Card Counting in Hold 'Em?

My buddy Berk went to Mohegan Sun over the weekend and played their hybrid version of Texas Hold 'Em and blackjack. Hands are played like normal in hold 'em, but each player plays individually against the house kinda like blackjack. The house never folds, so you simply have to beat its hand. Only one deck is used. Players hands are face down, but no one stopped them from sharing some information about who had what. The betting is structured so that you ante to get your pocket cards. Then you either double your ante to see the flop or fold. At that point, you can raise or call for the turn and the river.

It does take some of the fun of bluffing and the other mind games out of it, but is there an opportunity to count here? Before you even have to bet for the flop, you know 12 of the 52 cards that the house cannot be holding. Anyone want to work some numbers out and take a trip to Mohegan to try it out?

Idea Markets

Really cool article in the NYTimes about a company that created an internal market for ideas. Complete with stock ticker, employees come up with ideas whose shares can be traded on the market. Popular ideas have become products, often things that management never would have thought of.

NYTimes: Here's an Idea: Let Everyone Have Ideas

Are you a communist if you use a ThinkPad?

State Department Is Criticized for Purchasing Chinese PC's

This xenophobia/protectionist thing is getting out of hand. What cave have all these people been in for the last few years? There are a TON of companies that do big, critical business in the US that are owned by people and countries from all around the world. It's called Globalization. It's been going on for quite some time now.

The irony of this specific instance is two-fold. First, as the article says, many of the Lenovo computers are assembled in North Carolina. And second, has no one been paying attention that the vast majority of computers and computer parts have been manufactured in Asia for decades now?

Why don't we just enact another Smoot-Hawley Act and be done with it?

Backing Up Belief

It's time we start demanding people back up their beliefs with some evidence. I'm not talking about religious beliefs, which are impossible to prove, but statements about actual events and predictions for the future. It is easy to say you believe something will happen. But for all I know, you're just making something up unless you can back it up with some rationale.

There are two instances that come to mind in this. First, is an episode of "The Apprentice" that I saw a few weeks ago. The two teams were holding competing marking events for Sam's Club where the objective was to sign up more new Sam's Club members in one day than the other team. After it was all over and Trump had them all in the board room, he asked the each of the team leaders if they thought they won. Both said something to the effect of "I believe we won because we put in incredible effort and worked really hard. I'll be absolutely shocked if we lost." That rationale was absurd. You don't win by putting in effort, you win by signing up more members than the other team. It doesn't matter how hard you worked, but you damn well better know how many members you signed up. I realize that it's all scripted and edited to be dramatic on television, but it was still just stupid hearing these people puff themselves up about their beliefs when they should just come straight out with the relevant number and why they predict that the other team got fewer new members.

The second instance is a little more serious. In his press conference today, President Bush says this:

I am confident -- or I believe; I'm optimistic -- we'll succeed. If not, I'd pull our troops out. If I didn't believe we had a plan for victory, I wouldn't leave our people in harm's way....I can understand how Americans are worried about whether or not we can win. I think most Americans understand we need to win. But they're concerned about whether or not we can win. So one of the reasons I go around the country to Cleveland is to explain why I think we can win. And so I would say: Yes, I'm optimistic about being able to achieve a victory.

All we need to do is believe we have a plan for victory, not actually have one. We have to be confident, and optimistic. But the only way to build confidence and optimism is to see evidence that we can actually achieve the goals of "victory", which are never really defined anyway. Certainly there is the fog of war to account for and of course no prediction will be completely accurate, but shouldn't we base war decisions on a little stronger rationales than simply being optimistic?

If you went into a real business meeting to propose a plan, you'd get laughed out of the room if you didn't provide a convincing explanation of your goals, resource needs, schedule, risks, and rewards. Simply saying you're confident you can do it because you believe you have a plan just doesn't cut it. Shouldn't we demand the same kind of thoughtfulness on issues of war and peace?

Does Laissez-faire Actually Exist?

Tom Freidmans's op-ed today about "Realism" in the alternative energy debate[$] contained this quote from a speech by Senator Richard Lugar at the Brookings Institute:

My message is that the balance of realism has passed from those who argue on behalf of oil and a laissez-faire energy policy that relies on market evolution, to those who recognize that in the absence of a major reorientation in the way we get our energy, life in America is going to be much more difficult in the coming decades. (Emphasis added)

But is it really true that energy policy is laissez-faire and relies on market evolution? Sure, oil is traded in open markets, but then again so is all energy, whatever the source. But I would hardly call our energy policy "laissez-faire". Just how many subsidies did the energy industry get in the Energy Act of 2005? Even then, no one ever factors in the cost in dollars or lives that we've spent over the last 60+ years in the Persian Gulf to maintain access to oil supplies. If the gulf had no oil, we'd ignore it just like we ignore Sub-Saharan Africa. And on top of that, there's no good way to measure the total cost to the commons of global warming, pollution, etc.

None of this should really be surprising, but it does make me question the validity of the laissez-faire concept. There are always costs that are subsidized, either directly or indirectly. These subsidies influence the outcome of a market choice that otherwise might be different. The market simply provides people a venue to decide what is the best deal for them. By doing so, they must weigh costs and benefits. In that sense, the government is part of the market, in that it is also a participant in the market. Leaders might decide that it costs more to secure oil than it's worth and that a better way to spend money is to invest in homegrown energy alternatives. What's so anti-capitalist about that? The government is trying to find the best deal, just like a good businessman should.

I'll go ahead and make the assertion that people who argue for "laissez-faire" are those that are favored by the current market and subsidies. By making the assumption that the current set of subsidies and valuations is the "natural" state of things, they can accuse someone who favors a different set to be anti-capitalist. It is shams like this that are holding back the evolution of our nation's energy policy.

HR Word of the Day: Onsite-Offsite

I laugh every time I hear that word used: "We're going to have an onsite offsite to discuss it." Doesn't that just mean we'll have a long meeting? I guess you may have to assemble your stakeholders so that they can leverage their core competencies to synergize your value chain. Or you could just have a meeting.

Hedging on Democrats

Quick post to assuage Thomas before getting back to work: I saw an interesting tidbit on NYTimes.com about how hedge funds have contributed a lot of money to Democrats. The survey does exclude donations to 527's, so it doesn't represent the full spectrum of political giving, but it's still interesting to see an relatively lightly regulated financial business donating to Democrats at a time when they are not in power anywhere and when you have people like Tom DeLay trying to squeeze out lobbying to anyone but his loyal Republicans.

In the comments of the article, people were speculating as to why they gave to Democrats. Social conscience? Questionable. Buying access and influence? For what purpose, Democrats don't have any power right now. Because the Democrats have become the party of fiscal responsibility? Maybe, but still doubtful. If I had to guess, I'd probably say that they're doing what they do well, hedging their bets against future events. They're also giving to Republicans, but, Tom DeLay's efforts aside, it never hurts to have friends on both sides of the aisle.

Mini-rant on Patents

Brief mini-rant before I get back to work. I want to install an electronic gyro in an aircraft cockpit panel. That panel is offset by some number of degrees from the vertical when the airplane is sitting on the ground. I want to make sure that the horizon line is level at 0 degrees pitch when the airplane is sitting on the ground. Obvious solultion is to take the negative of the pitch angle measured while sitting on the ground and use that to offset the pitch displayed in flight. Takes about 10 seconds to come up with this idea, which is really just one line of subtraction. But I can't do it because it's patented. Someone patented a line of subraction. Now I have to do some hokey manual workaround that makes the system more difficult to use so that I don't use the obvious method. Isn't it great that our IP system encourages such innovation and advancement?

Non-sketchy Real Estate Listings

So just for fun last night I was browsing Craigslist's apartment listings for Boston. I was reminded from back when we were looking for a new place how much I hate sketchy real estate agents. It's amazing how many posts contain no words of any descriptive value, and instead say things like "outstanding" and "blowout!" Some don't give you a location, and only say things like "five minute walk to MIT and five minute walk to Harvard." Right, only if you live near the Cambridgeport wormhole. But the new insidious trend seems to be tricking you into thinking there are pictures of the place. I only will click on a listing if it has a picture. Craigslist puts up a little "pic" next to the listing in the search results if there's an image associated with it. But a lot of them only have a graphic with the agency logo on it. They're tricking me into clicking on the listing by making me think they have a photo.

It's not at all clear to me how being deceptive is beneficial to a real estate agent, especially when they work on commission. By deceiving your potential customers, you piss them off and make them less likely to call you. If you are not descriptive of an apartment's features and don't give a location for that apartment, people are less likely to call you. And even if they do call you and you set up a showing and it's not what the people expect, you've just wasted your time with them that you could have spent on another customer.

In my opinion, online real estate listings are about at the same level of sketchiness as porn and penis enlargers. Is there a place for (or does it already exist) for community moderated listings? On every listing, you have a simple feedback option so that people who scan them can rate the postings by how informative they are. They could also report listings that don't have logos in the pictures section, don't have addresses, or are otherwise have misinformation. Then the poster can be requested to fix the posting. These ratings would be tracked for the poster, so that you could build up a recorded reputation for honest and informative listings. You would be rewarded by having your listing appear earlier in the search results. Conversely, if you build a reputation for dishonest listings, you get put at the bottom.

I'd also build in some fields so that the listing isn't entirely freestyle. Basics like number of bedrooms, number of bathrooms, appliances, parking, etc. Default for each of these would be "None" so it's in the interest of the poster to choose something. You could then get into some cool multi-parameter search. You could search for a three bedroom, greater than two bathrooms, dishwasher, laundry at least in building, at least one off-street parking spot, within 30 minute drive to X location, and within a Y distance to a T stop on the Red line. Distances and times would be calculated independently of the poster. They simply provide the address. Seems like something like this would save people looking for apartments a lot of time, and it would also help agents find apartments quicker for their customers. Unless of course it puts agents out of business, which may not be such a bad thing.

American Rhetoric

Very cool website that CEJ pointed me to the other day. Holds a huge archive of speeches from throughout American history, in text and audio format.

American Rhetoric

Alternate Retirement Investments?

Thomas pointed me to Blog Maverick, the blog of Mark Cuban, the semi-crazy but very successful owner of the Dallas Mavericks. He's got a lot of interesting commentary about the NBA and business, especially the theater business which he's into now. But one post caught my eye the most, where he claimed that the stock market is for suckers. Basically, his point was that the value of stocks has ceased to relate to the profitability of a company, and thus is no different than any other gambling arena. As such, the advantage goes to those who can meticulously research companies and buy significant portions of them. Everyone else, especially people who own mutual funds, are solely at the mercy of others. He even goes so far as to call the stock market at Ponzi scheme, and he makes a pretty good case for it.

What he didn't do is recommend an alternative investment strategy for those of us who can't afford to trade with the big dogs, but who cannot possibly expect any pension or Social Security to take care of us. So what other venues might there be for investing? Obviously there are all other kinds of assets, like real estate, precious metals, rare stamps, etc. You'd like to think that you should invest in things that provide added value through your investment. I think this is why the stock market had previously been a good choice because companies were supposed to take your investment in stock and turn that into new employees and equipment, who would go on to make new products with which to sell for a profit. This is a way to generate wealth in a non-zero sum way, right?

But Cuban seems to believe that it is all purely gambling, where there are equal numbers of winners and losers. Are there other assets that could provide growth? Or could you build a retirement investment strategy based entirely on gambling? I don't mean playing blackjack, but on things like online futures markets, or sports, or just basic futures markets? Maybe there's an opportunity to package non-traditional gambling into something like a mutual fund. What do you think?