For me, this is pretty awesome! I love numbers and data. The optimization junkie inside me wants to start playing with them right away. I want to see what happens to one number when you increase the other. I want to know if two numbers are related. I even want to see if I can predict one number based on the behavior of others. There’s a whole field of science around this statistical analysis and I find it all fascinating.
In fact, one of my favorite scenes from one of my favorite books (Friday) has the hero being given some random data about gold prices, beard lengths, skirt lengths and then being told to make sense of it. At first, our heroine thinks this is nonsense, a crazy assignment meant to annoy her. However, she slowly begins to see connections until she gets to the point where she can predict the price of gold simply by looking at a picture and examining beard and skirt lengths.
Sounds a bit crazy, doesn’t it? Maybe not so much.
Don’t You Just Hate The Big Banks?
We love to hate the big banks. We love to talk about how they manipulate the system in their favor to make more money. But maybe it’s not so much manipulation as much as it is being better at reading the numbers. Take a look at this chart:
This is a graph of recessions compared to interest rates. On the surface, it looks interesting. The blue line seems to spike before quite a few recessions. However, it also spikes in a few places that are not recessions so does it really matter? Then you add in the black line, oil prices, and things get a lot more interesting. Now look again.
Every single time both oil prices and interest rates spike up, we get a recession. Not so surprising when you think about it, our economy runs on oil and debt after all. However, my point is that if you know this and you follow these easily available numbers then it’s really not that hard to predict a recession. And if you can predict a recession, you can cut your losses (and even make some profits betting against other people’s profits). So are the big banks really manipulating the system or are they just better than us at reading numbers?
Note, did you folks notice oil prices rising? Are interest rates going up?
The Race / Crime Connection
Your child / little sister / wife / parent (pick your loved one) is stuck on a dark road in the middle of nowhere. A car pulls up and out comes a stranger. Would you prefer this stranger to be an Asian female or an African American male? If you answered “I don’t care because I’m not racist” then you’re an idiot. Take a look at these graphs based on FBI crime stats:
On average, African Americans are around 20 times more likely to be a violent felon and the numbers get even worse when you compare male to female. So now you think to yourself “damn, Gal is racist!” and again I say “you’re an idiot”.
Take a look at the difference between black and white education rates:
Or the income level by race:
All of these show a huge disparity. When you control for these factors (and others like the higher likelihood of a black man being arrested and convicted for the same crime as compared to an Asian female) you’ll see that race has very little with propensity to commit a crime, it’s actually far more driven by income, education, single parent household, parent’s education level, neighborhood and so on. So while statistics can tell me that I should prefer the Asian female coming to help my stranded loved one, statistics also tell me that race is not a factor, it’s just an indicator of income level, education and other factors which are the true drivers of crime.
The Magic Of Numbers
Do you see how useful numbers are? Do you see how they can be used to discern so much about our lives? And not just on a grand macro level like recessions and crime. Numbers are just as useful in our daily lives. Have you ever thought to chart the hours of sleep you get per night versus the number of calories you eat in a day? I did and the result was surprising. Days in which I slept better also ended up being days in which I ate healthier. How about food versus sexual performance? (hey, I’m 37. That’s the age most guys start worrying about these things!) Guess what, it turned out less caffeine and sugar made a difference. How about productivity vs. workouts? Turns out I am more productive on days where I take a break to get some exercise.
All of these are insights into my life that I would have missed if it wasn’t for an obsessive love of numbers.
Now you don’t need to be quite so obsessive but I would recommend a bit more method to your madness. What parts of your life are important to you? What are you trying to change? Trying to be more productive? Eat less? Workout more? Get more dates on a dating website? Why not collect some data (or do a few Google searches to see if anyone else has already collected the data for you!)
Numbers are wonderful. If you want to improve your life, learn to love them!