Sunday, September 30, 2007

Advice for Dan

Dan got bit by a fire ant. Ouch. Here's a big tip:


Calamine lotion! You rub it on, and you stop itching immediately. And it works. I get bit by spiders and mosquitoes a lot in Rio, and it's so hard not to itch the bites. I didn't believe Vanessa when she told me it would work, but Dan, it does, so go buy some.

The result of building too close to disaster, high prices, and speculation

Florida faces tough questions.
Two years ago, Ms. Cohan and her husband divorced. Ms. Cohan had planned on staying in their condominium, but after Hurricane Wilma, condo fees jumped to $3,200 from $1,220, reflecting higher insurance costs for the building. The couple sold their condo for $280,000 and split the proceeds. But instead of looking in Florida, Ms. Cohan paid $140,000 for a townhouse in Simpsonville, Ky. "I just couldn't stay another year and pay those kinds of fees by myself," she says.

Saturday, September 29, 2007

Early Bar Closing Times: Underrated

Bars and clubs must close at 2:00 a.m. so night-life hot spots in downtown
Minneapolis, Uptown and near the University of Minnesota get crowded
relatively early.
That's from a profile about the Twin Cities here. The article seems to be saying places getting crowded relatively early is a bad thing. I beg to differ.

Here's my theory, which I wrote in the Arizona Daily Wildcat not long ago in response to Arizona moving back it's closing time from 1 AM to 2 AM:


Sometimes, laws that seem to restrict people actually help them out. Take traffic lanes, for example. Similarly, an early closing time for bars just makes sense. Bars are a unique good in that, unlike Disneyland, Wal-Mart or the golf course, patrons want to go where everyone else goes. And what is the only way for people to reliably find lots of other people at bars? Go between zero and three hours before closing. So pushing back closing only makes business start an hour later, but it forces a lot of people to mess up sleeping schedules even more.
Basically, what time to go out is a prisoner's dilemma. We would all benefit if we went out earlier. People could get to bed earlier, which would distort workers' and students' lives less. But because everyone else coordinates the same time around the closing time, we need to go out later to be out with everyone else.

I've seen this vary all over the world. In places without closing times like Rio, people start going out as late as 1 AM or 2 AM. On the other hand places with earlier closing times have people go out earlier. The biggest potential losers of an earlier closing time would be business owners, which might lose more business. But you might think it's also just as likely that with an earlier closing time you bring it closer to dinner eaters, and could increase the number of people that stay after dinner for drinks.

Just a thought....as with everything else, I would be interested to hear what friends/readers think about this.

Men Happier than Women

Stone sends me this article, which talks about two research findings that show men are now happier than women, a reversal from the past.
Ms. Stevens was recently having drinks with a business school graduate
who came up with a nice way of summarizing the problem. Her mother’s goals in
life, the student said, were to have a beautiful garden, a well-kept house and
well-adjusted children who did well in school. “I sort of want all those things,
too,” the student said, as Ms. Stevenson recalled, “but I also want to have a
great career and have an impact on the broader world.”

I find the new happiness studies fascinating. With all the economic development in the world and higher means for so many, our happiness is nonetheless not doing nearly as well as it should. I see a couple things going on here for women. One is the unfortunate desire by so many to outdo others around them. Our happiness, it seems, is based more on how we compare to others than simply our own merits. I see this playing out with women, who increasingly are competing directly with men for jobs and material success. Now they are getting compared to role model mothers, the homemakers who tend the house and the kids, at the same time as they are compared at work to their male counterparts. These male counterparts don't face the home pressures, either, which only makes it harder for females to compete with them.

In a sense this desire by females to do so much is good. It's a reflection on women's entry into the broader economy and their being on a more equal plane with men. However the old ideas of what it means to be a woman mean that women feel like they have to do it all.

You can only do so much with your time. Given these extra constraints that men just don't have, it's no surprise women's happiness is dropping.

Here's an article about happiness classes at universities.

Friday, September 28, 2007

"Blitzed"

Yesterday I had my first police search. I was leaving the favela and took a cab because I was in a hurry. I mistakenly took a cab right in front of Rocinha. As we were about to get on the road, there were three police officers "randomly" having cars stop. According to the driver it is illegal, but the police are corrupt. Anyway he obviously stopped me because I was a foreigner coming out of a favela.

He exhaustively searched my pockets, including reaching all the way almost uncomfortably. Then he took out my wallet. He grabbed the money and for a sec I was thinking he was going to keep it for himself. But he finished searching, asked a bunch of questions, and I was off.

No harm, no foul.

Thursday, September 27, 2007

Why I finally bought Google stock earlier this year

Second, as more and more aspects of work and life move online, the companies who provide services in the real world start looking for a way to provide a similar service online. They often find that Google is already there.
here.

Note that one of Warren Buffett's most succesful investments, Coca-Cola, he bought even after it had already had a huge rise. "Mas Vale Tarde Que Nunca", as they say...

Not a good sign for Rocinha math education

So I got a HUGE meal for only R$8.50 (US$4.25). That for enough food to comfortably feed two 200-pound males for dinner. And this was lunch!

So I hand the waiter at this mean a R$50 and say "give me back R$40 and keep the rest." He gives me back R$42.50. I would have thought it was funny except that you realize that that's just the state of education here. It's sad, because it prevents so many from getting good jobs.

Where I now live


Also marked is where I lived before, to the east (scroll to the right), which should help give some contrast of how close lower and upper classes live in Rio. Thanks to Vanessa for making this for me. Note: the pin on Rocinha is not where I actually live; I live more toward the center, but toward the lower left. Alas there is only one official street in Rocinha (plus some alleys with names like "Street 1" and "Street 2") so you can't put my address into Google Maps.
View Larger Map

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Wednesday, September 26, 2007

The headline says it all

We don't "endure" congestion; we are congestion.

Thanks Vanessa for sending me this interesting critique of the media spin on the recent report of increased traffic congestion.
What's unmentioned here is that there isn't a difference between us and congestion; when we're driving, we are congestion. So, the only way to "relieve traffic" is to get people out of their cars by providing realistic, accessible alternatives to driving. It's a pretty obvious conclusion, but one that rarely comes up in media coverage of the annual TTI report. Splashy headlines, presumably, are easier than digging into the data.
This is what's so hard about planning transportation systems. Car drivers benefit from a huge subsidy, then they don't pay for their negative externalities. There would be so much room to better society if we could just solve this better.

Best sentence I read today

Europeans will talk all day about sex, Laclau says, "but they won't tell you what they paid for a house; that is taboo."

here.

Consulting.....makes you old

McKinsey is this magical, super smart, brimming with energy place that was an unquestionable privilege for me. But it was so incredibly hard. The kind of hard that makes you old.
here.

Tuesday, September 25, 2007

One foreigner's brief impression of Rocinha

here
Paying just enough attention to be inconspicuous my eyes rested upon a troop of 15 or so men carrying various assault rifles, chrome AK-47s M4-A1’s, tech 9’s, 12 gauge shot guns with handle pumps, and various pistols and submachine guns, walking though the crowd with the masses paying precious little attention…
And as with so many foreigners he is amazed by the girls...
I’ve been to Brazilian beaches and the woman there are soo beautiful that I’ve had to just shake my head and ponder that a god must exist if he can create such juicy curves on a woman and give her style and an equally beautiful face, not to mention a penchant for wearing as little clothing as possible while in public. But in the favela, my world was again sent crashing down. Woman on the beaches don’t have Shit on those in the favela- and this is not the type of thing I can explain in words, you must come and see for yourself, because my words are just that, words- its only real when its in front of you for you to interact with and catalog yourself that it can truely be understood.
Personally I think the girls thing is a bit overrated. Maybe this is because I just finished 4 years at UofA, but still.....

What even most smart Americans don't realize

That our dollar is down, and fundamentals still don't look good. Article.

Also, Robert Schiller says the home market will likely go down for years (he doesn't give a specific number, but reading between the lines he seems to be saying about 5 more years).

Eric sends me this, which says Dallas is going to be the top nationwide market in the next year. The affordability of Texas housing played no small role in my decision to go there starting in (gasp) January.

The Soccer Project


Today at the institute I volunteer at, a group of Americans filming a documentary came to try to film in Rocinha. Their project is interesting. They want to explore how pickup soccer games around the world bridge social divides. They´re going all over South America now, and they plan to go to far off places including Iran and Afghanistan.

They´re a group of former soccer players, mostly from Duke. They told me that Duke is trying to generate some positive PR in the wake of the Lacrosse fiasco, and so they´re helping finance the project.

Anyway their website is here. Their blog is here. They clearly haven´t learned the lesson that everyone is South America shows up late.
We finally meet two guys, Rogerio and Washington, who grew up there and agree to take us in. We plan to meet them at 3:00 at the bottom of the footbridge right outside the favela, and we get there early to ensure we don’t miss them. Our promptness backfires: they aren’t there yet, and we are now four tourists hanging out at the entrance to a slum.
Rogerio and Washington are two of the main employees at the institute. I´ll blog about it at some point. In any regard, the filmmakers were hoping to film the drug gang members playing soccer, to give an example of how soccer eliminates barriers. I´d be impressed if they manage to get that on film....

More on recycling Company

Jon makes an astute comment on the post about the recycling company that pays people to recycle and then takes a cut of the city's savings for trash processing.
Well, one concern here: The way the city recycle program works now, at least in the Phoenix area, is that there is no real economic incentive to recycle. You just do it because you want to help out....but (under the company's system) how do they regulate and make sure the stuff being put in the recycle containters is actually recyclable?
Definitely a problem. You can think of all kinds of issues that could be raised by paying for recycling - people putting extra stuff in the can, for instance.

First, despite benevolent intentions a large percentage of what shows up at the recycling plant currently in Phoenix, where people are not paid, can't actually be recycled for various reasons. Here's a great article. The most common problem - people put their recyclables in plastic bags, and the plant doesn't have enough time to open the bags, so just throw them and their contents away.

I don't see these problems as being deal breakers. I think enforcement on violators plus the company taking into account "cheating" will still produce a better outcome.

Of course what's not measured in any of this is that what's MUCH better than recycling is just using fewer materials. But that's not as tangible and thus recycling gets all the buzz.

Monday, September 24, 2007

Streets of Rocinha

A typical "street". There is only one actual road for cars in the whole favela. Most people live off "streets" that are no wider than a sidewalk.

Sunday, September 23, 2007

How should I feel about this?

I spent nearly all of today at the beach. On Sundays in Rio they close the road on the beach, and now that winter is over it is cheio-para-caramba. Anyway once the sun went down it was beach movie time! This week a film festival meant free movies on a giant projection screen on the beach.

I wanted to rent chairs. The price, R$3 ($1.50). I asked if I could have it for R$2 since the guy had over a hundred chairs and was clearly going to be having a good day.

His response: No I can´t sell it for less than R$3 because we have a monopoly.

Saturday, September 22, 2007

Background on Rocinha

So I've mentioned it occasionally without every fully explaining it. Now that I'm living there, I wanted to give some background on Rocinha.

Rocinha is the mass nestled up in the hill near the upper left of this picture. The area on the beach is Sao Conrado, one of the nicest neighborhoods in Rio, which even has a golf course. Inequality it thrown at you hard in Rio.

Rocinha is a favela, or shantytown, in the heart of the nicest neighborhoods of Rio. If you've seen pictures of Ipanema/Leblon Beach, Rocinha is on the other side of the monolithic Two Brothers Rock (in the middle of the above pic). It sprawls from sea level by a highway all the way up and now over the hill, with simple concrete structures 2 to 6 stories tall.

It is the biggest favela in Brazil. Various population estimates put it at around 150,000 people. It's not nearly as bad same as some favelas - It has basic sanitation including electricity and running water, and has banks, pharmacies, and other basic stores.

Now the part that's going to scare my parents. Rocinha, like other favelas, is run by drug gangs. The drug gangs are more than just gangs - they are like the government of the place. This is good and bad. The police don't go into Rocinha except in large scale raids. I didn't go into detail when I wrote about it before, but my class was canceled one day in August because the police staged a massive raid (think like 300 to 500 officers in these raids) in retaliation for someone killing a police officer. The drug gangs and the police engage in this game of coexistence, which involves corruption as well.

Because of this relationship, the drug gangs want as little trouble as possible in the actual favela. In other words, they are the only ones allowed to commit crime. As a result, there is little burglary, theft, etc in the favela. There are lots of stories of someone reporting, say, a bike stolen and then it gets returned right away. The drug gangs also help the community, paving roads and throwing often lavish parties.

In any regard, here's the Wikipedia entry for more. I am safe. There are other volunteers living in the favela, as there always are, and none of them have ever had a problem. In reality you're more likely to be the victim of a crime in Copacabana or on a bus than in Rocinha. The one dangerous time is if there is a raid, but in that case there is an elaborate system of fireworks to warn you to go inside.

In the meantime, it's a heck of an experience. I'll keep writing more, including pictures, some of which my student Nildo gave me.

Friday, September 21, 2007

Best Business Idea I've Seen in Months

I envy this guy.
Here's how it works: Customers who sign-up with RecycleBank receive a special container embedded with a computer chip. Every time the recycling truck comes for a pickup, it records the weight of the bin and transmits it wirelessly to an online account. Homeowners accrue up to $35 worth of credits a month based on the amount of recycling they do.

I did not know that fact of the day

Extra effort is going into the $100 makeover since this bill represents more
than 70 percent of the $776 billion of currency in circulation, two-thirds
of which is held overseas.
from this article on the redesigned $5 bill, which was largely redesigned because it had features similar to the $100 bill and so counterfitters were bleaching the old $5 bill to make $100 bills.

The Trident Test of Your Portuguese Skills

Today while waiting for a bus with my friend Gustavo I realized something - the price I get charged for Trident has come down considerably since I've been here. And it wasn't a sharp drop, but rather gradual. I'd say when I first got here I averaged R$2 (US$1, for 5 pieces), with R$1.50 being the usual low end. Then it started ranging between R$1.50 and R$1.20. Now, I regularly pay R$1. Why?

I thought more about it. I don't negotiate for Trident (call it a personal fault, but I'm the opposite of penny-wise, pound foolish). I doubt there has been a dramatic decrease in the prices of inputs for gum or some newfound market competition to drive down the price.

Nope, we decided it's because of my Portuguese skills. It's no secret that there's a regular price, and a "gringo" price. The difference between the two varies by country of course. By if you speak correctly and with a clear accent, you just might get a better price.

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Thursday, September 20, 2007

Food in Brazil: Dried Pineapple

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Wednesday, September 19, 2007

Rocinha moment of the day

So last night I got my toothbrush wet, put the toothpaste on, and started brushing. I then turned the water off (trying to break bad habits).

All nice and clean, a little bit less than the recommended two minutes but sue me. Then I went to turn the water on again to rinse out, and nothing.......

So my first night in Rocinha I went to bed with a mouth full of toothpaste. What other adventures lie ahead?

Actual Conversation with Countrywide Today

background: I'm advising someone on refinancing her mortgage to take some equity out. We have a lock on a 5 year interest only ARM at 5.875%. She's getting close to signing and we just wanted to make sure it's still a good price.

Countrywide: A 30-year fixed would be 6.5%. A 5/1 ARM would be more than that, so I would recommend the 30 year fixed. Her monthly payments would be $300 cheaper than her current mortgage.

me: but the one she's locked at would be something like $300 even cheaper than THAT.

Countrywide: But that mortgage doesn't pay any money toward principal each month.

me: but she saves enough money with the lower interest rate to pay off more than the amount of principal that the 30 year fixed pays.

Countrywide: no you don't get it, this loan is what we call "amortized", which mean the payment stays the same each month but you're paying down principal each month so over time more and more of your money goes to principal. What "interest-only" means is your payment only includes interest.

me: (realizing this guy is just repeating whatever he learned in his training without knowing what he's talking about) I understand. But she saves so much with this lower interest rate that she could pay the amount of principal your loan pays down each month and still have more than $100 left over per month.

Countrywide: (clearly confused) let me get my manager.

The manager did happen to be competent, though she still tried to change the subject and focus on Countrywide's "155 products, so we can structure it however you want" as opposed to admitting that her rates are much worse that this other company. Countrywide apparently isn't just giving away the store anymore...

The only real argument against the other company was just that you have interest rate risk after 5 years with the other company (but even then the other company had a 30-year fixed much cheaper than Countrywide).

For bonus points does anyone know an even better argument Countrywide could have used? Hint: see the Dave Ramsey video I posted.

Tuesday, September 18, 2007

Now living in Rocinha

I've been saying I want to do it for a long time, but today was the day to stop procrastinating. I'll write more in the coming days now that I'm here.

My return to the Daily Wildcat

Monday, September 17, 2007

Ridiculous

I just got a call from American Express. I had ordered the Starwood Amex card because I'll use it to store points once at my new job, which will result in multiple free hotel nights per year. Anyway besides the fact that they already told me I was approved before, this sentence form the caller was just comedic:
American Express recommends you add another authorized user because you will more quickly earn points.
Haha, they "recommend" you spend more so that you earn points. Weaksauce.

Why the water crisis is not inevitable

Simple: despite growth, we can reduce per-capita use significantly. Just low-flow toilets and shower heads make a big difference. And as the market price rises, people will take quicker showers, transition to low-maintenance yards, and undertake other water-saving measures. All hope is not lost.
While more people and jobs are now located in this paradise, water consumption per-capita has been falling faster than the scale of growth has increased. The net effect is that aggregate demand has declined.

Jealousy

My friend and old relay team member Austin Craig got to see one of the 5 One Laptop Per Child models in existence. Here.
-You know how they got this thing to fly? They faked it. They didn't have prototypes to show potential investors and philanthropists, they had plastic models. When Nicholas Negroponte was showing this off to everybody, he was using a cheaply (carefully and skillfully, yes, but cheaply) made model. It was faux wood with pins and plastic, etc. That's what he showed to Kofi Annan, that's what he gave the Pope when he wanted one (yes, the Pope called and asked for one), that's what he leaked to the world as the earth shattering innovation. When Negroponte himself leaked some of the first images of the OLPC, what he was really showing was a cardboard mock up.
And my favorite part
-That picture with Kofi Annan? If he looks a little flustered, it's because he just broke the handle off the cheap model at a press meeting, and is trying to stick it back on. They wrote the designers asking for a repair kit. The designers sent them super-glue.

Manaus Profile

This report is more enthusiastic about Manaus than I was:
You are, after all, in the heart of the Amazon jungle, and your accommodations, no matter what they might lack in grandeur, would have been the envy of the area's first European explorers. They came looking for “El Dorado” and found a “green hell” instead. Fortunately, you, the 21st-century traveler, now have other options.

Currency Trading + Amateurs = Disaster

Currency fluctuations have confounded even the most knowledgeable economists, so it's no surprise that some amateurs are getting beaten up by it. Don't try this at home!

Ms. Itoh is one of them. Ms. Itoh, a homemaker in the central city of Nagoya, did not want her full name used because her husband still does not know. After cleaning the dinner dishes, she would spend her evenings buying and selling British pounds and Australian dollars.

When the turmoil struck the currency markets last month, Ms. Itoh spent a sleepless week as market losses wiped out her holdings. She lost nearly all her family’s $100,000 in savings.

Sunday, September 16, 2007

ASUA up to no good

Back at the good ol' UA, which I still follow closely, the student government is again up to no good. Now they're talking about scholarships for "spirited" fans. The money will of course come from other students via the ZonaZoo passes for sporting events. This happens because of a revenue sharing agreement "won" by the scholarship's namesake, former ASUA President Erin Hertzog.
"I brought up the idea to the athletics department to give ASUA a percentage of Zona Zoo pass sales to give back to the students," she said. "The athletics department is not affordable or accessible for every student, and we needed more ways to maximize (the ways that) students (can) profit."
Here's a novel idea: why not just let the students keep that money in the form of lower ticket prices?

Saturday, September 15, 2007

Business School

Why B school may be losing its appeal.
Headhunters for hedge funds and private equity firms say hedge funds, in
particular, do not value an M.B.A. “I have some clients that will legitimately
say, ‘An M.B.A. means absolutely nothing to us,’ ” says Tim Zack, principal of
In-Site Search, a headhunting firm in Westport, Conn., that is a division of
Chaves and Associates.
Someone who used to work for my future employer told me I would learn more, a lot more, in my first 6 months at my future employer than by getting an MBA.


Thursday, September 13, 2007

Top Sign You Might Have Gotten Screwed

From a post on the Brazil Facebook network:
Hi

I have just bought a property in 'Panaiba' North East Brazil and will be coming to visit soon

Can anyone tell me what this area is like please
May I recommend more research next time?

You know you're in Rocinha when....

So I'm in a van riding up the hill to get back over to where I live from Rocinha, the favela where I volunteer, and a motorcycle comes by with a guy on back holding onto the driver.....and dragging 20-foot rebar behind him. Just dragging on the ground. Sparks and everything. And nobody in the van said anything. That's when you know you're in Rocinha.

On being "stupid" because you don't speak perfectly

I wrote earlier that when you don't speak a language perfectly, people of that country often wrongly think it is a sign of your intelligence.

It also goes both ways. When you're around a bunch of native speakers, you're used to being the "dumb" one asking for how to say something or having an error in some of your sentences. Then that mindset carries over and causes errors in things unrelated the language - like pouring water or cooking.

Does anyone else have this same experience abroad? I think it's another example of the subtle role psychology plays.

Wednesday, September 12, 2007

Another Series of Good YouTube videos

This is a presentation by Dave Ramsey. He talks about getting out of and staying out of debt. And he's a great public speaker to boot.

Tuesday, September 11, 2007

The Vodka Parables

Recently at a bar with some Brazilians I was talking about the wide price differences in alcohol here. One person was very opinionated on the issue and made the following statements about three different vodkas.

A. This vodka is terrible, it's just low quality and doesn't taste good at all.

B. I like this one better. I'll order it with mix drinks. But it's not the best.

C. This vodka is like heaven. I feel nothing in the morning and it goes down so smooth.

Now what if I told you that in taste tests, the vodkas often finish A,B,C. Confused? Does my friend just have really bad taste in vodka? Let me tell you about how marketing can mess with our heads, using Vodka as the example.

The vodkas? A is Smirnoff (here's one review surprised it is so good in blind taste tests), B is Absolut, and C is Grey Goose.

Smirnoff is the best seller, Absolut is the famous marketing machine, and Grey Goose is the first to create the so-called "super-premium" vodka category. Problem is, price doesn't always correlate with taste (this article explains that actually many vodka makers get their ingredients from the same place).

In reality, people formulate a huge part of their decision based upon the container and marketing (as MalcolmGladwell put rather well in Blink, hat tip to Get Rich Slowly for getting permission to excerpt it). It's no coincidence my friend thinks the expensive ones are better.

As few wine experts as there are, there are even fewer Vodka experts. I certainly am not one. Most people haven't a clue between Albertson's Best and the most expensive brands. Mix it with cranberry and it's downright impossible for most.

A trick I used on occasion in college was to buy two bottles, an expensive one and the cheapest one. I would put the expensive vodka in the cheap bottle and vice versa. At parties I would offer the nice bottle to moocher guests I didn't know, but friends knew which one had the good stuff.

Not once did anybody ever say anything. Not one person could ever tell the difference. The other weird thing is that when I told friends the good stuff was in the cheap bottle, it was like they still didn't think it was the good stuff. Not that they didn't believe me, I think it's that they have this image of getting their vodka from a pretty blue, sleek Skyy bottle, and that's more important than the actual vodka.

This isn't just about the vodka, of course. This extends to all kinds of products. Cereals, soap, milk, canned soup. The point is that even if you think you are in control of your consumer emotions, you are susceptible to marketing and it would behoove you to at least recognize it, if not outright defy it. And next time, just get Smirnoff.

Monday, September 10, 2007

Delivery McDonalds!

Julia (homestay daughter just starting freshman year of college) just got McDonald's delivered to the house. Amazing. I love what low labor costs combined with entrepreneurial ambition can do.

Sunday, September 09, 2007

Sao Paulo

Wow what a turnaround Sao Paulo made in my head. When I came here two summers ago on a mission with the World Bank, I could only think of one word- clusterfuck. The transportation was perilously gridlocked, the planning was all over the place.

Now I came away thinking I would want to spend significant time in Sao Paulo. The transportation has been dramatically improved. Segregated busways and new metro lines are the two principle reasons, but there are others.


(If you don't see the video click here)
Sao Paulo from the apartment where I ate lunch with some transport experts. If you listen carefully you can hear the Paulista accent of those next to me.


Welcome to probably the best metro in South America. Santiago is the only other one that holds a candle. In fact, now I think Sao Paulo is similar in many respects to Santiago. Except three times bigger (think 18 million to 6 million).
Relics from the protest of the cost of the University of Sao Paulo earlier this year. USP is for the people!
One of the big reasons for going was to meet with some transportation experts. One of them, Eric, is an avid bike rider (not at all uncommon with transportation experts). His idea - bike around the city. I am terrified of the drivers in Rio. Seriously I've never seen such a blatant disrespect for pedestrians. Eric assured me that Sao Paulo was better and that pedestrians understand better with bicyclists.

Bicyclists have apparently achieved critical mass in Sao Paulo, with more than 100,000 using bikes as their primary method of transportation. They even make renegade bike markings on the street.

I really wanted to take a picture of this guy, but I hate asking people to take a picture, but when he asked for money for a "cafezinho", I figured it would be a fair trade. This is a "cartoneiro." He fills his cart with cardboard to sell to someone who packages it. It eventually gets recycled or sent to Asia. After I took the picture, I gave him R$2 (US$1), thinking I was being generous. He had other ideas. "That's it," he said. Totally killed my opinion of you, dude.

Typical downtown Sao Paulo street.
Sing the bells, bells, bells, bells, bells of Notre Dame.
Portuguese Langauge museum with Devin. He's an inch taller than I am, so we're like the two giant gringos there, and a group of high school students stared at us, took pictures of and with us, and kept asking questions. We both think it was because there were two of us.
Sao Paulo has always had "motoboys," or crazy motorcycle riders that go to the front of every traffic light. Their incredibly high rate of accidents has caused the city to start experimenting with motorcycle only lanes.
Awesome buslanes. This particular one was there two years ago, but now there are a lot more.
The subway network ingeniously hooks up to the intermunicipal bus station. Amazing. This is just great. Here people sleep overnight. This and the potential Rio-Sao Paulo high speed rail link and things are really looking on the up and up.

I hope to see you soon, Sao Paulo.

Dinner Time

A friend was having her going away party today. It started at 7, I arrived at 7:45. There was nobody there. No I wasn't in the wrong place. I was just the first to arrive.

Love Brazil time.

Anyway it was a "rodizio" of pizza, which is where you pay a flat rate and they bring by countless different pizzas for everyone to try. Some of the interesting varieties included sushi pizza, and hamburger and fries pizza.

Best Sentence I Read in The Economist Today

Mr. Kim's eldest son (by an earlier mistress), Kim Jong Nam, 36, had been written off as a potential sucsessor after the embarrassment of being caught entering Japan with a fake passport to visit Tokyo's Disneyland.
You can't make this stuff up.

Saturday, September 08, 2007

Why Americans don't vacation like the French

Hat tip to Matt Stone for sending me this article in the American Prospect.
Being concerned with one's relative position rather than one's absolute position is not irrational or merely motivated by envy. In order to retain your relative standard of living, you need to keep up with the purchases of others in your income bracket. Housing works as an example here, too: Part of the use of an expensive home is the nice neighborhood, which gets your child into good schools – what matters, again, is not your square footage, but your relative affluence. Good schools, of course, are also a positional good – your education largely matters in terms of how much better it is than everyone else's. Retaining your relative position also ensures that you don't send the wrong signals when a client comes over for dinner. Houses, cars, clothing -- they all help send those signals. And because the rich in this country keep getting richer, we're caught in what Frank calls "expenditure cascades" in an effort to keep up with them. Their purchases raise the bar for the group right below them, which in turn increases the needs of the next income set, and so on. To retain our position, we're constantly needing to increase our incomes and affluence.
I am well aware of, and in some ways a fan of, Robert Frank's theories and ideas on positional goods. He came to the UA for the Fathauer lecture (Stone, you might have been in Russia when he came, but I can't remember) and I got lucky and was invited to lunch with him (Gentle Ben's). The basic idea is that Americans work longer than they need to just to maintain a certain social status. He promotes, among other ideas, taxes on positional goods (examples: fancy handbags, bimmers, McMansions). I think this would be a very interesting policy to experiment with to see the real effects. The part about mandating fewer work hours, not a fan, but the positional goods idea is a very interesting policy avenue nonetheless. Would love to see some data afterwards.

Another accident

So just 10 minutes ago there was another accident at the intersection outside my house. That's at least the third serious one just that I've heard. This one was not because of someone running a red light, but rather a lady going the wrong way on a one way street. She slammed head first into a large truck full of workers and equipment. Amazingly, despite having no airbag, she was carried safely away, bleeding on her chest, but without life-threatening injuries.

Notice the "big ear" telephones that were knocked down from the last accident I photographed.

Is anyone talking about the Dbacks back in AZ?

So after a few years of not being good, the Dbacks find themselves in first place by two games with three weeks left in the season. I can't wait for the playoffs if we make them, but I wanted to know from those in AZ if anybody is paying attention. Is there any buzz, or are we just waiting for the Suns' season to start?

Happy Independence Day, Brazil

The beach was PACKED today. This was half because today was a holiday, and half because the temperature was PERFECT. It's just getting to the end of winter now, which means it's not cold anymore (though it really never was), but still isn't hot.

At night, went to an in-street concert featuring 1920's and 30's Carnaval music. Think big band music meets Brazil.

Friday, September 07, 2007

My kind of technology

Thursday, September 06, 2007

Real Estate Agents Feeling the Pain

Real estate agents are deservedly in a funk these days. Not only are they facing a declining market with fewer sales, but their industry is slowly but surely being invaded by lower cost options. This article talks about their misery. Now, ironically, they are trying to get jobs at low cost providers such as RedFin where they would get a salary, despite the real estate agent lobby opposing them.
Some who want to stay in the business are taking a second look at working for commissions. “People who used to turn up their nose at working for us are now drilling holes to get into the building,” said Mr. Kelman of Redfin, which pays a salary and a bonus based on customer satisfaction.

He said that during the first six months of 2007, Redfin received 2,000 résumés and hired 34 agents, bringing the total at Redfin to 40. Mr. Kelman says he expects to hire 35 to 50 more agents in the next year.

Charity worth it?

I think most people realize that in strictly monetary terms, volunteering is often inefficient. If a doctor earns $100 per hour, he could pay 10 people $10 to work in a soup kitchen for an hour, instead of volunteering just one hour himself.

We justify this inefficiency by saying there are non-monetary effects, such as a sense of fulfillment the doctor gets, or the doctor contributing to society or being a role model.

Yet it's hard to stomach some instances of charity inefficiency. In this story, we find out about how hair-donation programs are not all they're cracked up to be:
But although charities have been highly effective at stirring the passions of donors, they have been less successful at finding a use for the mountains of hair sent to them as a result. As much as 80 percent of the hair donated to Locks of Love, the best known of the charities, is unusable for its wigs, the group says. Many people are unaware of the hair donation guidelines and send in hair that is gray, wet or moldy, too short, or too processed, some of which is immediately thrown away. Even hair that survives the winnowing may not go to the gravely ill, but may be sold to help pay for charities’ organizational costs.
Someone more cynical might suggest that donating your hair is relatively popular because it is a visual symbol and you will have the opportunity to boast about your charity to everyone.
“We created this monster because people get so much from it,” said Madonna Coffman, the president of Locks of Love. “They get the attention. They get a warm and fuzzy feeling..."
I won't go that far, but maybe we should instead celebrate the ones that are going to have the biggest impacts.

Wednesday, September 05, 2007

Best one-liner I read today

What's the stupidest animal in the jungle?

The polar bear

Power, Sex, Air Safety and Politics in Sao Paulo

from this article:

The newspaper O Estado de Saõ Paulo editorialized that it was high time authorities moved against "figures involved in marginal activities [who] remain far away or above the law."

But Mr. Maroni has plenty of fans, too. Fabio Alves, passing by the shuttered club on a motorcycle, paused long enough to predict that Mr. Maroni would soon be free and running his hotel. "Powerful people go to his club and that gives him power," he said, as an airliner roared overhead. "He knows things that could embarrass people."

ADDENDUM: I forgot the best quote (end of this paragraph)
São Paulo officials say they're taking the initiative in Mr. Maroni's case because of doubts about the impartiality of the aviation officials involved in the building-permit process. Prosecutors say federal aviation officials' personal phone numbers were found in a directory seized in Mr. Maroni's office at the Bahamas Club during a raid in 2004. The current investigation is looking into whether the officials got favors from Mr. Maroni. Vladimir Oliveira da Silveira, Mr. Maroni's lawyer, says that it's perfectly normal for a businessman to have contacts in government and Mr. Maroni's dealings weren't inappropriate. He accuses Mayor Kassab of grandstanding, "trying to play Rudy Giuliani."

First 3 Rules of Real Estate Are....

You know the drill (from Dow Jones):

Lowe's rated higher than Home Depot in most areas, including product selection and customer service. Asked which chain they like better, 53% of respondents chose Lowe's, while 47% chose Home Depot. That's an even wider gap than a similar survey in 2006, which found a 51%-49% preference for Lowe's.

But Home Depot ranked significantly higher in having convenient locations, which turned out to be the strongest predictor of where respondents spent the biggest chunk of home-improvement dollars, the firm said.

Personally, I have exactly the same reaction. I go to whichever is closest. I'll even go to Ace. Ace saves 15 minutes of driving and so even if they charge a bit more it's often worth it. Note: if a plumber or electrician working on your house is charging you by the hour, ALWAYS have them go to the closest one. They'll probably tell you they need to go to one that's not the closest, stop at Carls Jr, and charge you $75 an hour the whole time.

Tuesday, September 04, 2007

In defense of Leandrinho

So I'm reading an article on Leandro Barbosa, in which he's quoted in his broken English, and a commenter pisses me off:
million dollar body, 10 cent brain.
Seriously, screw you, ignorant commenter. Leandro Barbosa didn't speak a word of English when he came to the NBA. Even now, he's still learning. He's not stupid, he's just not speaking his native language. Let's hear you speak Portuguese, although I'll bet you thought they speak Spanish in Brazil. You're probably the type of person that walks up to Eriberto's and says "dos tacos" and thinks he's speaking Spanish. Kiss my ass.

What pisses me off is that this is a common response. When a Mexican doesn't speak fluently, so many people associate that as being dumb. This is so wrong and detrimental. Unfortunately, this viewpoint is everywhere in the world...when I have more time I'll explain my own frustrations with people giving condescending directions and hand signals to me because my Portuguese has an accent.

Rock on Leandrinho. (random note: if he were a soccer player they would call him Leandrão, but that's a story for another day)

Addendum: another commenter backs me up
Barbosa isn't dumb, people. He speaks a different language and does far better with English than most of you.

Buffett making large, growing bet on railroads

For those as obsessed with Warren Buffett as I am, here's his latest move.

He's already amassed $4 billion worth of BNI, Burlington Northern Santa Fe railroad, based out of Dallas/Fort Worth, and now he's talking about raising that stake much more. It could even become a bigger position for him than Coca-Cola, Wells Fargo, and Proctor & Gamble, which have long been huge bets for him.

Considering how conservative he is and the size of this bet, clearly he has a very high degree of confidence in it. Copying his bets has long been a reliable way to beat the market, so don't be surprised if this turns out to be a smart move.

The man is a genius, and an amazing human being. Note that while the market is in turmoil and stocks are down the last month, Berkshire Hathaway, which I have more than half of my portfolio in, is up well over 10%.

Keep it up Warren. I hope you live to 100. And write books.

finance sites always have disclosures but I never know if you are supposed to. So I own brk.b but not BNI. Do you own research, nobody really knows what they're talking about and that's why the S&P 500 index funds beat most mutual funds.

Consultants face questions like these too....

An article with the headline "Want a job at Google? Try these brainteasers first" forgets that management consulting for years has been the place for challenging interviews. A major component of the top firms' interview process is a series of case interviews, in which you go through a business situation. Variants include brainteasers and guesstimates, the type of which Google apparently uses.

The companies are trying to figure out how you think, and see your logical thought process. Anyway here are the questions from the Google interviews, the type of question of which could easily come up in consulting interviews.

How many golf balls can fit in a school bus?

About 500,000, assuming the bus is 50 balls high, 50 balls wide, and 200 balls long

You're shrunk and trapped in a blender that will turn on in 60 seconds. What do you do?

Some options:

1. Use the measurement marks to climb out

2. Try to unscrew the glass

3. Risk riding out the air current

How much should you charge to wash all the windows in Seattle?

Assuming 10,000 city blocks, 600 windows per block, five minutes per window, and a rate of $20 per hour, about $10 million

If you're going to go through interviews at the management consulting cos, I recommend practicing, a lot! I used the Vault Guide to Case Interviews and the Wet Feet Guide, though personally I preferred the WetFeet guide.

Monday, September 03, 2007

311

Finally got to see 311 in concert while back in Phoenix in August. They were my favorite group for years. A little underwhelming in concert, but still liked it.

And that completes my August trip back to the US.....be back again briefly in October.

Classic Example of Why Subways Are Overrated

Everyone loves subways. They are fast, sexy, and simply work. However, they are massively expensive (think on the order of $100 million per kilometer), and so developing them comes at the expense of other projects.

Here's an article about the subway in Santo Domingo, Dominican Republic, and how it is mocked because it is not the top priority for the country:

Msgr. Agripino Núñez Collado, a religious leader active in civic affairs who spoke at the event, apologized to the hundreds of assembled guests for arriving an hour late. He said he was stuck in traffic so bad that the vice president had to send motorcycle officers to extract him and race him to the palace. What better endorsement for a subway project than that?

But as the religious leader spoke, the palace lights briefly went off, a reminder of the power cuts that are a regular part of life in Santo Domingo. How can a country that cannot keep its lights on possibly keep the trains running on time, critics ask.

Unfortunately, the attitude of "what better endorsement for a subway project" is just wrong. The goverment could have done other projects for a fraction of the cost. My personal favorite would have been busways or another form of segregating public transport. Other ideas would be congestion charges, increased licensing fees, favoring non-motorized transport, or any number of cheaper options.

Politicians are often not willing to do anything that would go against cars, when those solutions would be great for the city. Subways will always get subsidized because they are clean and provide a positive image for a city and multiple positive externalities. However, for a developing country with other priorities, the DR should have tried cheaper options.

Interesting Response from Bloggers to Traditional Media

Calculated Risk, a solid real estate blog written by two anonymous authors lists their policy on why they usually won't respond to traditional media reporters, whom they call BIG PAID MEDIA. Here's one of them on why it's insulting that the reporter will call for a comment, but won't just quote off of the blog:
Do you, can you, understand the implicit insult in that? You want to talk to us because of what we have written on this blog, instead of simply engaging with what we have written on this blog. You are saying that blog entries we have written, at our own inspiration, on our own time, for our own intellectual purposes, backed up by our own research, are not good enough for you to use as source material (properly credited). It only “counts” if you get to ask the questions, form the story angle, edit the material, and put names on it.

Smart Idea at UA

I've always wondered why students don't start more small enterprises on campus to try and make money. Now via a Facebook link I found azlaundry.com, a service that picks up your laundry at your dorm or apartment, washes it or even drycleans, then drops it back off. They have different plans, but appear to charge about 50% more than services around campus that require you to drop-off and pick up laundry.

Services like this aren't going to hit it big. You just can't expand that nationwide because it's too easy to copy. But compared to most student jobs, doing that would be fun and probably more profitable.

Moreover, it's a great service to students with the cash. Outsourcing more personal tasks is going to be a steadily growing thing for years. And it makes sense- people should focus on what they're good at, and if they say have a job that pays $15/hour and they would reduce their labor by an hour for every $5 they spend on azlaundry.com, it makes sense.

Anyway I have no idea who is running this- they are unfortunately a bit too secretive on their web site. But I wish them luck. If nothing else, it will be a good lesson in business.

Petrobras' Turnaround

Petrobras, the Brazilian national oil company, seems to be everywhere here. They have ads all over, they heavily sponsor the arts, and they of course all selling a lot of energy of various types. The WSJ last week praised the company for turning itself around in the 90's, largely due to the vision of President Cardoso.

Mr. Cardoso termed his policy for Petrobras "flexibilization." He wasn't willing to privatize it fully, but he used market forces, like a stock flotation and foreign competition, to make Petrobras behave more like a private company.

In 1999, the government started allowing foreign operators to bid against Petrobras for offshore blocs. To prepare the company for competition, Mr. Cardoso named an investment banker as its president. The new chief cracked down on dicey deals with suppliers, started an incentive-based bonus system for managers and cleaned up the books by acknowledging billions of dollars in pension and health liabilities.

The next year, the government sold a 16% stake in Petrobras for $4 billion on stock markets in New York and São Paulo. While Petrobras shares already traded locally, the Big Board listing "had a big impact on governance," says Mr. Gabrielli. "It forces transparency. It forces disclosure."

Even my university made it into the article as benefitting from Petrobras.
One cooperative venture funded by Petrobras royalties is a massive water tank at the Federal University of Rio de Janeiro. The tank, slightly bigger than a tennis court and 50 feet deep, simulates winds and waves encountered offshore, and ultimately helps design safer platforms.

Interesting debate about sex offender lists in Daily Wildcat

There was an interesting question posed by the Arizona Daily Wildcat's publishing of the names of 2 of the 3 sex offenders registered for classes at the UA. While their prior convictions are public information, is bringing them to the forefront irresponsible? And to that end, are sex offender lists, which similarly bring already public convictions to the forefront, similarly excessive?

Here's a response from several past Daily Wildcat columnists:
The men to whom the article referred have served their jail time and have repaid their debt to society. What's more, they are apparently making an endeavor to better themselves through education and gainful employment. This is the route one would hope all ex-felons pursue, and the Wildcat should not play a role in needlessly adding to their opprobrium.

To be sure, UA students who are concerned about sex offenders in their midst can easily find that information in a wide array of online databases. But absent any real news story, there is no reason - journalistic or otherwise - for the Wildcat to cast a dark pall on members of the UA community who are ostensibly trying to rehabilitate themselves by seeking an education.
The WSJ recently discussed when public information becomes too public.

Sunday, September 02, 2007

Panama City

Just got back from four days in Sao Paulo. I still need to finish my trip back up to the US in August, but I will have thoughts on Sao Paulo soon- hint: it was very different from my first impression when I came with the World Bank in summer 2005.
The canal is cool to see, but oh so slow. It takes more than an hour for one boat to come through. This is after the water level where the boat is in the video had been lowered.The presidents of Panama and El Salvador were visiting the canal that day with their security entourages. This while a major labor protest from all the construction workers was going on in the center of the city.

In front of a Panamax boat, the largest size that can fit in the Panama canal (and built as such). After the expansion of the canal (to add a third set of locks), the canal will allow much larger boats, helping shipping meet more economies of scale, which have played a huge role in expanding international trade already.

Panama is having explosive growth, perhaps too much so. Expect an oversupply of residential condos in a few years, though there's no denying the appeal of the area given the familiarly (has the dollar, US friendly) and the great tax breaks Panama is offering to get foreigners to move there. Combine that with the new business from the expansion of the canal, and you have a booming place. Of course, I ended up sharing a taxi with a residential developer that moved from, of all places, Florida. The real estate speculators that chase booms don't go away, they just move on sometimes. At least he is actually retiring here.

A red-devil, the famously colorful and dangerous driving public buses in Panama. I wish I had gotten a better picture.