time runs out. This goes from about 9:30 until 3:30 Central, with Warren Buffet and Charlie Munger (his longtime business partner) holding court.

********************************************************************

So again, we see the two (very) old friends up on the screen.

Warren Buffet and Charlie Munger, Berkshire Hathaway Q&A 2016
Warren Buffet and Charlie Munger, Berkshire Hathaway Q&A 2016

Q1: Going from low capital high earnings businesses to high capital moderate earnings businesses (regulated like rail and utilities).

The question asked why Berkshire moved from purchasing companies with low capital requirements and high income to purchasing companies with high capital requirements and moderate income.

The fundamental answer has to do with the size of opportunities available vs. the size of the conglomerate as a whole. (You can read all about it in the shareholder letters.)

Pithy remarks on the subject:

“Increasing capital acts as an anchor on earnings.”

This one I think was a Charlie-ism:
“When our circumstances changed, we changed our minds.”

Q2: Precision Cast, and the huge multiple premium paid
Under Berkshire, Helped make their main asset (the CEO) & made him more productive to the company.
Running a public company distracting vs. being under Berkshire.

“Buy a business that an idiot could manage, because eventually an idiot will have to.”

Q3: What would you do differently?
Warren said he’s ‘doing exactly what [they] like to do with the people [they] love’.

“It’s more fun to do things as a partnership.”

And a Charlie-ism:
“[Learning slowly] is a blessing too. At 92, I still have a lot of ignorance to work on.”

Q4: Munich and Swiss Re divestment
Business is less attractive for the next 10 years, because of low interest rates.

“Supply has gone up but demand has not gone up.”
“Reinsurance is easy to establish a disguised operation in a friendly tax jurisdiction. Couple that with low returns on float…”

Q5: Geico getting ‘whooped’ by Progressive Direct. Why?
Buffet: Diversion to number of car deaths/100M. From 1930 15/100M to 1/100M recently. (40,000)
‘Last year, for the first time, there was more driving, and more distracted driving’
‘Made a bet many years ago on the Geico model over the Progressive model.’
Charlie:
‘I don’t think we have to worry about a competitor having a good quarter.’

Q6: Direct sales -> Search, Push to Pull marketing…
Need to always think about the powerful trend (Amazon) when we make decisions.
‘Doesn’t worry us with Precision Cast.’
‘We were slow on the Internet.’ ‘Mobile and whatever.’
Internet still has much to change…
‘Thought of ourselves as having capital to allocate’, so makes it easier to pivot industries.
‘Amazon has a real advantage, 100s of millions of happy customers.’
Charlie
‘We failed so thoroughly at retail when we were young…[laughter]’ (so not likely to try retail again, and has helped guard them against that particular type of hubris)

Q7: Negative health effects of Coke products, why do you keep dodging the question?
[they dodged the question again]
184k deaths per year…’Declined to invest in cigarettes, why should be proud to own Coke?’
‘I’m about 1/4 coca cola. I’m not sure which quarter, I don’t know if we want to pursue that question.’
‘1.9 billion 8 oz servings per day.’ (Since 1886)
Dodged the question. ‘You have the choice of consuming more than you use.’ Talked about how Coca Cola is not the sole problem.

‘[small town with a constant population] Every time a girl had a baby, a guy had to leave town.’
‘If you want to change your longevity, you should have a sex change.’

Charlie:
‘We ought to almost have a law (I’m sounding like Donald Trump), that you have to say the benefits along with the detriments.’

Q8: Coal vs. renewables
Is your goal to get to 100% renewables?
‘We cannot make changes that are not approved by the Public Utility Commissions.’
‘Iowa’s been marvelous at encouraging renewables.’
In Iowa, we can offer lower rates because of it.
(2.3c/kWh federal tax credit)
‘Benefits of reducing carbon emissions are worldwide…’
‘A benefit that accrues to the world.’
Pay a lot of tax, so worth it to make a lot of investments
Iowa has gotten server farms because of cheaper electricity (from wind)
Vs. more expensive public Nebraska power…

Charlie:
‘If the whole rest of the world were behaving as we do, it would be a better world.’
‘I want to conserve the hydrocarbons’, for chemical feedstock…’I’m in their camp, for different reasons.’

Q9: Derivatives:
How do you value the banks you own?
‘If you asked me to describe the derivative position of the BoA…’
‘The great danger in derivatives is discontuinities’
WWI closed the stock market for many months
1987 almost did, but went on the next day
If marked to market and collateralized, most of the problems are okay…
Large quantities and collateral requirements are the most dangerous…
Kuwait went to a six-month stock settlement process, and caused all kinds of problems because of lack of certainty of ownership.
‘If you took the 50 largest banks, we wouldn’t look at [investing in] 45 of them.’
Charlie:
‘We’re in the awkward position of making 20B from those derivatives.’
‘We would have preferred if those derivatives had been illegal to buy. It would have been better for the country.’

One comment Buffet made which received less attention than it should have is about the issue with having an effective oligarchy amongst auditing firms. The specific issue was that the same person from an auditing firm could be rating or valuating the same derivative from both sides of the deal, and they could easily be rating or valuating it differently…

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Those were the first 9 questions (out of a usual 60-ish). Stay tuned for more, comments below!

DS9: The Power of Adversaries, Season 4

Continuing our adversaries series, we’re looking at DS9 season four. We’ve seen a number of different patterns season to season, with season one being ‘Q and Prime Directive’, season two being ‘Cardassians and Introspection’, and season three being ‘Dominion, Time/Planar travel, and Introspection’.

Let’s see what’s out there…

S4:

High: 7 (3 Dominion)
Equal: 4 (Klingons, Klingons, mirror, and Jem’Hadar)
Low: 3
Self: 11

The standout this season was internal conflict, whether it’s Bashir vs. O’Brien, or Worf vs. his brother, season four was a study in character stories and internal dilemmas. The writers continued to use the Dominion for the plurality of the high-powered adversary plots, while eschewing almost entirely low-powered external adversaries.

Almost like the calm before the storm, the self introspection before the galaxy erupts into war.

1 (Klingons)
2 (frozen in time)
-1 (Bashir vs. O’Brien)
-1 (Kira vs. Dukat vs. Dukat)
-1 (Dax vs. Dax)
2 (Time Travel)
2 (Two Jem’Hadar ships and a gas giant)
-1 (Worf vs. Kor vs. Worf vs. Kor)
2 (Holodeck)
-1 (Earth and fear)
-1 (Earth and fear, part II)
-1 (Odo & Kira)
2 (freighter vs. Klingon ship)
-1 (Worf & Kurn)
-1 (Quark and the union)
0 (Bajoran politics)
1 (Klingon courtroom drama)
-1 (O’Brien suffers)
1 (Defiant vs. Mirror)
0 (alien & Lwaxana’s lover)
-1 (Sisko)
1 (crew + Jem’Hadar vs. Jem’Hadar)
2 (Dominion disease)
0 (one Ferengi)
2 (The Great Link)