Fung explains how to challenge big data interpretations with numbersense

The more that managers come to rely on so-called Big Data in their decision making, the more important it is that they understand how to ask the right questions about data, explains Kaiser Fung in Numbersense : How to Use Big Data to Your Advantage.

Fung is a statistician who believes that data consumers need to develop better numerical common sense  or ‘numbersense’ in order to cope with ‘Big Data’. In this book he teaches us how to challenge big data.

Taking examples from healthcare, law school rankings, marketing promotions, sports and economic indicators Fung demonstrates how misdirected data interpretations can lead to poor decision making with damaging consequences for businesses and individuals and he explains why it is important to challenge big data.

As the data available to us grows exponentially, so too does the number of interpretations and analyses of that data with the result that consumers are faced with increased complexity and reduced clarity. Developing  ‘numbersense’ equips us to ask the right questions and to perhaps listen  more closely when common sense tells us that the data we’re presented with doesn’t quite add up.

 Numbersense : How to Use Big Data to Your Advantage by Kaiser Fung is published by McGraw Hill. ISBN 9780071799669. [Disclosure: A free ARC was provided via Netgalley.com]

The Filter Bubble : How the new personalized web is changing what we read and how we think by Eli Pariser

In The Filter Bubble, Eli Pariser tells a powerful story about how the results that we see when we search the Internet are increasingly limited by personalisation so that what I see when I search on a particular topic may be quite different from what you see — even if we search on the same topic, using the same search terms, at the same time. This matters quite a bit because more and more of us are consuming 0ur news from personalized news feeds with the result that we may never encounter really important stories which the alogrithms factor out without our knowledge simply because they don’t match the profile of stories we previously clicked on. Worrying, too, is the fact that so many of us don’t realise this is happening. As Pariser notes: “In polls, a huge majority of us assume search engines are unbiased. but that may be just because they’re increasingly biased to share our own views.” What I really like about Pariser’s book is that is a very accessible and thought-provoking read — particularly in the earlier chapters. For a quick introduction to the topic, it is worth having a look at Pariser’s TED talk on the filter bubble.

“The Filter Bubble: How the new personalized web is changing what we read and how we think ” by Eli Pariser is published by Penguin Books; Reprint edition (April 24, 2012). ISBN-10: 0143121235; ISBN-13: 978-0143121237.

Octopus : Sam Israel, The Secret Market, and Wall Street’s Wildest Con by Guy Larson

Octopus — the page-turning tale of how Sam Israel’s dream of becoming a Wall Street trader turned into a nightmare that ultimately landed him in prison — is both a thrilling and a scary read.

Born into one of the big-time Wall Street commodity trading families, Sam Israel was a teenager serving drinks at a party in his parents house when he first encountered Freddy Graber, “the man they called “the King” on Wall Street.”

When Graber gave him a business card and an insincere invitation to drop in to the office, Sam recognised the opportunity and before long was knocking on Graber’s door. Determined to work for his hero, Sam’s persistence eventually paid off  and before long he had quit college to take up a junior role on Wall Street. He spent a number of years working with Graber. This was the 1980s and Sam saw that the introduction of computers in the  was transforming the trading environment. Access to the right computer programs could deliver a critical advantage in an environment where speed played a key role in profit — the high tech, high velocity world that would subsequently become a trigger of the global financial crisis.

Bayou, the hedge fund that Sam founded in 1996 planned to use a computer program, “Forward Propagation” to analyse and reveal hidden patterns in stock prices which he believed would give him the ability to make predictions about the highs and lows for his watch list of chosen stocks.

When Bayou lost money at the end of its first year through a misjudged move into gold stocks, a decision was taken to fudge reporting the loss and before long, what had begun as  a temporary plan to cover a relatively small loss had spiralled into ‘a big Problem’ .

Sam’s attempts to solve the big Problem led him down some truly hair-raising paths involving encounters with the owner of a video that purports to show the assassination of JFK, agents and double-agents, an attempt to get access to a trading program owned by Octopus which Sam believed was a secret cabal that controlled the world …

It is hard to know to what extent Sam’s account is reliable — he is a self confessed con man who has SpongeBob SquarePants on his cheques, who abuses cocaine, has chronic back problems, a heart condition that one of his shady contacts tells him was caused by poison because he is ona lis of individuals considered to present an intellectual threat to the State, he  takes a cocktail of meds including meds to treat bipolar disorder.

As the story becomes increasingly bizarre, you have to keep reminding yourself that this is based on fact, not fiction.

Whatever the truth, it’s a fascinating tale told with pace and style by Guy Lawson.

A  copy of  Octopus: Sam Israel, The Secret Market, and Wall Street’s Wildest Con  was provided free of charge by the publisher for the purpose of this review.

Octopus: Sam Israel, The Secret Market, and Wall Street’s Wildest Con by Guy Larson is published by Crown Publishers.
ISBn: 978 – 307 – 71607 – 1
eISBN: 978-0-307-71609-5