Saturday Cup of Joe: a lending and tech(ish) newsletter from Detroit

Saturday Cup of Joe #124.

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Friends & Colleagues,

Week 124. That’s all I have this week. I hope this week’s newsletter is valuable and entertaining. Thanks, as always, for reading.

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When I moved to Detroit, I heard a lot about the lower cost of living and the quality of life. While both have seemed true, it turns out it’s not true until after you receive your paycheck. Put another way, workers in Seattle and Boston actually take home more of their monthly pay. It’s only after it’s in their account that they end up spending dramatically higher costs than Detroiters.

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Source: howmuch

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“We know what we are, but know not what we may be.” -William Shakespeare

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Detroit: Harvard and U of M join forces under the Equality of Opportunity Project to address Detroit’s social challenges. For example, the two universities will build on neighborhood revitalization, housing affordability, and youth-focused initiatives already announced and being implemented by Mayor Duggan’s office. A second project will focus on Detroiters’ fighting a personal battle with opioid addiction.

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Answer Well: Learning to make better decisions is difficult. Interestingly, “In all [the] years at school, not once did I take a class that taught me how to make a complex decision, despite the fact that the ability to make informed and creative decisions is a skill that applies to every aspect of our lives: our work environments; our domestic roles as parents or family members; our civic lives as voters, activists, or elected officials; and our economic existence managing our monthly budget or planning for retirement.”

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Lafayette Street, Detroit, MI, USA.

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Consumer data: I really liked a post I read on Medium.com this week because it asks a question that I often try to ask — “how do we know?” When I was in law school, I published an article based on the Michael Lewis book Moneyball that asked the question — how do we know the good law schools are actually good? The Medium.com article focused not on law schools but consumer data. The author notes, what seems anecdotally accurate to me, consumer data is as expensive and sought after as its ever been, but that many companies (most?) do not know what data is valuable. The obsession to get any and all data fails to isolate or identify the truly meaningful data.

The author concludes that predicative models of consumers are often off and sometimes way off. With one exception, Amazon, most third party consumer models are still too watered down to be truly effective. According to the author, “To Amazon, you are what you buy. Nothing more, nothing less” allowing them to be slightly more accurate in their predictions.

One question I thought was — if I had the correct model, would anyone know? Perhaps some of these retailers actually did crack the code, but haven’t announced or sold the fact that they figured it out.

At the same time, it is exactly the “current ineptitude of data providers” that is “actually protect[ing] the privacy of many internet users.”

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Source: puredetroit313 on IG

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In Brief: Here is an interesting story on “surveillance capitalism” and the unlikely person in Silicon Valley fighting it. If you, like me, constantly find yourself in debates about online activity and consumer data, this story will interest you.

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What’s next: I’ve often wondered why Presidents and other leaders do not focus or promote research & development as an area of investment. Too attenuated from why people vote? Too abstract? Not helpful enough to enough people? I saw a statistic recently that, on average, American companies spend 18% on R&D. I couldn’t believe it. I thought that was incredibly high and was likely the result of companies overstating their efforts when asked about. Either way, one article caught my attention because it suggests that Congress is considering funding research and investment in quantum computing. Thought to solve complex problems or synthesize solutions in ways we humans cannot, quantum computing is still far away from creating a significant impact in our economy. Interesting area to keep an eye on, especially in healthcare and financial services.

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This is a completely unremarkable list of the 10 affordable cities, growing the fastest. With 1 exception — Sacramento — this list is totally obvious and found in one way or another all over the web. I included it here merely to highlight that fact.

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“One must see many cities, men and things. One must know the animals, one must feel how the birds fly and know the gesture with which the small flowers open in the morning… One must have memories of many nights of love… But one must also have been beside the dying, one must have sat beside the dead in the room with the open window…” — Rainer Maria Rilke

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Belle Isle, Detroit, MI, USA

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Friction: According to Stanford researchers, the concept of “organizational friction” is the incidental work, stress or effort that managers cause their teams when making off-handed comments or giving out tasks without knowing the full impact. For instance, if managers do not pay close enough attention to their teams, waste and duplication results. What do you do? Look for employees that end old, obsolete and ineffective programs and practices instead of celebrating employees that start new, big ones. According to the research, “the best leaders discourage [the] addition sickness by praising, promoting and paying employees who remove destructive friction and waste.”

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Unsure of where to put this next article or whether to endorse it at all, I decided it was worth the read. This Guardian piece tracks the global economic history of the gold standard from Bretton Woods to present. Present as defined by the world’s richest 42 people holding as much wealth as the bottom half. 42! That’s why I think you have to have your guard up when you read the Guardian. Nonetheless, it is interesting to see how rules can be made across the board but small applications or changes have a ripple effect across the world. And it doesn’t hurt that the author uses the plot of the movie Goldfinger to tell the story.

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Source: BuildYourEmpire on IG

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Action over activity: Idea debt. “Idea Debt is when you spend too much time picturing what a project is going to be like, too much time thinking about how awesome it will be to have this thing done and in the world, too much time imagining how cool you will look, how in demand you’ll be, how much money you’ll make. And way too little time actually making the thing.” — Jessica Abel

The answer? Start right away. At least take the step. Then handle each task or step only once. Finish that step. Will it work? No idea. But it’s worth thinking about.

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Where art meets science: Data visualization. Here is an interesting look at the data visualization of Amazon, Facebook and Google courtesy of FastCompany.

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Economies of scale: Lenders of all stripes worry about the result rising student debt is having on our businesses. Politicians worry about the result on employment and the economy. Students and debtors worry they’ll never escape the crushing pressure. And for what?

This article in The Atlantic says, “All told, including the contributions of individual families and the government (in the form of student loans, grants, and other assistance), Americans spend about $30,000 per student a year — nearly twice as much as the average developed country. “The U.S. is in a class of its own,” says Andreas Schleicher, the director for education and skills at the OECD, and he does not mean this as a compliment. “Spending per student is exorbitant, and it has virtually no relationship to the value that students could possibly get in exchange.”

The only country that spends more per student is Luxembourg and that cost is borne by the government.

If this is of interest, I would highly recommend the link. The author looks into the cost of “ancillary services” like entertainment and comfort. The cost of non-teaching staff such as counselors, lawyers, accountants, fundraisers, security staff and maintenance is also compared to other schools and systems globally. Unfortunately the conclusion is a somewhat bleak one — the closest comparison to higher education in our society is the healthcare system.

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Today’s thought: Collar buttons and table salt. I’ve written before, I believe, about the hiring executive who cannot select between the two candidates for an open position. Both are imminently qualified. Both interview extremely well. Both have rapport with the new team and new company. Finally, the executive decides to take both out to dinner at the same time and hope that someone shows themselves to be the right choice. Even after dinner, both candidates have proven themselves. The executive decides that something must break the tie and remembers at dinner that one candidate salted his plate when the food arrived and one candidate tasted his food before adding salt. The candidate who tasted the food first was selected.

My grandfather told me that story. I have no idea if it’s true or the type of white collar legend that gets grandsons to take all choices and interviews seriously. Nevertheless, years after he told me that story, I was working in a company and a more experienced employee came up to me to let me know my collar was not button to the collar buttons. I quickly thanked him pretending like it was akin to missing a belt loop. I was 22. We were business casual. The reality was that buttoning the collar buttons, until that moment, hadn’t mattered to remember one way or the other.

I was reminded of both stories this week when I sat across from someone in a negotiation (of sorts) who did not have their collar button down. I thought back to both stories and then immediately thought — “should I pass judgment on this guy’s collar buttons?” If so, what does it tell me? In the end, nothing. Or probably nothing. Too many other variables — maybe he got up early to be at this meeting, maybe something crazy happened with his kids before work, etc. — to make critical decisions on that type of detail. Do you agree? Do you notice the slightest action or movement or choice in others? If so, what do you do with that information?

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Quote: “The brain is wider than the sky.”

— Emily Dickinson

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Bonus Content: Apparently there’s a warehouse near New Orleans with between 6–7 million species of fish…preserved in jars. Seriously, it’s got a minnow from 1838.

Continued success and continue to answer well,

Written by

Thinker, curious leader, once an attorney…always trying to answer well.

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