Wells Fargo adds a class action waiver

Effective February 2012, Wells Fargo is adding the following language to its agreement with customers:

Binding arbitration
If you have a dispute with the Bank, and you are not able to resolve the dispute informally, you and the Bank agree that upon demand by either you or the Bank, the dispute will be resolved through the arbitration process as set forth in this part. A “dispute” is any unresolved disagreement between you and the Bank. It includes any disagreement relating in any way to services, accounts or matters; to your use of any of the Bank’s banking locations or facilities; or to any means you may use to access your account(s). It includes claims based on broken promises or contracts, torts, or other wrongful actions. It also includes statutory, common
law, and equitable claims. “Disputes” include disagreements about the meaning, application or enforceability of this arbitration agreement. This arbitration agreement shall survive any termination of your account(s). YOU AGREE THAT YOU AND THE BANK ARE WAIVING THE RIGHT TO A JURY TRIAL OR TRIAL BEFORE A JUDGE IN A PUBLIC COURT. As the sole exception to this arbitration agreement, you and the Bank retain the right to pursue in small claims court any dispute that is within that court’s jurisdiction. If either you or the Bank fail to submit to binding arbitration following lawful demand, the party so failing bears all costs and expenses incurred by the other in compelling arbitration. Arbitration procedure; severability You or the Bank may submit a dispute to binding arbitration at any time, regardless of whether a lawsuit or other proceeding has been previously commenced. NEITHER YOU NOR THE BANK SHALL BE ENTITLED TO JOIN OR CONSOLIDATE DISPUTES BY OR AGAINST OTHERS IN ANY ARBITRATION, OR TO INCLUDE IN ANY ARBITRATION ANY DISPUTE AS A REPRESENTATIVE OR MEMBER OF A CLASS, OR TO ACT IN ANY ARBITRATION IN THE INTEREST OF THE GENERAL PUBLIC OR IN A PRIVATE ATTORNEY GENERAL CAPACITY...

This comes in the wake of the AT&T Mobility v. Concepcion Supreme Court decision back in April.

Just another incentive to move to a credit union, I suppose.

Oddly, I was unable to find any news coverage of this change.

Eloquence from the White House

I was impressed by Melody Barnes' interview with Jon Stewart. Typically, liberal bureaucrat-type people don't talk the way I would, and I find myself wishing I could step in and make the arguments for them. Melody spoke far better than I could have. Shame she'll be leaving.

Practicing with databases and SQL

I came across SQLzoo.net a few months ago and went through basically all of it. Really good review of SQL, especially if you're like me and have read a lot but haven't actually written the queries nearly as much. I also found a decent review of transactions over at Wired's Webmonkey website.

"Free-styling" with rhymes

I did my first sort of free-style rap the other day on vacation to the East Coast. It went pretty much as follows:

Money is all I've ever thought
But that doesn't mean it's all I've got
I'll have to keep this terse
Because I have trouble coming up with a verse
I'm not very good at saying what I feel
But that doesn't mean I can't seal a deal
Cause I try to be methodical
About focusing on the logical

This got me thinking about rhyming - and I think I might actually start trying to do some poetry.

Data Liberation Front

This is why I am a Google person rather than an Apple person.

The Delaware Court of Chancery

Many people are aware that Delaware is a very popular place to to incorporate, with Delaware's Division bragging that 63% of the Fortune 500 are incorporated in Delaware.

Less commonly known, perhaps, is that Delaware retains a court of "equity". I read through Quillen and Hanrahan's (1992) A Short History of the Delaware Court of Chancery. They describe it as such:

The role of procedural and doctrinal inflexibility in the decline of England's Chancery Court contrasts with the determination of Delaware's Chancellors over two centuries to eschew broad rules in favor of specific holdings and carefully crafted remedies that address the particular circumstances of the case at hand. The secret of Delaware equity rests in two old concepts, both English in origin. First, equity is a moral sense of fairness based on conscience.⁽⁸⁾ Second, equity is the recognition that the universal rule cannot always be justly applied to the special case.⁽⁹⁾ Equity is the flexible application of broad moral principles (maxims) to fact specific situations for the sake of justice. Delaware has preserved the essence.⁽¹⁰⁾

Moral maxims and fairness based on concepts? Such an idea must sound quaint to most lawyers and particularly to legal positivists. And it seems somewhat ironic that corporations would choose to be located so near to such an ambiguous concept.

After reading the article, I can't say that it really seems that Court of Chancery has been revolutionary in applying moral principles. Certainly I haven't heard of its involvement in remedies for the frauds of the mortgage crisis. There was some mention that it had done some work to protect minority shareholders, although I'm a bit skeptical. It is noteworthy that it was a decision from it that was affirmed in Brown v. Board of Education (while other lower court decisions were involved, apparently the Chancery's was the one affirmed).

Stage hypnotist Doug MacCraw

I'm skeptical but open-minded about most things, but when it came to hypnotism I was mostly skeptical. I figured it could have minor effects, but that anyone hypnotized could quickly break out of it. I got back from a vacation a couple weeks ago, and there was a "stage hypnotism" show by Doug MacCraw. You can see a bit of what it was like in this Youtube video. I also found an interview with Doug over at The Daily Orange. He says he "bores people into hypnosis". However he does it, I'd like to learn. He mentioned at the end that the medical applications of hypnosis are underrated, which, if that show is any indication, seems likely.

TaxAct: best alternative to Turbo Tax?

I did my taxes the other night. At first, I used the Free Fillable Forms like I'd used last year - it is supposed to be the most basic "do-it-yourself" online method, similar to just filing electronically with the IRS. But it's not the same. It's run by a third-party (a tax accountant trade group), and it's crippled for that reason (see this interesting Fatwallet discussion). I quit when I found out that I wouldn't be able to import my capital gains but I would have to do them manually. Since my broker gives me free access to Gainskeeper, which automatically creates the capital gains information, I wasn't going to do it manually (it's only about a dozen trades).

The next thing I tried was "Complete Tax from E-Smart" (internet-taxprep.com), which was a mistake - minor issues in how it accepted my input led me to skip past that. I glanced at Turbo Tax, but I try to avoid the market leader in many cases to stimulate competition - and it is obvious that Turbo Tax was using its position to impose higher costs, since it was charging me $50 for my return. I then tried H&R Block, although the company's legion of tax employees makes me wary that they would produce a crippled product - and it also required manual entry for capital gains.

I settled on TaxAct. To avoid manual entry of capital gains, I had to pay $10, and they also charged me $5 to save a backup copy, but that's a far cry from $50. I was satisfied with its interface, although I actually had to load up IE to import my .csv file with the capital gains.

Couple thoughts

The biggest driver of world government will be intellectual property rights, since I'm watching a show illegally (through the excellent website sidereels.com).

The other thought: my window of opportunity for creating an excellent website like sidereel is quickly nearing its end, and while I am full of ideas, my web development skills remain weak. So it's time to stop watching this mindless show and get to this PHP book I have sitting on my desk.

The future of work

As I mentioned back in 2007, I believe that we will eventually enter an age of leisure, largely due to robots and technology. We are seeing this trend accelerate in the United States currently, as companies are finally beginning to see real cost-savings from technology. In the initial ramp-up, technology improvements employed a ton of engineers and programmers. In its later phases, these contractors will be out of work. Martin Ford has written a lot about this and his blog Future Economics and Technology keeps up on the developments in that direction.

It seems to me that this view is quickly becoming more common. A few days ago I saw What happens when we have enough technology that there is no need for a work force? on Reddit. There were some people who said this could never happen, such as "skeeto", but when pressed it was noted to him that the robots could be designed to be identical to humans (the Japanse are already making humanoid robots - see video). It's true that there will always be some demand for workers, but I think it's naive to think that more than a small percent of potential workers will be needed in the long-run. We'll have to figure out some way to keep the rest of people occupied, and we'll have to have a system which supports them.

I do not expect the unemployment rate in the United States to drop back to 5% in the next few years, and possibly never. I actually expect it to be in a slow uptrend, although we'll probably see a dip if the baby-boomers actually retire like they should. We might have to figure out a different economic system sooner than people think. The Reddit thread directed me to an interesting story called Manna which describes the possible future. It's not exactly as I see the future, but fundamentally a lot of it is plausible.

VBA and bankers' rounding

Most children learn in elementary school that you round 5 up. That's how Excel works. But the language used to write programs in Excel, Visual Basic for Applications, does not do that with its Round() function. It uses bankers' rounding, which is described by a Microsoft blogger. You can write a custom function such as one here, but that's kind of a hassle.

It's annoying, but there is a workaround: call the Excel Round function, as described by this guy.

If VBA was open-source, I imagine that this would have been fixed a while ago. Regular round would be Round(), and Bankers' round would be Bankround() or something. VBA seems like a mess.

The Institute of Medicine's vitamin D report

I watched about 50 minutes of the IOM's video of the new report's press release. I thought it was remarkable how sincere the scientists were: they truly do not understand a lot of things going on with these vitamins, they're upping the vitamin D required significantly for most population groups from a 200 IU adequate intake to a 600 IU Recommended Dietary Intake with a 4,000 IU tolerable upper limit. They ignore vitamin D from sunlight.

They say later that most people in the United States get about 200-300 IUs from the diet. They grudgingly admit that most people are going to have to take vitamin D supplements; later they discuss that people could specifically target fatty fish (e.g. salmon) or specific fortified foods. When asked about what they think about people taking 1,000 or 2,000 IU supplements just in case, they said it probably wouldn't increase risk, although one cautioned against it noting the beta carotene and vitamin E examples, which looked good in observational trials but proved unhelpful or even harmful in randomized trials.

It's rather sad that they've done all these randomized controlled trials on bone health, but they didn't collect all this other information on these trial patients (cancer, immune system, etc). Without the randomized trials, the IOM could not say anything, which I don't blame them for given the history of observational trials. I'll be taking a 2,000 IU supplement to be on the safe side, and I'll be upping it from the occasional couple times a week to a routine thing. I'm still partial to the idea that the seasonal flu is caused by vitamin D deficiency.

If you aren't looking for something then you'll never find it, which is why I'm constantly disappointed by people who seem to reject the idea that focusing on the nutritional basics (rather than taking a bunch of drugs) can effectively improve health. It's also rather sad that we still don't even understand how something as basic as vitamin D relates to immune function when we've expended enormous amounts of money on various drugs which were harmful dead ends.

I may add more thoughts on this later.

Interest rates, banking profits, and predatory lending

I like to get firsthand experience of things. When I heard that a local bank of mine was missing its TARP payments and possibly close to bankruptcy, I thought about opening an account. I wouldn't mind getting the experience of having my accounts transferred or being paid by the FDIC. Lately I've been lucky: I have an open directors & officers' insurance policy claim (I didn't file the lawsuit) and I recently got a $1,000 payout for a dink in my car (first insurance claim).

About a week ago I went into Wells Fargo to wire some money to China. I had purchased a credit report on a Chinese stock that I was invested in - the credit report used the SAIC (State Administration for Industry and Commerce) financials, which are often different from the financials that these companies file in the United States. The credit report confirmed my suspicions and I closed my investment at a loss. I was helped by a personal banker, and while I was there she suggested that I take out a personal line of credit.

I told her I didn't need it, but I was easy to sell on the idea: I wanted to see what the experience was, and I wanted to see what kind of interest rate they'd offer me. They found I have a credit score of 777 and I disclosed that I make about $45k a year. I have no debt. They offered me $6,600 with an interest rate of 8.750% plus the Prime Rate published in the Wall Street Journal Western Edition. As of November 29, 2010, that meant an interest rate of 12%. However, this was subject to a floor of 14.50% and included a discount of 25 basis points for automatically deducting payments from my checking account. I also went through a process of upgrading my checking account, and in that process I discovered in the documents provided that Wells Fargo actually does payday lending through a program called "Direct Deposit Advance".

I had reminded the banker several times that I was not interested if there were no fees. Reading the contract, I saw an annual fee of $25. I spoke to her about it and she said her manager assured her that it was waived the first year. So I went along with it. When I get the line, I was immediately charged $25, and interest began to be charged soon after ($0.03 was charged as interest). She offered to remove the fee, but I was glad to be rid of the line. I guess that goes to show that you can't trust words. If it had been serious, I would have gotten it in writing first, although I doubt that would have mattered much with the computer's programming.

Although not clearly related to the above story, I've sometimes idly wondered what the net effect the Fed lowering interest rates was on banks. The banks charge less in interest, but they also pay much less in deposits, so the effect on the net interest margin could be OK. As my experience shows, banks can still charge a fairly hefty interest rate to me, a borrower with very good credit. Plus, the lowered interest rates stimulates additional loans. The Dallas Fed's Southwest Economy said in 2003 that the lowered interest rates have, prior to 2003, been closely correlated with higher net interest margins, basically because low short-term interest rates are typically associated with a steep yield curve, and banks (accepting the risks of maturity mismatch) invest the deposits for which they are paying very little interest in longer-term assets. The effect had notably broken down in 2001-2003, and the author says this is because "interest income on many of [bank's] floating-rate loans falls with market rates, but deposit rates on short-term accounts fall by less as overnight rates get closer to zero and account management expenses become relatively more important". I don't exactly follow how this is different from the earlier years, but I guess it has something to do with the trend towards banks getting involved in money market funds.





A propos of the above discussion, Morningstar recently sent out an article on the implications of interest rate hikes (When Interest Rates Rise, Will the Tide Lift All Boats?). They target retail brokers as the greatest beneficiaries,

Accepting web design and funky CSS

I've made a few websites from scratch in notepad and played around with programs like Dreamweaver, but I was never very happy with the results and my understanding. The websites felt amateur, and CSS always seemed to do weird things. I gave up on further work on websites thinking that I was missing something about web design - that I wasn't quite up to the standards and secrets. In the meantime, I've collected a mess of links on web design which I thought someday might help me. HTML Dog and W3Schools are the two that I am most familiar with. In my quest to understand CSS, I'd also bookmarked thesitewizard.com, HTML Source, HTML Help from The Web Design Group, Good Tutorials which lists a bunch of other tutorials, an interesting extension of CSS called "HSS", and the Open Directory's listing on CSS. For general web design, I'd also found a list of 100+ resources, a handy "complete color chart". Suffice it to say that I did not read all these links carefully. It's the problem with bookmarks: it's easy to file away and forget. However, after all this I never took the time to look at the official source, W3's official specification (see the CSS 2.1 draft). I did look at it today, and found it somewhat helpful although still not completely clear. In my quest, I also bookmarked Wikipedia's Comparison of HTML editors; now, I also see another list of web design programs on AlternativeTo.net.

In my search, I found articles which I thought offered solutions, such as strange hackish One True Layout, and teaser samples of Sitepoint books such as HTML Utopia: Designing Without Tables, The Art & Science Of CSS or Everything You Know About CSS is Wrong I never bought those books. I also found that I wasn't the only one frustrated by CSS. In February 2009, I found an article by Eric Meyer (Wanted: Layout System), lamenting the fact that CSS has historically lacked any decent layout system. I also found a Reddit discussion (Does anyone else who doesn't work with CSS on a regular basis feel like a champ whenever they get it to work?). I didn't really understand what these posts were talking about at the time, and I still only vaguely follow them. For example, I don't understand Eric's point that the only reason floats are used is that there's the clear value which allows footers to be set at the bottom. I can use floats to create a decent layout without clearing at all. However, I agree with the general idea. When I think of web design, the tables based method is the most intuitive. I should be able to cut the screen into little pieces which don't overlap into each other. Floats are a hackish way to do that, but there should be something better.

One of the commenters to Eric's article mentioned Blueprint (and the similar program 960 Grid System as a way to get past this issue. I don't understand that. I get that Blueprint is a handy way to deal with defaults and special Internet Explorer quirks, but I don't understand how their grid makes CSS more intuitive and less hackish. Why split a webpage into 24 columns, and then use those 24 columns to create a basic layout with 3 columns, or however many columns? Working with the grid has its own rules (shown pretty well in the tutorial A Closer Look At the Blueprint CSS Framework). Further, it uses a fixed layout, and I generally come down on the side of using a relative "liquid" layout (see The Great Fixed Vs Relative Width Page Layout Debate).

After all this, I'm still rather confused. I think ultimately I need to get down to actually working on websites and hacking through problems however I have to. I don't actually need a perfect layout system. I can work with what's there, and what's really important in my website ideas are the databases and related programming. So I'll be trimming out my web design links and leaving instead the bookmarks on databases and programming. Perfectionism is the enemy of productivity.

Programmed music?

The problem with bookmarks is that there's no schedule reminding you to look at them at a certain period or deal with them. I used to use them for interesting articles or stories that I'd read later, but instead they built up as I moved on without finishing what I'd bookmarked.

One of these stale bookmarks is a press release about a program called Inmamusys (for Intelligent Multiagent Music System) which can compose pleasant music on the fly. No use to me, but I thought it was cool and it promises great, non-repetitive elevator music. Of course I'd be wowed and completely believe this kind of hype...

Giving What We Can project

I added this as a bookmark while I considered joining the project, but I'm pretty firm at this point that I will not join it. I'm looking to give about 10% of my income away in various causes, but not all of them are charity-focused. When I've built a small fortune I plan to return to this.

Trimming a few blog and other bookmarks

As part of an effort to continue to trim my bookmarks of old articles and half-thought ambitions, I'm removing a few blogs from when I was more obsessed about health, plus an article ("knol") about eyeglasses possibly exacerbating myopia ("Advisory on Eyeglasses for Myopia"), the Building a Mining Company website, Mines and Communities website, and all my privacy websites (Guerrilla Mail for temporary websites, Bugmenot for free logins). Not sure what to think about the knol, and my interest in mining will continue but somewhat more from an investor-based perspective (where I can look at the ecological impacts as well). I also trimmed the only link in my funny folder: Motivational Posters.

The blog include the Heart Scan Blog, which is about a doctor who advocates vitamin D and other things (thyroid stuff?). Caught my eye, but I haven't read much of it lately. Another is Whole Health Source, who caught my eye with an interesting article on Weston Price's research on tooth decay. I actually agree with both of the bloggers to some extent, or at least in the idea that mainstream medicine is often wrong and that the importance of nutrition is overlooked. But since I don't have as many health issues as I used to, I'm less into this area. Another is Modern Dragons, which seems like a guy with a common interest in tackling "modern dragons". There's also The Scholarly Kitchen (academic publishing blog), This week in batteries (need more technical background to follow).

I'm adding the following to my Google Reader: Aaron Schwartz's Raw Thought, Andrew Garret's Blog, Wikimedia Technical Blog. These are programmers who have a connection to Wikipedia, although I'm trimming out Wikipedian blog Vox Populi Vox Cani. I'm not adding Vision Master Designs also I'll likely go back to check on it (same with all of these, now that I've got them stored here). It's unfortunate that Google Reader doesn't seem to have a really convenient way to just store blog links.

Extending time to qualify for the long-term capital gains tax to overcome short-termism

For the past few years I've been advocating that the long-term capital gains tax rate of about 15% (to move up if the Bush tax cuts expire) be shifted so that the "long-term" holding requirement is 5 or even 10 years rather than 1 year. The tax rates should be staggered so that very short-term trading is taxed high (more than the income tax, perhaps by 10%), 1 year is taxed less (perhaps 5%+ of the income tax), and so on. Of course, there are other things that need to be addressed - for example, shareholders and institutional investors have to rise up and start voting their shares instead of leaving the managers to essentially own companies with a high turnover in ownership. This is one of the reasons I like extending long-term capital gains tax: it encourages people to stick with a company and act like an owner, and therefore hold management accountable to the long-term stability and profitability of a company.

I haven't heard many people repeating the idea. A while back I heard one guy on Bloomberg say that maybe there should be an 80% tax on short-term trading, and saying that his comrades on the Street would probably kill him for saying that. However, I was very happy to see the Aspen Institute's Overcoming Short-Termism report released in September 2009.

Of course, there are other things that need to be done - executives and employees doing risky deals (e.g., traders on Wall Street) should be rewarded with restricted stock or, if options are necessary, LEAPS (plus clawback arrangements). But I tend to think that these things can happen if more individual investors take long-term stakes in companies. The recent SEC rule which allows investors to access the proxy statement is nice, but really it's not such a big deal with the notice and access rules which allow investors to spend a relatively small amount of money to mount a proxy contest. Steve Nieman and Richard Foley have run proxy contests against Alaska Airlines in the past few years with only a few hundred dollars, and his votepal website offers some guidance on how to do it. He hasn't won, but that's probably more because he runs a slate of director composed of himself and his friends and family. Plus he seems to want to turn the company into a cooperative. I've been thinking about running a proxy contest, but generally I don't hold onto companies where there's reason to be highly dissatisfied.

Back pain troubles, chiropractic, and the multifidus

I've had back pain for just about as long as I can remember, but it is usually mild and somewhat intermittent. Lately it's gotten worse. I know basically why I have back pain: I sit a lot - but at the same time, lots of people sit a lot without as much back pain. I also have bad posture.

The last time I had back pain this bad was a couple years ago, after driving straight for a couple days. I went to a chiropractor and he gave me a quick adjustment for cheap. He first applied heat, and then solidly cracked my bank (spinal manipulation) manually. I felt way better. I don't generally have faith in chiropractic, but I figured I should try it again. This time, the (new) chiropractor first made me go through a whole diagnosis session with an "Insight Subluxation Station", X-rays, and a lot of stretch "testing". Then chiropractor then gave me an adjustment with an "activator gun" which gave relatively little relief. The subluxation station apparently showed my back as registering all sorts of out of whack and out of balance electrical signals, and the X-rays showed evidence of compression in the past (big surprise) but not much else. I would have preferred to look at an MRI scan to see if I have any herniated discs, out of curiosity, but the x-ray is interesting too.


The subluxation station is essentially a surface electromyograph (see THE SCIENCE & VALIDITY BEHIND THE INSIGHT MILLENNIUM SUBLUXATION STATION). I'll try to scan the results and post them later. I'm a bit skeptical, but I'm willing to see how it goes. It does not surprise me that it showed messed up results. I was able to feel my muscles and legs twitching with spasms when I had the really bad pain. I'm guessing that's not uncommon when you have back pain as bad as mine. But now the twitching has basically disappeared and it seems likely that the readings would be a fair bit better - acute back pain is often transient and self-limited, like most infections. The chiropractor seems to want to test me again after doing a dozen or so more adustments, and I imagine the reading will be much better - unsurprisingly. He's also saying that he wants to keep going until my legs are equal length, which is something the activator gun wiki article (linked above) discusses as somewhat dubious. The chiropractor is now expecting me to be a long-term customer, which I'm not really interested in - but I'll play it out for a bit longer (cheap with insurance). In the picture below, the right is me and the left is a healthy control (balanced).



One of the reasons that I will no doubt feel much better is that I'm doing a lot of research and paying careful attention to posture. I've been aware of the Alexander technique, which had a very positive clinical trial published in the BMJ not too long ago. The easiest takeaway from that is to lay down on your back and lift your knees, which is a very relaxing and pain-relieving way to spend some time. I've also been reading through Dr. Jolie Bookspan's articles, and have been particularly intrigued by her article on hyperlordosis as a cause of lower back pain. My back pain is mainly from sitting (the article identifies hyperlordosis as related to standing) but I feel that my back is caused by hyperlordosis. I've tried to implement posture advice and it may have been partly counterproductive - I've been trying to arch my back too much, and every time I do it I can feel the pain and stress it causes. Ironically, in reviewing my x-ray results the chiropractor said I had too little curve and arch, which I think is completely wrong.



Bookspan's research led me to research which has identified more fatiguable trunk muscles in those with lower back pai (see, e.g., Chok et al 1999). Daneels et al (2000) found that only the multifidus was smaller in those with chronic low back pain, and in 2002 Daneels et al found that those with chronic low back pain weren't activating their multifidus. The Musculoskeletal Consumer Review suggests feeling for the multifidus and then exercising it mentally to help activate it, but I can't seem to do that. Suggestions at the SlowTwitch forum include the "pointer dog" exercise, which I imagine looks like the following. There's also the The Multifidus Back Pain Solution: Simple Exercises That Target the Muscles That Count book, which I'll probably buy. The "activation" problem is mentioned by one of the reviewers. The reviewer recommends Spinal Stabilization instead, but interestingly enough the first reviewer of that book similarly complains that there's no real discussion on how to activate these muscles or know if they are activating properly. This article describes how to activate these muscles, and apparently the practice also does real-time ultrasound imaging (RTUS) tests to confirm the activation (unfortunately not in my area). It's so mysterious that I don't know whether I'm activating them or not, and thus I can't blame a couple physical therapists at a forum for ranting a bit about the newest "fad" (although they still annoy me). UPDATE: This is called the motor control exercise in the literature, and a systematic review was published not long ago.

Audience measurement, Nielsen's validity, and surveying

A couple weeks ago I got in a debate with someone on the internet about Nielsen ratings. He said something to the effect of: "of course these are basically accurate; after all, the advertisers and networks rely on these for billions of dollars of expenses". I responded that comparable amounts of money were involved in the mortgage crisis - and he responded that that was "entirely different" and "involved collusion". I thought this was naive, but it sparked my interest in the topic.

I set about to learn more about ratings. According to Nielsen's website, it measures 40% of the world's TV viewing, and in the United States it has 25,000 meters. I didn't really understand what that means and tired of Nielsen's website quickly, so I went to my next source: Google Scholar. There I found an interesting, but rather lengthy Master's dissertation by Seles (Audience Research for Fun and Profit: Rediscovering the Value of Television Audiences). Seles referred me to the book Ratings Analysis, but I hadn't finished the first chapter before I wandered to the Wikipedia page - where I should have started, and which covers the gritty process details decently - and read this passage (referenced to a USA Today article):

The number of U.S. television households as of 2009 is 114,500,000.^[12] As a result, the total number of Nielsen homes only amounts to 0.02183% of the total American television households, meaning that 99.97817% of American households have no input at all into what is actually being watched. Compounding matters is the fact that of the sample data that is collected, advertisers will not pay for time shifted (recorded for replay at a different time) programs.

Further, these sampled households self-select into this group. These are people who apparently care less on average about privacy. I'm not sure if they are being paid, if they are that would suggest they are also lower income. Seles points out that digital set-top boxes allow for an enormous amount of datamining which is much more valid than Nielsen ratings, but a confluence of factors have not led to these being fully exploited. As an odd sidenote, this 2004 Wired article reports that at that time, Nielsen was using diaries from samples of 500 to assess viewing. Diaries from 500 people, in the 21st century! It's worth noting that television networks should not be necessarily bothered by inaccurate data so long as the data overall does not underestimate viewers; it's only the advertisers that are screwed.

I've commonly heard people say that television advertising is more expensive than online advertising, but a 2009 eMarketer report abstract puts tv advertising at 13 cents/hour and online advertising at 17/cents hour. This suggests that advertisers are willing to pay up for the relatively rich and interactive data (e.g., click throughs and purchases). It's a topic which I need to become familiar with as I look into the media sector for investments, but like all these sectors it's mysterious at first. I've been looking at television networks (content owners) as a value alternative to the relatively "hot" area of Netflix, although I haven't gotten deep into it as of yet.

In my investigation into this topic, I ran across Reg Baker's The Survey Geek blog. This is an apparently honest, critical look into the survey industry which lays out the issues which I've suspected lie in the area: telephones increasingly difficult to access, surveytakers unresponsive, self-selection bias, etc. I'm still not clear on how the political surveys are accessing cellphone only users like myself. UPDATE: as I finish a survey on 9 Nov 2012, I have to say I didn't expect the surveys to be so terrible or tedious. There's really a lot of self-selection bias. I got $30, but not for sending it in (at least it's not biased towards poor people). Clearly this is only targeting really old-school cable; apparently the intelligent set-top boxes still haven't rolled out. Since I didn't have cable, I plugged my Hulu Plus shows but probably for no reason.