They call it The Living Yield Curve. It does a nice job of showing how the yield curve has changed over time. It also allows for overlays of typical yield curve shapes, and the average and latest yield curve for comparison.

I’ve selected the most recent inverted yield curve, which is commonly believed to indicate a coming recession, which occurred in February 2007.

~alex

Why these exchanges? From the article:

It will help film producers manage the risk that a film is not produced on schedule or is not produced at all; the risk that the production of the film exceeds its budget; and “release schedule risk”, or the risk that a film is not released on time and is late to market.

And, ahem, it will allow speculators to gamble on a movie’s success, or lack thereof.

Betting on Our Family Wedding at the HSX, currently play money only.

~alex

Swaps, for those of you with weak memories (like moi) are those things which brought AIG low and had a not small role in our recent recession. They’re also the very things which appear to be pestering Greece and consequently worries the Germans and the French.

From the FT:

“The only parties that benefit from a lack of transparency are Wall Street dealers,” Mr Gensler [CFTC chairman] told a New York derivatives conference. “Right now we have a dealer-dominated world, and that nearly drove us off a cliff.”

Transparency is generally considered a good thing for markets, so why would there be any resistance to it?

Two possible reasons come to mind:

1. Banks make money in creating swap contracts and bringing together buyers and sellers of these contracts. Placing them on exchanges means that the contracts would be standardized (bad for people who want a swap contract tailored for their needs), and, more importantly, the banks would lose business to the exchanges where these contracts would be traded.

2. Hedge funds like to keep their trades secret. Trading on exchanges makes this harder than trading OTC. And the banks have hedge funds as clients, so, naturally, they want to make their customers happy.

But, as much as the financial services industry is jealous of their profits, they’re up against some governments who are, you might say, relatively pissed off. After all, bailing out financial services industry with $700bn does tend to focus the mind. (And: AIG for $180bn; Germany’s bailout was at something like $400bn; and bailing out Greece will cost something like $27bn.)

This is not the last we’ll hear of this.

~alex

Percent change in RCL stock price and number of times Google search users searched on travel related terms, 2006 to present

On their own, without mapping to a stock, some of the trends are interesting, if perhaps expected. For example, searches regarding unemployment have dramatically increased over the past two years.

Change in number of times Google search users searched on unemployment related terms, 2004 to present

While exploring search terms in a conceptual manner makes tons of sense, and can actually say something interesting (even if it conforms what we already knew, like people’s interest in real estate falls off in the late fall and winter, and picks up in the spring) …

Change in number of times Google search users searched on real estate related terms, 2004 to present

… it’s a bit of a stretch to compare these to the stock price of a specific company. For example, TDAmeritrade’s stock price does not appear to correlate with the number of times people search on investing related search terms.

Percent change in AMTD (TDAmeritrade) stock price and number of times Google search users searched on investing related terms, 2006 to present

This holds true with multiple concept vs. multiple stocks (although I won’t claim to have made a scientific study out of this).

While Google is perfectly within their rights to explore how their different tools and data can work together, this mashup seems a bit pointless. While in theory search mindshare might ultimately be reflected in a specific company’s stock price, it’s a bit of a stretch to find a correlation between the two, much less an underlying factor causing the two to consistently move in tandem.

But, one might argue, what about mapping these trending concepts to economic indicators? For example, mapping unemployment searches to the actual unemployment rate. This doesn’t seem possible in the current interface, but if we download the data to excel and compare it to the unemployment rate produced by the Bureau of Labor Statistics, we can see the trends map closely, with the Google unemployment search trends exhibiting more volatility than the BLS rate.

Percent change in unemployment rate (from the Bureau of Labor Statistics) and the number of times Google search users searched on unemployment related terms, 2005 to present. click for larger size

So, overall, a useful tool? Undoubtedly, and seemingly appropriate at a macro level.

Comparing to stock prices? Mmm. Not so much.

~alex

As Dr. Pennock describes on his blog post introducing Predicalot:

Predictalot is a true combinatorial prediction market of the sort academics like us and Robin Hanson have been dreaming about since early in the decade. …

… In the tournament, after the play-in game, the 64 top college basketball teams play 63 games in a single elimination tournament. So there are 2 the the power 63 or 9.2 quintillion total possible outcomes, or ways the entire tournament can unfold. Predictalot implicitly keeps track of the odds for them all. To put this in perspective, it’s estimated that there are about 10 quintillion individual insects on Earth. Of course, for all practical purposes, we can’t store 9.2 quintillion numbers, even with today’s computers. Instead, we compute the odds for any outcome on the fly by scanning through the predictions placed so far.

The downer is that there are a limited number to the types of prediction one can make at the moment. For example, right now one can’t make a prediction about who will win the tournament. Prediction types so far seem limited to what seed, or range of seeds, will win the maddness, as well as number of upsets, but if you want to pick Syracuse to win it all, tough luck. However, the good doctor assures us these prediction types will be active soon.

Regardless, congrats to David and Yahoo for finally following up on TechBuzz. I think they were just waiting for an innovative idea to really take hold of them (and perhaps the resources to actually build it ;-)

~alex

It tracks four types of economic indicators and plots them as a time series. Play the animation and you can see how the economic indicators move through the four stages of the economic cycle: Expansion, Slowdown, Downturn, and Recovery.

But if you really want a great explanation of it, check out this information graphic from the NYTimes which takes the reader step by step through how the OECD’s information graphic is assembled, and then “plays” past recessions, and the recession of 2007-2009.

~alex

Having never used Tableau before, but hearing that it’s quite powerful, I decided to check it out. Here are the results, a simple scatter plot of US wheat production (million of acres per year) by price.

Price of wheat for millions of acres produced per year in the US
(full chart here, it seems to have been chopped off below)

My first thoughts are “what a difficult program to work with!” It takes a lot of wrangling to get the data to display the way you want it to. There is a training video, but it is relatively worthless, and just getting in there and playing around is probably the only way to really learn the program. So, in terms of ease of use, not so good.

The charts, though, are not too bad. And they’re interactive. I’m sure with a lot more time I could improve the look quite a bit, but what you get by default is definitely serviceable. There are no heavy grid lines, and in general the charts have a clean look to them.

The Tableau service comes in two pieces. The application, which one downloads and runs off the desktop (PC only), and an online component where data is stored and where one can share the charts they’ve created. The nice thing about this arrangement is that you get a lot more features than many of the online visualization apps, but you get the sharing features which actually make these programs worthwhile to use.

So, despite the fact that you hurt yourself just figuring out how to do some simple things (like pulling actual data rather than SUMs, COUNTS, etc.) I am cautiously optimistic that this could be a good tool.

~alex

Our first response is: whatever happened to Project San Dimas, eBay’s earlier attempt to clean up the user interface? Or, for that matter, the eBay Playground? To be fair, both the Playground and the Garden point to a beta site. But Project San Dimas, we hardly knew you. Who pulled your plug?

Regardless, eBay seems strangely convulsive when it comes to their UI. No one can ever accuse them of not trying lots of different things. But perhaps this time is different. From the article (emphasis mine):

The first change to be crowdsourced this way is a set of new tools to search eBay’s Web site. EBay has about 200 million items for sale at any given time, and sifting through that list can be burdensome.

Instead of rolling out the search features to all users, eBay will put them in a new place on the site called Garden by eBay. People can choose to use the new tools, rate them and send critiques to the product team, which will continually tweak them. Some will fail and others will be incorporated into the main site.

“It’s imperative that we have a deeper conversation with customers and buyers,” said Christopher Payne, vice president of search. “It’s fair to say it’s a cultural change at eBay.”

Hunh? Haven’t they been talking to their users already? I do know that they employ UX designers and researchers. But perhaps more than anything this shows that it’s a company’s culture that helps translate the work of UX designers and researchers into an actual improved, 100% Grade A user interface. A company has to want to listen to their users and the people who know how to interpret their needs, behaviors, etc.

All of this is rather ironic, in a way, since, according to Forrester, many eBay customers seem quite happy with their eBay experience. What to make of that?

The “old” eBay search interface …

… versus eBay’s new search interface. Let the feedback begin.

~alex

Setting aside my cynical side (hard, very hard) which says that this is nothing but a ploy to get companies to sign up for UX evaluations from Forrester, there is something rather interesting here. Assuming that the use of the term index is meant to indicate that this index could be comparative to other market indexes, like the S&P500, would it be feasible to construct an index of companies that create superior user experiences for their products and services, and track them in comparison to the market?

Such an index might look something like this, where I’ve taken ten of the top rated companies from the index (which strangely, or perhaps not, doesn’t include Apple — Apple shows up in the 35th spot) and compared them against the S&P500 over the past year … admittedly, not a normal market. The results are:

One year price comparison of 10 top companies in the CE Index (equally weighted) vs. the S&P 500

The detailed data is:

This brief, somewhat haphazard, analysis seems to suggest that there could be some market value in UX, however many questions remain:

• While it seems intuitive, and perhaps proven, that UX should boost revenue, how do we know that superior user experience is indeed causing a rise in the company’s stock price?
• If so, what piece of the UX strategy generated the revenue? Is it temporary, or permanent?
• How much more revenue does the experience generate? Was it worth it?
• Can the company continue to innovate on that experience? Can that possibly be baked into the stock price?
• Does the customer experience differentiate their company in their industry? Does it matter? (As an example, one could say that booksellers tend to provide highly satisfactory customer experiences, whereas health insurance companies tend not to, therefore, a health insurance company who managed to provide a good user experience should be more highly valued than a bookstore that can).

In addition, the results displayed above could purely be happening by chance (although we sincerely hope not). They also only cover one year of time. Hardly enough to say anything conclusive.

NB Jon Picoult also did a similar analysis — Yes, Virginia, There Is A Return On Customer Experience Investments — and his results align with mine, which is to say: interesting results, but hardly scientific.

~alex

Also of interest, for those can get themselves to care about this most mundane (yet somehow fascinating) of topics, is the market at InTrade for future tax rates. Perhaps the most interesting finding here is that the prediction for Highest Marginal Single-Filer Fed Income Tax Rate to be greater than 38% dramatically rises from 2010 to 2011. This is the expiration of the Bush tax cuts, and the traders’ beliefs that these cuts will not be extended at their current levels.

Mint, on the other hand, provides this rather fascinating infographic about where the money comes from to fund our federal government. This breaks down the share of the tax burden by income level.

~alex