Hal Varian:

Every now and then a set of technologies becomes available that sets off a period of "combinatorial innovation." The component parts of these technologies can be combined and recombined by innovators to create new devices and applications.

It is hardly novel to suggest that contractual form depends on what is observable. What is interesting, I think, is the way that progress in information technology enables new contractual forms.

Varian:

These days nearly every economic transaction involves a computer in some form or other. What does this mean for economics? I argue that the ubiquity of computers enables new and more efficient contractual forms, better alignment of incentives, more sophisticated data extraction and analysis, creates an environment for controlled experimentation, and allows for personalization and customization. I review some of the long and rich history of these phenomena and describe some of their implications for current and future practices.

Ross Anderson:

Many of the problems [of information insecurity] can be explained more clearly and convincingly using the language of microeconomics: network externalities, asymmetric information, moral hazard, adverse selection, liability dumping and the tragedy of the commons.

Dee Hock:

Inherent in Visa is the archetype of the organization of the 21st century.

Economist:

The tempting answer is to try to wriggle free from the dilemma with a compromise that would permit innovation but exert just enough control to squeeze out financial failure.

It is a nice idea; but it is a fantasy.

Financial progress is about learning to deal with strangers in more complex ways.

Computer Mediated Transactions

Embrace the suck.

When Lieutenant Matt Gallagher began his blog with the aim of keeping his family and friends apprised of his experiences, he didn't anticipate that it would resonate far beyond his intended audience. His subjects ranged from mission details to immortality, grim stories about Bon Jovi cassettes mistaken for IEDs, and the daily experiences of the Gravediggers -- the code name for members of Gallagher's platoon. When the blog was shut down in June 2008 by the U.S. Army, there were more than twenty-five congressional inquiries regarding the matter as well as reports through the military grapevine that many high-ranking officials and officers at the Pentagon were disappointed that the blog had been ordered closed.

Based on Gallagher's extraordinarily popular blog, Kaboom is "at turns hilarious, maddening, and terrifying," providing "raw and insightful snapshots of a conflict many Americans have lost interest in" (Washington Post). Like Anthony Swofford's Jarhead, Gallagher's Kaboom resonates with stoic detachment and timeless insight into a war that we are still trying to understand.

From the archive, a selection:

Things will be frustrating. Don't get frustrated.

Some of your greatest successes are going to be the children of failure.

I beg you, as you begged me,
Tell me what I can do
To make you forget
That my people never remember.

They listened. Then in the distance he heard a dog bark. He turned and looked toward the darkening town. It's a dog, he said.
A dog?
Yes.
Where did it come from?
I don't know.
We're not going to kill it, are we Papa?
No. We're not going to kill it.
He looked down at the boy. Shivering in his coats. He bent over and kissed him on his gritty brow. We won't hurt the dog, he said. I promise.

Kaboom

Khalid Mohtaseb:

A week after the devastating earthquake hit Haiti, I was hired to shoot ENG footage for two international networks. This is a montage of personal footage I shot of the aftermath during my spare time, in and around Port au Prince. We were in Haiti for a total of 6 days in which 2 of those days were spent traveling to and from Santo Domingo, Dominican Republic.

Shot with a Canon EOS 5D Mark II DSLR.

Haiti Earthquake Aftermath Montage

Nir Rosen:

Marines lay about in the shade.

A young specialist sat atop a Humvee.

"We came, we parked, we relocated, then we parked," he beamed.

Richard Haass:

Let's not kid ourselves. We're not going to find some wonderful thing that's going to deliver large positive results at modest costs. It's not going to happen.

David Kilcullen:

You've got to make a long-term commitment.

A retired American military officer, working in security in Afghanistan:

We're winning every day. Are we going to keep winning for 20 years?

Cormac McCarthy:

At dusk they halted and built a fire and roasted the deer. The night was much enclosed about them and there were no stars. To the north they could see other fires that burned red and sullen along the invisible ridges. They ate and moved on, leaving the fire on the ground behind them, and as they rode up into the mountains this fire seemed to become altered of its location, now here, now there, drawing away, or shifting unaccountably along the flank of their movement. Like some ignis fatuus belated upon the road behind them which all could see and of which none spoke. For this will to deceive that is in things luminous may manifest itself likewise in retrospect and so by sleight of some fixed part of a journey already accomplished may also post men to fraudulent destinies.

In the Land of the Stoner Cops

Asadullah Falah:

First we eat, then we drink, then we talk!

Naheed Mustafa:

Afghans have a term, ishqi watani, that refers to a deep and abiding affinity for one's people, culture, and identity. Essentially, it means an unconditional love of the homeland. But the state -- or at least what we in the West think of as a state -- has never really existed in Afghanistan. There have been attempts to bring reform through monarchy, through secularism and Communism. The country has had kings and presidents. None have matched up well with Afghans' ideas about what it means to be Afghan. Ishqi watani has helped Afghans endure thirty years of war. But it has also kept their gazes fixed upon their battles to preserve, not looking ahead to where they could go.

Rory Stewart:

"We're beating the cat."

"Why are you beating the cat?"

"It's a cat-tiger strategy."

Three Meals in Afghanistan

Matt Gross:

Over six days in late November, I submerged myself in Tokyo's ramen culture, eating roughly four bowls a day at shops both fancy and spartan, modern and ganko, trying to suss out not just what makes a good bowl but also the intricacies of ordering and eating well. Above all, I wanted to know why such a simple concoction -- brought from China by Confucian missionaries in the 17th century -- inspired so much passion and devotion among Japanese and foreigners alike, and to thereby gain some deeper understanding of Tokyo itself.

Andy Raskin:

Success at the Tokyo restuarant Ramen Jiro starts with knowing yourself:

Can you handle the large size?

"Bob" on Ramen Jiro:

"It's like the White Castle of ramen."

One Noodle at a Time in Tokyo

James Fallows:

Retired Admiral Mike McConnell argues that we now suffer from a conspiracy of secrecy about the scale of cyber risks. No credit-card company wants to admit how often or how easily it is cheated. No bank or investment house wants to admit how close it has come to being electronically robbed. As a result, the changes in law, regulation, concept, or habit that could make online life safer don't get discussed. Sooner or later, the cyber equivalent of 9/11 will occur -- and, if the real 9/11 is a model, we will understandably, but destructively, overreact.

Tom Cross via Andy Greenberg:

Internet-related companies need to be more transparent about their lawful intercept procedures or risk exposing all of their users. There are a lot of other technology companies out there that haven't published their architecture, so they can't be audited. We can't be sure of their security as a result.

Rattle:

Paranoia about the conspiracy is always justified. It's just usually misplaced.

Rebecca Brock:

She tells me she's ready. She may be small, she says, but she's mean. She outlines her plans for fending off terrorists. She says, "I kind of hope something happens, you know?"

She wears an American flag pin on the lapel of her blazer. She sits on the jump seat, waiting for her life to change.

Decius:

Wow, life is boring.

Cyber Warriors

Steven J. Murdoch, Saar Drimer, Ross Anderson, and Mike Bond:

EMV is the dominant protocol used for smart card payments worldwide, with over 730 million cards in circulation. Known to bank customers as "Chip and PIN", it is used in Europe; it is being introduced in Canada; and there is pressure from banks to introduce it in the USA too. EMV secures credit and debit card transactions by authenticating both the card and the customer presenting it through a combination of cryptographic authentication codes, digital signatures, and the entry of a PIN.

In this paper we describe and demonstrate a protocol flaw which allows criminals to use a genuine card to make a payment without knowing the card's PIN, and to remain undetected even when the merchant has an online connection to the banking network. The fraudster performs a man-in-the-middle attack to trick the terminal into believing the PIN verified correctly, while telling the issuing bank that no PIN was entered at all. The paper considers how the flaws arose, why they remained unknown despite EMV's wide deployment for the best part of a decade, and how they might be fixed. Because we have found and validated a practical attack against the core functionality of EMV, we conclude that the protocol is broken.

This failure is significant in the field of protocol design, and also has important public policy implications, in light of growing reports of fraud on stolen EMV cards. Frequently, banks deny such fraud victims a refund, asserting that a card cannot be used without the correct PIN, and concluding that the customer must be grossly negligent or lying. Our attack can explain a number of these cases, and exposes the need for further research to bridge the gap between the theoretical and practical security of bank payment systems.

Steve Bellovin et al:

Architecture matters a lot, and in subtle ways.

Joe Klein:

Blackboard, now acting like a financial network, is not using secure communications.

John Schwartz:

The critical issue is no longer getting information, but getting the right information to the right people at the right time. And that turns out to be one of the hardest tasks around.

Chip and PIN is Broken

Mark Pincus:

I'd rather be on a team that has no bad people than a team with stars.

It's not that they're a star player, but they have decent skills, and they will get you the ball and then be where you'd expect to put it back to them. It's like their head is really in the game.

If you give people really big jobs to the point that they're scared, they have way more fun and they improve their game much faster.

Scott Boms:

Ultimately, burnout results from a lack of equilibrium. When you lose your balance, physically, you fall over. Burnout is very similar, except that once you're down, it can be a real challenge to get back up.

Justin Kan:

You could be working on the most boring piece of software, and you talk to Paul and you think, Man, I'm excited to go back to work.

Are You a CEO of Something?

Bradley A. Smith:

The law, Malcolm Stewart contended, would even require banning a book that made the same points as the Citizens United video.

There was an audible gasp in the courtroom. Then Justice Alito spoke, it seemed, for the entire audience: "That's pretty incredible."

Decius, 2010:

The thing that sucks about freedom of speech is that rich people can afford more speech than you can.

Decius, 2003:

Your right to freedom of speech is an inalienable right. Even if you are rich. That's what an inalienable right is.

Decius, 2009:

It's important to understand that it isn't Congress that must change -- it is us.

The Myth of Campaign Finance Reform