Pi-Consulting

Homo Sapiens is defined by rationality. Since we mutated into Homo Consumiens, economists believe we are all supposed to be even more logic-driven in our pursuit of self-interest. Really? Maybe somewhere out there super-intelligent extra-terrestrials are monitoring our eBay bids and online purchases, checking the human race for signs of innate common sense. They should perhaps not hold their breath; (or chlorine gas, or whatever it is they breathe).

Faced with rational choices, the options we humans go for can be downright weird. At the supermarket checkout, a self-described thrifty, health-conscious shopper will pat herself on the back for choosing low-fat, no-added-sugar foods at bargain prices. Yet, just as her right hand is handing her money-off coupons to the checkout girl, her left hand is impulsively scooping up a high-priced gossip magazine and a handful of sugar-filled candy bribes for her fractious kids.

Such self-contradictions follow us as we try to “save money” online. We found the book we wanted, reduced. Just as we go to hit the checkout button, up comes a message saying “You qualify for this week’s special purchase. Spend another $19 and get free shipping”. We obediently agree to an additional item that we never intended to buy, to “save” $3.99. Hmmm. Define “free”.

These examples may seem trivial and random, but in fact they are neither, according to Dan Ariely, an MIT professor of behavioral economics, and author of “Predictably Irrational: The Hidden Forces that Shape Our Decisions”. The all-too-human propensity for kidding ourselves betokens “irrational behaviors (that) are neither random nor senseless …but systematic”, says Ariely. “We make the same mistakes over and over”.

These ‘mistakes’ can be life-changing. Rationality says we should be minimizing debt, and saving for our retirement years. So why do we borrow to the hilt and spend virtually all the money we can lay our hands on? Last year, according to The New Yorker, Americans had $10.184 trillion in disposable income. They spent $10.132 of it. That’s 99.5%. Needless to say, a sizable proportion of the money went to credit card companies in late fees and interest payments.

As the report had it, “Americans, having reviewed their options, collectively resolved to spend virtually all the money they have”; proof that “people have trouble acting in their own self-interest”. Some theorize that this is because we are ‘loss-averse’, even when the ‘loss’ from our monthly pay-packet would be going into a savings fund. But how does that explain people who fail to enroll in company retirement plans even when no employee contribution is required?

Homo Sapiens means “Knowledgeable Man”. Yet we seem oddly incapable of perceiving the dividing lines between what we know and what we believe. Perhaps the best-measured example of this is the arresting fact that 60-70% of adult Americans believe the literal truth of Bible stories like the creation and Noah’s flood. Indeed, a 2007 Gallup survey reported 31% saying the Bible is “the actual words of God”. Yet when Gallup fielded questions about the Bible’s contents, half of respondents were unable to name its first book as Genesis; two-thirds did not know who gave the Sermon on the Mount – many thought it was Billy Graham – and 60% failed to name even half the Ten Commandments. 12% thought Noah was married to Joan of Arc. What we know and what we believe, it seems, can diverge.

Of course we have a new excuse for this. The internet has expanded the world’s supply of verbiage, and this fact allows us to dismiss things we don’t like the sound of as “too much information”. The cyber-avalanche of unsifted intelligence, inference and rant impedes real facts from reaching a wide audience. Last year the number of active blogs on the Net passed the 100 million mark. Their readers now vastly outnumber those who read serious, unbiased sources which have to filter their output through a team of fact-checkers. The result is that many of us now only read the ‘facts’ and opinions that actively appeal to us.

A case in point is the battle between Encyclopedia Britannica and Wikipedia, (which the latter has resoundingly won, if eyeballs on screens is the measure; it claims 2.5 billion page-views per month). Britannica’s contributors have included Einstein, Freud, the economist Milton Friedman and more than 100 Nobel laureates. Wikipedia, by contrast, is a ‘wiki’, the type of website that allows visitors to easily add, remove, or otherwise edit content at their whim. Being voluntary, Wikipedia has no real editor. Its driving principle is “This is my truth; what’s yours?”. The aim is not necessarily truth per se, but the warm, fuzzy feeling of consensus. In consequence, Wikipedia offers more “knowledge” on Pokemon characters than on quantum mechanics.

Do we humans really want to know the truth at all? The way the majority of us vote in elections implies, for instance, that we believe saving jobs is more important than productivity and the prosperity it engenders. The folly of this was recently pointed out by a story in The Economist’s Lexington column. An economist inspects a dam-building project, and sees hundreds of workers with shovels. “Why not use a mechanical digger?” he asks, to be told that this would put people out of work. “Oh, fine, if it’s jobs you want, take away the shovels and give them spoons”. Makes perfect sense, doesn’t it? Yet politicians figured out long ago that “job-protecting” xenophobia and protectionism mobilize more voters than genuine economic stimulus and fiscal common sense, however much better off those would make us. A candidate’s aim, after all, is to gain and keep power, not to fix things. We behave just as irrationally when choosing our leaders as we do when spending money.

All in all, it shows we humans are prone to endearingly muddled thinking. If asked by a clipboard-wielding canvasser to agree or disagree with the statement “Either something makes sense, or it doesn’t”, we seem disposed to reply “Uh… what was that middle one again?”

God gave Adam a luxuriant growth of facial hair, but every morning his sons laboriously scrape it off again. A huge global industry is based on this curious fact.

What do men use to keep themselves clean-shaven? A recent survey in Europe showed that 45% of European males have electric shavers, and that nearly two-thirds of them use some kind of wet-shaving system, whether conventional razors or the disposable kind. All together those who shave seem to represent nearly 90% of adult males. (There is some duplication: a significant number of ‘wet shavers’ apparently keep an electric shaver handy as well). That leaves around 10% of adult males who don’t give any direct evidence that they shave at all.

Logic says that we can assume that those guys all wear beards. In the absence of “Do you have a beard?” as a questionnaire item in most surveys, it’s perhaps as close as we’re likely to get. (But wait. Could these people be regular shavers who happen to use someone else’s razor? Their wives’ or girlfriends’, for instance? Ewwwww!!! If yes, Pi would like to hear from the Wronged Women whose shaving equipment is being borrowed by their Unprincipled Menfolk. In keeping with this website’s fearless editorial policy, We Will Name The Guilty Men).

Interestingly enough, a man’s propensity to wear a beard seems to vary according to a North-South divide, at least in Europe. A higher proportion of British men turned up in the “don’t shave” column than Frenchmen. There are considerably more bearded men in the chilly climes of Germany than in sunny Spain, where the clean-shaven predominate by a higher margin. Pi’s Law of Thermobarbanomics (“more heat, less beards”) could be close to becoming proven scientific fact.

Electric shaver owners tend to be older (peak age is 55+), and predominantly married. They seem to be the buttoned-up sort, who like organized routines, and judge a fellow by the car he drives. Wet shavers cluster in the younger age ranges, and are slightly more likely to be divorced or separated.

How do non-shavers differ from their clean-shaven brethren? For a start, they tend to be either way older or way younger, polarized to the under-20 and over-65 age groups. Many of the younger ones are students, and still single. Temperamentally, they can be casual to the point of untidiness, forthright to the point of rudeness, and they tend to do things impulsively, on the spur of the moment. They don’t really see cars as status symbols, don’t put much effort into appearing attractive to women, and are not particularly happy with their jobs. Barbarians, perhaps… ?

Paris is where good Americans go when they die, it used to be said. The same is true about Miami and the Latin Americans. People from all over Hispanic America speak of Miami with a wistful sigh and a flutter of the eyelids, as if it were some kind of earthly paradise. Instead of pronouncing the name “Mee-ah-mee”, Spanish-style, they call it “My Yammi”, much as Americans used to refer reverentially to “Paree”. Anyway, your blogmeister used to live overlooking Biscayne Bay and South Beach, and, with the curiosity that comes naturally to a Pi executive, studied up on what makes the place tick.

Pi knows that the most absorbing of all sciences is that of human behavior and interaction. All the really interesting places on earth are where races, colors, beliefs, languages, cuisines and tastes collide, and then collude. Rio de Janeiro is one such spot. Xenophobia rarely gets a toe-hold in countries whose populations are mostly immigrants. Such places also frequently have ports attached. Puerto Rico is another cheerful ‘melting pot’, given its kaleidoscopic – and mostly benign – racial and linguistic mix. New York used to be like that, and ought to be today, but somehow isn’t. Someone once acerbically described NYC as “White people in brown shoes exchanging sidelong looks with brown people in white shoes”. The different groups there seem to slide sullenly past each other like oil and water in a Petri dish, even within ethnicities. This may in fact have something to do with socio-economic stratification, or perhaps the concentration of lots of people in a small and very expensive piece of turf. (The imbecilically-named “War on Terror” sure didn’t help, enlarging latent mutual suspicions exponentially). Anyway, by comparison with NYC Miami is big and spread out, and everyone rubs along pretty much okay. (By the way, has anyone ever noticed the unusually high concentration of “Star Trek” fans in New York City? My theory is that Trekkies respond to, but fail to perceive, that venerable TV show’s real underlying themes, ie. [i] the very American concept of obedience to authority and [ii] the ultimate impossibility of any real accommodation with aliens, however liberal your persuasions).

So what about Miami? Definitely another ‘melting pot’ market. You’ll hear Spanish in ten different dialects, (some mutually incomprehensible), plus Portuguese, French (and its Creole derivatives — all the taxi drivers are from Haiti), even Russian. Oh, and English, though it’s not always immediately recognizable as such. Miami is one of the few places where you will encounter Americans making a serious effort to speak a foreign language, whether it be Spanish or, of course, English.

Miami as a city is a jigsaw of different cultures, languages, tastes, diets and shopping habits. Older retirees from the North-Eastern US and sun-seeking newcomers from all over the States rub shoulders with conservative Cubans, dance-mad Dominicans, nostalgic Nicaraguans, and folk from every other corner of the Americas. Burger King vies for your lunch-money with Pollo Tropical (spicy chicken, yellow rice, fried bananas and salsa) and innumerable Cuban and Caribbean-style eateries, serving rice, beans, ‘yuca’, fried plantains and roast pork. Oh, try the “Vaca Frita”, why don’t you? It means “Fried Cow”.

When the writer moved to Miami, he was told how lucky he was to be living here. “What makes Miami such a terrific place”, said my witty NYC-bred informant, “is that it’s so close to the USA”. Indeed, the city has been chosen as Latin American HQ by big hi-tech and service companies, media conglomerates, ad agencies and dozens of manufacturers. (Despite this trend, some Chicago- and Minnesota-based corporations frankly shuddered at the thought of having to mix with all those flaky, unpredictable and tempestuous Latins. Realizing that you can’t easily run a Latin American business from the shores of the Great Lakes, such outfits tended to opt for an HQ in Fort Lauderdale, forty miles up the coast from Miami, on the basis that “At least that’s still the real United States”).

Anyway, the melting-pot thing really works. Miamians turn out in market research surveys to consider themselves 70% friendlier than the rest of the USA. Oh, and nearly two-thirds luckier: Miami Latinos outscore the nation by +63% on weekly purchase of lottery tickets. ¡Mucha suerte, damas y caballeros!

As this site reported on March 17th, “America’s consumer electronics (CE) industry is grappling with stringent new federal and state legislation to ensure that manufacturers ‘take out the garbage’ as they sell-in new gizmos like HDTV. The issue is a serious one, with the impending switch-off of analogue TV services likely to mean huge numbers of old TV sets getting left on the sidewalk”. We spoke too soon. A new CEA (Consumer Electronics Association) study posits an “afterlife” for many superannuated TV sets. “While some have speculated that millions of TVs would enter the waste stream, …results of the (CEA) study …show that households …expect to remove fewer than 15 million televisions from their homes through 2010. Ninety-five percent will be sold, donated or re-cycled”. Nearly half of OTA-only (i.e. traditional “over-the-air”) TV households “expect to buy a digital converter box, …and to continue using the same TV”. When the old set has to go, re-cycling is increasingly the disposal method of choice, with consumers reporting 30% more TV’s recycled in 2007 than two years earlier. Pi salutes this impressively green and responsible consumer trend! Sources: CEA, Pi.

If you go to Las Vegas for a blackjack’n’craps weekend, watch out for whales. Whales, in gambling parlance, are players who can afford to lose (or, presumably, win) $3 million dollars during a single stay at a casino. They number only a few thousand worldwide, though a growing number of them are swimming in from the People’s Republic of China. You know how it is: $3 million here, $3 million there, pretty soon you’re into big money, as the people behind Las Vegas’ Venetian casino and resort empire have found. Their new Venetian casino resort in Macao is three times the size of its namesake in Nevada, and opens its doors to 60,000 gamblers a day. 40% of the casino’s revenues come from 59,700 of them. The remaining 60% of the money is laid on the green baize tables by just 300 people. The rest of us punters just shrug our shoulders, and reflect that getting skimmed a few hundred bucks seems insignificant beside what the whales must be losing. Sources: Washington Post, Pi.