E is for Earnings

While we look for harmonious balance, we are also creatures of change and achievement. We yearn also to count. Any youngster who approaches a pond with pebbles will toss them in and count the skips or try to hit the lily pad ten times. Or a crew rows by us on the river and we count the strokes. Well, maybe I just do because I was raised on Sesame Street. Remember The Count? Vun…doo…tree bats… ah.ah.ahh…

The river of time flows by, but we are compelled to stop and take reckoning every so and often, after a month, the year. What comes in, what goes out? Are we draining our resources or building a surplus?

Drawing by Leonardo Da Vinci, “study of water passing and falling,” shown in kensycooperrider.com.

That’s the purpose of an Income Statement.

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Going Once…Going Twice…

“Paul, it’s Bob Wilson. You’ve won the Nobel Prize.”

A security camera in front of Paul Milgrom’s home in Stanford, California, recorded Wilson and his wife Mary sidling up to Milgrom’s front door in the predawn darkness and repeatedly knocking and ringing the doorbell to wake him up. After a short pause to take in the momentous news, Paul Milgrom responded, “Wow, yeah. Okay.”

Story by Melissa de Witte at stanford.edu.
Robert Wilson and Paul Milgrom, photo by Andrew Brodhead.

The Nobel Prizes for 2020 were announced earlier this month. I thought I should take it on myself to understand what it was that earned these folks the Biggest Blue Ribbon for Brains in the world. I know just enough economics to get myself into trouble, so this could be fun. Economics (and science for that matter) are like languages that I speak badly (hablando de español…) I can almost read economic theory with a little wikipedia and dictionary.com at hand, but writing about it might generate some misinformation. Nevertheless, let’s dive in and alleviate your curiosity. I know you saw the awards but did you understand what they were for. I’m especially proud since northern Californians took four out of the eleven Nobel awards, two from my alma mater and two from its rival but still my peeps, woot woot!

Not All Auctions Involve Cattle or Eyebrows

My favorite award this year has to be the Prize for Economics, which usually annoys me in its advancement of “free markets,” which aren’t. This year, however, the theories were comprehensible and practical. Understanding the math is something else entirely, but never fear—we won’t go there. Two fellows from Stanford (take off that red shirt!) won for their development of Auction Theory.

When I think of auction, I always visualize a Texan with a big hat and microphone who sounds something like Leroy Van Dyke, in his famous song from the 1950s:

Either that or auctions make me think of a scene in a spy movie or comedy, where fancy people are seated in a room, and the British butler begins auctioning the mysterious painting or golden egg or Wonka ticket, which might hold a clue to the whereabouts of the Austerioserlian terrorists. Numbers are randomly repeated as he points at audience members who do nothing more than move an eyebrow or lift a pinky. Or, if it’s a comedy, the lady inappropriately dressed keeps accidentally bidding when she sneezes. To me, that’s an auction. It turns out that those are not the only types of auctions.

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Turkey Flow Redux

Author’s Note: Today, in time for you to plan your Thanksgiving, I repost one of my most popular entries, the turkey preparation process flowchart, with some handy 2019 updates.

Perhaps someday I’ll write a book that is nothing but flow charts. They fascinate me! My Turkey Dinner flowchart encompasses everything you really need to know about preparing the meal from three days out, including a logarithmic scale. But, wait– I’m getting ahead of myself. Let’s take this step by step.

You can start with a simple set of process steps, which I show below to use as a building block for what is to come. When I show you the full, unadultered version, your head will explode.  Bear with me.

Turkey cooking flowchart
Turkey specific flowchart, by kajmeister.

Clearly, everyone has their own T-day traditions, whether it’s deep-frying the turkey (dangerous but popular) or serving crab (very San Francisco) or canned cranberries (really?). I will map out the standard meal with the basics: a stuffed turkey, gravy, and ancillaries to put the gravy on. Maybe a few vegetables, too.

In our house, we brine the turkey–which has its supporters and detractors I know–and we saute fresh green beans and mushrooms, rather than bake them in a soup. Plus deviled eggs because it’s not T-giving without deviled eggs. By the way, if you don’t waste spend loads of time watching cooking shows as I do, you should know that “sous chef” is short hand for all the prep work that you do which doesn’t involve heating or freezing the food–chopping, measuring, mixing, and making room in the trash and compost for all the potato peels, onion skins, and turkey liver. No, you don’t eat the liver. I don’t care what your grandmother did. Gizzard, neck, and heart, ok; liver, no.

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