The importance of being clear

A formatting fubar involving an Excel spreadsheet has left Barclays Capital with contracts involving collapsed investment bank Lehman Brothers than it never meant to acquire.

Working to a tight deadline, a junior law associate at Cleary Gottlieb Steen & Hamilton LLP converted an Excel file into a PDF format document. The doc was to be posted on a bankruptcy court's website before a midnight purchase offer deadline on 18 September, just four hours after Barclays sent the spreadsheet to the lawyers. The Excel file contained 1,000 rows of data and 24,000 cells.

Some of these details on various trading contracts were marked as hidden because they were not intended to form part of Barclays' proposed deal. However, this "hidden" distinction was ignored during the reformatting process so that Barclays ended up offering to take on an additional 179 contracts as part of its bankruptcy buyout deal, Finextra reports.

The Register has the full story. As Merv has always warned, 'horrible things happen when you hide cells in excel'.

I see this as a manifestation of a wider lack of education on the importance of communicating information efficiently. The Spartans, Tufte, Strunk and White, the Economist, Picasso and numerous econometricians have done a lot to improve things, but management-speak, TV advertising and other such phenomena show we still have a long way to go.

Friday Special 76

Think tank of Julia Fullerton-Batten - Award winning photographer

What if the whole world could vote in the US Presidential election? BetaVota 2008

Paul Krugman, Nobel Laureate

I suddenly realized the remarkable extent to which the methodology of economics creates blind spots. We just don't see what we can't formalize. And the biggest blind spot of all has involved increasing returns.

That's Krugman from an essay on how he works. Here is a taste of his dark side. I also know many people who will agree that George W. Bush, apart from all his other failings, also managed to make the world a much more boring place via his effect on Krugman.

Reading The Accidental Theoristat a tender age was a revelation for me, and it started a chain reaction that changed my life in a way no other book has. Paul Krugman, thank you; and the most heartfelt congratulations!

Friday Special 75

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Get out and play

Kill your dictator

In “Hit or Miss? The Effect of Assassinations on Institutions and War,” Olken and Jones looked at the effects of political assassination, using a strict empirical methodology that takes into account economic conditions at the time of the killing and what Olken calls a “novel data set” of assas­sination attempts, successful and unsuccessful, between 1875 and 2004.

Olken and Jones discovered that a country was “more likely to see democratization follow­ing the assassination of an autocratic leader,” but found no substantial “effect following assassinations—or assassination attempts—on democratic leaders.” They concluded that “on average, successful assassinations of autocrats produce sustained moves toward democracy.”

From a profile of Ben Olken in the American. And here's the paper (free access).

Video of the day

Lehman's Richard Fuld makes the case for a long-dated compensation system.

Addendum: And this, ladies and gentlemen, is what passes for journalism.

Friday Special 74

I.O.U.S.A. One Nation. Under Stress. In Debt.

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Who killed the economy?