Nassim Nicholas Taleb’s The Black Swan contains, among its other observations, an fascinating illustration about how possessing more data without having the capability to understand it can cause us to make what are poorer decisions than what we would have made if we didn’t have the data in the first place. The context in which Taleb works (and, consequently, the example that he gives in his book) is within the context of the stock market, and here is how it works:
Let’s say that you own a stock that, over the course of a year, increases in value. You’re more likely to keep the stock (and thus make money on it) if you are updated on the progress of the stock over infrequent intervals as opposed to intervals that are closer together. That is, if the price goes up over the course of a year, and you only check the price every 6 months or so, you’re likely to see that the price has gone up since you last checked it – this will make you feel good, and you’ll probably hang onto the stock.
If you check it every week, though, the price will not always have gone up – if a stock price goes up over the course of a year, it doesn’t mean that it’ll make a small amount of progress every week. The noise that’s inherent in stock prices will mean that it goes up some of the time (in our example, probably even most of the time) and other weeks it will have gone down.
What we would like to think is the weeks that the price will go up will make you feel good, and cancel out the effects of the weeks that the price goes down, but this is not the way the human mind works: it takes quite a bit of the price going up to cancel out the mental effects of the price going down, and so the more frequently that you check the stock, the worse you are likely to feel about it, unless of course the stock price never goes down at all, which – to use Taleb’s term – would be a black swan.
To make matters worse, news agencies won’t report that what they’re actually seeing is just noise, because no one’s going to watch a news show that says something to the effect of “Hey, a bunch of stocks went up and down today, but it’s really just noise in the system. There’s no good reason for it.”
Even if the host of the show is right about this, his ratings are going to go through the floor – people are going to want to watch the show that can actually give them a reason why – even if the reason is completely bogus. To say that there’s no reason is probably going to get the host of the show fired.
When you look at it this way, this means that on some level, news sources (at least about stocks) have a vested interest in not telling anyone the truth, at least to the extent that they’ll have a tendency to make up explanations where none actually exist. (It’s difficult to explain this in such a way that doesn’t make it look like a creepy sort of conspiracy theory, but it makes good sense.)
The end result is that if you check the stock price every day – or, even worse – multiple times a day – you’re probably more likely to unload a stock that, ultimately, you probably shouldn’t have sold. If you check the stock price once a year, you’ll be getting quite a bit of signal for the amount of noise that you’ll have to sort through. The more frequently that you check the stock price, the more noise you’ll be getting for what’s essentially the same amount of signal: the stock price went up over the course of the year.
Taleb’s point in all this is that at least in the context of the stock market, having more data doesn’t necessarily translate into being better informed, because it’s extremely difficult to separate the signal from the noise. What’s signal and what is noise isn’t going to be obvious until quite a ways down the road (or maybe not even then) and when you’re in the middle of it, it’s pretty much impossible to tell. According to Taleb, not many stockbrokers know, either.
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In a similar vein, there’s an anecdote – probably apocryphal – concerning a lawyer who had little to no regard for the intellectual ability of the judge before whom he was arguing a case. When the lawyer concluded his argument, the judge leaned forward and said, “I cannot say that I am any the wiser after listening to you.” The lawyer smiled and replied, “That is undoubtedly true, your honor, but at least you are better informed.”
No word on how sympathetic the judge was, but I’m guessing that he wasn’t amused.
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The lessons that can be drawn from these sort of illustrations are, I suspect, perfectly valid when applied to trying to learn anything of value from the nightly news. Just because viewers of the news are better informed about whatever it is that the news is covering doesn’t necessarily mean that any of them are any better equipped to understand what the actual situation is – if Taleb’s example holds, they’re actually worse off than if they hadn’t watched the news at all.
The regions for this are legion:
As in Taleb’s example, the signal to noise ratio is going to be more difficult to sort through if we’re absorbing the news at frequent intervals – what seems important right now may not be revealed to be all that important down the road, and the things that are truly important may slip under the radar. If a news channel has to report something for 24 hours every day, it’s pretty much a sure bet that a pretty high percentage of the stuff that gets airtime isn’t really all that important.
To make matters worse, the news agencies don’t really have any sort of motivation to cover what’s truly important in the first place. What they do have a motivation with is to compete for viewers with other news agencies or (even worse) reruns of Family Guy. Consequently, cable news networks have to present the news as entertainment, and as a result they have much more of a motivation to keep their audiences interested (or shocked, titillated, or riled up at whatever political party they’re not a part of) than they do to keep them informed.
A interesting example of this is presented in Thomas P. M. Barnett’s Great Powers: America and the World After Bush. Barnett, who – it’s worth noting – is not a supporter of George Bush, wonders if the Bush administration’s successes with China won’t have more of an impact, 50 years from now, than the administration’s failures in Iraq.
After reading that, most of us – myself included – have a reaction that’s something akin to: “China? What successes did we even have in China, and when was that ever even discussed?”
And that’s precisely the point: as far as CNN was concerned, it was probably never worth discussing, or if it was, it wasn’t given the same quantity of airtime that more interesting issues (like, for example, the latest story about Lindsay Lohan breaking out of rehab) get on a fairly regular basis. To be fair to CNN, this probably isn’t because there’s any media conspiracy to make the Bush administration look bad (though it’s not like it would have been that challenging, anyway) but because good news rarely makes people keep watching. Instead, reporting on the latest body counts from Iraq (if you’re MSNBC) or reporting on the success of the surge (if you’re Fox News) or reporting on Paris Hilton’s stay in jail (if you’re any news network at all) draws more viewers than an in-depth discussion of the governmental policies that are, for example, drawing China into gradually liberalizing its trade laws.
Additionally, a large part of why this sort of data that is presented on the nightly news is useless is that information generally isn’t useful unless whoever is absorbing it has a context in which they can place it: if I know that there is tribal warfare in Uzbekistan, for example, this piece of data doesn’t do me any good unless I understand some of the background of the various ethnic groups and their motivation for wanting to fight each other. On a more basic level, it also helps if I can locate Uzbekistan on a map.
Data without context isn’t actually useful information, and it doesn’t help anyone understand the world any better. Unfortunately, the sound byte quality of the nightly news pretty much precludes the communication of any comprehensive context and background.
The best way I’ve heard it summed up, alas, has been “Television is to news what bumper stickers are to philosophy” – true enough, perhaps, but on some level it felt wrong to learn this lesson from reading a bumper sticker.
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One of the many issues in which any sort of clarity of thought has become a casualty of ratings-boosting nonsense is pretty much anything that has to do with environmentalism. It’s a complex topic that doesn’t lend itself well to sound bytes, and coverage of it – especially when coupled with anything to do with politics – tends to reveal more about the political biases of whoever i’s doing the reporting than what’s actually going on with the planet. Furthermore, the overwhelming impression that is disseminated by the media is that the most important and most urgent environmental problem (if not the only problem at all) is climate change.
If we’re actually trying to be informed about the state of the environment, getting our information about the environment from either newscasters or politicians is probably not a good idea. On some level, it makes about as much sense as it does for evangelical Christians to get all their advice about politics from a psychologist.
On the other hand, there’s something to be said for listening to scientists, science writers, or people that have charged into the discussion from somewhere in academia. The books that follow are some of the more interesting books about ecology and the environment that have been written recently, and I think they’re all worth a read. All of them give enough background to help put the information they present in some sort of context, and most of ideological axes seem to have been checked at the door.
1. William Stolzenburg, Where the Wild Things Were
The traditional view of ecology – at least, the overly simplistic view of ecology that we all were exposed to in elementary school – was that it works in a mostly bottom-up way. That is, the survival of the species on the top of the food chain is heavily dependent on the species that are lower on the food chain. This is true as far as it goes, but a big limitation in this way of thinking is that if this is the only model by which we understand ecology, there’s no obvious problem if the top of the food chain is removed.
Removal of apex predators, though, has been happening all over the place – probably the most well-publicized example, at least in this country, has been the U.S. Government’s attempt to eradicate the wolf population of the western United States over the last century. Unfortunately, the reduction in the big predators all over the planet – of which wolves are only one example – has had a more far-reaching impact than most people suspected that it would – Stolzenburg refers to the big predators as “keystone species,” because they are just as necessary for an ecosystem to function correctly as the prey that are traditionally seen as being the base of the food chain. This may sound obvious, but the case studies that Stolzenburg cites reveals that this works in unexpected ways: wolves being re-introduced to Yellowstone has led to a re-population of the aspen groves, of all things, even though the elk population on which the wolves prey has remained more or less constant. (Before the re-introduction of the wolves, the elk were being shot on a regular basis by the rangers to keep the population under control.) The behavior of the elk changed with the introduction of the wolves, even if the numbers of elk was a constant.
Overall, though, this isn’t a very optimistic picture: reintroducing wolves into Yellowstone was a great start, but that’s going to have to happen all over the place and with lots more species for the ecological damage that’s been done by removing keystone species to be undone.
There’s a more detailed review over on the book review section of the Christian Science Monitor that’s worth a read. So is the book itself.
2. Charles Clover, End of the Line
Clover is the environment editor for the London’s Daily Telegraph. He’s been keeping an eye on fisheries all over the world for the last 20 years, and the results are not encouraging. End of the Line is the the book that details the current status of the world’s fisheries, and how overfishing is depleting them at a dangerous rate. The book hasn’t gotten a lot of attention, unfortunately, but it has recently been made into a documentary film. At least so far, it hasn’t been getting a whole lot of attention, either, but perhaps the situation will improve.
Clover makes a compelling case that the problems that we have with the world’s fisheries is a much more immediate problem than global warming – and, in theory, it should be easier to fix, too. No new technology is needed: just slow down the rate of fishing in the areas that have been depleted.
It’s also refreshing to read a book about the environment in which the United States is not the primary culprit, which sets this book apart from most of the discussions about the Kyoto Protocol, for example. The United States doesn’t hasn’t been doing everything right, but compared to the situation in Europe and Asia, at least we’re not doing as bad as we could be.
There’s an interview with Clover and a discussion of the book over on salon.com that’s worth a read. Depletion of the world’s fisheries is one of the largest problems, and it is being discussed less than just about any other problem. Consequently, this is probably the most important book on this list, and it’s one of the least well-known. It also includes a list of sustainable fish – what to eat and what to avoid, and which restaurants are helping and which aren’t. (Surprisingly, McDonald’s is – at least mostly – doing the right thing, here.)
3. Bjørn Lomborg, Cool It
A list like this wouldn’t be complete without a nod to the discussion about global warming, although Lomborg is probably a more polarizing figure than he presumably set out to be. Most of the ruckus surrounding Lomborg is due primarily to his first book, The Skeptical Environmentalist, which caused a fairly impressive brouhaha when it was published.
As a result of The Skeptical Environmentalist, Lomborg seems to automatically invite ridicule from anyone involved in the environmental movement, which is a shame: Cool It is an interesting read, even if no one at all agrees on any of the specifics. Lomborg’s main point in Cool It is that we can learn how to think more clearly about global warming by looking at it from a cost-benefit analysis – how much would implementing the Kyoto Protocol cost, for example, and how much good would it actually do? (According to Lomborg, “too much” and “not enough,” respectively.)
Thinking about saving the planet in terms of cost-benefit analysis seems wrongheaded, somehow, but as Lomborg points out, our society does this all the time already. Take, for example, all the deaths that are the result of traffic accidents – according to the NHTSA, 37,261 fatalities last year. Then consider that all (or at least nearly all of them) are completely preventable: all we have to do is set the maximum speed limit for the entire country at, oh, 5 MPH. Possible? Sure, but it’s never going to happen – something like that would completely kill the economy, and it’s not worth it to our society to do that in order to save that 37,261 lives. Would we consider lowering speed limits? Probably, but it looks like it would take more fatalities than we’ve got in order for this to happen.
If there’s a weakness of this way of thinking, it’s that it’s much more difficult to pin down the benefit – in terms of the cost-benefit analysis – in terms of the ecosystem, as opposed to human lives. That is: what’s the cost (or benefit?) of environmental damage if the action that does that is the same action that saves lives or pulls people out of poverty? Lomborg pretty clearly (and correctly, I believe) assigns a higher value to human life (and pulling people out of poverty) than he does having a pristine environment in which polar bears do not have to change their feeding habits to survive. Still, it’s pretty clear that the benefit of having a ecosystem that is less disturbed is a benefit, albiet one with a cost that’s difficult to pin down.
Still, Cool It presents a more coherent way of looking at climate change than what we’re getting from most places, and it would be worth reading in parallel with Eban Goodstein’s Economics and the Environment in order to contrast Lomborg’s analysis with a similar analysis (at least, as far as I can tell – I haven’t read Goodstein’s book, only Lomborg’s) from someone who sees climate change as more of a problem that Lomborg does.
Over on salon.com, there’s an interview with Lomborg by Kevin Berger, who pretty clearly doesn’t like what Lomborg has to say, but the resulting discussion is still civil and enlightening. There’s also a review of Cool It elsewhere on the website (by the previously mentioned Eban Goodstein, another economist) that’s makes for fascinating reading, if for no other reason that the conclusions that Goodstein says that Lomborg comes to are not the conclusions that Lomborg says that he comes to in both the interview and the book.
Nice post. I have a few comments to support what you said.
First, passing out data to know-nothings is fulfilling the biblical idiocy of casting pearls before swine. Having said that, the mainstream media is only a part of the problem, and a shrinking part. The reason for this is that most of us are “swine” and we blog or pontificate around our version of the water cooler. When we are electronically published, we may be picked up by a search engine and deposited on some other swine’s crt or lcd. Behind all this misuse of information is the issue of swine making decisions. Back before you were born, the world was less democratic. Some folks were considered in need of custodial assistance. They weren’t allowed to make decisions–and that was fine with them. Perhaps it was even best.
For example, if you were in the military below a certain paygrade, the military automatically deducted money from your paycheck and gave it to your wife. The idea was that you probably would make the wrong choice on whether or not to go home with the money or stop off at the pool hall and lose some of it. No decision needed here.
In regards to fisheries, I believe that the more data we have the more “loopholing” we see. Back in 1978, the US passed the Fishheries Conservation Management Act (FCMA). The purpose of the act was to protect species like tuna that swam through US waters, as well as manage species that were contained within our 200 mile management zone. As a government lawyer involved in enforcing it, I can tell you that the enemy lawyers loved to get new data to analyze for possible arguments on how to apply the law. Data was there to be abused. The problem was corrected by issuing permits, much like we buy fishing licenses today (only more expensive). No data analysis. Got a license or not worked just fine. And yes, solving this problem appears to be easy, but only if other countries don’t mind non-fish consuming economies telling them how to live and what to eat. Not likely, in my opinion.
Overall, a mostly coherent and consistent review.
I have a few comments:
Stock market noise is no different from noise on scientific graphs, such as astrophysical data from deep space. A good scientist must understand and interpret the background noise to make sense of the intricasies of the universe. Likewise, with the stock market… There is ALWAYS a reason… Even the noise is important in its own way, and there IS a statistical pattern to it… It is true that not many brokers understand and make good use of this information. I can pass along some further in-depth reading suggestions on stock market interpretation and analysis (which I have yet to tackle reading myself), if you are actually interested in learning about statistical interpretation of the collective human psyche…eww….
Regarding the importance of human life and economy vs. ecosystems preservation: Why are fish being rating higher priority in this review than polar bears? Is it because fish are lower on the food chain, while polar bears are apex predators? If all points brought up here are valid, I think we’d better take another look at that conclusion…
Agreed, poverty is a serious problem, but can other solutions be found which also protect polar bears? Personally, I’d rather hug a polar bear than a fish any day, as I suspect many other conservation-conscious people would, but we might get eaten in the process. Then again, having predators as a conservation goal might just save a few of those fish, as well…
I read “End of the Line,” and found it quite tedious reading, which might account for some lack of popularity, but also very informative and thought-provoking. We really never do hear about these things on the daily news!
If Mr. Clover wants to be heard by the masses, perhaps he should stop messing around with world governments, and get on-board a pirate ship for his next film voyage… While “civilized” bullets are whizzing over his head, how might he propose to solve the problems that motivate poachers? Not too many people are willing to risk life and limb for greed alone…as he oversimplifies quite often…
I really liked his suggestions about “buyouts” and making lots of marine reserves in populated areas with recreational fishing areas along the borders. That sounds like at least one workable idea, which does make sense and makes it worthwhile reading.
Bob – that’s something that I hadn’t thought about, but you bring up an interesting point: the difficulty of protecting a natural resource that moves around. How can we protect it if it’s only in our territorial waters only some of the time?
And, you’re right – the difficulty that the rest of the world has had in trying to convince Japan to not hunt whales (for “research,” I think they’re calling it – on what, sushi?) suggests that this isn’t going to be easy. Still, I think we may have a better shot at solving this problem than, say, getting everyone to reduce greenhouse gas emissions.
Ann – Taleb’s book was probably more in-depth than I really wanted to go, but I’d still be interested to see the titles that you recommend. Incidentally, Black Swan is worth a read, but his earlier book – Fooled by Randomness – is probably better.
With regards to fish and polar bears:
I’m not disputing that polar bears are important, and I don’t think anyone wants to see them go away. There’s some interesting data (that Lomborg quotes, I don’t have it in front of me) that suggests a few things that makes the polar bear crisis seem like it may be overblown:
(a) Polar bears have (or may have, I’m not sure off the top of my head how solid this is) the capability to forage in ways that are similar to brown bears – i.e., if all the ice melts, they’re a lot less likely to all just die than they would be to change their living habits. So we’re not likely to lose an entire species, here. At least that’s the theory.
(b) Lomborg quotes some statistics (that, again, I don’t have in front of me right now) that suggests that the number of polar bears that are killed by hunting is a much higher number than those that are being drowned melting of the ice as a result of climate change. If we’re really serious about saving polar bears, implementing the Kyoto protocol is an incredibly inefficient way to do it in terms of the amount of money that has to be spent and when it’s going to start having an effect. Outlawing polar bear hunting will have an immediate and positive effect, so if we’re really serious about saving polar bears, let’s do that first and see what happens.
All that to say – it’s not that I’m trying to dismiss the plight of polar bears while saying that fish are more important – but I think that the plight of polar bears has been (over?)emphasized in the media, while the discussions of a crashing fish population have gotten a lot less airtime.
Nice article! You’ve inspired me to pick up a couple of the books you mentioned. Of course, I won’t have time to read them until Christmas, but at least they’ll be on my list.
In regards to polar bears vs fish…maybe the public wouldn’t be so excited about polar bears if they hadn’t been exploited by Coca-Cola? (kidding)
Was I supposed to call you back the other day, or were you going to call me back? I thought you were going to call me… Hooray miscommunication between the male and female species! : )