Why not copying successful people may not always work [2016/1/11]

The internet is flooded with self-help tips and following successful people. However, there are three caveats.

1. Survivorship bias. You don't see the people who failed that engaged in the same activities that the successful person engaged in. For instance, a star CEO may had a hardcore management style for him but many other CEOs who did the same strategy failed.

2. Recall bias. People tend to have faulty memory and attribution is especially not so accurate. A star may attribute his success to his hardcore upbringing while the real factor may be something else, such as the star being naturally smart. Hence, a successful person's advice may not be so accurate.

3. Lack of context. Some strategies are not for everyone. You have to contextualize. For instance, a CEO may say be more charismatic. But your leadership problem may not be charisma and increasing charisma may not be effective.

4. Effort and cost. Many successful strategies are well known such as working extra harder. But such strategy is easy to say but extremely difficult to implement. It takes immense will power and sometimes high cost (foregoing time with your family).

5. Lack of uniqueness. If everyone is doing the same strategy then nobody will succeed. For instance, if everyone stands up then no one can watch the movie better. Similarly, if everyone engages in value investing then value investing will not generate profit. Hence, it is important to realize whether one is engaged in a unique strategy to gain competitiveness.

Given survivorship bias, recall bias, lack of contextualization, high costs, and potential lack of uniqueness, it is not a good idea to just blindly listen to successful people.

So what can be done?!

Well, the best proven way! Experimentation!!

Try out new activities and see which one fits you. Methodically measure the input and output. Of course, lot of things are really hard to measure but qualitatively assessment provide some indicator. For instance, writing journals will help you better assess the impact of the new activity. Hence, be a true scientist. Experiment! Experiment! Experiment! Be your own expert!

Finally, be patient and flexible. Most activities do not bring drastic results. But accumulation of many activities changes lives. Thoughts change actions. Actions lead habits and habits change your life.  Also, start small, getting small wins is the key to discipline. Remain flexible. You have try out new things and keep adjusting your activity until you find the optimum choices. Often the journey of betterment is hard and long but its fruits are awesomely rewarding and it is much better than doing absolutely nothing.

Self-driving bus [2015/1/11]

Self-driving buses are now being promoted as one of the alternatives of future transportation. The idea seems quite interesting but I wonder about the safety of the passengers. After all, buses carry more passengers than cars. Also, what happens if there is some malfunction? Do we have a real life "Speed" movie with a crazy bus?

Also, would this buses operate in chaotic city environment or only long distance rides? I can see the self-driving bus, an alternative to a train, where people can comfortably sleep with reclining chairs to go across the country.

However, in chaotic city environments, where buses have to break rules to ride people...hmmm..it may be too early.

I am sure we will figure it out in the future.

New Year Resolution Gym... [2015/1/7]

The last few days, my gym was packed with people. Wow, lot of New Year's resolutions.

Sadly, I don't expect to see as many within a few weeks...why, why,....why.

I think the issue with exercise is that most people take it to drastically. They make it

difficult. They say I have to come to the gym and work out. Like you can't work out

anywhere else. This is the exact problem. They can't take baby steps. They try to break

dance before they can even walk. Yup, failure...

So in order to not only enrich our gym and subsidize other members, people who want

to exercise more and lose weight should do the following. Do easy exercises!!!

Here are the very easy list.

1. Take stairs! Wow, not hard trust me. If you live or work too high then only go up two floors and then take the elevator.

2. Stand up more. Don't sit all day. Just stand up whenever and work while standing up. You can read and answer email while standing up. People do it all time.

3. Just move more. Move your legs and arms. Whatever. That burns calories and gets you ready for more exercise.

Finally, if you are real serious, make a bet. Put the money on it. Use healthywage to lose your desired weight and also make money. Yup, money makes incentivizes :D

GM invests in Lyft [2016/1/4]

GM invests 500 million in Lyft.

I think it is a good idea overall since GM can have Lyft drivers lease their cars and do self-driving car research together.

Lyft could further boost the deal by giving discounts to GM or having Lyft drivers pick up workers at GM.

However, doesn't GM have huge debt and pension obligations? Of course, the Lyft deal seems like a good deal over the long run but somehow I believe GM should try to resolve its debt issue first before it goes bankrupt again.

Also, didn't GM have a defective switch ignition problem...

Responsible investing [2016/1/2]

Millennial generation is engaged in socially responsible investments.

This is good news but there are two caveats.

First, social responsible (SR) measures are noisy and still being developed. It is challenging to measure social responsible well and there is a high chance that firms may just dupe the investors by checking the box. Hence, it is important for the millennial generation to do their own due diligence. Millennials can start by looking at innovation.org and givewell.org. Of course, SR may not always coincide with charity work but it gives a good indication what problems are there and need to be solved.

Second, social responsible may not be optimal. It may seem following certain procedures may help society but may be ineffective. For instance, diversity for only diversity sake alone may not be so beneficially. Also, certain recycling procedures may be prohibitively expensive and inefficient and there may be better ways to offset the pollution.

Third, there are better ways to solve problems than investing. The best way is to not use a company's product that is really doing harm. If you think the product produces so much pollution, don't consume it and urge others not to buy as well. If you think certain retailers labor practices are bad then don't shop there. Vote with your feet.

Hence, it is great that Millennials are more conscious but they must be aware of the shortcoming of social responsible investments. This will allow them to make better decisions and improve the world.

The real reason why luxury hotels charge for internet [2015/12/26]

There has been many theories why luxury hotels charge for wi-fi.

Reasons include guest's price insensitivity, perk, avoid cannibalization, and to maintain
reasonable high internet speed.

Perk was a weak theory to begin with because if customers really needed wi-fi, they would just purchase it.

Cannibalization cannot be ruled out but is not a very convincing theory either. Who would just use internet and stay in their room in a luxury hotel? Customers would surely take advantage of the luxuries that the hotel provide instead of being sucked in to Netflix, which they can anywhere else.

Well, today, we are closer to the real reason why they charge for internet. Recently,
Marriott has been fined by FCC for blocking customer's hot spots.

This action rules out price insensitivity and to maintain reasonable high internet speed. If customers were price insensitive then they would just pay for hotel wi-fi. If the hotel cared about internet speed, then they would not care about customers using their own wi-fi.

Hence, what convincing evidence are we left with? Yup, money, money, money...charging for internet makes money and is probably a super high margin business because once you set up the internet, the maintenance is very low cost. That is why Marriott actively banned customer's wi-fi.  It could not lose its cash cow, especially as lodging became more competitive with rise of Airbnb and other innovative lodging.

So in sum, luxury hotels charge for internet because it makes profit!

Close yet far from home [2015/12/26]

A study found that on average an American leaves 18 miles from mom.

This is a quite interesting finding given the unprecedented mobility. 18 miles is 25-40 min

drive in most cases so families are quite close yet we have a whole issue of families

breaking down in the US. Close yet far. Some can be thousands of miles apart yet feel

connected while others never visit those family members who are in the same town.

During the end of year, I think it is a good time to reflect about the relationship with family

and loved ones.

Love, love, love...love more ^^