Affinage/You Only Go Through Life Once

The October 5th edition of the New York Times contained an article, "Cheese: A Coming-of-Age Story" about affinage,

"the careful practice of ripening cheese... a series of tedious, ritualized procedures (washing, flipping, brushing, patting, spritzing) that are meant to inch each wheel and wedge toward an apex of delectability."

Uh-oh.  As someone who only draws the line at eating cheese from a spray can, "ritualized procedures" fired its sh*t detectors.  Biodynamics, phases of the moon, unnatural acts with common objects.  Still I buy into it.  Paying attention to what's happening is more likely than not to produce a better cheese.  (Of course to my uncle Hal, "good cheese" was an oxymoron.)

The Times taste sampling of 3 cheeses supported the idea that attention to the cheese resulted in a better cheese.

Living close to the bone it's unlikely that I'll ever taste an artisanal cheese.  Chalk it up to parochial tastes, inherent cheapness, pedestrian aspirations, something.

Oh, wait.  It's could be like the time my brother brought a special meatloaf over for us to sample.  I could tell it was special because there were two different textures of meat separated by pistachio nuts and the slice had a crust around it.   Nice meatloaf I said.  When my brother was able to stop laughing he identified it as a hideously expensive pâté.  (I can't recall the exact figure, but as I remember it, a pound of that pâté costs as much as a ticket to a first-run Broadway show.) Tasted OK though.

Going through life once?  Oh that.  I had a recent conversation with an aunt, the wife of the uncle who wouldn't eat cheese, who said we only have one shot at life.  Why not enjoy it?  Why suffer?  In the specific, she was referring to fixing up her house and eating good food.  My mind translated this to dying as my money runs out: having a fatal attack with the last morsel of that hideously expensive pâté. 

That would be OK in my own home, but not in a restaurant.  Keeling over in a restaurant would stick my estate with the bill and inconvenience the establishment. Not a socially responsible way to go.

Hanlon's Razor and How Law School Students Lose the Grants Game

Hanlon's razor: Never attribute to malice that which is adequately explained by stupidity.

On the other hand, an article by David Segal in the Sunday Business section of the NY Times from May 1 of this year, "Behind the Curve, How Law Student Lose the Grant Game and How Their Schools Win" indicated that law schools could be using grants to:

1. Boosting the school's ratings based of the quality of their entering classes 
2. Recovering revenue when the grant students' grades fall below a specified GPA.

The first reason is common among all schools of higher education, offering scholarships to students to increase their ranking and making the school more appealing to future students.  However, with law schools grading on a curve it becomes statistically more difficult for a student to achieve the specified GPA.  The difficult in calculating the odds of maintaining the grant is dependent on the median GPA of the school.

Note to presumptive law school grant recipients: learn to calculate standard deviations and learn the practical applications thereof.  The Golden Gate Law School for example requires a 3.0 GPA to maintain the grant.  50% of the class got a grant, but only a third of the students get a grade of 3.0 or better.  Do the math: a sizable portion of the students with grants are expected to lose them.

Once the student loses a grant the student is faced with deciding whether to continue at full fare (a win for the school as the student's undergraduate GPA has already served its purpose) or go to Plan B.

I passed a reference to the story to two profs who teach statistics for a toss off in class.

It is a companion piece to Segal's article about employment after law school, "Is Law School a Losing Game?" That earlier article pointed out quite clearly that the employment statistics published by law schools doesn't provide the details necessary for presumptive students to know how many of those jobs are behind the counter at Starbucks.

 

When Genius Failed

As I was going through some things my father filed away, I came across some pages taken from the New York Times Book Review from September 24, 2000.  My guess is that he was attracted to Floyd Norris's review of"When Genius Failed" by Roger Lowenstein.  Although Floyd Norris, the NY Times' chief financial correspondent, was writing about "The Rise and Fall of Long-Term Capital Management" (the subtitle), his comments jump out as prescient:

It is far too early to know what the long-term lessons of the Long-Term saga will be. But it is clear that Wall Street has not learned much. Banks and hedge funds still use complicated derivatives to gain tremendous leverage, just as Long-Term did in placing its ill-fated bets in the stock market. ...

''Greenspan's more serious and longer-running error has been to consistently shrug off the need for regulation and better disclosure with regard to derivative products. Deluded as to the banks' ability to police themselves before the crisis, Greenspan called for a less burdensome regulatory regime barely six months after it.'' He complains that Greenspan has supported the banks in efforts to avoid making meaningful disclosures about their investments in derivatives.

It takes time, but seven years later we had Lehman Brothers, AIG, and the whole sub-prime mess making the scary Long-Term Capital Management fiasco pale by comparison.  As Norris said, there are limits to what academics can do for investors.

I was reminded of an academic discussing his analysis of eastern European's rocky transition from Communism to a market-driven economy.  His results indicated that a quick, painful dislocation produced the best results.  When asked if that is what he would recommend to national leaders, the professor, said that was what the data indicated, but, he was quick to add, he was not an official who would face the wrath of the populace whose life's savings and retirement benefits evaporated.