Letters Remain

Category: finance

  • Financial Consequences of Winning the Lottery

    For individuals and families facing financial ruin one would assume that a lottery win would be a perfect, if lucky, way out of hardship. Contrary to this, however, an analysis of a small, unique set of people—Floridian lottery winners linked to bankruptcy records—finds that lottery winners are more likely to claim bankruptcy than others who were…

  • Psychology of Money

    New Scientist provides a comprehensive summary of studies looking at the psychology of money. There are some fascinating findings here, including a study showing that “simply thinking about words associated with money seems to makes us more self-reliant and less inclined to help others [and] just handling cash can take the sting out of social…

  • The Truth About Markets

    My current read, The Truth About Markets/Culture and Prosperity (UK/US title respectively), is a thoroughly enjoyable—if occasionally dense and dry—introduction to economic theories and applications. Published in 2003, it’s aged fairly well. I felt the need to share this two-paragraph excerpt from a section discussing “large models purportedly descriptive of entire economic systems” (pp. 193-194): The…

  • Economics Lectures

    I was introduced to Stephen Kinsella—Junior Lecturer in Economics at Kemmy Business School, University of Limerick—through his beautiful looking economics presentations available on SlideShare. Of course, the problem with (the majority of) beautiful presentations is that they lack context and thus, without a voiceover, end up being a confusing set of beautiful pictures with scant text. Not…

  • The Zone of Essential Risk

    ‘The zone of essential risk’ is a term coined by Bob Blakely to describe the problem with rare, medium-sized transactions: If you conduct infrequent transactions which are also small, you’ll never lose much money and it’s not worth it to try to protect yourself – you’ll sometimes get scammed, but you’ll have no trouble affording…

  • Creative Capitalism

    ‘Creative capitalism‘ is a term popularised by Bill Gates at the World Economic Forum in Davos, 2008. Here Gates delivered a speech saying that many of the world’s problems are “too big for philanthropy” and that the free-market capitalist system itself would have to solve them. Creative Capitalism: A Conversation has a transcript of Gates’ speech but it…

  • Grade Inflation

    With news that Cambridge University is to demand A* grades at A-Level as a prerequisite for entry (a grade that currently doesn’t exist), there is much in the news about ‘grade inflation’. However “grade inflation” is actually the answer; the problem is “grade distortion”: True grade inflation would mean each grade was equally devalued, with…

  • 13 + 17 Tips for Startups

    Two articles of fundamental startup tips, from two people who know what they’re talking about: Startups in 13 Sentences, by Paul Graham of Y Combinator. Of the 13 sentences, which one does Paul believe is the most important? Understand your users. That’s the key. The essential task in a startup is to create wealth; the…

  • Physiognomy and Looking Creditworthy

    Using data from the person-to-person lending company Propser.com, research is starting to show that—when it comes to analysing creditworthyness—the once discredited science of physiognomy may be valid. In other words, people may be able to tell if we are actually trustworthy just from looking at our facial features. Science proceeds by trial and error. The successes…

  • Business Models for Web Apps

    Looking at the business models of the top 100 web apps of 2008, Dan Zambonini of Box UK found that 34% use Advertising, 12% a Variable Subscription model, and a further 8% each for Virtual Products, Related Products and Pay-Per-Use. Continuing this analysis he compiles an extensive list of different methods to monetize web apps. via @zambonini