Adding complexity to avoid the truth

Seth Grodin provides a nice comment on the sophistication of truth and the fact we hide behind complexity in an effort to avoid our fears of failure. How my times have we heard ourselves or others hide behind a wall of complexity.

The sophistication of truth, a common form of complexity is the sophistication of fear.

Long words when short ones will do. Fancy clothes to keep the riffraff out and to give us a costume to hide behind. Most of all, the sneer of, "you don't understand" or, "you don't know the people I know..."

"It's complicated," we say, even when it isn't.

We invent these facades because they provide safety. Safety from the unknown, from being questioned, from being called out as a fraud. These facades lead to bad writing, lousy communication and a refuge from the things we fear.

I'm more interested in the sophistication required to deliver the truth.

Simplicity.

Awareness.

Beauty.

These take fearlessness. This is, "here it is, I made this, I know you can understand it, does it work for you?"

Our work doesn't have to be obtuse to be important or brave.

Risk and chance quotes

Fortune brings in some boats that are not steer'd 
-Shakespeare from Cymberline 

Never underestimate luck. It happens. You just have to be ready to be lucky. That is why you need the prepared mind.

Chance favors only the prepared mind. 
- Louis Pasteur

The basis for many a investment mistakes is having false beliefs.

I wouldn't have seen it if I hadn't believed it.
-Marshall McLuhan 

Always love this quote when quants want to get too precise. Do not miss the forest for the trees.

I'd rather be vaguely right than precisely wrong.
 - John Maynard Keynes 

Get the odds in your favor. It is not about betting. It is about betting when you have an edge and you got to make your edge.

Who cares if you pick a black ball or a white ball out of the bag? ... don't leave it to chance. Look in the damn bag and pick the color you want.
- Hard eight by Janet Evanovich 

The Culture Map - good for understanding international investors

Finished reading The Culture Map - Breaking through the invisible boundaries of global business by Erin Meyer. This is an important book for any one who works with other groups around the world or markets to international investors. Culture matters. Different countries thinking and act different or more precisely they differ on a spectrum of behavior that can be measured. If you do not understand this cultural spectrum, there will a high degree of misunderstanding and no chance of finding common ground.

The insightful author breaks down cultural differences based on eight scales.

• Communicating - Does the culture speak in high or low content, that is, is there significant unsaid meaning in a conversation as is the case in high content?
• Evaluating -  Is negative feedback direct or indirect?
• Persuading - Is form based on providing the formal principals employed or are the conclusions or applications presented first?
• Leading -  Is it command and control or more democratic?
• Deciding - Are decisions made by the boss or through building a consensus?
• Trusting - Is trust based on relationships or through the effective completion of tasks?
• Disagreeing - Does the culture or accept confrontation?
• Scheduling - Are schedules flexible or very strict?

The table below provides some differences in culture. It is a handy guide of what you may be dealing with when you market or work with others. It can also explain why you are not being understood by others around the world.

This was an eye-opening book that breezed through quickly because of good prose and useful story-telling. If you are a global businessman, you should read this book.

"Considerable Time" and Yellen

"Considerable time" is the buzzwords from Fed Chairman Yellen, but putting some distance from the last Fed Meeting announcements makes me more uneasy about what these words mean. It really tells investors nothing other than there is a slow recovery and there is no reason to tighten policy through raising rates. 

The discussion always has to come back to a review of rules versus discretion and which creates more uncertainty. The Fed wants to have management flexibility but in so doing that there will always be more uncertainty. If you have rules but break them in the future, there is a loss of creditability. If you have discretion that is unclear there is less loss of creditability. The Fed can argue that it provided what they thought was useful information.

It is unclear the current level of creditability with the Fed. Inflation expectations are stable and grounded around 2%, but it is not  clear whether this is because of or in spite of the Fed. Fed clarity is still in short supply.