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Monday, August 25, 2003

 

A random walk down wall street

You can't sit through a statistics course very long before wondering if the class can be used to make some cash. I'm talking, of course, about stock speculation. (daydream sequence on floor 3 of Huntsman Hall) "After finding the standard deviation in this historical stock data from Assignment #3, maybe I can play with this data some more, find some hidden pattern, place a few trades, and make a fat stack of cash!!!"

If that were even remotely possible, do you think our statistics professors would still be taking the train in from Jersey? No, they would be wearing diamond pinky rings, yachting in the Caribbean, and clubbing with P. Diddy and the Hilton sisters.

Clearly, the value of statistics in stock speculation has its limits. Perhaps Louis Bachelier (despite being a dead French economist) may have been onto something when he stated that "The mathematical expectation of the speculator is zero."

The academics may have a point here. Maybe markets are efficient? Maybe speculators and asset managers are just spinning their wheels. There are nearly as many mutual funds as there are publicly traded companies. Many people still believe they can beat the market. And thus we have 6000 different mutual funds available... which is to say, ~6000 different ways to do worse than a boring index fund. (advocators of index funds, like John Bogle, founder of Vanguard, have been shouting this on deaf ears for eons).

I know all of this efficient market hypothesis stuff has merit. But I still like to trade stocks. And, truth be told, you win some and you lose some. BUT IT SURE FEELS GOOD TO WIN SOME! (as for dog years like 2000-2002, I have found that a policy of denial works quite nicely)

Heaven forbid, but maybe investment management is a possible career option? :)

posted by Ryan : 7:16 PM | permalink

Wednesday, August 20, 2003

 

Art

Me, the misses, and junior all went to the Philadelphia Museum of Art tonight. It was Wharton night, and we all got in for free. Not a bad deal, if you ask me. All of this studying and Leave it to Beaver re-runs had me starved for a little culture. A number of people dressed up for the event. I had jeans and a bowling shirt on. But then again I'm married so what do I care? I was there for free art, plain and simple.

My favorites were the European impressionists, particularly Monet. Christian found the modern art exhibit thoroughly enjoyable. Nevertheless, he had a particularly strong reaction to Marcel Duchamp's "Fountain" (a urinal on a pedestal). One might infer that Christian would simply have connected more with a diaper on a pedestal (i.e. "Pamper"), but in the end he just didn't connect with any of Duchamp's post-1915 work. Look, I don't agree with him... but the boy is entitled to his own opinions.

posted by Ryan : 9:34 PM | permalink

Tuesday, August 19, 2003

 

Another expen$e they didn't tell you about

Man, you print a LOT in b-school. I've printed some 200+ pages in my first two weeks of pre-term. Syllabi, class notes, assignments, old exams, etc. The list goes on. On campus, they charge you $0.10 a sheet, which adds up very quickly. Some crafty students tweak the print options so they can cram 4, 12, or 32 pages per sheet, expanding the power of their dime. Preferring to eschew the magnifying glass, I decided to invest in a laser printer. I got a Samsung ML-1750. Decently priced, good reviews, small and compact. It should do the trick.

Economic justification: adding the costs of the printer and toner, and subtracting the 50% salvage value of the printer after 2 years, my purchase will be justified after only 1370 pages printed. I should reach this number by Spring of 2004 most likely.

Real justification: I refuse to pay $0.10 marginal revenue for a $0.02 marginal cost good!

On a related note: don't get me started about the on-campus Au Bon Pain's monopoly pricing. $6.50 for a sandwich? $1.79 for a 20oz soda? $1 for 1oz. cream cheese to put on my bagel? Time to pump some alumni dollars into a subsidized cafeteria here! The "Class of 1923 Ice Rink" is all fine and well... but when it comes down to our grad school experience, a $0.50 Mountain Dew and a $1.50 sandwich will do all of us a whole lot more good.

posted by Ryan : 10:15 PM | permalink
 

BYU gets D- in Binge Drinking 101

My alma mater scored #1 out of 351 in Princeton Review's "stone-cold sober schools". A badge of honor for Provo, Utah!

posted by Ryan : 9:50 AM | permalink

Monday, August 18, 2003

 

Google Calculator

Google just integrated calculator functions into its search engine. Try simple stuff like 2+2 or 5*5.

For kicks you can also use scientific functions... for example figure out how much money you'll have in 5 years if you put $1000 in a (continuously compounding) money market account at the current rates. Hint: not much more than $1000!

posted by Ryan : 2:11 PM | permalink

Thursday, August 14, 2003

 

My daily 6PM routine

Entertainment in its purest form.

posted by Ryan : 8:57 PM | permalink
 

Movie-going in Philly

On 40th and Walnut, not too far from Penn, there is a brand new movie complex called The Bridge. The place is pure class. It's the Four Seasons of movie theaters. As you walk through the lobby area (past the furniture that looks more like art than furniture), you approach a state-of-the-art snack bar designed to satisfy your every culinary whim. The hot dogs are not just hot dogs, they're Nathan's Hot Dogs. And the ice cream is scooped from large containers bearing the name "Swensens". Once you proceed to the theater, you sink into the ergonimically correct loungeback chairs and enjoy the gigantic screen and Dolby Digital soundtrack. It doesn't matter how bad the movie is, you're still going to give it a thumbs up if you see it at The Bridge.

Last night, my friend and I went to see a movie at what may very well be the OPPOSITE of The Bridge -- yes, the Cinnemagic 3, directly across the street. The experience was akin to boarding a plane, walking by first class, walking straight through coach, and being escorted directly into the lavoratory where you are told to remain for the duration of your 2 hour flight. The Cinnemagic 3 is the Motel 6 of theaters, only worse. If you're in Philadelphia you'll have to try an A vs. B comparison yourself.

We went and saw the movie S.W.A.T. As I have learned at Wharton, SWAT is a problem-solving framework that stands for Strengths, Weaknesses, Apportunities, and Threats (contrary to what most people believe SWAT stands for: Self Contained Underwater Breathing Apparatus). Based on this knowledge, I had anticipated a movie about an elite force of MBA quant jocks slipping into a Fortune 500 automotive plant in Detroit, delivering a deck of slides, and escaping out the ventilation duct. Disappointingly, however, the movie dealt with nothing of the sort... it was just 2 hours of relentless violence and 12 Dr. Pepper product placements. Maybe I'll have better luck this December when "Growth-share Matrix: Revolutions" finally comes out. If you go, definitely see it at The Bridge.

posted by Ryan : 8:31 PM | permalink

Friday, August 08, 2003

 

Pre-term whirlwind and time management

This week has been quite a whirlwind. A lot to balance between classes, course materials, online course rooms, practice exams, a new campus, hundreds of new faces, and the need to eat and go to the bathroom every few hours (the latter often in the middle of a 3 hrs class).

Perhaps it's time to start looking into creative time savers.

I attended two optional lectures today. At 2 hours each, what was I thinking? Where'd I find the time? More on time management later (I received a little inspiration during the 2nd lecture).

The first lecture, "Musings about Mathematical Models and the Music Market" was just fascinating. The lecturer was Professor Pete Fader, who has done extensive research on consumer purchasing behavior and was an "expert witness" in the Napster trial. I'm a big music junkee & filesharing hobbyist, so the lecture was infinitely more interesting than, say, theoretical statistics. Professor Fader made the point that filesharing does both good and harm. But he is convinced (like I am) that filesharing does at least as much good as it does harm, and that record companies are shooting themselves in the foot with a hostile stance toward their best customers.

The 2nd lecture was about competitive advantage. There was a lot of theory and slides, which was somewhat stale and appeared to come directly from a Michael Porter tome. But the professor's encouragement of questions and discussion at the beginning and end of class made the 2 hours well worth it.

Incidentally, I have noticed that most of the pre-term professors don't tolerate much discussion between students and they tend to cut off thoughtful, open-ended questions. This is somewhat discouraging, although the confining atmosphere may be because a) they're trying to make it through a lot of material in an already abbreviated pre-term time period and b) stats and calculus are not exactly touchy-feely subjects. I'm hoping the classes that cover some of the more interesting subjects will allow a greater degree of interaction. I suppose there's something to be said for the case method vs. the lecture style on this point.

Now back to time management. In the 2nd lecture, the professor insisted that sustaining competitive advantage (i.e. sustaining profitability) is all about DECIDING WHAT NOT to do. Managers who focus on efficiency and cost reduction don't necessarily gain competitive advantage. Any organization can become more efficient, but where you differentiate yourself is where you choose to say "no" in favor of more profitable activities. Prioritization, in a nutshell. I suppose this is what allowed me the time to take two elective classes, write in the blog, spend some quality time with my new son, etc. I said "no" to sleep, "no" to TA labs, and "no" to several other classes this week. I suppose I'll ultimately pay for it, but it sure feels empowering!!

posted by Ryan : 3:08 PM | permalink

Thursday, August 07, 2003

 

Tivo or not Tivo

Last night I was reading through the bios of my professors online. I noticed that one of them had done some work with Tivo. Being a huge fan of Tivo, I struck up a conversation with him after class. For those of you who have not experienced the Tivo revolution, there are three things to remember: 1) Tivo is rad. 2) You’ll never willingly go back to regular TV after Tivo. 3) I'm usually not such a brown noser. I swear.

It turns out this professor had done early work on Tivo’s recommendation algorithm (for the uninitiated: the recommend engine helps users find programs they like based on their preferences, such as: “We see you like Three’s Company and Cheech and Chong... can we interest you in some Jerry Springer and Highlander reruns?”). After talking with him about the recommendation engine, I decided it was time to profess my undying love for Tivo, so that he would know we were in the same club. And then the clincher: he doesn’t have a Tivo. In fact, his household doesn’t watch TV at all. Hah! Silly!

Lesson learned: once you convert to Tivo, you will either stick with the Tivo or you just destroy your television altogether. There is no middle ground. No lukewarm, just cold or hot. Maybe he’s onto something with the whole no TV / no Tivo thing. Then again, I’m not sure what I’d do without my daily dose of Leave it to Beaver.

posted by Ryan : 11:18 AM | permalink

Monday, August 04, 2003

 

First day of school

All of these things were key to Day 1 in the 2nd grade. Why, 21 years later, did I neglect each and every one of these (essential) steps of preparation on my first day of business school?

Well, day 1 of pre-term was fairly soft compared to what will inevitably follow. We had a big information fair, the kind where you get a free bag and you stuff it full of pamphlets, 70% of which you will never read. But it's good stuff to have just in case. Most likely I will seal up the free bag I got, put it in a nook of a closet for safe keeping, and unearth it in the year 2011 with no small feeling of nostalgia for my Wharton days.

After the information fair we proceeded to a giant auditorium to hear predictably noble but surprisingly self-deprecating speeches by the school's leadership. An inspiring video portrayed Wharton alumni, students, and faculty thanking Wharton for what the experience allowed them to contribute to the world. I daydream a lot and so envisioned a guy on Wall Street talking to the camera: "I just made a cool $3 million last year in derivatives. Thank you, Wharton." Course, you won't see that kind of talk these days.

Calculus review in the afternoon was surprisingly straightforward. It has been >5 years since I've had any sort of Calc practice but it all sort of came back. So I used that lecture time to read up on the auction system for registration. The detail behind how the auction system works is somewhat superfluous. In the end it's a bit like eBay's automatic bidding. Say you're bidding on a really cool thermos & lunchbox combo which is currently at 9.99 and you bid a maximum of $50 but eBay is smart enough to keep your bid at $10.49 until someone outbids you. Or.... something..... like.... that.

Didn't get much schmoozing time at the dinner/reception tonight. It's a different ballgame when you have a kid. Christian slept long enough for us to eat, then he wanted to eat. Which requires you know what from you know who. Then he needs to fall sleep again, but preferably at home where there is no schmooze noise, loud laughter, or 70's soul music in the background. Once the boy is down for the night, then we can turn the 70's soul music back on and laugh loudly without repercussion.

Well, time to find a thermos & lunchbox worthy of the Wharton experience.

posted by Ryan : 8:12 PM | permalink

Sunday, August 03, 2003

 

Adventures in Wi-Fi

When I pulled my new laptop out of the box 2 weeks ago, I booted it up and was shocked to find that I already had Internet access. It turns out there were two different unprotected WiFi networks available and unencrypted in our apartment building. (Silicon Valley, go figure.... I'm now in a much more densely populated apartment in downtown Philadelphia and there are no available 802.11 networks around). People just turn these routers on in their homes and anyone in the vicinity can piggyback on their bandwidth. I was alarmed at how simple it was. Hijacked IP addresses are a hackers or spammers bread and butter. And there are tens of thousands available for the taking (a recent article in the Washington Post outlines this emerging threat).

Having just set up my own WiFi router in my home, I can see why people don't bother with all the security measures. The setup is fairly confusing, encryption is difficult to use, and setting up filesharing between two XP machines was a bear. It was ultimately worth the hassle, if only to be able to check email while in the can, but I'm still wondering if I've left some sort security vulnerability open. For all I know, someone down the hall may well be using my connection to send Viagra offers to your Hotmail address.

Someday, somebody's going to figure out how to make residential home networking and broadband sharing easier to set up. There's a reason 31 million people still use AOL.

posted by Ryan : 8:53 PM | permalink

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