Friday, December 30, 2011

The genius of Apple's Genius Bar

Do you know why Apple's Genius Bar is so... 'genius'? Because they've managed to make 30 customers with electronics problems look like the store is stocked with eager customers.
--JW on reinventing the "make people wait in a long line outside the empty nightclub" ploy

How tariffs stripped the X-Men of their humanity

You probably did not realize that the official legal position of Marvel is that contrary to the general thematic content of the Marvel Universe, mutants are not people. A recent Radiolab podcast brings the shocking true story, but it's easy enough to summarize: Marvel-licensed action figures are generally made abroad and imported into the United States. But "dolls" (which are representations of people) face a higher import duty than "toys" (which are representations of non-humans), so it's in the interests of Marvel to argue that X-Men action figures should be taxed at the low non-tariff rate. ...

What we have here is a federal 12% sales tax on dolls, but only if the dolls are made in foreign countries, and a different -- arbitrarily lower -- 6.8% federal sales tax on toys, but again only if the toys are made in foreign countries.
--Matthew Yglesias, Slate, on another casualty of tariff distortions

Thursday, December 29, 2011

Stir-fried bagels

Now it’s time to offer some appreciation for New York food in China — specifically bagels in Beijing.

The bagels — translated 贝谷 (beigu, or “precious wheat”) at Mrs. Shanen’s Bagels — are pretty decent. They are not simply rolls with holes that you find in some parts of the United States. These New York-style bagels, though slightly smaller, with a crisp crust and soft insides, are the product of a Brooklyn-bred Chinese-American entrepreneur, Lejen Chen, who wanted a taste of home when she moved to China. ...

The company makes about 26 flavors, ranging from chocolate chip to jalapeno cheddar to rye to cranberry walnut. But one flavor is distinctively missing: poppy seed. Because of the country’s association with opium, poppy seeds are illegal in China. ...

An interesting thing is how Ms. Chen’s staff chooses to eat them. It is not obvious to them that bagels should be limited to being cut in half and spread with cream cheese or butter.

Ms. Chen says the workers will slice up the bagels into little strips and stir-fry them in a way similar to noodles. “They would slice it and slice it again,” she said. The bagel’s chewiness allows it to absorb flavor without becoming too soggy. “They tried it and it was very good, stir fried with cabbage and sometimes bean sprouts.”
--Jennifer 8. Lee, NYT, on stir-frying anything in sight

Sunday, December 25, 2011

The economics of the Empire State Building

The cramped observation decks [of the Empire State Building] on the 86th and 102nd floors are startlingly profitable, especially during the holiday season, when tourists swarm the city.

The decks attract four million visitors a year and generated $60 million in profits in 2010, while the owners made little if any money on the office space, according to newly disclosed documents that offer a rare glimpse at the building’s balance sheet. ...

Even with adult tickets ranging from about $20, for a trip to the 86th floor, to $55, for those who want to avoid the lines and get to the top, attendance never sags.
--Charles Bagli, NYT, on office spaces as loss leaders for the observatories on top

Saturday, December 24, 2011

What's in Champagne

Come quickly—I am tasting stars.
--17th century Benedictine monk Dom Pérignon upon tasting the very first Champagne

The two kinds of causality

The two methods by which we are allowed to produce events may be called work and prayer. ... What we do when we weed a field is not quite different from what we do when we pray for a good harvest. But there is an important difference all the same.

You cannot be sure of a good harvest whatever you do to a field. But you can be sure that if you pull up one weed that one weed will no longer be there. ... The kind of causality we exercise by work is, so to speak, divinely guaranteed, and therefore ruthless. By it we are free to do ourselves as much harm as we please. But the kind which we exercise by prayer is not like this; God has left Himself a discretionary power. Had He not done so, prayer would be an activity too dangerous for man and we should have the horrible state of things envisaged by Juvenal: "Enormous prayers which Heaven in anger grants."

Prayers are not always -- in the crude, factual sense of the word -- "granted". This is not because prayer is a weaker kind of causality, but because it is a stronger kind. When it "works" at all it works unlimited by space and time. That is why God has retained a discretionary power of granting or refusing it; except on that condition prayer would destroy us. It is not unreasonable for a headmaster to say, "Such and such things you may do according to the fixed rules of this school. But such and such other things are too dangerous to be left to general rules. If you want to do them you must come and make a request and talk over the whole matter with me in my study. And then -- we'll see."
--C. S. Lewis, "Work and Prayer"

The psychological price of a medical education

It’s been clear for several years now that while aspiring doctors may start medical school as happy and as healthy as their non-doctoring peers, four years later they aren’t.

More than 20 percent end up with depression, more than half suffer from burnout, and in any given year, as many as 11 percent contemplate suicide.
--Pauline Chen, NYT, on post-MCAT risks

The rate of suicidal ideation among medical students in our study (11.2%) is
higher than for individuals of similar age in the general U.S. population (6.9% among 25- to 34-year-olds).
--Liselotte Dyrbye et al., "Burnout and Suicidal Ideation among U.S. Medical Students," Annals of Internal Medicine, on one benchmark group

Thursday, December 22, 2011

Financial bets on North Korea

Saturday's death of North Korean leader Kim Jong Il has given a lift to that country's only openly traded securities, a batch of bonds that haven't received a payment in almost three decades.

The defaulted bonds, which were created in 1997 when French bank BNP repackaged a series of non-performing syndicated bank loans that were granted to North Korea in the 1970s, have suddenly sparked interest among speculators. The sporadically traded bonds, which trade at a deep discount to their face value, saw a tick up this week and were recently quoted at 14 to 18 cents on the dollar, compared with 13 to 15 cents, according to London-based sales and brokerage house Exotix.

Those who have bought the bonds are making nothing less than a bet that the transfer of power to Mr. Kim's son Kim Jong Eun will usher in a moment akin to that of the Berlin Wall's collapse for the tightly controlled communist country. ...

According to Mr. Chappell's calculations, investors' claims extend to the principal and interest accrued since 1984, when the original loans defaulted. That amounts to anywhere between 300% to 600% of the principal in unpaid interest.

The premise that has attracted hedge funds and pension funds is that North Korea can't exist in isolation forever, and, like other former communist countries, will need to tap the international markets for funds.
--Prabha Natarjan and Erin McCarthy, WSJ, on Arrow-Debreu securities on North Korea's reintegration into the global financial market

Tuesday, December 20, 2011

Advising James Franco at Yale

When I read that an NYU professor was allegedly fired for giving James Franco a “D,” I was shocked for several reasons. First, that any college could be so stupid as to fire a professor for not giving a good grade seems ridiculous, so much so that I imagine there will be an enormous burden of proof on the part of the accuser even if it is true. ... Second, I was shocked that James got a “D” for not attending class. ... I’ve been James’ professor, and it struck me as highly uncharacteristic for him to just “blow off class,” as several articles are suggesting.

When I was assigned to be James Franco’s adviser in the English department at Yale, I was not exactly sure what to think. ...

The catch was that this was also the semester that James was going to be in Detroit filming for the new Disney blockbuster Oz, the Great and Powerful, which meant he wasn’t going to be able to meet with Matt and me in New Haven. However, I didn’t feel comfortable carrying on a Ph.D-earning conversation over the phone each week, and so I told him he’d have to agree to take the time away from whatever he was doing (which just happened to be shooting a multimillion dollar film) and at least have a video conference call for several hours each week. ...

He always came prepared, and at one point even followed through on our scheduled meeting from Palo Alto where he was attending his father’s funeral. That’s right—he actually did the reading and scheduled discussion the same week his father suddenly died. "I'd still like to have the discussion," he said when I realized that he was preparing for a funeral and offered to postpone. "My dad was very proud that I was at Yale, so this is what he'd want." Blowing off class? I certainly would have blown it off under similar circumstances. ...

How could he possibly be simultaneously reading for a Yale Ph.D and filming a multimillion-dollar motion picture? ... [W]hen you’re the star, you end up just sitting around a lot. ... So when you see James’s character with his arm trapped under a rock in 127 Hours, what you don’t see is that there was an assigned reading under the rock with it. When he’s playfully wrestling with a genetically-enhanced chimpanzee in Rise of the Planet of the Apes, just off to the right of the shot was a stack of books. ...

The truth is, if you’re an A-list Hollywood star like James Franco, and are willing to put the time into earning a Ph.D, you may actually have more time to read than many of your colleagues. Heck, you don’t even have to worry about the grocery shopping, laundry, and other sundry tasks that every other poor graduate student in the country has to worry about. After visiting Detroit, the thing I found myself wondering was not “How does James do it?” but rather “Why aren’t more Hollywood actors earning Ph.Ds?”
--R. John Williams, Slate, on extracurricular advice for Hollywood stars

It's hard to effectively regulate pay

Insurers that cover directors and officers may be pushing back on clawbacks. Allowing regulators to recoup undeserved rewards from executives is central to recent financial reforms. But in addition to more standard risks, directors and officers policies are now covering salaries and bonuses lost in this way — at shareholder expense. ...

Meager fines for errant corporations haven’t satisfied the public’s lust for rolling heads. That is one reason the Dodd-Frank and Sarbanes-Oxley laws provide for clawbacks. The idea is that at least part of senior executives’ hefty pay packages can be recovered if they run banks that fail or receive remuneration based on bad numbers. ...

Clawbacks also created a business opportunity. Insurers began offering policies in April to cover them, even before regulators issued the first applicable rules under Dodd-Frank. Dozens of companies, banks, hedge funds and private equity firms have bought policies covering clawbacks, worth millions of dollars, for annual premiums of a few tens of thousands.
--Reynolds Holding and Una Galani, Reuters, on the invisible hand rising to meet demand

Monday, December 19, 2011

College football hurts non-athlete student achievement

We consider the relationship between collegiate-football success and non-athlete student performance. We find that the team's success significantly reduces male grades relative to female grades. This phenomenon is only present in fall quarters, which coincides with the football season. Using survey data, we find that males are more likely than females to increase alcohol consumption, decrease studying, and increase partying in response to the success of the team. Yet, females also report that their behavior is affected by athletic success, suggesting that their performance is likely impaired but that this effect is masked by the practice of grade curving.
--Jason Lindo, Isaac Swensen, and Glen Waddell, "Are Big-Time Sports a Threat to Student Achievement?," on the negative academic externality of college sports

30% of Americans have been arrested by age 23

The study, the first since the 1960s to look at the arrest histories of a national sample of adolescents and young adults over time, found that 30.2 percent of the 23-year-olds who participated reported having been arrested for an offense other than a minor traffic violation.

That figure is significantly higher than the 22 percent found in a 1965 study that examined the same issue using different methods. The increase may be a reflection of the justice system becoming more punitive and more aggressive in its reach during the last half-century, the researchers said. Arrests for drug-related offenses, for example, have become far more common, as have zero-tolerance policies in schools. ...

Criminal justice experts said the 30.2 percent figure was especially notable at a time when employers, aided by the Internet, routinely conduct criminal background checks on job candidates. ...

The researchers found that the probability of a first arrest accelerated in late adolescence and early adulthood — at 18, 15.9 percent of the participants reported having been arrested — and then began to flatten out as the youths entered their 20s.

Saturday, December 17, 2011

Unbelievable cluelessness at RIM

One reason for the worry, analysts say, is that no amount of advertising will help increase the sales of BlackBerrys in the United States because the current line is a jumble of models. There are BlackBerrys that flip, BlackBerrys that slide, BlackBerrys with touch screens, BlackBerrys with touch screens and keyboards, BlackBerrys with full keyboards, BlackBerrys with compact keyboards, high-end BlackBerrys and low-priced models.

The company, in a statement, said it did not know how many models were on the market.
--Ian Austen, NYT, on not knowing the first thing about your own business

Sunday, December 11, 2011

The HBS lifestyle... and its cure

At some point in the process of developing a start-up, every small business owner has to dedicate themselves to their new trade. For Brenna S. Haysom [Harvard College] ’00, that meant four to five hangovers a week for months as she attempted to hone in on the perfect flavor for her new drug

Finally, that work has paid off, and Blowfish, a hangover cure, is now being offered online and is already being sold in some stores in New York. ...

Haysom returned to Cambridge to attend Harvard Business School, graduating in 2006. During her second stint at Harvard, she began researching potential hangover cures.

“I was a lot more social when I was in business school than as an undergrad,” Haysom said. “[Hangovers were] something I started doing a lot of research around, just in my own personal habits.” ...

The final product created by Rally Labs includes caffeine and aspirin to give the consumer energy and relieve pain and antacids to help the stomach recover from the alcohol. The product comes in the form of an effervescent tablet.
--Jacob Feldman, Harvard Crimson, on a candidate for inclusion in MBA welcome packets

Saturday, December 10, 2011

Reasons not to check your luggage with American Airlines

Testimony at Mr. Bourne’s trial in Federal District Court in Brooklyn during September and October revealed a culture of corruption among some baggage handlers at [John F. Kennedy airport]. They stowed drugs in secret panels inside planes; stole laptops, lobsters and fine clothing flown as freight; and rifled through passengers’ belongings for perfume, liquor and electronics. ...

In 2009, the last year for which there is complete data, the Transportation Security Administration received about 6,750 reports of property missing from checked baggage. Passengers reported the total value of their losses as nearly $5.3 million. ...

From 2002 to 2010, American Airlines generated more such reports than any other airline. ...

“What percent of American Airlines employees would you say engaged in this conduct?” a federal prosecutor, Patricia E. Notopoulos, asked Matthew James, a defendant in the case who pleaded guilty and testified for the prosecution.

“About 80 percent,” Mr. James answered. ...

“I was bragging around the job that I was doing it, and I was trying to get my other friends involved so they could make extra money,” Mr. Asencio said. ...

Even the defense lawyer, Mr. Savitt, said that he believed part of the witnesses’ testimony. “It became very obvious that everyone in American Airlines’ baggage services is dirty,” Mr. Savitt said.

The price of black and white babies in Texas

My wife and I are thinking of adopting and shockingly found in Texas, the cost for a white infant was $35,000 and the cost of a black infant was $17,000 – these are published numbers on private adoption websites.
--Freakonomics commenter Brian on supply and demand in operation

Caffeinated drinks led to the Age of Enlightenment

Until coffee and tea became mainstream beverages in the 18th century, the daytime beverage of choice for both the masses and elites in British society was alcohol for health reasons because the water just wasn't safe to drink. And so you had an entire culture that was waking up in the morning and was drinking two pints of beer and then going to work and then having a little bit more beer and then having a little wine and then having a little gin... And so the entire culture was basically drunk all day long as kind of a default state. And so it's not an accident... that the Age of Reason accompanies the rise of caffeinated beverages.
--Steven Johnson, ForaTv, on the Enlightenment running on Dunkin'. HT: Greg Mankiw

Saturday, December 3, 2011

The new racial passing

Racial passing refers to a person classified as a member of one racial group attempting to be accepted as a member of a different racial group. The term was used especially in the US to describe a person of mixed-race heritage assimilating to the white majority during times when legal and social conventions of hypodescent classified the person as a minority, subject to racial segregation and discrimination.

[Harvard freshman] Lanya Olmstead was born in Florida to a mother who immigrated from Taiwan and an American father of Norwegian ancestry. Ethnically, she considers herself half Taiwanese and half Norwegian. But when applying to Harvard, Olmstead checked only one box for her race: white.

"I didn't want to put 'Asian' down," Olmstead says, "because my mom told me there's discrimination against Asians in the application process."

For years, many Asian-Americans have been convinced that it's harder for them to gain admission to the nation's top colleges. ...

Now, an unknown number of students are responding to this concern by declining to identify themselves as Asian on their applications.

For those with only one Asian parent, whose names don't give away their heritage, that decision can be relatively easy. ...

Amalia Halikias is a Yale freshman whose mother was born in America to Chinese immigrants; her father is a Greek immigrant. She also checked only the "white" box on her application. ...

But leaving the Asian box blank felt wrong to Jodi Balfe, a Harvard freshman who was born in Korea and came here at age 3 with her Korean mother and white American father. She checked the box against the advice of her high school guidance counselor, teachers and friends. ...

...Tao Tao Holmes, a Yale sophomore with a Chinese-born mother and white American father... did not check "Asian" on her application.

A study by Princeton sociologist Thomas Espenshade examined applicants to top colleges from 1997, when the maximum SAT score was 1600 (today it's 2400). Espenshade found that Asian-Americans needed a 1550 SAT to have an equal chance of getting into an elite college as white students with a 1410 or black students with an 1100.

Top schools that don't ask about race in admissions process have very high percentages of Asian students. The California Institute of Technology, a private school that chooses not to consider race, is about one-third Asian. (Thirteen percent of California residents have Asian heritage.) The University of California-Berkeley, which is forbidden by state law to consider race in admissions, is more than 40 percent Asian — up from about 20 percent before the law was passed. ...

Kara Miller helped review applications for Yale as an admissions office reader, and participated in meetings where admissions decisions were made. She says it often felt like Asians were held to a higher standard. ...

...Harvard freshman Heather Pickerell, born in Hong Kong to a Taiwanese mother and American father, refused to check any race box on her application.

About 1,300 students were admitted [to Yale's freshman class]. Twenty percent of them marked the Asian-American box on their applications; 15 percent of freshmen marked two or more ethnicities.

Ten percent of Yale's freshmen class did not check a single box.

The returns to selling candy in NYC subways

"Excuse me ladies and gentlemen, may I have your attention please. Pardon the interruption..."

The announcement is familiar to many New Yorkers, who as they ride the subway, get visits from various people asking for their spare change, sometimes in exchange for an accordion tune, a belted 1960s ballad, or a pack of M&M peanuts. Probably few of those travelers know that at least one of those peddlers earns $150 a day.

Alex "Tracks" McFarland started selling candy on the subway at age 11, and is the subject of a two-minute documentary by Bianca Consunji (via New York magazine). ...

And many New Yorkers spend that dollar. Tracks walks the D train in $300 kicks, and takes home around $55,000 a year, in cash.
--Claire Gordon, AOL Jobs, on lucrative public nuisance jobs