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Black Box Posted July 13, 2009 @ 7:36 pm In Black,Colors | No Comments “Black box” can be used to describe a process or program, whose functioning is not transparent to the user, or doesn’t require any human interaction to function. It can be used in a variety of fields such as computers to describe the functioning of a program or in finance to describe an investment strategy, or biology to describe the way a system functions. Computer Science: “The software’s ‘black boxness‘ was driven home for me once when XP was taking an excruciatingly long time to load, and even the best tech sleuths at Microsoft couldn’t figure out the cause. Had I been able to look under cover, I might have seen, oh, that Windows was wasting 90 seconds looking for a nonexistent drive.”—Lee Gomes, “Dear Windows 7 Programmers, I Have a Few Ideas… [1],” The Wall Street Journal [2], 4 Jun 08, p. B8. Finance: “Being long a bunch of radioactive crapola that you can’t sell except maybe for cents-on-the-dollar to some vulture, er, distressed-investment specialist, and being forced to mark it on your books at that price instead of the price that your high-tech black box model says it is worth can’t be much fun. It’s especially unpleasant when, after marking it to market, you have to take big fat writedowns and the next thing you know your stock options are worthless and nobody’s getting a bonus this year. Dudes, that’s harsh.”—Harry Koza, “Mark-to-market: Great on the way up, very painful on the way down,” The Globe and Mail [3], November 7, 2008, p. B12. Biology: “For many current research purposes, however, the ecological model can be daunting. ‘As an overall approach, ecology is hard,’ Goldberg says. ‘It’s complex systems and highly dimensional.’ These challenges have led many to think of human microbiota more as biologists conceptualize organ systems, looking for inputs and outputs and putting aside—for now—what happens in the so-called black box. ‘It’s conceptually easy to think of it as an organ system,’ Foxman says. ‘But there are lots of reasons to go into the black box…Ultimately, we really do need to understand the system.’”—Katherine Harmon, “Bugs Inside: What Happens When the Microbes That Keep Us Healthy Disappear? The human body has more microbial than human cells, but this rich diversity of micro-helpers that has evolved along with us is undergoing a rapid shift—one that may have very macro health consequences [4],” Scientific American [5], December 16, 2009. |
“Better technology also appeals to some of the exchanges' most important customers, who increasingly are making use of algorithms, statistical arbitrage and other 'black box' techniques to trade shares on several markets at once.”
—Alistair MacDonald, Aaron Lucchetti, and Edward Taylor, “Long City-Centric, Financial Exchanges Are Going Global,” The Wall Street Journal, May 27-28, 2006, p. A4.
“It may be an oversimplification, but the black-box funds appear to be value investors, buying stocks with low price/earnings ratios, low price/revenue ratios or low price/book value ratios while selling stocks with high-P/E, high-price/revenue and high-price/book ratios.”
—Andrew Bary, “The Bill Lands on Wall Street’s Desk,” Barron’s, August 13, 2007.
“'People are creating a new asset class,' said Anne Valentine Andrews, head of portfolio strategy at Morgan Stanley Infrastructure. 'You can see and understand the businesses involved—for example, ships come into the port, unload containers, reload containers and leave,' she said. 'There’s no black box.’”
—Jenny Anderson, “Cities Debate Privatizing Public Infrastructure,” The New York Times, August 27, 2008.
“From that moment, though, the Wall Street firm became a black box. The shareholders who financed the risks had no real understanding of what the risk takers were doing, and as the risk-taking grew ever more complex, their understanding diminished. The moment Salomon Brothers demonstrated the potential gains to be had by the investment bank as public corporation, the psychological foundations of Wall Street shifted from trust to blind faith.”
—Michael Lewis, “The End,” Portfolio Magazine, December, 2008.
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URL to article: http://www.ealmanac.com/357/colors/black-box/
URLs in this post:
[1] Dear Windows 7 Programmers, I Have a Few Ideas…: http://online.wsj.com/article/SB121252179249042275.html
[2] The Wall Street Journal: http://www.wsj.com/
[3] The Globe and Mail: http://www.theglobeandmail.com/
[4] Bugs Inside: What Happens When the Microbes That Keep Us Healthy Disappear? The human body has more microbial than human cells, but this rich diversity of micro-helpers that has evolved along with us is undergoing a rapid shift—one that may have very macro health consequences: http://www.scientificamerican.com/article.cfm?id=human-microbiome-change
[5] Scientific American: http://www.scientificamerican.com/
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