Warren Buffett is the world’s most successful investor. In a letter he wrote to his wife, advising her how to invest after he dies, he offers some clear advice: put almost everything into “a very low-cost S&P 500 index fund”. Index funds passively track the market as a whole by buying a little of everything, rather than trying to beat the market with clever stock picks – the kind of clever stock picks that Warren Buffett himself has been making for more than half a century. Index funds now seem completely natural. But as recently as 1976 they didn’t exist. And, as Tim Harford explains, they have become very important indeed – and not only to Mrs Buffett.
Nicholas Murray Butler was one of the great thinkers of his age: philosopher; Nobel Peace Prize-winner; president of Columbia University. When in 1911 Butler was asked to name the most important innovation of the industrial era, his answer was somewhat surprising. “The greatest single discovery of modern times,” he said, “is the limited liability corporation”. Tim Harford explains why Nicholas Murray Butler might well have been right.
How the high-tech ‘death ray’ led to the invention of radar. The story begins in the 1930s, when British Air Ministry officials were worried about falling behind Nazi Germany in the technological arms race. They correctly predicted that the next war would be dominated by air power. To address the problem, Britain launched a number of projects in hopes of mitigating the threat — including a prize for developing a high-tech ‘death ray’ that could zap a sheep at a hundred paces. But even though the project failed to develop such a weapon, it did result in something potentially far more useful that was able to detect planes and submarines – radar. And it was an invention that was crucial in the development of the commercial aviation industry.
It wasn’t an accident. Mike tells Sarah how the infamous space shuttle disaster came to be seen as a white-collar crime. Digressions include the Donner Party, George Lucas and “Jurassic Park.” Both co-hosts are audibly recovering from colds.
The Myspace music purge. The Google+ shutdown. As you store your life’s archive online, what happens when it’s taken away?
This week on CYBER, we talk to the people who concocted a bold sting operation to unmask an undercover agent.
Douglas Preston on the young paleontologist who may have discovered a record of the most significant event in the history of life on Earth.
Being a great decision maker is uniquely challenging for women. It’s not us; it’s sexism. Stereotypes about the way we make calls can be insulting and distracting. Knowing that we’ll be judged more harshly than men when we make mistakes is discouraging. We talk about how to make informed decisions that stick, despite gender bias. Guest: Therese Huston.
Aleks Krotoski and Jemima Kiss report from the SXSWi festival in Austin, Texas
A Series of Information Explosions
As usual, microbes led the way.
Bacteria have swarmed in intense networks for 3.5 billion years.
Then a hierarchical form emerged with the first nucleated cells that were made up of an enclosed society of formerly independent organisms.
That’s the pattern for the evolution of information, Alex Wright said.
Networks coalesce into hierarchies, which then form a new level of networks, which coalesce again, and so on.
Thus an unending series of information explosions is finessed.
In humans, classification schemes emerged everywhere, defining how things are connected in larger contexts.
Researchers into “folk taxonomies” have found that all cultures universally describe things they care about in hierarchical layers, and those hierarchies are usually five layers deep.
Family tree hierarchies were accorded to the gods, who were human-like personalities but also represented various natural forces.
Starting 30,000 years ago the “ice age information explosion” brought the transition to collaborative big game hunting, cave paintings, and elaborate decorative jewelry that carried status information.
It was the beginning of information’s “release from social proximity.”
5,000 years ago in Sumer, accountants began the process toward writing, beginning with numbers, then labels and lists, which enabled bureaucracy.
Scribes were just below kings in prestige.
Finally came written narratives such as Gilgamesh.
The move from oral culture to literate culture is profound.
Oral is additive, aggregative, participatory, and situational, where literate is subordinate, analytic, objective, and abstract.
(One phenomenon of current Net culture is re-emergence of oral forms in email, twittering, YouTube, etc.)
Wright honored the sequence of information-ordering visionaries who brought us to our present state.
In 1883 Charles Cutter devised a classification scheme that led in part to the Library of Congress system and devised an apparatus of keyboard and wires that would fetch the desired book.
H.G. Wells proposed a “world brain” of data and imagined that it would one day wake up.
Teilhard de Chardin anticipated an “etherization of human consciousness” into a global noosphere.
The greatest unknown revolutionary was the Belgian Paul Otlet.
In 1895 he set about freeing the information in books from their bindings.
He built a universal decimal classification and then figured out how that organized data could be explored, via “links” and a “web.”
In 1910 Otlet created a “radiated library” called the Mundameum in Brussels that managed search queries in a massive way until the Nazis destroyed the service.
Alex Wright showed an astonishing video of how Otlet’s distributed telephone-plus-screen system worked.
Wright concluded with the contributions of Vannevar Bush (”associative trails” in his Memex system), Eugene Garfield’s Science Citation Index, the predecessor of page ranking.
Doug Engelbart’s working hypertext system in the “mother of all demos.”
And Ted Nelson who helped inspire Engelbart and Berners-Lee and who Wright considers “directly responsible for the generation of the World Wide Web.”