Book summary: How Asia works by Joe Studwell

Many years ago (around 7) I read poor economics. It was a book about developing nations and what challenges they are facing. I even did a review in Spanish. This is a topic that aligns with my quest for a better world. Joe Studwell, in the book How Asia works, analyzes different Asian countries. He analyses Japan, South Korea, Taiwan, Indonesia, Malaysia, Thailand, the Philippines, Vietnam, and China. Comparing the rights and wrong each country did and what they could have done better acknowledging why some countries did better than the others.

The book is well documented and has a good literary style. Not the typical boring and dense academic approach to science. Just be aware that he analyzes what takes for countries to go from poor to rich which is not the same formula for already rich countries. In the book, Joe is quite harsh on IMF and the world bank. He argues that these large bureaucratic institutions are keeping poor countries poor due to bad advice not fitting their economic status.

One of the first key points is the idea that “poor countries” should maximise their farming yield. The maximization should be aiming to get the maximum output per acre of land; thus, forcing people into labour intensive jobs on small farms. Studwell proposes a land reform as the path to achieve high yield/acre. Expropiating land from rural landlords to give it back to the farmers in theory should prevent communism and motivates the farmers to do the best job they can. At the same time the government should be aware that farmers cannot stand alone and need external aid. Farmers need services and infrastructure. Once a good farming base is set the next step is manufacturing and industry.

After the farming stage is completed or near completion the country tilts toward industrialism. There is not enough land for everyone so people move towards the main metropolis. This movement is accompanied by an industrialization of the economy. Studwell often repeats that manufacturing companies should aim for exports to be more productive. He calls it “export discipline”. By forcing companies to export the government is making sure that they reach the global market and keep high standards for they products. The companies that that find a niche and produce quality resources will succeed at exporting and survive the test of time. Although he argues that at early industrialization stages the companies shall be protected, gross exports are much more important than the net exports.

There are several strategies to improve the quality of the manufactured products. The first one is through collaborations with more advanced companies from other countries. Collaboration to learn the know how and the state of the art of the processes for the industry. Then an important Darwinian management from the government should be applied. The companies should be let fail (go bankrupt) or force merges to accumulate volume and knowledge. It should be about allowing internal competition while protecting the baby companies but forcing them to compete in the global market. The government should not pick the winners. The key point is to achieve an accelerated technological upgrading.

In conclusion, I liked this book although towards the end it became repetitive. These may be some good ideas that African countries and less fortunate Asian ones could apply to their economies. It never ceases to amaze me how different countries evolve differently. But most surprisingly is how some countries in a ver, very short period of time turned around and became super-powers.

10 Interesting Conversation Starters from Vanessa Van Edwards

Ten questions:
1) What is one thing that you have always wanted to try but never have? Why haven’t you done it yet?
2) What has been the highlight of your year so far?
3) What book or movie character do you most relate to?
4) What is your biggest regret?
5) What do you daydream about?
6) Who would you play in a movie?
7) If you could trade places with anyone for 1 week, who would it be?
8) What is something that you have always wanted to learn?
9) What is your best memory?
10) What question have you always wanted to ask me? What do you wish you knew about me?

And here the full video:

We got the trolley dilemma wrong

The trolley dilemma or trolley problem is a thought experiment in ethics. The problem states that we have a trolley on railway tracks going directly towards five people. They are tight to the tracks and therefore cannot move. The trolley is also unstoppable. You are standing next to a lever with a full picture of the situation. If you pull the lever the trolley will switch to a new set of rails. However, the new direction has one person tied to the tracks. Then you have two options:
1. Pull the lever and the trolley will kill one person
2. Don’t pull the lever and the trolley will kill five people

This is a dilemma because if you pull the lever you’re being utilitarian and you end up killing one person and preventing the death of five. Whereas by not pulling the lever you take no moral responsibility and five people die. This problem is interesting because it has many dimensions. For example, the only person that would die by pulling the lever could be someone you love, then you may be inclined to let the five die.

Why I’m telling this? Why we got the dilemma wrong as stated in the title?

Well because it’s not about the people who would die, but about the trolley company that would get the service interrupted. With the current pandemic, the famous coronavirus COVID-19, politicians and other authorities have been faced with a novel problem. Something that happens once in a lifetime. Something that we hope will never see again. Since January different countries have been forced to take extreme measures to prevent the spread and contain the virus as much as possible so the health system did not collapse. As I’m writing this some countries have failed but it is still important to minimize the spread to give time to the hospitals to treat successfully the maximum amount of people.

The health care system has collapsed in some countries because politicians were reluctant to apply the right measures on time. In part, I attribute this to the fact that successful prevention would have been deemed as an over-reaction. However, in Spain they had a 2-week forecast by looking at Italy. Then why did the government fail miserably? Because of the trolly company. The trolley company here represents the economy and our politicians reacted late because they didn’t want to disrupt the economy. Some have already wondered if it would be better to let the elderly die for the benefit of the economy while others think that the show must go on regardless of the consequences.

With an economic collapse and meltdown on the foresight, USA, Europe and others already prepared incentives to smoothen the fall. Some even argue that these incentives won’t prevent the economy to fail and certainly won’t help much the average citizen.

Those incentives are predominantly oriented to save the economy, not to the individual who is suffering. Such a grinding halt on the world economies has affected negatively a lot of people. People who cannot go to work. Small business owners are forced to shut down indefinitely. Any bar, restaurant, disco is closed until further notice. Hotels have close to 0% occupancy. And yet the government is worried about the big business. Too big to fail? Should we save big business because then indirectly we are saving lots of jobs? When I say “we” is because that money comes from our taxes the ones taking the decisions have other tax liabilities. Maybe in some cases we should save some business. But it’s my belief that those rescued businesses should suffer. CEOs should not be artificially pumping the stock so they get a bonus. CEOs should prepare for the future the best they can. It’s very advantageous if the wins go to the CEOs/companies and the losses to the taxpayer. But that’s not the way it should be because it incentivizes a reckless way of doing business and it penalizes businesses that were conservative and prepared for the long run. The unprepared ones should be let to fall. It incentivizes the survival of the fittest. However, if a company is deemed strategically important I’m in favor of rescues but with conditions. Rescuing should not be free money. It should come as shares or other assets that will return value back to the taxpayer.

So in conclusion. Are we f*cked? I would say yes a little, but with every collapse new opportunities arise. This may be the time for a paradigm change. Maybe we should repurpose the economy for the greater good instead of value extraction. Maybe it’s time to dust off old ideas and repurpose them for the modern world. Maybe it’s time to implement the Tobin tax and prevent short-sighted speculative trading with little value creation. Maybe we should take hazardous activities into the value calculation where polluting costs money. Maybe it’s the time to consider happiness, health and wealth being equally important metrics to optimize for the countries. Maybe we should reconsider widening the GDP definition and adding other non-monetary factors. Or simply we can give up, look down and follow the current system where rich people have assets and are protected against many setbacks while most people have to work for a living and this downturn may imply severe consequences for them.

How to add ROC AUC as a metric in Tensorflow / Keras

The way to add the ROC AUC as a metric on your Tensorflow / Keras project is to copy this function that computes the ROC AUC and use the function name in the model. The function only requires a little customized tf code.

To use the function in the model. We first need to compile with the function passed directly and not a string (as it is shown in the example below).

Then we can use it in the callbacks but we need to refer to it as a string (so this time between the “” as shown in the snippet below).

Other customized functions follow the same pattern.

The function tf.keras.metrics.AUC already implements the Area Under the Curve natively in TensorFlow in the Keras module. You can check the documentation for further information in this regard.

How to insert code snippets in WordPress or any other website

I was recently struggling to insert code snippets into this blog. I tried SyntaxHighlighter Evolved among others. And I didn’t like the outcome… (CSS is messed up?). The way to go?

1. Create a Gist thanks to Github ( https://gist.github.com/ )
2. Copy the embedded JS script they offer you after publishing the code snippet.
3. Put it on your website

Nice, isn’t it?

Forcing the disagreement

Currently, the idea that the crowd is wiser than any single individual is widely spread. Places like Wikipedia and Quora rely on the network effect of the internet to benefit from collective human knowledge. The idea behind this is that the aggregated knowledge of the population is able to find the right answer and cancel out the noise. But the crowd may not be wise.

The un-wiseness may be caused by the herd mentality. Once several people group together and discuss the points and actions to take only a few ideas my prevail. People with stronger charisma or higher in the hierarchy may enforce ideas on their peers without knowing. Leading everyone in the meeting room to buy into it and go with the flow.

This is why it is important to place different mechanisms to question and re-evaluate different action plans decided in meeting rooms. The tool that I’m here proposing is a forced disagreement. If everyone in the room agrees the last person to agree on the plan has to disagree even though he or she strongly believes in it. This person has to do the research and argue why this idea is wrong and work on an alternative approach. At every meeting the person who disagrees should change; thus expanding the “thinking out of the box” across the people in the team.

This tool forces people to think outside the box and not follow the pack mentality. This is important because not always the agreed decision is the best. The disagreement, although artificial, creates an intellectual tension that incentives continuous growth within the group. It prevents conformity and may lead to overlooked but better solutions.

Black swan and gray rhino

“Blacks swans” and “gray rhinos” refer to two very different but dangerous threats for investors.

Nassim Taleb popularized the term “black swan” through his book (es) with the same name. But the black swan theory comes from much farther and is a metaphor describing an unforeseen event that has major effects. These events are so rare that they do not enter into the computations or any kind of possible expectations; although in retrospect it seemed predictable. At the same time if one of these events strikes it will have major consequences.

Gray rhino’s concept was popularized by Michele Wucker through his book The Gray Rhino: How to Recognize and Act on the Obvious Dangers We Ignore. As the title phrases it, gray rhinos are troubles we see coming but nobody has prepared or has the courage to confront them. Gray rhinos are scenarios where current data show what can happen but we actively choose to ignore it.

Fix yourself before you try to fix others

Many want to eliminate suffering… No shit! Who wants to increase the world’s suffering?
I’m against poverty. No kidding, no one is pro-poverty!

If you commit to a greater good don’t do it in public; otherwise, your goal is to demonstrate how virtuous you are to the world.

The journey starts by fixing oneself first. Fix your own life first and be humble. Doing something privately implies that you care about it. Making it private means that’s real to you. Do it when no-one is watching, then is when you’re true to yourself.

Public activists are superficial, trendy. Being public makes it too easy. It externalizes the blame and it is easily self-congratulatory. Evil is not elsewhere, it’s likely that you’re missing the full picture. Often the evil is oneself. You/me are probably not our best versions of what we could and should be.

To really make a dent into the world and influence policies it takes effort. In the first place, one should establish themselves as a credible human being and should be asked to help with policies. Before that, it’s too premature and pretentious. People should be on the public service because of their accomplishments. Otherwise, it’s about creating an avatar big enough. That does not make you fit to lead.

Leaders should know where are they going. Leaders craved themselves out of a personal vision. Reading a couple of books and having an ideological vision is not enough. A detailed analysis is required. To influence policies one should deeply know the topic they plan to influence. First, you should be successful on many different levels, make yourself credible. By doing that you would know how the world works on many different dimensions and then your knowledge will be deep enough to improve policies. There are too many collaterals to change the system with a swallow understanding.

You should be competent first, you cannot change policies and the system by performing a simplistic analysis. Anyone who thinks that can change a complex system may be suffering from the Dunning-Kruger effect.

Worth mentioning I: Content generation, Flywheels, Network effects, what customers want?, Instagram bots

This is a small experiment. When I read posts that I really like I will compile them in groups of five, write a small paragraph for each link and post it here. So let’s start with the first of its kind.

The GaryVee Content Model This is the most insightful presentation I’ve seen in a long time. It contains the content creation of Gary Vaynerchuk is a well-explained way with insightful examples. The top-down pyramid consists of one big piece of content that then is chopped and adapted for each of the social media platforms.

Advantage Flywheels In this context flywheels are self-reinforcing loops that improve your business. E.g. More customers -> lower costs -> because of the lower costs you get more customers. In this post, there is a nice explanation with some real-world examples.

The Network Effects Manual: 14 Different Network Effects (and counting) This is a great post with network strategies. Interesting, maybe for reference but nothing extremely new. If you don’t have much time check the first video on the post.

Want to Know What Your Customers Want? Go to Amazon and YouTube This article contains simple information to gather ideas for your product. It basically consists of watching youtube videos and learn from them. But also using amazon to do research.

How I Eat For Free in NYC Using Python, Automation, Artificial Intelligence, and Instagram I’m a sucker for automation and this post is lit. I loved the explanation on how to automate an Instagram account, I disliked the fact that he used it to get free food…

New Year’s Resolutions 2020: Focusing on the right habits

For eight years I’ve been setting public goals for myself. With more or less success I’ve also been evaluating the outcomes without exception. From these reviews come the feedback I crave to keep improving and tweaking to adapt myself. From last year’s review, one of the main conclusions was that I need some more focus and planning. I’m satisfied because I achieved a fair amount of goals, but I missed many of the optional or less relevant ones. So, this year I will focus on fewer goals, mostly bounded to a few months but with a higher amount of required time. What I won’t change is the use of the SMART criteria. SMART goals come from project planning vocabulary and it stands for Specific, Measurable, Assignable, Realistic, and Time-bound.

January

Every journey starts with a single step.
– Chinese proverb

The month of January will be a little convoluted. During these days I will ultimate the details for Australia, say goodbye to friends and wrap up some of my work. I plan some more swimming and climbing with friends. The main goal is obtaining a climbing license. On the business side: put up a webpage with the book summaries and aim for 50 visits/day by the end of the month.
Book to read: Zig Ziglar on selling

February, March and April

I will be posted in Perth (Australia). During that time my work goal is to get comfortable with Tensorflow and Keras. But man shall not live by bread alone; therefore, I intend to learn scuba diving, surfing, and dancing (potentially bachata or swing). I shall visit the surroundings but right now it is still unclear exactly what. I will regularly join a toastmasters club in the city. During this period I will also work on my business ideas. I will prepare myself by doing market analysis consolidating each of the ideas until I understand and make sense in my head. After that, I will craft a strategy on how to approach decision-makers to turn the ideas into something worthy.

Books to read: Small giants, getting to yes, the snowball

May

This is my vacation month. During this time I want to visit the most important landmarks in Australia and maybe some other countries nearby. The first contact about my business ideas will take place.
Book to read: the inevitable

June, July and August

Back to real life in Copenhagen. Some catching up with friends will happen. I will find someone that helps me to improve my running biomechanics. I will get a wet suit and swim in open water. By the end of summer, I shall finish a small triathlon. By now I should have already spoken with some key people about my ideas and build relevant contacts.
Books to read: The intelligent investor, grow rich, how Asia works

Spetember

After summer, the bad weather will arrive and people will sell their bikes. I will buy a racing bike and start building muscle for this sport. I also expect to keep working on my business ideas and start elucidating patterns.
Book to read: Endure

October, November and December

During autumn and early winter training outdoors will become complicated. However, some degree of training will be performed. Maybe some trips to visit family and friends will occur. In the last trimester of the year, I will add some more steam to the business ideas to have a more clear picture of what to plan for the following year.
Books to read: thinking in bets, never split the difference, see you at the top.

All year goals!

Habits do not require deadlines, they are a long term commitment not bound to a goal. Those activities that deem to be recurrent across months will be placed here.

Even though by the end of 2019 I failed a little bit at it, I want to improve the quality of my inputs and outputs. That means watching less random TV shows, visiting less random websites, focusing on things that really spark joy and focus one a thing at a time. Along those lines, I want to strengthen my self-discipline . I want to plan more things and reduce my thoughts of do I feel like doing X when the time comes. That also includes act on the tough calls without much time dilation.

I am going to spend at least five minutes a day meditating. No matter how much late I run, or how much work I have to do, there are 5 minutes a day that I can take and meditate. To clear my mind. To stop the world. Another five minutes of yoga/stretching a day. When I wake up, before going to bed, when I arrive at work or when I get home.

To end my resolutions I would like to do something for you. For those that read these lines. I propose myself to write in the blog for at least once a month about new insights that I gain or something I want to remember but also something that may be useful for you.

Remember aim for the stars, be happy and when in doubt choose the adventure.
That being said…

Happy new year!