Thomas Scoville

Hello, are you human?

At a Silicon Valley cocktail party, it's hard to find anybody who passes the Turing Test.

Sentience is a slippery concept. Since there’s little agreement on the fundamentals and mechanics of consciousness, the question “Can computers think?” invariably descends into circular and fruitless debate. How can we decide if a computer can think until we decide what thinking is in the first place?

The late, great Alan Turing — generally considered a giant of computing theory and artificial intelligence — neatly sidestepped this theoretical gridlock by proposing his own functional definition: A computer that responds with enough subtlety and complexity to convince users that it’s human is said to pass the Turing Test, and thus meets the standard for true machine intelligence.

Turing Tests are commonly staged as chat-style conversations, since natural language — with all the subtleties of syntax, semantics and wordplay — is widely intuited as an unmistakable earmark of real intelligence. There have been many attempts by artificial intelligence researchers to create language generators that pass the Turing Test. One example is the Eliza program — a popular, decades-old conversation module written to mimic a psychotherapist. A recent exchange between me and Eliza went like this:

Me: Hi, Eliza.
Eliza: How do you do? What brings you to see me?
Me: Not much. How are you today?
Eliza: Does it bother you that are me today?
Me: Uh, excuse me?
Eliza: Why do you say uh excuse you?
Me: You’re not really trying very hard, are you?
Eliza: Earlier you said are me today?
Me: Are you trying to tell me I’m crazy or something?
Eliza: Maybe your plans have something to do with this.
Me: Is this visit covered by my HMO?

Eliza quickly betrays herself with the wooden and brittle conversational style of the machine. Clearly she was just parsing my words (in this case, badly) and reflexively shoveling them back, lightly repackaged as questions — a cheap ruse on the part of the designer to make her appear interested or contemplative. When my statements exceeded a threshold of complexity, Eliza changed the subject — bad couch-side manner, to be sure, and enough to make me consider therapeutic alternatives like Prozac or electroconvulsive shock. At any rate, Eliza roundly flunks the Turing Test; she is transparently digital and less than scintillating company to boot.

On the other hand, a recent exchange in an AOL chat room was sufficient to convince me that my interlocutor was all too human:

Me: How are you today?
BiteMe100Times: What’s it to you? Unless you’re my mother or my shrink, you can fuck off.
Me: Just trying to be friendly.
BiteMe100Times: Yeah, but I want a commitment.
Me: Actually, I’m writing a magazine piece on the Turing Test. I’m trying to figure out if you’re human. You could be a machine, you know.
BiteMe100Times: Oh, sure I’m human. Two plus two is four. Four times four is 16. Four to the 16th power is [core dumped]
Me: Very clever.
BiteMe100Times: What the hell do you expect? I’m running Windows NT. Now go away.

My chat room partner, unlike Eliza, strongly displayed many of the key features of carbon-based consciousness: sarcasm, irony, misdirected hostility, frustration with Microsoft. Definitely a real person. I took comfort in the proposition that my humanity was secure; differentiating a person from a machine was trivial, even in an Internet chat room.

This confidence was short-lived. Sometime afterward, I attended a cocktail reception thrown by a group of implausibly self-actualized, 20ish Silicon Valley Internet entrepreneurs. But they were real people, I was pretty sure. At least they looked human. Certainly they swilled martinis and slurred their speech and bounced off the walls in that distinctly homo erectus kind of way.

But, as I was beginning to get a little bored by all the hobnobbing and elbow pressing, my mind drifted back to the Turing Test. I decided to play a little game with myself (I am, if nothing else, easily amused) by inverting it: What if I ignored my co-imbibers’ hardware — their bodies — and abstracted our conversations into pure text, like Eliza? How would they stand up to the Turing Test? I began to project a stream of luminous, disembodied text onto the inside of my forehead. (The tequila helped a lot here, believe me.)

The results were more than a little unsettling. Excerpted from forehead:

Me: Hi there.
Martini25: What’s your name?
Me: Tom. Great party. What are you drinking?
Martini25: B-to-G.
Me: I’ve never had one of those. Is it a vodka drink?
Martini25: Our company’s moving out of a distributed, hierarchical B-to-B architecture and into a peer-to-peer, B-to-G back-end strategy that’s going to ignite our share price and send it back into orbit.
Me: Um, can we back up here? I got lost at B-to-something …
Martini25: Do you have a card?
Me: I left them in the car. In my briefcase.
Martini25: You left them in the car? You should check out our Web site. It’s at www.BtoGeewhiz.com. What’s your name?

To be fair, it was a really noisy party. But I was pretty spooked; Martini25 seemed to be a dot-com upgrade of Eliza: stock phrases, recycled language, trouble switching contexts, an eerie inability to connect with my side of the conversation — a finite-state machine in jeans and a black turtleneck, clutching a cocktail and spouting URLs. Disoriented, I stumbled toward an attractive brunet, hoping for a less automated exchange.

CalSpritzer: Hi.
Me: Hey there. I’m a little freaked out by this scene. Could you humor me for a minute and do something to reassure me that you’re actually human?
CalSpritzer: Excuse me?
Me: Are you really human?
CalSpritzer: Why are you asking if I’m really human?
Me: Oh, don’t do that! Yowch! Wait — sorry. My fault. Start again. I’m Tom. What’s your name?
CalSpritzer: I’m Penny. Web designer. I consult to content portals to increase their stickiness.
Me: Nice. I like to mooch free drinks from budding Internet moguls.
CalSpritzer: You should check out my site. It’s at www.WebGlue.net. Do you have a card?

I decided to get out of there before I lost it and made a scene. My grip on my own humanity was in need of an increase in stickiness. I decided to consult a therapist.

It didn’t help:

Me: I’m having doubts about my humanity.
Eliza: Why do you say you are having doubts about your humanity?
Me: It was something about a peer-to-peer B-to-G back-end strategy.
Eliza: What makes you believe that?
Me: Well, it’s supposed to ignite shareholder value. That’s good, right?
Eliza: Maybe your plans have something to do with this.
Me: Do you have a card?

Later, I reflected, maybe the problem is that the Turing Test just isn’t so relevant anymore. Perhaps it’s just a charming theoretical anachronism, an artifact of a distant time (Turing did his best work in the 1930s, after all) in which computers themselves were mostly theoretical. In this new millennium of wireless communications and ubiquitous computing, maybe the big challenge isn’t for a computer to simulate a human. Maybe the real challenge is for people to prove they aren’t machines.

Randomized thoughts

Hey Gemini, it's time to stop making sense and let chaos reign.

May-June 2000

Greetings from Planet Chance. Feeling stuck in a deductive
rut? All those logical linkages, causality chains and
first-order predicate calculations have kept you rule-bound
and earthbound for way too long. Take a hint from that wacky
genetic algorithm cabal: Sometimes the most elegant
solutions to complex problems make absolutely no intuitive
sense whatsoever. So this month I’m prescribing a dangerous
dose of randomness to jump-start your bad-ass, nonlinear
alter ego. Start out slowly, say, with dice, roulette or
Brownian motion, then progress to harder stuff like
Amazon.com’s customer service or the political target="new" href="http://www.larouchepub.com/">writings
of Lyndon LaRouche. In no time you’ll be wowing fellow geeks
with your outrageously fresh and chaotic insights.

Gemini (May 21-June 20)
Disrobed! This lunar
cycle finds you feeling particularly vulnerable as hackers
demonstrate that there’s no such thing as security — short
of taking an ax to all your network connections and lining
your walls with lead. Privacy is dead, secrecy is a myth
and the king’s not wearing any clothes — but this time
around, we’re all buck naked as well.

Cancer (June 21-July 22)
You’ve always suspected
that you’re the smartest person in any crowd, but this month
will permanently vanquish any doubts to the contrary. Wear
your mantle lightly lest jealous interlopers set fire to
your smarty-pants. Stay calm, stay logged on and stay put
on the 12th, when Venus puts you under house arrest.

Leo (July 23-Aug 22)
Options, options everywhere,
but not a buck to bank. Your mania for equity compensation
has left you unable to pay the rent on your castle in the
sky. Could it be your optimism is overdrawn, or is it merely
misplaced? Only you can say. But if I were you, I’d be
looking around for something real to grab in the event of a
fall.

Virgo (Aug 23-Sept 22)
Personal multitasking goes
on the fritz. Your miraculous talent for separating the line
between home and work begins to fail as you absent-mindedly
run your laptop through the dishwasher and read bedtime
stories to your children out of Red Herring. Better
debug before you doing anything really disastrous, like
conflating “significant other” with “hostile takeover.”

Libra (Sept 23-Oct 22)
Cognitive polarization to
the max! Angular, absolutist, black-and-white thinking
blinds you to the low-hanging fruit on the tree of
ambiguity. Possibility thrives in the gray area between “is”
and “isn’t.” Remember — there are two kinds of people in
the world: those who think there are two kinds of people in
the world, and those who don’t.

Scorpio (Oct 23-Nov 21)
Though prior experience
suggests the finish line looming ahead is just another cruel
hoax, you really are on the brink of wrapping up your
current project. It’s time to recaffeinate, rally your
remaining brain cells and flail away at the keyboard like
there’s no tomorrow. Inelegant but functional solutions
triumph over inertia.

Sagittarius (Nov 22-Dec 21)
Pluto administers
object lesson on the vagaries of selling out in Net-ville as
the IPO well runs dry. Is that your company you’re putting
on the block, or your head? Your latest gambit to
flip-and-flee turns ugly as last-minute disclosures find you
huddling in a server room to escape the public eye.

Capricorn (Dec 22-Jan 19)
Remember when you were
a kid, and all the adults were spouting futuristic bosh
about personal hovercraft, domestic robots and
college-in-a-pill? You redeem your grown-up disappointment
with your own historical perspective as you realize those
expensive high-tech prognosticators are standing knee-deep
in the murky lagoon between pulp science fiction and
stand-up comedy. They’re clowns, so don’t be timid about
tweaking their big red noses.

Aquarius (Jan 20-Feb 18)
Unexpected confluence
of planetary anomalies causes an astrological core-dump. You
cold-boot your already dodgy karma when you realize your
cosmic peripherals have all become completely unresponsive.
Contact astral systems administrators for
up-to-the-nanosecond revision of your metaphysical source
code.

Pisces (Feb 19-March 20)
You chuck your
e-commerce business model out the virtual window when you
discover that your customers’ Web site loyalty
asymptotically approaches nil. There are big changes afoot
on both sides of the production/consumption divide; as your
company becomes more nimble, retooling and reinventing
itself twice a day, so do your customers. How can you hope
to make your Web site any stickier when consumers are now
made of Teflon?

Aries (March 21-April 19)
May starts slowly, but
before you can say href="http://diamond.idbsu.edu/~marion/teaching/math100/cryptography/DiffieHelman.htm">
“Diffie-Hellman”
you’ll be as wedged
as a Palm Pilot trying to crack a 64-bit key. Try to reward
yourself with nano-vacations: sneak out to Starbucks, get a
mocha and a copy of Wired, and put up your feet for a moment
or two. Comfy? What the hell are you thinking? Get back in
that cubicle!

Taurus (April 20-May 20)
Feeling a wee bit
obsolete? Not to worry; this month, a confluence of powerful
companies, bleeding-edge technologies and sexy public
offerings conspire to turbo-charge your career. Meanwhile,
indifference is the best revenge as the planets jockey to
open up big new opportunities for your nemesis in Q/A,
testing and customer support.

Continue Reading Close

Of greed, technolibertarianism and geek omnipotence

Paulina Borsook talks with Thomas Scoville about her new book, "Cyberselfish."

By now we’re heard it so many times that even the most rabid technology boosters are weary of it: The geek wizards of the New Economy, aided by microelectronics, deregulation and free markets, have boot-strapped productivity through the roof and irrevocably improved life on earth. All hail the captains of digital industry, for they have done what government could never do: With nothing but pluck, vision and venture capital, they have conjured a better world out of thin air — on time, and under budget. If only government could be run like a cyber-business, we should all dreamily imagine.

As Paulina Borsook might reply, “yeah — right.” But then, she’s making a fine career out of challenging, rebutting, baiting and vexing the conspicuously libertarian technology community. Last year’s essay, “How the Internet Ruined San Francisco,” touched off a vintage Borsookian conflagration, unleashing a hell-storm of flaming responses across the Web from angry and aggrieved Northern California computer elites.

That was just the warm-up, it now appears. Borsook, who has been closely observing technology’s elites for two decades, has broadened her investigation with a volume of even more scathing ontological critiques. In her new book “Cyberselfish: A Critical Romp Through the Terribly Libertarian Culture of High Tech,” Borsook sounds a round challenge to the techie conceit of total autonomy. She asserts — among other highly flammable propositions — that decades of government funding for basic research, aerospace electronics, housing and higher education are conspicuously absent from the standard story of privatized technology heroics. She sees the prevailing libertarian ethos of Silicon Valley and the technology sector as merely a strain of geeky, adolescent narcissism masquerading — and dignifying itself — as politics.

It seems like you’re contending that technolibertarianism is a rhetorical projection of control-oriented, non-communitarian, arrested-adolescent urges of the preponderantly male geek technocracy. You document a collective, industry-wide failure to grow up and participate in society, as well as a culture that celebrates a massive underdevelopment of its humanity. Did I get that right?

Well, yes, I suppose. Though I should say this book was written over several years, and the culture has changed a bit over that time. One of the very recent changes has been that the übergeek libertarian culture I wrote about has been mated with MBA culture, which brings its own prejudices and religious beliefs to the party.

That’s an interesting melding: the masters-of-the-universe MBA culture colliding with awkward geek, “I don’t have the world’s best social skills” culture. But they love each other’s rhetoric and ideology and there’s a strange sort of symbiosis going on. Geeks and MBAs intrigue each other for complementary reasons: MBAs like being associated with the geek shibboleths of inventiveness and revolution; Geeks are attracted to the MBAs’ promise of making things real through the glamour of money. And both of them like money because it’s something that can be counted.

So now, when we talk about high-tech culture, a lot of what we’re talking about is really business-speculation culture, and a transplanted Midtown Manhattan advertising culture, or Wall Street financial culture. So, though we may use the words “high tech” these days to refer to this group, they’re not all the same kind of person — but they are finding lots of common ground.

Absolutely. I noticed that at some point in the mid-’90s, we got major culture-creep, when programmers and systems administrators all became covert stock traders on the Web.

Yes. It’s horrifying. [laughs] Because — and I’m not anti-technology or anti-geek — what is really best about these people is what I call their “curious child” quality — scientists have it — that kind of noodling around with code, and zoning out for 36 hours at a time working on something. That’s where the really good creative work can happen. But if you have one corner of your monitor that’s constantly watching the stock market, or you’re thinking about what sort of play you can come up with to impress the institutional investors, well, that’s not how really serious technology work gets done. That, to me, is kind of sad and scary, and — not to sound patronizing — but kind of a loss of their innocence in a way that I don’t think is good.

At what point did you decide you had to write “Cyberselfish”? What did you hope to accomplish in writing it?

I guess it’s because I had been writing so much for Wired and I had the usual love-hate relationship with the magazine that many of us did in the early days, which was that I loved that the magazine was so literary and so cultural and did new stuff that nobody else would have done, and placed technology alongside culture, and I was besotted with it.

But then I began to realize that they were deeply libertarian — which freaked me out; I didn’t know that going in — and I didn’t understand it. And any time I don’t understand something I have to write about it, like that old George Orwell notion of “I write to find out what I think.” This intersection of technology and libertarian philosophy and world view — really it’s not so much politics, but something else — was fascinating, and it just seemed worth a book.

I really intended the book as a tour guide to a subculture. It’s like, if you were an anthropologist from Mars and you were to come down to late 20th century earth, and you might look at a Russian Orthodox priest and a lay Unitarian gay community worker and those two people might think they’re really different from each other, but the Martian anthropologist would see two vague Judeo-Christian things that were more alike than not. With “Cyberselfish,” it’s really important that people understand that I’m talking about a spectrum of things — it’s subtle, it’s not just aimed at people in the Cato Institute or something. It’s really important to stress the number of times I’ve heard computer people say, “Well, I’m not a libertarian like that wacko over there, but I think the government is in people’s lives too much,” or “I believe in the free market,” or advance this fantasy that there’s no interdependency or no mesh and that somehow the government doesn’t make this a safe, reasonable place to live and make lots of money.

You write about the willful blindness by techies to the prior contributions of government and universities in creating the foundations of the Internet. In your own perfect hypothetical world, what kind of evil torture might you contrive to open their eyes?

I want to say something like an “It’s a Wonderful Life” kind of scenario: “Look, Jimmy Stewart — what would it be like if you hadn’t lived!” I mean, you’d have to think of something like that, because, the problem with the Internet example, and all the other examples in the book — there’s nothing new in there, I’m just pulling it all together — is that the really important thing to remember is the Internet/ARPANET was sheltered from having to make any money for, like, 15 years. So how can you give people an image of what it would be like to live in a world without economic shelter of any kind?

What would it be like to live in a world in which there was never a time-out from the philosophy and pressure of the marketplace? It’s kind of like trying to explain to people the notion of prior restraint, or how their world is impoverished by the absence of something they’ve never seen. And that’s a very hard thing to do, and since I’m not fundamentally sadistic, it’s hard for me to come up with a torture.

There seems to be this hidden assumption in geekdom that cleverness at coding must naturally generalize to all other areas of knowledge — as if being a good hacker qualifies geeks to be philosopher-kings as well. Would you agree? Where do you think this feeling of intellectual entitlement comes from?

I would totally agree, but then again I must be a little bit fair — there are lots of doctors and lawyers and other people who think, well, if I ran the world, I’d know what I was doing. I think perhaps that in the geek world — because you’re basically always creating a system that will work and respond, you’re creating little, bounded universes all the time — I think perhaps it’s more tempting to think that this kind of general omnipotence can extrapolate out from that. Because [as a programmer] you’re often being brought in to solve a problem — whatever it is — and even if you solve that problem poorly, or with unnecessary complexity, the fact is that you’re confident in your skill set as a problem-solver. So why wouldn’t that extend to everything else?

If the shakeout of the dot-coms continues as we’ve seen recently, if more companies die off or are eaten by larger companies, and the prevailing technolibertarian meritocracy pose becomes less and less tenable, do you think the rhetoric within the industry will change? As the losers file for protection or seek government intervention, do you anticipate a, shall we say, softening of the libertarian hard line?

I’m very, very curious to see what happens — whether [technolibertarians] are going to hew to the social Darwinist line or maybe be more intellectually honest, and say it’s more a matter of luck — but I don’t see that happening in high tech.

It’s a lottery — it’s a less rigged lottery than other things, but it is still a lottery — so, I’m going to be very curious to see what happens when people want to say, “It’s not fair, it’s not fair, my company never IPO’ed, but my friend’s company went public six months ago, and he got his money out and I didn’t, and it’s not fair.”

So, it’s going to be hard to tell because — you know the notion of cognitive dissonance — it’s like some chiliastic cult that thinks the end of the world is going to happen, and then it doesn’t happen, and their fearless leader comes up with an explanation of why the end of the world didn’t happen. This ideology is so pervasive and largely invisible that I’m not going to say yes, they’re going to have a more sober and mediated view of human life because of witnessing a NASDAQ wobble. I could hope that might happen, but I’d be reluctant to predict it.

Do you know any women technolibertarians? How do they justify/explain the wild gender-skew of technolibertarianism?

I do know some women technolibertarians, and — just like there are women fans of Ayn Rand. Rand was so violently anti-female in so many ways, but I guess that’s OK with some women. They really have no explanation for the gender skew. I have to a make a distinction here, though: When I talk about technolibertarianism, it’s a spectrum with a whole range of people along that spectrum, and among the really hard-core technolibertarians there are really very few women. But in the more moderate, free-market-works-for-everybody, it’s-a-meritocracy, self-reliance-is-best crowd, there are more women. They are not that different from, say, the women attending business school. Business school is also a world that skews male, but doesn’t skew as madly.

Much of the most stinging indictments of “Cyberselfish” spring from your examination of philanthropy — or shocking lack of it — in the tech sector. Technology seems to be a game for young, unattached males, who typically seem to strongly discount their own mortality. Do you see any coincidence that Bill Hewlett and David Packard — now deceased — were major exceptions to the stinginess of the industry, particularly in advanced age, when their mortality was clearly presenting itself? And how do you account for the Gates Foundation?

Now that Hewlett and Packard are gone, it’s not like you see anyone else stepping forward to fill their shoes. What we forget is even though there are all these 20-year-olds worth zillions of dollars on paper, there are many people in the Silicon Valley in high tech who are way over the age of 25. And nobody is stepping forward.

There’s a story about Bill Hewlett’s response to all these great initiatives to teach entrepreneurial skills to the disadvantaged, et cetera — all that Way New Philanthropy stuff — and he said, “Yes, but first you have to feed them.” In other words, this whole notion of compassion and caring and that there are human problems that can’t be solved but just require care or even money, gets lost.

I also think it’s an interesting hypocrisy in high tech — which I don’t get into in the book, but something I’ve been thinking about a lot — it’s kind of a two-tiered thing, which is that the classic charitable act in high tech is to do a Web site for a nonprofit, or donate computers or whatever, and that’s fine, but the winners in high tech measure each other with money — like, “Money is OK for you and me, but those other people over there, they’ll get whatever technology we want to tithe.” So there’s a weird disconnect between what they really value and what they’re trying to tell everybody else is valuable.

Bill Gates has obviously been giving away a lot of money recently. And I think what the Gates Foundation is doing is laudable. But again, I think that technology and tech culture start in the Silicon Valley. Microsoft is kind of a planet unto itself, and though it plays a major economic role in the computer industry, Microsoft doesn’t inform the culture of high tech anywhere near in proportion to its size as a company. And again, very few are following Gates’ lead — certainly no one with the stature or clout of a Hewlett or a Packard. I just don’t see anybody else saying, “Gee, wouldn’t it be great to make a billion dollars and give a bunch of it away.”

I think you’re going to ruffle more than a few feathers with “Cyberselfish.” As a recovering nerd, my intuition is that you’ve shined a light into a dark, uncomfortable place in the collective geek subconscious — you seem to have psychoanalyzed the industry, and found it to be a raving narcissist. And — as in the case of most narcissists who receive unsolicited analysis — the industry will certainly respond bitterly. Aren’t you a little worried about being buried in geek ire?

I’m anticipating it. It’s one of the things I lie awake at night staring at the ceiling and thinking about. Unlike many writers who have fantasies of ending up on bestseller lists, I worry about the amount of flaming e-mail I’m going to be getting — I’m basically a very nice girl, and don’t really understand why everybody gets so upset with what I do. One aspect I’m coming to see is the line between people who are genuinely interested in the world we’re living in, and seem to be really hungry [for my work] because I seem to be articulating some of their unease, and the techies [who] are just going to ignore me, or flame me, or write me off as a flaky girl and what does she know anyway? But that’s the risk I took writing this book. And the other risk I took, well, I have this day job writing about technology, and it’s like that Julia Phillips book, “You’ll Never Eat Lunch in This Town Again.” But whatever part of me thinks you should speak the truth to power — and I’m not an activist per se — well, I think you have to write the truth as you know it because that has some social value. And I just couldn’t turn my back on that.

Continue Reading Close

It's a bubble, all right!

In "Irrational Exuberance," Robert Shiller credits investors' folly with keeping the bull market on its feet.

Behind the historic highs and record volatility of the U.S. stock market lurks a widespread and quite fundamental disagreement about its valuation. Are today’s spastic stock prices really determined by the cold logic of an efficient market, or are they instead conjured forth from the anxious nightmares and giddy fantasies of a largely deluded investor class, one that has never known real economic hardship and has no use for historical perspective?

It seemed until recently that a new article of faith had been entered into the financial canon: that information technology in general and the Internet in particular have replaced the cycle of boom and bust with a single, terminal Long Boom. Occasional, short-term market wobbles notwithstanding, we should all invest as if the upside were a new law of physics.

Certainly the springtime swan dive of the NASDAQ seems to have germinated some fresh doubts to the contrary: What if the immutable optimism of the Information Age prophets is wrong? What if today’s Way New Economy is just another version of the Same Old Story? After all, there have been world-changing technological revolutions before, and the worlds that followed were no more immune to widespread financial catastrophe. What makes us so sure it’s going to be any different this time?

Robert Shillers book “Irrational Exuberance” (the title deriving from one of Federal Reserve Chairman Alan Greenspan‘s Dow-dampening addresses) arrives nicely coincident with these broader misgivings. A professor of economics at Yale University, Shiller has stepped into the breach with the dreaded proposition that we’re in the middle of an economic anomaly of epic proportions — in short, a bubble. He asserts that today’s high stock prices — even with April’s dot-com deflation factored in — reflect not a brave new era but rather more ancient human tendencies toward self-deception, wishful thinking and collective folly.

Classical economists continue to defend the still-largely balmy investment climate with the argument of “market efficiency”: All financial prices accurately reflect all available information at all times, both “hard” (revenues, profits), and “soft” (revenue projections, prospects, competition). As you might imagine, from this premise springs a body of largely mathematical models to describe and rationalize the mechanics of this alleged efficiency.

Shiller counters, “Economists have certainly made progress in understanding financial markets, but the complexity of real life continues to prevail.” He steps outside the mostly mathematical realm of economic theory and integrates a much broader range of disciplines than is usually considered in writing about the market. Finance, portfolio theory and macroeconomics only take us part the way, he declares, then turns the social sciences loose on the problem. It is primarily this consideration of human nature and the cognitive landscape that brings him to conclusions so radically divergent from the “efficient markets” school of thought. Markets, Shiller argues, can’t be perfectly efficient or rational because people aren’t efficient or rational.

He backs up this assertion with a litany of studies highlighting the swings and vagaries of human attention as directed toward the market: Herd behavior, or the finding that people who communicate regularly think similarly; the myth of fully independent judgment, or how people tend to cave in to the wrong answers when trumpeted by their peers; the “shocking” experiments of Stanley Milgram suggesting a universal tendency to suppose that when experts say something is right, it probably is, even if it does not seem so; the amazing human capacity to simultaneously hold conflicting beliefs with no apparent discomfort; a variety of investigations pointing to the proposition that in general, people think they know more than they do.

Shiller feeds these findings through some provocative epidemiological and anthropological models to posit a number of plausible mechanisms of speculative bubbles: “information cascades”  a kind of en-masse game of “telephone” accelerated by such modern conveniences as e-mail and chat rooms  as well as naturally occurring, Ponzi-esque feedback cycles emerging from the interplay of capital flows, investment culture and mass communications.

Shiller also brings to the table another sensibility conspicuously absent from his more quant-minded contemporaries, namely an almost Galbraithian feel for history. And just as in J.K. Galbraith’s classic, “A Short History of Financial Euphoria,” Shiller finds and defends enough historical similarities to give even the most gung-ho portfolio manager a case of the chills. In particular, he examines the largest increases of foreign stock indices over the past 40 years. Exaggerated investor enthusiasm, it appears, is not only short-lived but often associated with “new era” theories. Remember when the Nikkei was the world’s miracle bourse, and we were all living on the brink of the Japanese Century?

Refreshingly, Shiller doesn’t cleave to this “been there, done that” historical hindsight. He identifies some fresh permutations of circumstance altering investor perceptions in today’s market. In particular, he cites the World Wide Web which, in his view, conveys an impression of a changed future to all and gives people a powerful and intoxicating sense of mastery over the world. Because the Web experience is so immediate, because of the “intuitive plausibility of Internet lore,” it’s easier to imagine the consequences of this new technology compared to other, perhaps equally significant but less visible, technological advances. Hence, the bid-up of dot-com share prices from Wall Street and Main Street alike.

Shiller also argues for a profound case of mistaken identity in the age of the Internet: The recent rise of profits was well underway before the ascent of the World Wide Web, yet in these wired times a direct link is popularly imagined. This misperception of happenstance supports the widespread impression that digital communications drive endless abundance, which further pressurizes the optimism bubble.

For all his qualitative insight and interdisciplinary gymnastics, Shiller begins and ends his book with recourse to a decidedly more quantitative observation: The history of the market strongly suggests stock prices are, and have always been, a function of earnings. Though this association may from time to time be temporarily suspended — as it seems to be at present — the departure never lasts for long.

Or, to paraphrase The Artist, we may all be partying like it’s 1929.

Continue Reading Close

Signs of conflict

Decoded genomes and wired planets trash your solar house.

April 22, 2000

April-May 2000

Are you really a geek Taurus? If you
disagree with at least three of the
statements below, your moon or ascendant
is in a conflicting sign. Either that,
or astrology itself is constructed on
completely bogus astrophysical
assumptions. You decide.

1) You’re a raving skeptic, but you’re
mysteriously drawn to this column
anyway.
2) You don’t believe in UFOs, but you do
believe that the market capitalization
of Amazon.com is justified.
3) Not only was there a second gunman,
there was a second grassy knoll.
4) You call the shots in a relationship
– er, hypothetically, anyway.
5) Linus Torvalds? Total babe!

Taurus (April 20-May 20)

This month’s meta-question comes from a
curious Taurus in Portland, Ore.:
“Dear Geek Astrology — Is there any
future in fortunetelling?” Well, dear
reader, I’ve gazed into the crystal
ball, and it isn’t pretty: By 2100,
roving bands of autonomous gypsy robots
will hunt you down in stores like the
Gap and Barnes & Noble (which by that
time will enjoy national sovereignty).
Before you’ll be able to protest, they
will have obtained a tissue sample
(ouch!) and decoded your genome with a
nano-analyzer that bears a suspicious
resemblance to a chrome human skull on a
stick. You’ll get a spreadsheet
predicting your future medical,
employment and sexual history with a
+/-.0005 percent certainty, along with a
coupon for a free double mocha at
Starbucks — a $200 value. Scary!

Gemini (May 21-June 20)

Roswell meets human resources! What
seems at first to be a case of alien
abduction turns out to be Silicon
Valley-style job transition: Key members
of your technical staff inexplicably
vanish, then reappear days later working for a competitor, and with no
recollection of you or your company
whatsoever. Mysteriously, all their
salaries have increased. Extensive
hypnosis recovers dim memories of a
slender, almond-eyed “recruiter” with
unworldly powers of suggestion.

Cancer (June 21-July 22)

Naughty fantasy morphs into disturbing,
hyper-dimensional flirtation: Tamely
bisexual Gemini chat-room partner turns
out to be a transgendered,
polymorphously perverse erotonaut
sysadmin with, er, universal services
bus. Kinky! Pipes, sockets or
semaphores, this red-hot
mama/papa/virtual farm animal swings in
six different dimensions at the same
time — you’ll need an advanced degree
in Lobachevskian geometry just to figure
out the foreplay. You’ll never be the
same — !ybab ,hoO

Leo (July 23-Aug 22)

Think those are wildly original ideas
you’ve been having lately? You may be
giving yourself too much credit; your
alleged powers of independent thought
are being steadily eroded by Microsoft
cognitive imperialism. PowerPoint
presentations have infiltrated your
subconscious; in fact, you’ll notice
you’re actually starting to dream in
bullet points. And what you’ve mistaken
for the Muse is actually that annoying
little paper-clip “helper” — you know
the one — who’s constantly interrupting
with irrelevant advice and stupid
suggestions. Next time you brainstorm,
try pencil and paper. Radical!

Virgo (Aug 23-Sept 22)

Variations on cosmic game theory,
offered for your edification: Einstein
famously asserted, “God does not play
dice with the universe.” Actually — as
God herself subsequently published in
the obscure Journal of Divinity and High
Energy Physics — it’s more like a
combination of curling, donkey baseball
and naked ultimate Frisbee: fast, nearly
frictionless, vaguely embarrassing and
full of third parties who really wish
you would get off their backs.
Unfortunately, this clarification goes
widely underreported because it doesn’t
have the same catchy ring to it –
typical.

Libra (Sept 23-Oct 22)

“Call me Ishmael.com:” Single-minded
pursuit of e-commerce fortune is
starting to look an awful lot like an
updated version of “Moby-Dick,” as your
electronic-age great white whale sloughs
off your virtual harpoons and generally
makes a mockery of your business plan –
not to mention your very existence.
Skeptical Neptune surfaces to declare
you’re not equal to the task. Quit while
you still have two legs to stand on.

Scorpio (Oct 23-Nov 21)
Info-chagrin! Network privacy invasions
ruin your life as every unsavory Web
site you’ve ever visited comes back to
haunt you: Pressed for profits,
e-commerce marketeers have given up on
banner ads and consumer profiling,
resorting instead to plain old blackmail
– your entire Web-surfing history will
be e-mailed to your mother’s AOL address
unless you supply Visa, Amex or
Mastercard number (secure transaction,
of course). OK, OK — it was only a bad
dream. You hope.

Sagittarius (Nov 22-Dec 21)

Relentless robotic focus on
technological imperatives has turned you
into an asocial automaton; you’re having
difficulty passing the Turing test, even
with your family and loved ones. Time to
gather up what remains of your
disintegrating humanity and explore your
nonlinear side: Train a cat to fetch;
attempt telepathic contact with giant
koi; try to find the hidden Christian
messages in Marilyn Manson CDs.

Capricorn (Dec 22-Jan 19)

Tip for Capricorn project managers:
Overactive imaginations and generally
paranoid worldview make geeks
particularly vulnerable to the
proposition that absolutely everything
is secretly controlled by baroque
conspiracies and hermetic organizations.
The fools; as if it were that simple.
Reassure your managees with the standard
pep talk about self-reliance, hard work,
meritocracy and the level playing field.
Try not to laugh. Then proceed with
Trilateral Commission Secret Plan “X.”
See you at the Masonic Lodge on Thursday
night. Don’t forget the funny hat.

Fnord.

Aquarius (Jan. 20-Feb. 18)
Sudden appearance of upstart
infobusiness paradigm catalyzes a
dynamic restructuring of the
organization, the most visible effect of
which is a sudden glut of parking in the
company lot. Unfortunately, these new
vacancies generate considerable
back-pressure on the org chart;
excitement and nausea shake hands as
premature promotion sucks you up the
corporate hierarchy. Later this lunar
cycle, when nasty Mr. NASDAQ reminds you
it’s a big, scary world out there,
unhitch your self-esteem from your stock
options and try to remember why you decided
on a career in technology in the first
place. You do remember, don’t you?

Pisces (Feb 19-March 20)

Your wide-open business-to-business
e-commerce opportunity becomes
close-quarters hand-to-hand combat as
eager imitators rush to the game. Still,
it’s important to project a winning
attitude to shareholders, even as the
opposition attempts to gouge out your
eyes and kick field goals with your
spleen. Now is not the time to lose that
cocky, dot-com smirk. Besides, you’ll be
able to wear it with so much more
authority once you’ve earned it — if
you survive, that is.

Aries (March 21-April 19)

Newly completed systems architecture
turns out to be eerily reflective of
management: Front-end friendliness masks
back-end hostility; plain data is
relentlessly obfuscated beneath layers
of indirection and abstraction; rampant
polymorphisms render carrots
indistinguishable from sticks. Look for
increasing burnout factor on the 28th,
when your oh-so-toasted cerebrum is
further scorched by fabulously
conflicting and wrongheaded theoretical
assumptions. Fight back with a fusillade
of confusing yet profound-sounding
aphorisms like, “A stitched pot never
boils spilt milk under the bridge,”
“When you’re carrying a hammer,
everything looks like a cockroach” and
“Are you Sarah Connor?”

Continue Reading Close

Howl.com

(with apologies to Allen Ginsberg)

March 22, 2000

I saw the best minds of my occupation destroyed by venture capital, burned-out, paranoid, postal,

dragging themselves through the Cappuccino streets of Palo Alto at Dawn looking for an equity-sharing, stock option fix,

HTML-headed Web-sters coding for the infinite broadband connection to that undiscovered e-commerce mother lode in the airy reaches of IP namespace,

who poverty and ripped Yahoo tee shirts, cubicle-eyed and wired on Starbucks sat up surfing in the virtual ether of one-million-dollar, one-bathroom condos next to the railroad
tracks, skipping across the links of killer Web sites contemplating … Java,

who rammed their brains into compilers and saw Intel angels staggering on microchips under the insane weight of investor expectation,

who blew off the search for Truth for as-yet-undreamed New Economy scams, business models hallucinating infocapitalist messiahs on clouds of market cap,

who abandoned lucid dreams of a Better Way for Shockwave fluff and RealAudio baubles dangling from the buggy venality of digital commerce,

who, while haunted by the scowling ghosts of hackers past - Stallman, Nelson, Engelbart - auctioned their immortal souls on eBay, with documentation and a full year of support
included, of course,

who got busted in their spotless Nike cross-trainers traveling through cyberspace with a file of illegal crypto for Open Source,

who ate sushi in Austin or drank microbrews in Silicon Alley, jousting with bad mojo funk of layoffs, Chapter 11, or diluted company stock night after night,

who chained themselves to start-ups for the endless ride from San Jose to Wall Street on adrenaline and Evian, laptop batteries flaming out over Oklahoma, no more vegetarian
entrees, sir, would you like the latex omelet instead?

endless nights of keyboard grinding and corporate microwave popcorn and Jolt Cola until the noise of their own deadlines brought them down, gawping, convulsing, mute, crushed
beneath their own project plans,

who talked continuously about convergence and distributed control and cluetrains and Y2K and extropians and Libertarians and Microsoft and Linux and slashdot and wouldn’t fucking
shut up,

who pointed their browsers at Red Herring and Slate and Salon.com hoping against hope that somebody might be able to make sense of the infinitely perverse, ball-busting,
soul-scorching, silicon-supernova black hole that kept them awake all night every night and wouldn’t let them alone long enough to find dates in this lifetime,

who tattoo’d and pierced and dyed and branded themselves in a desperate act of self-mutilating cyber-hepster cool, all the while wearing a suit and tie on the inside they could never, ever take off, and praying nobody would find out about the MBA,

who renounced the smokestack relics, the old guard and their father’s Oldsmobile only to find that they had been replaced by artifacts even less substantial,

who chanted the free market mantras of laissez-faire and techno-darwinism and Adam Smith’s invisible hand-job except when Big Bad Bill the Bully Gates-of-hell came to take away
their lunch.com — and became Socialists of Convenience.org,

who stalked investment bankers through Bistros and wine bars and martini lounges, begging pleading groveling for one more hit of funding from the luminous check-book oh please oh
please oh please

ah, Bill, you are not safe, I am not safe, and now we languish in the dot com pressure cooker hoping for one last buzz of the old hallucinations.

The wrecked avenues, the sullied conduits, the pinched pipes of a quadrillion dropped and ruined packets.

The world wide waits, the denials of service, the infinite hosts of hardcore farm-animal
boredom, ghoulish domain-name squatters jumping out from behind every virtual tree.

These failed revolutions, these paradigms lost, the end of Web Time, and P/E ratios good to last the next thousand years.

Dot com! Dot com! Dot com!
forever, and ever, ka-Ching.

Continue Reading Close

Page 1 of 13 in Thomas Scoville

www.salon.com/writer/thomas_scoville/index.html