Jessica Leong on Who Actuaries Are

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Why did I do this show: I think the actuarial profession is at a very interesting transition point and also caught between new and old school data science. Tradition is their source of institutional strength but they are at a branding deficit compared to mainstream “AI”. Jessica embodies a way forward and she’s the president of the CAS!

What did I learn: I learned that there is a plan at the CAS! Jessica is launching a deliberate effort to move the profession forward

What was my favorite part: I got the chance to touch on the debate that I never got to have about the potential merging of actuarial professions. Someday to revisit I am sure!

GA Bartick on How to Sell

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Why did I do this show? Sales is underrated! I love thinking deeply about sales and I have learned quite a lot studying GA’s work.

What did I learn? My favorite lesson was in thinking about how sales has changed over time (or not!).

What was my favorite part? I loved GA’s story about how he named his book. What is the silver bullet for sales?

Doug Hubbard on How To Measure Anything

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Why did I do this show: Doug’s work is an astounding depth of highly practicable advice on how to make decisions. Quantifying the value of information (you can do that!), overcoming cognitive bias (you can do that!), using actuarial techniques to apply to any decision making process (you can do that!), and on and on. Read Doug Hubbard!

What did I learn: Ok, here’s the real thing about Doug’s work: nobody has heard of Doug Hubbard. The implications of that are mind boggling to me. We have in our hands the way to really improve the world if we all respected and admired Doug the way I do. Yet we don’t! Figuring out why is becoming an obsession of mine.

What was my favorite part: Doug dropped a great phrase on me, analysis placebos. Love it

Bryan Caplan on the Myth of the Rational Voter

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Why did I do this show: I have been studying politics of all things to better understand how we make decisions under uncertainty. Anthropologists that study risk make the link between decision making under uncertainty and the political decision making process. Bryan is such a fantastic person to study because he is an incredibly thorough researcher. You get an integration of almost all thinking in a field with you read one of his books and I wanted to understand politics.

What did I learn: I learned about Bryan’s concept of irrationality and how that captures the real political decision making process that underpins all decisions about uncertainty. There is much to continue learning here!

What was my favorite part: I think my favorite part was linking the organizational political process to Bryan’s work which isn’t something he’d thought about.

Mahbod Moghadam on Controversy

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Why did I do this show? I first came across Mahbod on Erik Torenberg’s podcast several years ago. I was fascinated by the guy’s willingness to be a complete contrarian but also pretty open and self-aware. Very unusual person and one that I think is very easy to underrate. This was a bit of an experiment for me and I wasn’t sure I was going to publish it. It was on the shelf for a long time. But I dusted it off and gave a listen and found I enjoyed it so here it is!

What did I learn? I learned that Mahbod doesn’t like capitalism! Ha, what an interesting dude.

What was my favorite part? I can say my LEAST favorite part was accusations of racism and the like against all sorts of people. Ad hominem is definitely not my style, ha!

Joe Henrich on Cultural Evolution

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Why did I do this show? Joe is an absolute intellectual heavyweight in Sociology. This is a dream interview for me!

What did I learn? This is a bit meta but I was fascinated by Joe’s intellectual discipline. He never really strays from the research much as I tried to lure him to speculate about all kinds of ideas adjacent to his research but mostly undiscovered territory. How infrequently cultural evolution has been applied to business. More to come on this I promise you!

What was my favorite part? Easy, I got Joe to not disagree with my view that insurance is the most fundamental use of culture.

David Zuby On Crash Test Dummies

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Why did I do this show?

I was touring HDLI’s offices (I will publish this content some day!) and found myself talking to a worldwide expert in crash test dummies. I interrupted his stream of thought and asked if I could record!

What did I learn?

That cars once used cadavers instead of crash test dummies!

What was my favorite part?

How they design the biomechanics? How they transfer the data? How their research has directly led to improvements in airbag explosives! Much to like!

Scott Sumner On Monetary Policy

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Why did I do this show? I’m been a fan of Scott’s work for a very long time and when I found out he was putting out a book I asked him to come onto the show. Two massive lessons from Scott are: never reason from a price change and, more generally, the power of markets as forecasting tools.

What did I learn? I finally got my head around the basics of what monetary policy is! Here’s a clip!

What was my favorite part? Researching this show got me to thinking about how monetary policy experts really don’t participate much in the debates on cryptocurrency. I found one paper that touched on the topic and some random forum posts, and I asked Scott about how he might design a cryptocurrency right out of the gate. I was excited to use that as a device for exploring some of how monetary policy works and I think this was extremely useful for me to learn.

Follow me on twitter, linkedin and instagram for clips from the show!

Ken Brandt of Trans Re on COVID-19

Ken Brandt (episode page) is the co-President of Underwriting at Trans Re and we recorded this episode on June 3, 2020. COVID-19 remains a pretty big unknown and my own initial feeling was that it wouldn’t be a big deal for insurance. My thinking is changing on this.

Let me pull out some quotes on the best and worst case scenarios for insurance from Ken’s perspective. First the Best Case:

Ken Brandt: I think our best and now I think more realistic market scenario is we actually get paid appropriately for the exposures we’re taking on… and they’ll be reinsurance pricing momentum and the opportunity to provide our customers with, you know, quality return solutions at a fair price is probably better, better now than it has been in the last decade.

DavidWright: Why?

Ken Brandt: Well, that’s a good question. Why we you know, it’s not like someone woke up and announced, let’s alter in the market together. You know, it’s coming from pain and anticipated pain. So if you look at what was happening, pre pandemic, the market was already moving in several large areas, particularly in the US, particularly in casualty lines…

Here’s Ken on the Worst Case:

I mean, let me without a doubt the worst worst worst case scenario, not just for trans re, the industry, is what we’re kind of hinting at here and that government or legislature’s retro actively push in business interruption coverage where none was intended. To me, that’s what do they call it when the meteors supposedly wiped out the dinosaurs.. extinction level event? Yes, that’s an ELE, you know, the industry is not capitalized for that, or will ever be capitalized to take on a large portion of the damage done to GDP by a global pandemic. So, now, I don’t think retroactive coverage is going to happen. But that’s still not resolved. But that would be a very, very bad outcome for translating for everyone else in the industry. Outside of that, you know, I think a worst case for for us and many, many others, obviously, is that COVID losses kind of hit the higher end of some of these estimate ranges. And maybe the market has additional cats along the way….

David Wright: and it’s fascinating to me about about the answers. If I think your best case and worst case scenario is, is there actually a difference of kind not really a difference of type, right, and so it’s like the best case scenario like we know we’re going to get losses. The best case scenario is the losses are bad enough that it wakes us up. But not so bad that it takes us out. And the worst case scenario is it takes us out.

Ken Brandt: Right? It’s a simple business, David

In the insurance industry some surprises are good for business because they remind the rest of us that not everything is predictable. But handle that dynamite with care! Maybe the surprise is even scarier than insurance geeks imagined. When society is rocked to its core, assumptions for how the world works must change. There’s a doctrine called legal realism that basically says the law is what people want it to be. If there is a dire social need to extract money from the insurance industry, out it comes. They’ve got the guns after all. 

I don’t think insurance will be nationalized but that thought is rooted in my belief that we will come through ok in COVID-19. If things get worse, the social contract of “we as a society will let you keep your money”, among many others, will get rewritten. 

How COVID Hits the Poor with Jennifer Brady

Jennifer Brady (episode page) is the Executive Director of Oasis, a non-profit helping women, teens and children rise out of poverty in the greater Paterson, NJ area. Among the many, many things that are concerning about COVID-19, I think the most underrated is how this pandemic will afflict the poor. Jen and I cover a lot of ground in 30 mins, including:

  • How has the ‘COVID lockdown’ affected the working (now not working!) poor?
  • How able is this population to comply with CDC-recommended social distancing and other prevention practices?
  • What might be the social and political ramifications of substantial infections among the poor?

Think about huge groups of people that are predominantly first generation immigrants with poor English skills, highly concentrated in multi-generational homes (including the elderly and little children) and with high incidence of pre-existing health conditions. I can’t imagine a higher risk population.

What do politics look like when huge swathes of already marginalized people come down with a highly communicable disease that the richer parts of society overcome? And by politics I mean the potentially very ugly post-COVID politics where progressivism is dead?

Dark stuff, of course. The response Jen and the staff at Oasis are seeing so far is encouraging but there is a version of the future where when it turns worse when nobody is looking.