I'm very excited about this -- the screenshots released today of Apple's new OS, Mountain Lion, appear to show an unannounced version of Safari which has just one bar at the top of the window -- there is no separate search field. As a Chrome user, the unified address bar (or, as Google would have it, the "Omnibar") is one of the features that keeps me locked in and makes other browsers feel positively outdated. This really is a welcome change. We haven't quite made it to the Ubuntu HUD, but we're getting closer...
I was shocked to see the following bold headline this morning, as it describes something which did not actually happen:
CBOE 'fear guage' drops 6% in Monday trading
Let's be clear: the VIX is measured in percentage points. A 6% drop in the VIX is very significant, as it represents a 6 point drop in the index level. The drop referenced here was just 1.2 points from yesterday's 20.79 close -- so if the VIX was a stock (or something not measured in percents), it would be accurate to say there was a 6%. But the VIX is measured and expressed in percent, so the change is simply 1.2%. The headline was written either to mislead investors or by someone who doesn't understand the first thing about the numbers they've been tasked with writing about.
How ironic that a headline about the "fear index" is itself sensational! As an investor who looks to sites like MarketWatch for news, I find this absolutely unacceptable -- and it reinforces my (sad) belief that you must always do your own research, and you should never trust anything that anyone tells you.
Even worse, this isn't the first time I've used a "Misreading misleading...: VIX edition" headline. This index is ripe for information manipulation.
(Also, what's with the Facebook "like" button for tickers? Seriously? )
February 10, 2012 in Data
An NYT article about a text-message-based ad that aired during the Super Bowl talks about the high follow-through rate that the ad earned for its creator, the NFL. In fact, the ad did so well that one executive described it like this:
While Mr. Berman [general manager of NFL Digital Media] declined to say exactly how many people went ahead and signed up, he said the number was “exponentially higher” than the 2 percent conversion rate for most Web sites.
What does "exponentially higher" really mean in the context of a single number? Is 4 "exponentially higher" than 2? Is 6? Is 10? Maybe. The trouble is that they are all "linearly higher" as well (yes, I'm making terms up). The problem here is that to describe a pattern or growth as exponential requires a few datapoints. In fact, it even takes multiple observations to characterize something as linear! The most we can say about a single observation is that it is some multiple of another, baseline measure. To say a single number is "exponentially higher" than some other single number doesn't actually have any meaning at all!
Here's a brilliant post by Andrew Gelman, highlighting a tutorial that will actually destroy information in 25 steps, allowing you (yes, you!) to create this anti-masterpiece:
People who treat chartjunk infographics as real data visualizations should be redirected to a GeoCities archive every time they access Wikipedia.
Last week, I was horrified to watch a Bloomberg TV analyst use an enormous touch screen to give details about recent earnings activity. With the massive piece of hardware behind him, and the efforts of Bloomberg's extensive graphics team surely supporting the screen's visuals at every step, the analyst used the screen to... handwrite the number of companies that have beaten expectations so far. When I say handwrite, I mean he actually used his finger to draw a number (let's say it was an impossible "3", because I can't remember and I don't want anyone using this post as an actual source). Hundreds of thousands of dollars invested in hardware and software, and Bloomberg is basically putting a glorified Etch-a-Sketch on the air. Chu followed up this performance by circling the logos of companies that had beaten expectations, and drawing X's over those that did not. Tic-tac-toe at its finest!
I've written before about how technology is being used in the media, first for good and then for evil. Most recently, I wrote:
Over the last two years, CNN has pushed those [touch]screens from "cool and informative" to "overused and stupid" as they have pervaded every aspect of the newscast. Learning nothing from the hologram stunt, the company has used multitouch screens to display information that requires no interactivity.
Meteorologists have been standing in front of non-interactive screens for years. Most people prefer when they step offscreen and allow the visuals to be seen unimpeded. With these idiotic touchscreens, Bloomberg and CNN have gone the other direction: presenting information in a way which is too bombastic for its own good. Remember the sufficiency test: information or visualizations should be able to stand on their own. Here, the networks appear so desperate to harness new technology that they are actually removing information in order to create excuses for analysts to interact with the technology. Why create a graphic saying 3 companies have beat earnings when a person could draw it? When even create an overlay graphic when the same information could be presented on a screen behind someone, requiring not only bizarre handheld camera angles (and associated perspective issues) but introducing technical challenges like refresh-rate syncing?
I could only find one clip of this nonsense on YouTube, unfortunately. While it does not show the specific example that infuriated me, you can see tic-tac-toe marks around 0:40 and useless annotations around 1:50. The entire segment involves slides that the analyst is moving, resizing and rotating by hand. Even Powerpoint doesn't require its users to do something so painfully backward! Not even Keynote on the iPad itself resorts to such forced interaction! And by the way, what's with taking about 30 seconds to show us that Intel and McAfee are near to each others? Couldn't they just say that: "These two companies are close to each other." How am I supposed to infer that from an unlabeled map with no scale?
You would be excused for thinking the networks are trying to borrow a page from NFL broadcasts -- or perhaps that's just my fault for having football on the brain -- which use on-screen annotations to highlight hidden aspects of the game. But the key word is "hidden." Without the annotations, most users would never see those details. What the networks are doing, actually hiding information in order to add it back by hand, is so crazy I can hardly believe it.
The NYT's Bits section, which up until now I thought was doing a wonderful job of evolving technology reporting to a higher, "post-blog" level, has left me stunned with a bizarre editorial in which the author requests compensation for his contribution to Facebook's success.
Is it just a tongue-in-cheek opinion designed to attract eyeballs and -- yes -- goad bloggers into responding? Probably. But it inadvertently highlights how seriously people are taking the alien business of social networking -- so seriously, in fact, that as usual they appear unable to understand it at all.
Take, for example, this opinion:
“The idea that a business benefits from social interaction is not so strange or new. A lot of cafes and small restaurants will let people hang out because they attract other people,” said Yannis M. Ioannides, a professor of economics at Tufts University. “What is unusual and new is that Facebook takes access to information about these people to make its business more powerful.” He added: “The proprietor of a cafe doesn’t use personal information about me and my friends to make money.”
Really? Cafes don't use your personal information to make money? Find me a cafe that doesn't tailor its menu, prices, inventory, background music, specials, wifi, tables arrangement, etc. etc. based on the interests of its customers. Tell me that Starbucks has never once run a focus group (yes, Internet, there actually was A/B testing before there were computers). My preferred cafes in New York are those where the people behind the counter greet me by name and have my order ready before I have a chance to ask for it.
The difference between Facebook and your average cafe isn't that the experience (and more importantly, the key inventory) is tailored to the customer; it's that Facebook's inventory is virtual (unlimited) and their profit margins are insane. The fact that user-created content draws people in is no different than a cafe hanging paintings by local artists, or people being attracted to busy establishments. The social aspect, as the professor does point out, is not new. And therefore (among other reasons), the op-ed's entire point -- that because the author contributed to the social aspect, he deserves compensation -- is absolutely ridiculous.
A sweeping tip of the hat to Barry Ritholtz's guest blogger SilverOz, who was willing to call out the mad (tinfoil) hatters at Zero Hedge on their usual nonsense (emphasis mine):
So Rick/Zero Hedge, unless you would like to argue that the population of the United States also grew by 1.5 million in one month (since that is from the exact same report/revision you quoted), I think both of you should retract your extremely misleading statements about those not in the labor force increasing by over a million in January and simply admit that you are either too stupid or too focused on selling a particular world view to read the data correctly.
Longtime TGR readers will remember that we were willing to burst the ZH bubble well before it was the cool thing to do. If there's one thing I can't stand, it's people who claim to have the ability to tell when others are "lying with statistics," but then turn around and do exactly the same.
The most frightening thing about these reports -- both the initial article and this response -- is how vehemently readers are responding in the comments. It is clear that few of them have any real understanding of the issues, let alone the content of the articles. It terrifies me that articles which are purported to educate are in fact doing exactly the opposite: reinforcing prejudiced, uninformed worldviews and encouraging people not to seek answers themselves, but to rely on unverified secondary sources.
It's been a while since we posted one of these, so here's Corning's latest peek at the future, "A Day Made of Glass 2:"
(And here is a narrated version with additional details on what is -- and isn't -- currently possible.)
I came across an article on whether or not closing credit card accounts lowers your credit score, which included this bizarre observation:
The addition of new credit card debt also increases your credit utilization, or debt-to-credit limit ratio, on revolving accounts such as credit cards. For FICO scores, this ratio is part of a factor worth 30 percent of your score.
You've paid off your store card debt, which should help to lower your utilization. According to Barry Paperno, consumer affairs manager for FICO, "in addition to making payments on time each month, the No. 1 concern for people with several new store cards should be ensuring that the amounts owed on these cards are as low as possible."
He says the best-case scenario is for store cardholders to pay off their balances quickly to reduce their utilization, which is figured for each card and across all of their cards.
Now, if this were really true -- that is to say, that the marginal utilization of each new card constitutes such a major piece of your credit score that a department store account could hurt you -- then, conversely, you must be able to raise your credit score by opening as many cards as possible and not charging anything to them! These new cards would have utilization scores of zero, presumably moving your credit score as far up as the department store cards drag it down. I think we all know that isn't the case -- though it may have more to do with other variables besides utilization than some nonlinear utilization relationship.
The article isn't completely wrong, however, because the department store cards it refers to 1) typically have an immediate balance and 2) have low credit limits, resulting in high instantaneous utilization. The smart credit card arbitrageur will pay it off the next day in full, capturing the discount and (if you believe it exists) the low-utilization credit bonus.
The most important thing to remember is that missing a payment wrecks your score. Anything else that could potentially lower it, like opening 100 department store cards, has a negligible impact by comparison. Do not go into default and your score will be fine.
This post is not meant to be financial advice. It is, however, common sense.