Category Archives: commerce

What is the median length of homeownership?

Well, it’s longer than it used to be, per Conor Dougherty in the New York Times:

The median length of time people have owned their homes rose to 8.7 years in 2016, more than double what it had been 10 years earlier.

The accompanying chart shows that “median length of homeownership” used to hover at  just under 4 years.  That startled me!  Doesn’t 4 years seem like a pretty short length of time to own a house?

When I thought about this a little more, I realized I had no idea what this meant.  What is the “median length of homeownership” in 2017?  Does it mean you go around asking each owner-occupant how long they’ve lived in their house, and take the median of those numbers?  Probably not:  when people were asked that in 2008, the median answer was 10 years, and whatever the Times was measuring was about 3.7 years in 2008.

Does it mean you look at all house sales in 2017, subtract the time since last sale, and take the median of those numbers?

Suppose half of all houses changed hands every year, and the other half changed hands every thirty years.  Are the lengths of ownership we’re medianning half “one year” and half “30 years”, or “30/31 1 year” and 1/31 “30 years”?

There are about 75 million owner-occupied housing units in the US and 4-6 million homes sold per year, so the mean number of sales per unit per year is certainly way less than 1/4; of course, there’s no reason this mean should be close to the median of, well, whatever we’re taking the median of.

Basically I have no idea what’s being measured.  The Times doesn’t link to the Moody’s Analytics study it’s citing, and Dougherty says that study’s not public.  I did some Googling for “median length of homeownership” and as far as I can tell this isn’t a standard term of art with a consensus definition.

As papers run more data-heavy pieces I’d love to see a norm develop that there should be some way for the interested reader to figure out exactly what the numbers in the piece refer to.  Doesn’t even have to be in the main text.  Could be a linked sidebar.  I know not everybody cares about this stuff.  But I do!

 

 

 

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I guess Caffe 608 was in trouble

Eight years after I wondered whether the arthouse cinema / cafe in Hilldale could really make a go of it, Sundance 608 is getting bought out by AMC.  I have really come to like this weird little sort-of-arthouse and hope it doesn’t change too much under new management.  It’s a sign of my age, I guess, that I still think of “movie at the mall” as an entertainment option I want to exist.  It’s my Lindy Hop, my vaudeville, my Show of Shows.

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Mathematicians becoming data scientists: Should you? How to?

I was talking the other day with a former student at UW, Sarah Rich, who’s done degrees in both math and CS and then went off to Twitter.  I asked her:  so what would you say to a math Ph.D. student who was wondering whether they would like being a data scientist in the tech industry?  How would you know whether you might find that kind of work enjoyable?  And if you did decide to pursue it, what’s the strategy for making yourself a good job candidate?

Sarah exceeded my expectations by miles and wrote the following extremely informative and thorough tip sheet, which she’s given me permission to share.  Take it away, Sarah!

 

 

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Bugbiter

Dream:  I meet two 9-year-old boys with identical long curly hair.  They’re in a band, the band is called Bugbiter.  They explain to me that most of their songs are about products, and they share their songs via videos they post on Amazon.

I share this dream with you mostly because I think Bugbiter is actually a legitimately good band name.

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Antonin Scalia thought jurisprudence was more like math than it really is

I didn’t mean for Antonin Scalia to be a major character in my book.  I was just going to write about an interesting math snafu that shows up in one of his capital punishment opinions.  But then that led quite naturally into talking about “formalism,” which many mathematicians use (or think of themselves as using) as their everyday philosophy of math, just as Scalia used it (or thought of himself as using it) as his everyday philosophy of jurisprudence.

Legal reasoning is not much like math.  But Scalia sometimes acts like he thinks it is.  That’s what makes him an interesting figure to me.  He writes down arguments which he presents as derivations axioms — as if the words of the Constitution determined the resolution of the legal question, so long as you were willing to apply them methodically and impartially in the correct sequence.

But surely that’s wrong!  The words of the Constitution underdetermine a lot of really interesting questions.  Richard Posner:

Most of the cases the Supreme Court agrees to decide are tossups, in the sense that they cannot be decided by conventional legal reasoning, with its heavy reliance on constitutional and statutory language and previous decisions. If they could be decided by those essentially semantic methods, they would be resolved uncontroversially at the level of a state supreme court or federal court of appeals and never get reviewed by the Supreme Court.

I have written before about the Court’s decision that statistical sampling in the Census is in conflict with the relevant Constitutional clause:

Representatives and direct taxes shall be apportioned among the several states which may be included within this union, according to their respective numbers, which shall be determined by adding to the whole number of free persons, including those bound to service for a term of years, and excluding Indians not taxed, three fifths of all other Persons. The actual Enumeration shall be made within three years after the first meeting of the Congress of the United States, and within every subsequent term of ten years, in such manner as they shall by law direct.

Scalia’s opinion concentrates on the word “enumeration,” which he argues does not mean “determining the number of,” but rather should be understood in the more restrictive sense of “counting one by one.”  And he has some good contemporary sources for this reading!  You get a nice satisfying no-nonsense feeling, reading this opinion.  Then you start to think about what it actually says. Is Scalia declaring that constitution requires that the census count people one by one?  Can’t be — for the last fifty years the census has been conducted mostly by mail.   Does he think the census has to enumerate something, but it doesn’t have to be people?  Could it be anything?  Could it be “all property owners?”  Could it be “all non-atheists?”

Note, too, that when you fill out the census form, you write down the number of people in your household, then you fill out information for each person.  When the numbers are compiled, the computer, surely, adds up the numbers from each form to get an answer.   In other words:  a mathematical process other than enumeration-in-the-narrow-sense whose output is an approximation to the total number of people in the United States.  Kind of like statistical sampling.  Except not as good an approximation.

I don’t think we should consider that process unconstitutional.  It seems reasonable to consider it an enumeration, despite the inconsistency with some dictionary definitions.  Because dictionary definitions aren’t mathematical definitions.  A mathematical object is exactly what it is, and nothing else.  But when we read a word, we make a choice.

Scalia makes one choice: we could also opt for a more expansive but equally common-sensical definition of “enumerate” as “determine, to the extent possible, the number of,” which permits statistical sampling aimed at counting the “whole number” of Americans.  That “whole” is a word in the Constitution too, with as much binding force as “enumeration.”  It doesn’t appear in Scalia’s opinion.

Am I saying Scalia’s opinion in Dept. of Commerce vs. U.S. House of Representatives was wrong?  No; I’m saying merely that it’s not the kind of opinion it presents itself as being.  It is not determined by the text before it.  It relies, elsewhere, on an argument from pragmatism:  if statistical sampling is constitutionally permissible, then legislatures might authorize it, and the resulting partisan wrangling over methodology would create hard cases for future courts.  These are fair arguments, but they’re not textual arguments.  The argument admits that we make choices when deciding what words mean, and we should let our choices be guided by their likely consequences.

But no, I don’t think those arguments are obviously wrong.  It is pretty rare to find Scalia being obviously wrong.  Except in the following higher-level sense.  Scalia seldom concedes that the questions he faces are authentically difficult.  He — or at least the character of “Scalia” he plays in the opinions — lacks the humbleness appropriate to the task.  His habit is to present his conclusion as if it’s obviously right, the way a mathematical proof, once you understand it, is obviously right.  That is obviously wrong.

Update:  Commeter aaaatos makes a really important point, one I meant to address directly in the post.  He writes:  “what makes the legal system so useful to mankind is the fact that therein law is treated in a formalistic way as much as possible, i.e. as if it were mathematics.”  This points to another plausible account of Scalia:  that he didn’t actually believe law was very much like math, but felt it was best practice for judges to pretend to believe that.  That’s what I was getting at with the distinction between Scalia the person and “Scalia,” the persona he adopts as a writer of opinions.

Why pretend?  Partly because it enhances the authority of the process; partly because pretending to believe it helps us be “as formalist as possible,” mildly constraining the inevitably biased choices we make when we read words and try to obey them.

 

 

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The furniture sentiment

Today’s Memorial Library find:  the magazine Advertising and Selling.  The September 1912 edition features “How Furniture Could Be Better Advertised,” by Arnold Joerns, of E.J. Thiele and Co.

Joerns complains that in 1911, the average American spend $81.22 on food, $26.02 on clothes, $19.23 on intoxicants, $9.08 on tobacco, and only $6.19 on furniture.  “Do you think furniture should be on the bottom of this list?” he asks, implicitly shaking his head.  “Wouldn’t you — dealer or manufacturer — rather see it nearer the top, — say at least ahead of tobacco and intoxicants?”

Good news for furniture lovers:  by 2012, US spending on “household furnishings and equipment” was  at $1,506 per household, almost a quarter as much as we spent on food.  (To be fair, it looks like this includes computers, lawnmowers, and many other non-furniture items.)  Meanwhile, spending on alcohol is only $438.  That’s pretty interesting:  in 1911, liquor expenditures were a quarter of food expenditures; now it’s less than a tenth.  Looks like a 1911 dollar is roughly 2012$25, so the real dollars spent on alcohol aren’t that different, but we spend a lot more now on food and on furniture.

Anyway, this piece takes a spendidly nuts turn at the end, as Joerns works up a head of steam about the moral peril of discount furniture:

I do not doubt but that fewer domestic troubles would exist if people were educated to a greater understanding of the furniture sentiment.  Our young people would find more pleasure in an evening at home — if we made that home more worth while and a source of personal pride; then, perhaps, they would cease joy-riding, card-playing, or drinking and smoking in environments unhealthful to their minds and bodies.

It would even seem reasonable to assume, that if the public mind were educated to appreciate more the sentiment in furniture and its relation to the Ideal Home, we would have fewer divorces.  Home would mean more to the boys and girls of today and the men and women of tomorrow.  Obviously, if the public is permitted to lose more and more its appreciation of home sentiment, the divorce evil will grow, year by year.

Joerns proposes that the higher sort of furniture manufacturers boost their brand by advertising it, not as furniture, but as “meuble.” This seems never to have caught on.

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Why would anyone want to become a security analyst or portfolio manager?

In today’s Wall Street Journal, Jason Zweig frets about the popularity of index funds:

If investors keep turning their money over to machines that have no opinion about which stocks or bonds are better than others, why would anyone want to become a security analyst or portfolio manager? Who will set the prices of investments? What will stop all stocks and bonds from going up and down together? Who will have the judgment and courage to step in and buy during a crash or to sell during a mania?

First of all, it hardly seems like the entire stock market is liable to become one big Vanguard fund:  as Zweig says later in the piece, “indexing accounts for 11.5% of the total value of the U.S. stock market.”  Big institutional actors have special needs which give them reason to actively manage their funds.  And an institution like Wisconsin’s pension fund, which manages about $100b, isn’t giving away 2% of its money per year to a manager, the way you or I would.  (This document says we spent $52.5 million in external management fees in 2013; percentagewise, that’s less than I give Vanguard for my index.  Update:  I screwed this up, as a commenter points out.  Our external management fees increased by $52.5m.  They present this as a substantial percentage of the total but I can’t find the actual amount of the fee.)

But second:  am I supposed to be upset if it becomes less attractive to become a portfolio manager?  One out of six Harvard seniors goes into finance.  Is that a good use of human capital?

(By the way, here’s a startling stat from that Harvard survey:  “None of the women going into finance said they would earn $90,000 or more, compared to 29 percent of men in finance.”  Is that because men are overpaid, or because we lie about our salaries the same way we lie about sex?)

 

 

 

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Full professors make more money than bus drivers

Former Republican Congressional candidate and current UW-Madison history professor John Sharpless stands up for us against the Governor:

He said he arrives no later than 9 a.m. and leaves no earlier than 5 p.m. During that time, he said he’s either teaching, preparing lectures, doing research, attending required committee meetings, advising students and managing teaching assistants. Sharpless added that he often spends his evenings reading and grading papers.

“None of this seems like work to a guy like Walker because he lives a different life,” he said. “And I’m not going to make fun of what he does. I’m sure being a governor is a lot of work. He has to spend a lot of time in Iowa and South Carolina and North Carolina and courting other Republican big-wigs. That taxes the man horribly.”

But just to make it clear he’s still on board with GOP, he drops this in:

“I will retire with a salary that’s less than a Madison bus driver,” he said.

UW-Madison salaries are public records, so I can tell you that Sharpless’s is just under $80,000.  In 2012, only 9 employees of Metro made more than $70K.  And the ones who made that much, I’m pretty sure, are the ones who worked tons of overtime.

In other words, what Sharpless said is likely true in the strict sense of

“There exists a Madison bus driver whose salary this year exceeds mine”

but gives the wrong impression about typical full professors in the history department and typical bus drivers.

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A very How Not To Be Wrong Christmas

My bookselling friends tell me that December is the big book-selling month of the year.  (These Census figures show even bigger spikes in January and September, but these are from textbooks, which make up a really big chunk of the total book market.)

And indeed, sales of How Not To Be Wrong shot up in a very satisfactory way during the holiday season; according to Nielsen BookScan, the book sold more copies in the Dec 15-21 week than it had any week since the first month of release in June.  The book also rose up the Amazon rankings; having settled in in the #1500-2000 range for a couple of months, it popped up to around #700, about the same level as August, and stayed there for two weeks.  Two days after Christmas, pop — immedately back down to four digits.  The increase in ranking suggests that How Not To Be Wrong was unusually popular around Christmas, even relative to other books.

One thing I don’t quite get, though; the Kindle edition also got a notable rankings boost in the second half of December, though a bit smaller.  Where is that coming from?  Do people buy books for other people’s Kindles as Christmas presents?

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Trader Joe’s is the Disney World of grocery stores

We’re back in Madison after three days at Walt Disney World.  CJ and I went to Trader Joe’s to pick up stuff for dinner and realized:  Trader Joe’s is Disney World.

Reasons:

  • Part of what you’re paying for is a sense of, well, “fun.”  WDW employees — who are called “cast members” — wear costumes.  Trader Joe’s employees — who are called “crew members” — wear Hawaiian shirts.  It is part of their job, not just to be pleasant to customers, but to appear actively happy to be talking to customers.  And maybe they are!  You can imagine that if you were the kind of person who likes chatting with strangers you’d be drawn to working at WDW or TJ.
  • Iron-clad branding.  Just about every single thing you can buy, see, or eat at Disney is Disney-branded.  Same for Trader Joe’s (even if the product is surplus Sabra hummus repackaged in Trader Joe’s tubs.)
  • Limited selection.  Disney World restaurants have short menus; they need to get thousands of people in and out fast.  There aren’t twelve roller coasters like at Six Flags, there are two.  At Trader Joe’s there aren’t a hundred different kinds of Cheerios.  Just the Trader Joe’s kind.  The problems of choice are taken away from you and this release is itself a kind of fun.

Unfinished thought:  both Disney and Trader Joe’s are trying to project a spirit of California.

 

 

 

 

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