Read The Undercover Economist

Tim Hartford is engaging and entertaining. His book and column on Slate show the reasoning of an economist as he interprets and explains the world around him. It’s much more compelling than any textbook introduction to microeconomics.

You can buy The Undercover Economist at:

His recent Slate articles on the impact of market designs are also interesting
• The design of fish markets:
• Auctions on eBay:

Bloomberg for President

It occurred to me a year ago that Bloomberg would make a great president. He has been a very effective mayor of New York. He restored fiscal balance and cooperated with the democrats after the factious Giuliani years. He has been in both parties. He is a pragmatist. He’s independently wealthy and not beholden to any special interest groups. He is a true social liberal and fiscal conservative where I believe the silent majority of Americans lie.

I did not mention it before, because I did not see how it could happen. But now that he quit the Republican Party to become an Independent and a few publications mentioned he was considering a run, the path seems clearer.

In the end, whether or not he runs will depend on the Democratic and Republican candidates. For better or worse, Hillary Clinton and most of the Republican candidates are divisive. Should they be nominated as party candidates, it creates a clear opening for Bloomberg to enter the race on a centrist, pragmatic, bipartisan platform “healing” the nation after a partisan and divisive Bush presidency. If Obama is the Democratic candidate, that opportunity would probably not exist, given the similarity in his positioning.

Given that he does not need to fund raise, Bloomberg does not have to enter the race until 2008. It’s going to be interesting to see what happens!

In the meantime, the rumors of a bid for a presidency do Bloomberg no harm in New York, where he remains relevant despite being in his last term as mayor.

Mahatma Gandhi quotes

Strength does not come from physical capacity. It comes from an indomitable will.

You must be the change you want to see in the world.

You must not lose faith in humanity. Humanity is an ocean; if a few drops of the ocean are dirty, the ocean does not become dirty.

As long as you derive inner help and comfort from anything, keep it.

Freedom is not worth having if it does not connote freedom to err. It passes my comprehension how human beings, be they ever so experienced and able, can delight in depriving other human beings of that precious right.

2 Days in Paris feels real and is tragically funny

I had the pleasure of attending the movie premiere of 2 Days in Paris at the Alliance Française last night where Julie Delpy presented her new movie. In many ways this movie felt like Before Sunset except that the two main characters have been in a relationship for two years. In this case, that’s a good thing – I loved Before Sunset’s dialogues and scenery. 2 Days in Paris matches that dialectic realism. The conversations feel real and seeing these two insecure, neurotic individuals go through their life and relationship is shockingly funny. The movie probably works better for bilingual viewers but should be entertaining for all.

Non-sequitur, based on the Q&A session Julie Delpy gave yesterday, she seems as neurotic as the character she plays 🙂

Patience and Thrift by John D. Rockefeller


All the while, John Rockefeller, with the dogged patience
that would defeat scores of embattled competitors, waited
determinedly in the wings. …

Rockefeller succeeded because he believed in the longterm
prospects of the business and never treated it as a mirage that
would soon fade.


Again, like Weber’s ideal capitalist, “he avoids ostentation and
unnecessary expenditure, as well as conscious enjoyment of his
power, and is embarrassed by the outward signs of the social
recognition which he receives.”

By avoiding talk of money as unbecoming, Rockefeller concealed
from his children the magnitude of his fortune. When Bessie [daughter]
enrolled at Vassar in the mid-1880s … she went on a shopping
expedition with some classmates to purchase a Christmas present
for a favorite teacher. At a Manhattan store, they found the
perfect gift: a $100 desk. Since Bessie and her companions
had only $75, they asked the merchant if he could wait a few
days for the remaining $25. He agreed to do so if a New York
businessman would vouch for them. “My father is in business,”
Bessie offered meekly. “He will vouch for us.” Who is your
father? asked the man. “His name is Mr. Rockefeller,” she
said. “John D. Rockefeller; he is in the oil business.”
The merchant gasped. “John D. Rockefeller your father!” When
he agreed to ship the furniture, Bessie imagined he had merely
changed his mind to please them.

Dislike of show-offs:

Rockefeller and Morgan were antithetical types, offering a
vivid contrast between the ascetic and the sybarite, the Roundhead
and the Vavalier. As the chieftain of the Anglo-American
financial establishment, the wellborn Morgan, expensively
educated in America and Europe, was a consummate insider in
the business world. … Blustery and theatrical, Morgan was
impetuous and hot-blooded… At his headquarters at 23 Wall
Street, he often seemed harried, ruling by brilliant snap
judgements. Fond of luxury, Morgan inhabited the world of the
ultrarich, with their gargantuan cigars, fine port, and
oversized steam yachts.

For Rockefeller, Morgan embodied all the sins of pride, luxury,
and arrogance. When they first met … they took an instant
dislike to each other.

[Rockefeller’s] retirement was equally remarkable for its
omissions. For instance, he lacked the wanderlust that infected
other rich men, such as J.P. Morgan, in their later years. He
never collected art or exploited his wealth to broaden his
connections or cultivate fancy people. … He showed no interest
in old-money clubs, parties, or organizations. … When someone
expressed surprise to Rockefeller that he had not gotten a
big head, he replied, “Only fools get swelled up over money.”
Comfortable with himself, he needed no outward validation of
what he had accomplished. We can criticize him for lack of
imagination, but not for weakness.

True philanthropy (as opposed to self aggrandization in the guise of philanthropy):

Before Rockefeller came along, rich benefactors had tended
to promote pet institutions (symphony orchestras, art museums,
or schools) or to bequeath buildings (hospitals, dormatories,
orphanages) that bore their names and attested to their
magnanimity. Rockefeller’s philanthropy was more oriented
toward the creation of knowledge, and if it seemed more
impersonal, it was also far more pervasive in its effect.

John D. Rockefeller Quotes

“I had no ambition to make a fortune. Mere money-making has never been my goal, I had an ambition to build.”

“The person who starts out simply with the idea of getting rich won’t succeed; you must have a larger ambition. There is no mystery in business success. If you do each day’s task successfully, and stay faithfully within these natural operations of commercial laws which I talk so much about, and keep your head clear, you will come out all right.”

“Charity is injurious unless it helps the recipient to become independent of it.”

“Singleness of purpose is one of the chief essentials for success in life, no matter what may be one’s aim.”

“Every right implies a responsibility; Every opportunity, an obligation, Every possession, a duty.”

“If your only goal is to become rich, you will never achieve it.”

I love this summer :)

The weather is great, skirts are shorter and this summer’s batch of blockbusters has been better than usual.

Ocean’s Thirteen: Fun, fast, frivolous – successfully recaptures part of the spirit of the original.

Transformers: I am almost ashamed to admit I really liked it. The dialogues are cheesy and this movie could have been completely ridiculous, but it’s actually very well done. It’s funny how Hugo Weaving has similar dialogue in all his movies – The Matrix, V for Vendetta, Lord of the Rings and now Transformers…

Live Free or Die Hard: Fast paced and fun with great one liners. The action is a bit too over the top and unrealistic for my taste (using a car to destroy a helicopter, jumping on a plane, etc.) – I prefer the grittier Bourne or Casino Royale type action, but it’s still a lot of fun.

The only real disappointments came in the spring. Spiderman 3 and Shrek 3. Both had too many characters, too many subplots. While still enjoyable, they were nowhere near as good as their predecessors.

Next up: Ratatouille, Knocked Up, Sunshine, The Bourne Ultimatum and I am Legend.

If you are in the mood for something more serious check out Rescue Dawn, Paris, Je T’aime ( and My Best Friend.

Other fun 2007 movies to check out on DVD: Breach, Hot Fuzz, 28 Weeks Later and above all The Lives of Others.

Ten Politically Incorrect Truths about Human Nature

Psychology Today has a great article on human nature. I am not sure I buy all the arguments – or at least not the explanations as everything does not revolve around sex – but it’s still intriguing.

The 10 points are:

1. Men like blond bombshells (and women want to look like them)
2. Humans are naturally polygamous
3. Most women benefit from polygyny, while most men benefit from monogamy
4. Most suicide bombers are Muslim
5. Having sons reduces the likelihood of divorce
6. Beautiful people have more daughters
7. What Bill Gates and Paul McCartney have in common with criminals
8. The midlife crisis is a myth—sort of
9. It’s natural for politicians to risk everything for an affair (but only if they’re male)
10. Men sexually harass women because they are not sexist

Some of my favorite passages are:
“Women often say no to men. Men have had to conquer foreign lands, win battles and wars, compose symphonies, author books, write sonnets, paint cathedral ceilings, make scientific discoveries, play in rock bands, and write new computer software in order to impress women so that they will agree to have sex with them. Men have built (and destroyed) civilization in order to impress women, so that they might say yes.”

“Studies demonstrate unequivocally that men are far more interested in short-term casual sex than women. In one now-classic study, 75 percent of undergraduate men approached by an attractive female stranger agreed to have sex with her; none of the women approached by an attractive male stranger did. Many men who would not date the stranger nonetheless agreed to have sex with her.”

The Inspiration for the Aucland TV Ad

In many ways the Aucland TV ad, shown below was great. It won a Silver Lion in Cannes and the uproar it created was amazing!

The inspiration had come to us from this series of TV ads that had run in the US:

They have similar dark humor and irreverence and are lots of fun. Arguably, the Aucland ad is better because at least it conveys what we did – auctions – while the ads revealed nothing about (they sell computer equipment online).

That said, the ad was ahead of its time. Few people in Europe at the time understood the Internet let alone auctions on the Internet. A simpler, educational and descriptive TV ad as our competitor iBazar ran would have been more effective.

Entrepreneurship matchup: France versus Afghanistan

The Financial Times ran an amazing story on three French entrepreneurs in Afghanistan.

I loved their quote on how you can go skiing if you know how to avoid the minefields. The money quote though is definitely: “He acknowledges that there are a range of difficulties facing entrepreneurs, from poor infrastructure to growing security concerns, but he still contends that it [doing business in Afghanistan] is an easier operating environment than France for entrepreneurs with a little flexibility and imagination.”

Read the article at:

Speaking of uncertainty: read The Black Swan

Massim Nicholas Taleb’s new book is insightful and surprisingly entertaining. While it has no predictive value – black swans are by definition “unknown unknowns” – the book’s criticism of the traditional Gaussian models used by all of us strikes a chord.

Taleb’s take on human nature feels dead on. I also appreciated his analysis on the nature of innovation which he ascribes to tinkering more than to grand theorizing.

Despite the arguably serious nature of the book, the book is made highly enjoyable by Taleb’s angry rants against the practitioners of the social sciences, especially financial economists, and against Nobel Prize winners in general.

On a selfish note, I also found comfort in his recommendation not to read daily newspapers or listen to daily news as it provides no valuable information. I limit myself to weeklies like The Economist (though I know Taleb dispenses with those as well).

You can buy the book at:

The nature of entrepreneurship: randomness, trial and error, and how intelligence can get in the way

In many ways, I am not a typical entrepreneur. Entrepreneurs are often risk taking, creative types who do not do well in the traditional education system or workplace. By contrast, I was the shy, introverted A+ student who was conservative and deferred to authority. I highly valued, and in many ways still value, the classical education I received and found beauty in the logical arguments I constructed both for my classes in college and for my clients at McKinsey.

Fortunately, somewhere along the way, I came to realize that’s not how the world really works. There is a tremendous amount of uncertainty in the world and especially in the fast moving environment of the Internet and thus management by trial and error is probably the single most effective way to become successful.

Consider this:

  • Friendster does not know why it is successful in the Philippines.
  • Orkut does not know why it is successful in Brazil.
  • Hi5 does not know why it is popular in Portugal.

In all three cases, it was not planned, it just happened – maybe because a single important user randomly decided to use that site rather than another. I am sure they have found arguments to rationalize their success since, but I bet those are only one of many possible explanations.

Also consider this: when eBay, Google, Yahoo, MySpace, Youtube and most other such companies were created, their founders did not expect them to be nearly as successful as they became.

From personal experience, I can tell you it’s far more effective to try something, discard it if it fails and continue refining it if it works than trying to theorize what is the most effective. Quick decisions – even wrong ones – if you have the humility to accept that you were wrong and are willing to rapidly change course – are much better than a long decision making process.

I don’t recommend running a startup by consensus. It takes time to get to a consensus and what the internal consensus of your company is, is frankly irrelevant. By all means involve everyone in the decision making process: get everyone’s opinions about what should be tried, but make up your mind rapidly and test the idea. In fact, I highly recommend testing multiple ideas and doing A/B testing if possible.

In other words, intelligence gets in the way because by looking for what should be the right answer, you waste valuable time you could be spending finding out what actually is the right answer.

Also note that many “breakthroughs” happen in a similar way. The Wright brothers did not just wake up one day and built a flying plane. They tested dozens of wing designs, built different types of engine. It was a grueling multi-year process of marginal refinements, the sum total of which led to a flying plane.