Escape from New York

I've returned from a jam-packed trip to NYC that was part business and part pleasure. I always find it hard to leave New York without feeling that leaving is a mistake. It is such an amazing place. Very few places on Earth can boast the same wide-range of risk/return opportunity sets. Here are some thoughts:

• To my impression, by a wide margin no other American city is as much an international city. This is an underappreciated quality.
• It is a shame people tend to be too uncreative to appreciate experiences that are not "tourist traps". 
• The success of the city, largely a reflection and exacerbation of the success of American free enterprise, disguises and minimizes the drag of being in the People's Democratic Republic of Bloomberg [insert any prominent former or future mayor as well]. It is hard to see the forest of unintended consequences when dealing so directly with the trees of real-world problems. Viewed in this lens, it becomes easier to excuse the frequent acquiescence to bureaucratic and technocratic power.
• If your only impression of life in NYC was from television sitcoms, you would be missing 75% of it. If it were only from movies, I'd say you are still missing 50%, and most of that corresponds to the prior missing 75%. 
• Goldman Sachs, the business portion of my adventure, is a first-class organization. I am often a critic of the revolving door between government regulators of GS and executive positions at GS along with other regulatory capture issues. Being in the heart of the dragon, one sees clearly how that cozy relationship maintains harmony. Literally, the janitors at GS exude more confidence and professionalism than I've seen among bank presidents. Uniformly both in informal conversations and formal presentations, every representative of GS was quite impressive--not cocky or arrogant, but definitely assured of themselves and their organization and certainly serious. They can and do laugh (when appropriate), but I am certain they physically lack the ability to giggle. 
• I appreciate Goldman for having me as a guest at what was a very good conference filled with good information and entertainment. I now have more respect for them as a money manager, and it is with more confidence that I consider investments with them for my clients. 
• Here is a random thought I had during the conference: Does corporate paternalism and generosity breed acceptance for governmental paternalism? This is similar to the forest/trees thought referenced above. People in these companies are very well taken care of with all ancillary needs provided or sourced, they are used to showing ID cards and having limited access within their firm and even on their floor or in their business group, they work in "safe" environments insulated from the "chaotic" world outside, etc. 
• Depending on your perceptive sensitivity to any given behavior, you can get the feeling that "everyone" in NYC matches that given behavior. For example, everybody jogs. Of course, everyone doesn't. But it is easy to be misled being that there are countless examples of any behavior, activity, etc. to be found. That is one thing >60,000 people per square mile will get you. This goes a long way to explain misconceptions visitors come away with.
• Being in the beautiful jungle of so many choices, a thought I have had previously occurred to me again. A key to happiness is being easy to please. If you can see the good in things (be optimistic) and if you can refrain from pickiness (see things as highly substitutable), you can greatly expand your happiness. In economic terms, the flatter your indifference curves and the looser your budget constraint, the greater your utility potential. 
• Nearby our hotel was a Whole Foods grocery. We have a Whole Foods store in Oklahoma City, but the store in NYC, as a microcosm of so much else, is quite different from the store in OKC. The selection was larger in scope and scale, and the services included delivery for a flat $10 fee. No such delivery option is available in OKC. Discussing this with my wife dovetailed with other grocery economics discussions we have had. We've thought before about the intrinsic differences among stores like Whole Foods and Central Market versus Safeway and the local Crest Market versus Sam's Club and Costco. Not to get too far off on tangents, but this thought problem brings up the difficulty of finding a comparable basket of goods for inflation as well as other comparisons. Back to the central idea, what are people getting out of food shopping? The joy of bargain hunting (optimizing $/calorie) versus the joy of elegant shopping (optimizing the experience per se) could be generalized extremes along what seems a reasonable dimension of quality/quantity tradeoffs (optimizing selection and discovery). At what point is the only physical grocery shopping we do that done as an entertainment (elegant shopping) with the remainder done online including preprogrammed? 
• Enough random thoughts. Here are some pictures from a great trip. Enjoy!

Vegas observations

I'm just back from Vegas, baby! and have a few observations to share:

• They didn't give daddy the Rainman suite, but they treated me well. Stayed at the Venetian, which is a hard act to beat and maybe the best option in town for a family such as us.
• Vegas has got to be the people watching capital of the world. Perhaps someday (hopefully) a cross section of the world will in fact be as wealthy and glamorous as the Vegas Strip population appears, but it will perhaps (unfortunately) also be just as shallow.
• Speaking of watching the shallow-minded people, it is fun to hear how confident foolish people can be. Craps and Blackjack are the penultimate examples of this. This observation deserves its own breakdown:
• It is amazing how many people have a long history of "always paying for their trips with their (Craps, Blackjack, et al.) winnings". I don't see how those casinos can afford to keep the lights on. Perhaps we should take up a collection.
• The ability to add quickly does not make you "good at math". Knowledge of mathematical principals, ability to see things in algorithmic terms, and appreciation for underlying systems like probability are qualities of good mathematical minds. They don't give out many Fields Medals for counting. To conflate that you can add up an Ace, Seven, Queen, and Four quickly or pay out at 6:5 odds on $15 bet with $75 backing it up in a swift motion with being "good at math" is like saying spelling bee performance is highly correlated with great writing in literature.
• The human mind is ridiculously susceptible to the lure of superstition. 
• How much can you really make in tips standing on the Strip in a creepy, B-level children's entertainment character costume? Apparently enough as compared to about 20 people's next best option.
• The variety of hotel casinos reminds me that it takes all kinds. I hear you say, "Is that what it takes? I always wondered what it took." But it is as true here as ever. A Las Vegas central planner would probably be a lot like Steve Wynn. His design would be remarkable, beautiful, distinctive, and exclusive while also being unappealing and unavailable to most. His monopoly status would promise unprofitability if without subsidy. Or the planner would be like the group that runs Caesars Entertainment Corporation (the owners of Caesar's, Harrah's, and a host of additional properties that appeal to a group much less sophisticated than the Encore set). The place would be tacky without perspective and a "big-box" version of a gaming destination. The monopoly status would again promise unprofitability if without subsidy. Fortunately, we have a mostly free-market approach, which allows for some, really a lot, of both styles with many degrees in between, above, and below. It is just important to realize that the right side of the distribution (almost no matter what distribution we consider: quality, variety, quantity, price, etc.) necessitates a left side. 
• I'm glad I saw this excellent piece in the New Yorker after my trip. I would have been even more paranoid about street crime. Watch the video as well. (hat tip: Kottke)

PS. Don't be misled by my hypothetical on a Las Vegas central planner. I very much admire the entertainment products of both Steve Wynn and the Caesars group.