Musings Report #14 4-7-13 The University of YouTube
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For those who are new to the Musings reports: they are basically a glimpse into my notebook, the unfiltered swamp where I organize future themes, sort through the dozens of stories and links submitted by readers, refine my own research and start connecting dots which appear later in the blog or in my books. As always, I hope the Musings spark new appraisals and insights. Thank you for supporting the site and for inviting me into your circle of correspondents.
The University of YouTube
In response to last week's Musings on the impact of the Internet on creativity, Fred R., who has taught for 43 years in a large state university, observed that students recall visual presentations with far greater ease than they do text-based precepts. Based on his long experience in the classroom, he suggested that the real leverage of the Internet in education and learning may be its power to distribute visually based lessons and ideas.
In confirmation of this, consider the phenomenal range of tutorials that are available on YouTube--what we might call the self-organizing University of YouTube.
Just within my own small circle of close friends, people have watched tutorials on everything from sewing on a button to installing WordPress, and I benefited from a tutorial on the Kindle Fire (supposedly intuitive, but I guess I'm just dumb).
Since virtually anyone with the basic technology of video recording can upload a YouTube segment, the quality of various tutorials varies, as does the quality of music and political rants. A rough sort of democratic meritocracy sorts the millions of postings into lists of most watched, providing a ranking to aid those who don't want to invest time in watching repetitive tutorials.
Is the "best" tutorial always the most watched? There is no way to know, but we can reckon that the most watched offers some value to a spectrum of viewers. We can also reckon that there is a feedback loop to popularity--that once a video reaches a certain ranking, more people find it and choose to watch it. Could misinformation be presented as true? Of course, but viewer feedback (visible below the video) would likely alert new viewers of the flaws.
There are several other features of YouTube worth noting. One is the instant availability of distraction: goofy pet videos, musical performances, celebrity interviews and so on in nearly infinite profusion. How can a student concentrate on the lesson with such distractions a mere click away?
Consider a YouTube series teaching beginners how to play guitar. This is an interesting example of the limits of YouTube University. I am sure the lessons are competent and useful, but one doesn't learn guitar from watching a lesson, one learns by repeated, organized, excruciatingly frustrating practice, repeatedly forcing one's fingers to press strings in unnatural configurations, and plucking the strings in a specific order and timing.
The learning curve is steep. It takes hours of practice that yield precious little mastery just to accomplish Lesson One. If the student perseveres, then Lesson 20 is much more easily absorbed because the foundation has already been mastered.
Learning to play a musical instrument is representative of a spectrum of knowledge that can only truly be learned by doing, and by pursuing a structured progression of building on basic skills and knowledge until the difficult becomes easy. The classical Taoist texts relate many examples of the Tao flowing as a result of mastery: when you reach the level of no longer thinking about the task per se, then you (finally) experience the Tao of doing. As Bruce Lee put it, "I do not hit. The fist hits all by itself."
This level of "not thinking about the mechanics" is the necessary basis for improvisation in music, the arts and writing.
Can YouTube University bring students to this level? The answer depends on the student. of course: we are not passive receptacles awaiting filling but participants. A student with very high levels of self-discipline, dedication and concentration could likely learn relatively high-level skills on YouTube. But most of us probably need some additional structure and help during the arduous and initially steep grade of the learning curve.
YouTube University is thus perhaps best as a learning tool for those who already possess basic knowledge about the task at hand, as opposed to the complete newbie. It may also reach its greatest potential when used in conjunction with other learning resources: collaborative projects, in the classroom, with mentoring, etc.
We can't claim to know the impact or potential of YouTube University. But we can can already conclude that its cost (free, other than cost of the Internet connection), range and accessibility make it an unprecedented educational resource.
Market Musings
One weakness in a weekly format is that sometimes things change dramatically in the market overnight, for example the remarkable plummet in gold, silver and the gold miners mid-week. This dramatic decline (in the context of the roll-over of one key index after another--copper, banking, transport, the Russell 2000, and so on) prompted me to exit my tech-sector trade for a 50+% gain and shift that capital into calls on the decimated gold miners. I also opened small positions long volatility and the SDS (bearish SPX) ETF which I already exited for gains.
As is often the case, an "unexpected" weak jobs report acted as a tipping point, pushing a market burdened with divergences over the edge. That "buy the dip" buying lifted the markets back to modest losses does not negate the divergences or the technical damage done by the decline. Now the question is whether this past week marks the top, or if this downturn will be brief and shallow, and serve to set up one last run for new highs and SPX 1600.
I have no expectation one way or the other, but I am certainly open to the possibility that a sell-off could set up one more run higher later in April or early May. We can look at indicators such as the VIX and the Put-Call ratio ($CPC on stockcharts.com) for indications of full-blown panic that tend to mark near-term bottoms.
The gold bears have been feasting at the banquet for months, and should gold break strongly above $1,620, that could trigger short-covering (it is currently $1,580/ounce). A sharp spike up in gold would not surprise me as a desire to book profits in equities and move into safe havens would logically push precious metals higher. There is of course no certainty or guarantees, and a number of good analysts see gold testing $1,487 or even lower. My timeline is days and weeks, not months or years. Gold could reverse and fall further, but divergences and the context of global uncertainty favor a move higher here.
If gold fails to exceed $1,620 and stay above that level for a few days, that would suggest weakness and another leg lower. But if it regains the 50-day moving average at $1,612 and moves decisively above $1,620, that would suggest the advance may have more room to run.
What I did: sold my tech position on Wednesday, bought the gold miners and calls on volatility and SDS (bearish SPX ETF), sold them for gains.
What I am doing: wait for a tradeable trend to develop.
What I would do if I were managing $1 billion: Dump my modest tech positions, pat myself on the back for building positions in commodities rather than equities, and open trading positions in the beaten-up gold miners, now that a near-term bottom has been put in and there are positive divergences in key indicators.
The best thing that happened to me this week
Attending Mish's Wine Country Conference in Sonoma was the best thing that happened this week--it was great to finally meet Mish in person after corresponding with him for many years, and hearing some excellent presentations. I will share some impressions and conclusions in next week's Musings Report. My attendance was entirely due to the invitation and sponsorship of Adam Taggart of Peak Prosperity.com. Thanks, Adam!
In the Best Fun Thing category, our neighbor's teenage daughter gave us this Easter Basket filled with home-baked goodies. A lot of time and love went into this basket....
From Left Field
Leaks reveal secrets of the super-rich who hide cash offshore (via Steve K.) $21 trillion is the estimated total stashed in the British Virgin islands. Gee, that's almost as much as the Federal Reserve backstops to the Too Big To Fail banks.... $20 trillion here, $20 trillion there, pretty soon you're talking real money.
The Decline of Critical Thinking (via Steve K.) Since critical thinking isn't taught in the classroom (though lip service is paid to it), where can it be learned?
Why the Euro Is Doomed in 4 Steps (The Atlantic) The conclusion is correct but the reasoning is faulty. Nonetheless it's noteworthy that an Establishment journal openly pronounces what we have known for years...
The Meme Hustler: Tim O’Reilly’s crazy talk Long, rambling, but interesting: "On first impression, O’Reilly seems like a much-needed voice of reason—even of civic spirit—in the shallow and ruthless paradise-ghetto that is Silicon Valley."
The erosion of facts: Real estate data is junk -- with all the hidden subsidies and shadow inventory, it's no longer possible to make sense of basic mortgage-housing data.
“The map is not the territory.” Alfred Korzybski
Thanks for reading--
charles
