6 AM Pacific

Funny Chart

Andrew Biggs compares spending on veterinary services and healthcare spending in the US. The case he makes is that the issue with healthcare is not the rate of growth of spending but the absolute amount of spending. He presents this chart as evidence of both. But it is a totally inappropriate way to represent the data.

The first thing that the chart hits you with is that the ‘slope’ of both lines is roughly the same. And the fact that Biggs’s conclusion is that the growth rate over the period is roughly the same for both might lead you to think that they are connected. But they aren’t. The lines are on different scales and so a comparison of slopes is meaningless. If you interpolate the data points, you get growth rates over the entire period of 267% for healthcare and 261% for vetcare. Close enough that the conclusions don’t change. But that’s not the point.

A chart of this kind (Y1/Y2) is the wrong choice to show similar growth rates. I could take any two time series and design the Y1, Y2 scales in such a way that they appear to be growing at the same rate. The right way of doing this would be an indexed chart such as is used to compare the performance of two stocks or a stock against an index.

The Broader Context of Swatting Flies

A couple of weeks back, President Obama swatted a fly in the White House. It did not go unnoticed in the media. Since this blog is about global trends, it would be remiss if I didn’t cover this important event and put it in the context of fly-swatting around the world.

The President is clearly a fit man with great reflexes. During the election campaign he sank a three pointer on demand for the camera which earned him my everlasting admiration. This time he swatted a fly that was bothering him during an interview in the White House. Nailing a fly is never easy, however, I am somewhat skeptical about the bona fides of the White House fly. Was it a house fly? If so, is it possible that the North American house fly is an entirely different species from the flies that I grew up with in India? They do look somewhat fat and happy over here, compared to the lean, mean third world variety. I don’t believe – and I say this from considerable experience – that a human being can swat one of those Indian flies with their hands. With a fly swatter, maybe, but not your bare hands. I mean no disrespect to the Prez, but that fly was not the real thing. More »

Why do so many NBA games go to Overtime

There is a fascinating analysis of NBA scores by Jeff Ely and Toomas Hinnosaar on Ely’s blog Cheap Talk. Read through the comments as well which try to explain the data.

The data plotted in the chart is the margin of victory for the home team at the end of regulation (negative if they lose). There is a very pronounced spike at zero, implying that the % of games that are tied and go to OT is much higher than if it was closer to a normal distribution around a mean of zero.

There is a great video if you click through to the post, which shows how the distribution of the lead of the home team changes in the last 40 seconds of the game. Things look pretty normal till about 20 seconds are left. Something happens in the last 20 seconds that makes things converge to a tie.

The comments from readers try to explain this. The explanations that ring true to me are:

1. Shot selection – If the trailing team is within 3, it will attempt a 3 point shot. If it is within 2, it will typically go for a higher percentage shot for 2 points.
2. Fouling to stop the clock – The trailing team will keep fouling to stop the clock in the last 20s which will typically expand the lead. If they luck out and pull even, they stop fouling. If they pull ahead, the other team starts fouling.

Said differently, if the two teams are separated by 3 or fewer points in the final 20s and the trailing team has the ball, they will try to run out the clock and make a final shot attempt to tie the game (or win it if they are trailing by 1). If the leading team has the ball, the other team will foul them in the hope that they will miss a free shot and they get possession of the ball.

Ely offers his explanation here. Another thread of discussion on this is on Yglesias.

Conflicts of Interest in Healthcare

Atul Gawande’s piece The Cost Conundrum in the New Yorker has created quite a buzz. Apparently, President Obama has been recommending it as a must-read. Peter Orzag, the Director of the Office of Management and Budget for the administration, referred to Gawande’s article a couple of times in the last week.

The reason Gawande’s seminal piece has caught the attention of the blogosphere and the administration is because it uses data to point the finger where so far in the healthcare debate, it hasn’t – at doctors themselves. It’s easy to blame the insurance companies or the pharmaceutical companies. They are big, powerful corporations and it is natural to assume that must be twisting the system to their advantage thus raising costs for everyone. Doctors, whom we trust with our care, are much more difficult to confront. But confront them we must. It appears that the root of the problem in American healthcare is over-care.

Doctors are paid by insurance companies (or patients) by the amount of work they do (number of visits) not by the results. Insurance companies pay a standard rate per visit. They make no distinction between the rates they pay to a doctor that provides great care and one that provides poor care. The doctor therefore has all the incentive to increase the number visits and none to increase the quality of care (above a certain minimum, obviously, otherwise they won’t be left with any patients). More »

Spelling Bee Notes

Kavya Shivashankar won the 2009 Scripps Spelling Bee Championship, as has been widely reported. I watched the last few rounds of the contest. The Bee doesn’t sound like an exciting sport to watch, but once you get into it, it can be quite riveting.

The only word that I knew how to spell in those last few rounds was ‘menhir’. Amazingly, it tripped up Aishwarya Pastapur, who tied for second place. Why did I know how to spell menhir? Because of Asterix – that amazing comic book series that is unfortunately not widely available in the US.

Three years ago, I blogged about the unusual success that Indian kids were having in Spelling Bee. The post was titled Indian-Americans and the Spelling Bee Conundrum. Only 1.8% of the college educated US population is Indian-American. But as many as 20% of the top ten finalists from 2001 to 2005 were Indian-American. Obviously, this is way outside the bounds of random variation.

Well, that percentage this year was more than 50%. 6 out the 11 finalists (Scripps list) were Indian-American. There is an interesting interview on NPR of Balu Natarajan, the first Indian-American winner in 1985. He credits this success to the North-South Foundation a non-profit that promotes education in India. NSF organizes a Spelling Bee every year in the US which effectively is the breeding ground for the National Spelling Bee winners. Kavya won the junior NSF Bee in 2004. Incidentally, Balu Natarajan, in 1985 won on ‘milieu’, which would be a softball for today’s contestants.

It is ironic that Indians, whose mother tongues all spell words the way they are pronounced, should excel at Spelling Bee which exists because of the illogical, wayward spellings in the English language.

Rants From Delhi Airport

I’m in a bad mood. I am at Delhi International Airport waiting for my flight back to the US. The flight leaves at the ungodly hour of 330 am and is already 15 mins late. I go through security and learn that the lounge is before, not after security. Since I have three hours to kill (I spared my brother who dropped me off from waking up in the middle of the night) I go through the process of cancelling my security check stamps. And of course, the mandatory entry in a register with the police. I then try making my way back to the lounge but going back through security is not easy. The process wasn’t designed to handle it. I was stopped twice within ten feet by men in khaki who wanted to know why I was going the wrong way. Finally I get to the lounge. Luckily, there’s wifi so I can rant. More »

Email Scam

I got this email recently. It is clearly the first step in a potential fraud. It caught my attention because it claimed to represent the interests of Byrraju Ramalinga Raju!

—–Original Message—–
From: Jessica Ferguson [mailto:balverson@earnhardtelectric.com]
Sent: Fri 3/13/2009 7:41 AM
Subject: Executive Placement

Dear Executive,

This is a Management Placement on behalf of Mr. Byrraju Ramalinga Raju.

Mr. Ramalinga Raju is looking for an experienced business person/company that can profitably invest monies in excess of Thirty Nine Million US Dollars. The sum will be paid from Zurich Bank International Limited, 43-51 Athol Street, Douglas, Isle of Man, IM99 1ET, British Isles.

Mr. Ramalinga Raju is willing to pay 10% for your role as the beneficiary partner to the funds. Also, a subsequent 10% “Management Commission” will be paid for your advised investment services.

If you prefer to be re-contacted for more express information, please send us your:

[1] Full Names:
[2] Contact address:
[3] Direct Telephone No:

Be advised to visit the following links to be better acquainted with Mr. Ramalinga Raju’s current profile and personality.

http://en.wikipedia.org/wiki/Ramalinga_Raju

http://news.bbc.co.uk/2/hi/south_asia/7832834.stm

http://news.bbc.co.uk/2/hi/business/7815031.stm

We expect your correspondence and our response will be swift. I can be reached on (+447035931859) for details.

Signed:
Mr. Hock Lai Chan
Chan Law LLC
Bridge House Bridge Street
Isle of Man, IM9 1AX.
Direct Tel No: + (44) 703 593 1859
Fax No: + (44) 700 608 5723

More »

Changes at Gridstone

From tomorrow I will no longer be CEO of Gridstone Research. Once again, as I have done twice before in my career, I step into the unknown.

I devoted the last three and a half years to our journey at Gridstone. We set out to build an important technology company serving the capital markets. However, Gridstone’s market, the investment managment industry, has been going through one of its worse downturns ever. Needless to say, budgets have been slashed and Gridstone had to take cost-reduction measures to adjust to the new reality. More »

How Tech Savvy is Obama?

The 44th President of the United States was sworn in yesterday. A great speech was made ordinary by the high standards he has himself set and the even higher expectations of the public.

As the new President and his new cabinet swings into action to meet the challenges of this economic crisis that has no parallels since The Great Depression, we ask ourselves the all important question – does Obama have street cred in tech land? Since this blog’s audience is very tech savvy, I am sure they will want to know if the leader of the free world gets it, when it comes to tech.

The short answer is yes. By almost any measure, but certainly compared to any other President. Probably compared to most of the Congress as well.

Everybody who has followed his campaign knows how Obama used the internet to mobilize campaign funds and volunteers. Never has that kind of money been raised in a US election with no strings attached.

Then there’s his blackberry. Apparently, they are inseparable. There is even talk of amending the Presidential Records Act of 1978 to allow him to retain his blackberry in the White House.

His photos such as the one above, and all content on his website change.gov is all under Creative Commons Attribution 3.0 License which gives unfettered freedom for his photo to be published around the world on blogs such as these.

The Whitehouse website http://whitehouse.gov went live at 12:01, a minute after he officially became President. His entire agenda is up there for the scrutiny of the world.

And like most techies, he won’t wear his jacket a minute more than he has to!

Did I leave out anything that might co-opt him into the tech-savvy crowd?

Have a Great 2009!

Been away on some R&R to South-East Asia. Thus the slow blogging (slower than usual, I should say).

The vacation was wonderful. Spent a few days in Singapore, Bangkok and then New Year’s at Koh Samui. Everywhere with friends.

To my readers – all the very best for 2009. May you thrive, or at least, weather the storm well.

May you continue to take chances. Seek out new experiences. Invest time in family and friendships. Giving even when you’re not getting.

Happy New Year!