Wednesday, February 29, 2012

Delighting FLG

FLG has commented numerous times how he thinks its stupid that companies but "delighting our customers" on their mission statements. FLG can't remember ever being delighted by a company, except maybe at Disneyland and maybe some high-end hotels.

There are a few companies, however, that FLG really does enjoy dealing with. Amazon is probably top among those. Another one, the one that prompted this post is Fidelity. FLG doesn't have to call them often, but when he does he always comes away happy. Yesterday's call was no exception. That's pretty hard to do as a financial institution.

Tuesday, February 28, 2012

Day Two

FLG isn't going to make this a daily thing, but he finished Day Two (and he guesses the first official workout given that yesterday was just a test) of the workout. And he is happy to say that he didn't throw up. However, he is completely exhausted and he downed a quart of water like it was a thimble.

Monday, February 27, 2012

Seriously?

Look, FLG ain't terribly well edjumuhkated or anything. BUT he finds it offensive to title a letter something like Advice from Your Uncle Polonius and then explain who Polonius is in a footnote and include the entire speech to Laertes in an appendix. We're not talking about Dick the Butcher, Reignier, or Osric here people!

Quote of the day

Badass of the week:
As you probably noticed, things got significantly more insane on planet Earth after the United States simultaneously declared war on everyone in the world in 2001

FLG Is Insane

Two Saturdays ago when Miss FLG Minor woke up for her early morning feeding, FLG thought it was a weekday. He went downstairs and, like he usually does on weekdays, turned on CNBC. Instead of the usual Asian and European markets coverage, FLG found an infomercial. Too tired to change the channel, he started watching.



Long story short, the infomercial worked because FLG thought to himself, "Hey, I'm crazy and fat. An Insanity workout sounds perfect for me." Well, today was the first day. On the first day you do a fitness test, which you then repeat every two weeks to demonstrate your improvement. Suffice it to say that FLG has a very low bar to clear next time, which is not puking halfway through.

FLG weighed himself before the start and came in at 220 lbs. He'll let you know how well the program works. If he doesn't keep puking that is.

Sunday, February 26, 2012

Quote of the day

Buttonwood:
not since the Black Death can there have been such a fall in workers

Saturday, February 25, 2012

Resolved

Every time FLG begins to say incentivize he should say encourage instead.

Thursday, February 23, 2012

FLG is currently listening to

Time for some arena rock.

Wednesday, February 22, 2012

Quote of the day

Dominique Strauss-Kahn's Lawyer:
Je vous défie de distinguer une prostituée nue d'une femme du monde nue.

Translation:
I defy you to distinguish a naked prostitute from a naked woman of the world.

The quote is actually pretty old, but FLG hasn't been following L'Affaire Carlton with the urgency he should have until the headlines today. It's crazy shit. Orgies on two continents. A dastardly, mysterious Franco-Belgian pimp named Dodo who has an assistant nicknamed The Assassin. Text messages.

A Follow-Up

FLG was thinking some more about this post and what Neal Stephenson had to say.

In it, you may remember, he says that if you took somebody off the street from 1900 and plopped them down in 1968 that person would be astonished by the changes, .i.e airplanes, rockets to the moon, nuclear power, etc, etc. If, however, you took somebody from 1968 and plopped them down in 2012, they'd see things they were very familiar with. Sure, cars have changed, but they're still cars. Jet airplanes look more or less the same. And then he says, dismissively, about how that person would go back to 1968 and say everybody has devices that are a cross between Capt. Kirk's communicator and Dick Tracy's wristwatch. How typewriters have been replaced by computers and hooked up to this Internet thing.

Anyway, FLG was thinking about this the other day. All things considered, smart phones and the Internet have had and will have a far larger impact on human beings than the moon shot. The power to communicate with people anywhere, anytime certainly comes with annoyance, but FLG'll will bet far more people have wished far more strongly far more often to be able to communicate with another person when they weren't able to than thinking how cool putting a human being on the moon would be.

Think of it this way - almost a billion people are on Facebook. How many people have walked on the moon? Twelve.

So, then FLG started thinking some more, and realized that what Stephenson desires, what he laments, is the failure of humanity to seek and demonstrate dominance and mastery of the physical world on a massive scale, which makes sense given that the talk was about Doing Big Things. But again, Big Things, while inspirational to some people, often aren't terribly relevant or meaningful to people's lived lives. Facebook, smart phones, and the Internet are orders of magnitude more relevant and meaningful.

To end somewhat abruptly, FLG has been mulling that over the last few days, and then this morning he saw this:
[P]overty has been reduced more in the past 50 years than in the previous 500. One major reason is the abundance of information-and-communication technology. According to research done at the London School of Business, adding ten cell phones per hundred people raises GDP by .6 percent. To quote technology write Nicholas Sullivan on this matter: “extrapolating from UN figures on poverty reduction (1 percent GDP growth results in a 2 percent poverty reduction), that.0.6 percent growth would cut poverty by roughly 1.2 percent. Given 4 billion people in poverty, that means with every 10 new phones per 100 people, 48 million people graduate from poverty.”

Tuesday, February 21, 2012

Individualism Versus The Church

FLG thinks Anti-Climacus misses something here.

Yes, modern day liberalism is inherently political and is much removed from its Protestant origins. Nevertheless, one should not overlook the strain of individualism that runs from those original Protestant liberals to today's more politically-based liberals.

Protestant churches are, for all intents and purposes, the individuals within the congregation within that local community. This goes back to Luther, and stands in stark contrast to the Roman Catholic Church as an eternal organization to which one belongs, but in important and fundamental ways stands beyond and above any of its members.

FLG thinks a misunderstanding of this relationship is why the Obama Administration got caught seemingly blindsided by the overwhelming negative reaction of even pro-choice, Democratic Catholics. Moreover, it's why FLG, who is not Catholic, finds many of the arguments based upon what percentage of Catholics use contraception, etc or arguing that the HHS mandate doesn't inhibit any particular Catholic individual from practicing their religion are incredibly offbase.

The Church, as an organization and institution separate from any group of Catholics even if they are a part of it, undertakes certain good works (education, health care, etc) as part of its religious obligation on behalf of its members, and if you pressed the logic all of mankind. It doesn't matter how many of its members use contraception or approve of its stance on abortion. The Church itself acts. Much in the same way that a corporation is a person that exists outside the individuals that own and work for it. Unlike a corporation, however, the Church endeavors to take up important good works instead of turning a profit. Thus, FLG is steadfastly in the grant a broad religious exemption and tell people that if they want to have contraception covered in their health care insurance plan, then don't work for the Catholic Church.

Anyway, modern liberalism, which is individualistic, a quality it inherited from its Protestant origins, does, FLG thinks, present a unique problem for the Catholic Church.

Monday, February 20, 2012

Quote of the day

Helen Rittelmeyer:
If women ruled the world, there would be no Heidegger — and that would be just fine, because the hours he spent writing Sein und Zeit would have been better spent playing pub darts with his friends or developing the perfect recipe for pfeffernussen.

Friday, February 17, 2012

Style Guide

The Economist's Style Guide is back online. FLG has resolved to review the introduction every month because its advice is timeless, simple, yet often difficult to heed.

Datapoint of the day

WaPo:
A new poll from Suffolk University shows Brown regaining a nine-point lead on former Obama aide Elizabeth Warren — a marked shift from a steady stream of polls that showed Warren moving into a virtual tie with the incumbent.

Hallelujah!

There is nobody FLG would rather see lose a Congressional/Senatorial election. Actually, FLG takes that back. He'd be more psyched to see Maxine Waters lose, but everybody knows she's batshit crazy and has no fucking clue what she is talking about ever. On the other hand, people think Warren is knowledgeable and competent.

Who Needs Nukes?

Iranian Female Ninjas

Thursday, February 16, 2012

Doing Big Things

While watching this video of Neal Stephenson talking about our society's seeming lack of ambition for doing big things...


Stephenson lists some of the great scientific accomplishments of the last century - antibiotics, airplanes, landing on the moon. But science says nothing about why these are great. Nor, would FLG argue, are they self-evidently awesome as Stephenson seems to argue.

So, what great new big idea does he proffer? We look back to Babylon and decide to build a big tower. Great. To what end? What does it mean? For whose glory? Who will stand as witness? What's the point? In fairness, Stephenson says, hey, maybe you think it's a dumb idea, the point is just to get people thinking big. But then FLG began to wonder about the moonshot. What meaning or relevance does that have for most people's lived lives?

FLG couldn't help but think of the greatest multi-generational projects - cathedrals - and wonder if maybe, perhaps, science is incapable of inspiring by itself.

And then FLG thought of this clip...

Wednesday, February 15, 2012

Made FLG Chuckle

FLG is currently listening to

DC Celebrity Sightings

FLG saw George Will on M Street again today.

It's Still About Leverage

FLG has written several times about how almost as soon as FLG begins to think Felix Salmon might just be a somewhat insightful journalist, he ruins it by posting something eyebleedingly dumb. Case in point, his insistence that the Occupy the SEC letter on the Volker Rule is amazing.

For those of you not paying attention to all this, the Volker Rule is a portion of the Dodd-Frank bill that attempts to restrict banks from engaging in proprietary trading, .i.e. the banks speculating in the market. As FLG has said before, he's generally supportive of the principle. He worries that the complexity of trying to implement it in practice will be a complete clusterfuck of complexity.

And, shocker, guess what the Occupy the SEC letter is? A complete clusterfuck of complexity. To be entirely fair, it is pretty damn good at what it is attempting to do. The people who wrote it were clearly in banking and are involved/were involved with this stuff on a day-to-day basis.

But that's part of the problem. There's can't see the forest through the trees. By which FLG means the thing was written from the POV of people in the finance industry trying to think of all the places that problems can arise in the day-to-day activities they perform. There's all these rules about underwriting, about what risks can be hedged with what products. They want, and FLG quotes, "a central database that catalogues the hedges that are consistently appropriate for each product." There's rules trying to prevent trading from simply shifting offshore. You get the idea.

This isn't to say that any of these are a bad idea, but it kind of misses the point. The issue we had in 2008 was systematic risk. Trying to limit systematic risk by trying to micromanage through statue and regulation the day-to-day activities of people who are 1) very smart and 2) stand to make a lot of money by finding loopholes is a dumb strategy.

Better just to deal with bank size and the real problem -- leverage. Less levered, smaller banks are less of a systematic risk. Full stop. Sure, the actual implementation will be more complex than that, but it will be way less complex than trying to stop proprietary trading.

The Changing Nature Of Banking

Bank branches used to be designed to create the feeling of stability, security, and wealth. Something like this at M and Wisconsin in Georgetown. FLG sees that newer branches that have lots of windows and are beginning to look more like Starbucks or something. This one, also in Georgetown, is a really good example. ING Direct's only physical customer presence is, in fact, coffee shops.

That got FLG thinking. All things considered, he interacts with his banks far more via the website, apps, or ATMs far more frequently than going into the branch. Several orders of magnitude more frequently. So, for FLG, the design, features, and ease of use of the website is far, far more important than the number of design of branches.

And this reminded FLG of something. He mentioned recently how he was reevaluating his bank accounts and searching for new banks. Well, as part of that he came across this website, from which he recoiled much in the same we as he would if a branch looked and smelled like bathroom in the Port Authority Bus Terminal.

Quote of the day

Were you magnet baby?

Jump to 3:30:

Tuesday, February 14, 2012

Internet Object Sex

PCMag:
The sensation was very strange; what felt like a whirring, rotating, feathery object made of a moist latex-like material was almost polishing my finger. Afterwards, my finger smelled like lube.

Monday, February 13, 2012

This Is Concerning

WaPo:
Obama also wants to use the grants to encourage colleges and universities to align their standards with high schools so that students entering college do not need remedial courses.

That sentence concern anybody else?

This sentence...
Obama also wants to use the grants to encourage high schools to align their standards with colleges and universities so that students entering college do not need remedial courses.
...FLG would be fine with that sentence.

That sentence sounds like high schools becoming clear on what college and universities expect, and then getting students to that level.

The first sentence sounds like dumbing down the curriculum so that remedial courses are no longer called remedial courses.

FLG is currently listening to



FLG heard this for the first time last night during the Grammys, right before a Taylor Swift performance that he could have done without.

Quote of the day

Reihan:
While I’m somewhat sympathetic to Sachs in this particular case, part of me just thinks that these three deserve each other. And indeed, if the Krugmans fire back by noting some of the (alleged) deficiencies in Sachs’s work on development, we might see a net increase in collective human understanding. 

Thursday, February 9, 2012

Quote of the day

Warren Buffet:
Right now bonds should come with a warning label.

Passwords Updated

Since FLG put up a post about passwords the other day, he thought that he ought to share this as well:
After hundreds of emails from the office of Syrian President Bashar al-Assad were leaked on Monday, a report revealed that several of Assad's aides and advisers used the password "12345."

Word Of Advice

If you have a 401k plan at your current employer, when you leave make sure to open up a rollover IRA and transfer the funds not too long afterward.  It's a pain in the ass to figure out who to call after five years and your former employer was gobbled up by another company.

Wednesday, February 8, 2012

Quick Round-Up


First, Dear GOP, right now the field consists of Mitt Romney, for whom FLG will hold his nose and vote, and a bunch of other jackasses that will give FLG's vote to Obama.  Gingrich?  Santorum?  Are you fucking kidding me?

Second, the idea that we should have mark-to-market taxation is fucking nuts.  It would create so many complications, particularly liquidity issues when somebody has to come up with cash to pay tax on unrealized gains, that only a fucking tax lawyer could love it.

Third, as FLG has said before, he thinks courts ruling to allow same sex marriage is a terrible idea.  He hasn't had a chance to see what the legal reasoning is to overturn prop 8, but he's skeptical of any ruling that overturns a constitutional amendment passed by a ballot initiative.  It's too much of a shift of power from the people to the judiciary and judges should tread very carefully.  (Just to be clear, FLG is aware of and understands the concept that an amendment to a state constitution regardless of how it passed can be in violation of the US Constitution.  Moreover, he understands the idea of protecting minority rights in the face of the tyranny of the majority. He's just saying that it's dangerous ground, politically speaking, for judges to overturn the will of the people.)   It's far, far better to have these things go through the legislature.   Again, as FLG has said before, it's more expeditious to have judges find new rights in law, but in the long run it causes far more problems and distorts the entire judicial system.  Prime case is Roe v. Wade, but the same thing applies in the California same sex marriage debate.  The chances that California wouldn't have passed a same sex marriage bill in the near future is near zero.  It's California for crissakes.  Instead, the California Supreme Court steps in and rules that it's unconstitutional to ban same sex marriage, which let's not forget what prompted Prop 8 in the first place and kicked off this whole circus.  And, as FLG has also said before, he's in favor of same sex marriage, but would've voted for Prop 8 as a rebuke to judicial overstepping.  So, same sex marriage proponents in other states, please go through the legislature.

Lastly, FLG has been meaning to write about the HHS' refusal to carve out a religious exception to the mandate that health insurance cover contraception and other treatments related to reproduction.  FLG's first thought was, what fucking sense does this make politically?   Sure, maybe it will help Obama with some diehard pro-choicers, but it's going to piss off a bunch of other Democrats on religious freedom grounds.  On net, FLG's guess is that it pisses off more Democrats than it helps.  It's going to render conservatives apoplectic.  Second thought - who exactly is the aggrieved party this is helping in consequential terms?    By not allowing an exception, it allows people who have already willingly decided to work for the Catholic Church in hospitals, schools, charities, etc under the existing rules.  Maybe there are some who would prefer that these services were covered under the health care, but FLG has to think that if it were really a make-or-break issue, then they wouldn't be working there in the first place.  So, from a consequential perspective, it's benefiting people who would marginally prefer these services be covered and, FLG guesses, people who really want to work for the Catholic Church in some capacity, but up until now haven't because the contraceptive services coverage was a deal breaker.  FLG doubts that's a huge constituency.  Third - under what sort of vision of the free exercise clause does the administration think this is cool?



Tuesday, February 7, 2012

Things FLG Has Learned

FLG is in the home stretch of his MBA and was reflecting on some of the things he's learned. He went in with a good knowledge of international relations, economics, and finance, so he only picked up some rather esoteric things in those disciplines.  In the others, he feels like has an okay base knowledge now.  Here's a quick list of the top takeways:
  • MBAs, in general, are horrible writers and even worse at self-editing.
  • Not all MBAs are math whizzes.  Some really suck at math in fact.
  • Marketing is more important than he thought it was.
  • Strategy is a lot less important than he thought it was.  Execution is the bigger issue.  FLG thinks politicians would do well to learn this lesson.  
  • Nevertheless, you do need a strategy, but keep it short - anything more than a three point plan gets muddled.
  • If you are going to start a business, then go first to the 3 Fs (family, friends, and fools).  If your business will have tangible assets, then a bank loan might work.  If it's intangible, then you'd better 1) be able to sell somebody that your business idea is a world-beater or 2) start scrimping, savings, and stealing. 
  • The way to get rich is with OPM - other people's money.
  • There's a difference between international, multinational, transnational, and global companies.
  • What shortage cost is.
  • FLG finally learned what goodwill is on the balance sheet.  Short answer:  It's how much the company overpaid to buy other companies.
  • Financial statement analysis is really about like a dozen ratios that FLG had already learned.  
  • You can negotiate with foreign governments regarding the tariff rates for your products.
  • What exactly a synthetic bond consists of.
One thing stick outs more than all of these:


FLG has never understood the advice to sock away 3-6 months of living expenses in cash.  Don't get FLG wrong, he gets that you need emergency savings.  A couple of months, maybe three, FLG understood.  But six months always seemed like it came with a huge opportunity costs.  Where exactly do people get that number from?

Well, in one of FLG's classes, the professor argued, based upon how much cash corporations have historically kept on hand relative to revenues, something more like 12 months might be better.  Needless to say, a bunch of FLG's classmates objected.   First, that's a lot to save. Second, keeping that much in cash is expensive.

But then the professor explained how to view that fund, not as an emergency fund, although it is that, but as a catch-all self-insurance fund.  Not just unemployment self-insurance. Once you have that much saved, you can bump up all the deductibles on all the insurance policies you have, and transfer only catastrophic risk onto insurance companies.   So, if it makes sense, only get catastrophic health coverage.  Drop collision coverage.    Never get a warranty ever again.  Etc.  Self-insurance is far cheaper.

FLG has nowhere near that saved. And to be perfectly honest, his personal finances aren't exactly where he'd like them.  He's embarked on a little bit too much consumption smoothing in anticipation of higher earnings following his MBA, which is rational in the abstract but also risky in the particular.  So, he has to find a new job and do a little digging out.   Anyway, the idea of a self-insurance fund makes all the sense in the world, if you can make it happen.

Quote of the day

FLG agrees:
“The Durbin rule was the worst rule,” says an executive at one of the major banks. “Debit cards had nothing to do with the crisis. The fact is, we give free stuff to our customers. Now we’re going to have to be the bad guy.”

That has shit all to do with the crisis and the rule, as far as FLG can tell, will have zero to negative benefits for consumers. This was something to benefit retailers. FLG might have to ask around to some of the lobbyists he knows about what the deal was behind the Durbin rule, besides, you know, Dick Durbin being a jackass, even if he is a fellow SFS alumnus.

Monday, February 6, 2012

Celebrity Sightings

FLG wouldn't usually add this as a celebrity sighting given that she's a G'town professor, but he almost got run over by Madeleine Albright. Or at least he's pretty sure it was her in that E-Class. Anyway, added to the list.

Quote of the day

Alexander Gloy:
Krugman’s rhetoric matches that of a mayfly rejecting the possibility she might die at the end of the day because so far the sun has never set during its life.

FLG's time horizons theory is still relevant.

Happy and Wrong

The wor Superbowl Champion New York Giants makes FLG very happy.

Relatedly, FLG expected the halftime show to suck, as they usually do, but he must admit that Madonna vastly exceeded his expectations.

Friday, February 3, 2012

FLG is currently listening to

What Bubble?

FLG found this interview with Eugene Fama very fascinating. He claims there wasn't a housing bubble, but rather the recession caused the housing price collapse. FLG feels Fama is wrong, but cannot figure out how he is. He's obviously right that net leverage always equals zero, but in our global markets that means worldwide net leverage is zero, not that leverage isn't a problem in particular markets or in particular institutions. But for that to be true there has to be some relaxation of market efficiency assumptions, for example, some sort of information asymmetry between American banks issuing mortgage-backed securities and the foreign banks and investors who were buying them.

Guest: Well, they just look at pieces of the data and the fact that the housing market collapsed is taken to be the cause; but the housing market could collapse for other reasons. People don't just decide that prices aren't high any more. They have to look at supply and demand somewhere in the background.

Russ: We did have people holding second and third homes who didn't have the income and capability of repaying the first one.

Guest: Sure. Standards were relaxed. But then you have to look on the supply side, the lending side. The people who were lending to these people had the information.

Russ: Yes, they knew it. I don't think that they were fooled. They were not overly optimistic about the value of those loans. They were willing to do that because they could sell them.

Guest: The puzzle is why they were able to sell them.

Russ: Correct. Now my claim is the people who bought them did it with largely borrowed money.

Guest: No, that's not true. These were bought by people all over the world.

Russ: Correct.

Guest: No one borrowed money. Remember now: savings has to equal lending. For everyone that's short bonds, somebody is on the other side. The net amount of leverage in the world is always zero.

Russ: That's true.

Guest: So you can't tell a story based on leverage.

Russ: So what's your story? I have to think that through. It's undeniably true, and I'm not going to argue with that point. So, what's your explanation of why people bought these things?

Guest: Well, I have no explanation. Again, I'd say the market crashes because of the big recession. Even a minor depression if you like. Remember that all the people buying these subprime mortgages all over the world, they are the ones making the loans in the end, they were sophisticated investors. Institutions, big banks all over the world. They thought these things were appropriately priced. They might have been at that time, but they weren't ex post.

Thursday, February 2, 2012

Passwords

FLG received an email a week or so ago that his data at Zappos.com was compromised:
First, the bad news:

We are writing to let you know that there may have been illegal and unauthorized access to some of your customer account information on Zappos.com, including one or more of the following: your name, e-mail address, billing and shipping addresses, phone number, the last four digits of your credit card number (the standard information you find on receipts), and/or your cryptographically scrambled password (but not your actual password).

THE BETTER NEWS:

The database that stores your critical credit card and other payment data was NOT affected or accessed.

Once FLG heard the credit card data wasn't accessed he breathed a sigh of relief. However, FLG thinks most people might not want to just yet. Zappos recommended, in fact they might even have forced, customers change their passwords in response.

Wait, didn't they just say that the hackers only got "your cryptographically scrambled password (but not your actual password)?" Yes, but what exactly does that mean?

Most websites, if they have any clue at all, store passwords in their databases using one-way hashes. There are a few of these, the most common probably being MD5, SHA-1, SHA256, and SHA512. The first two aren't considered secure anymore, so hopefully Zappos was using SHA256 or SHA512. Think of a one-way hash as a machine that takes any amount of data you want to throw at it from a simple password to whole files and on the other side comes a fixed length of output unique to whatever you threw into the machine.

There are two features that make these one-way hashes useful. First, the output is kind of like a fingerprint. A small change in the input results in a large change in the output. Oftentimes on the internet, even today but especially in the old days of spotty internet connections, people would post the hash of the file that they are offering for download so that you could run a hash on the copy you'd downloaded to verify it was an exact, untainted replica. Second, there's the one-way part, which means it should be trivial to take some input (password, file, etc) and generate a hash, but impossible to go the other way (take the hash and generate the password or file). This will probably make more sense with some examples.


FLG typed "password" into this hash generator and got the following MD5 hash:

Original text: password
MD5: 5f4dcc3b5aa765d61d8327deb882cf99

Again, MD5 is not secure for password hashing use, but still makes the point and generates short values that are easy for FLG to post.

Okay, so what Zappos is saying is that the hackers didn't get the plaintext word "password", but instead got something akin to 5f4dcc3b5aa765d61d8327deb882cf99. Once a hacker has a password hash, they would typically run a dictionary through whatever the hash algorithm is, in this case MD5, generating a output of each word and comparing to the hash they have. So, they'd take the word "apple" and generate 1f3870be274f6c49b3e31a0c6728957f. That doesn't match 5f4dcc3b5aa765d61d8327deb882cf99, so they keep going.

It might sound like this would take a long time, but it doesn't. Computers can run through millions or tens of millions of these things in no time. And then there's the problem of precomputation. There's no reason a hacker has to wait until after they have compromised a website to generate hashes. They could simple generate a password hash for every word in the dictionary BEFORE the hack, save it to a file, and then once they have the hashes they can search through the file to see if they have one that matches.

To combat this precompution threat, people salt passwords. A salt is a random value that is added to the password. FLG added a user named dummy to the linux computer he has in his house to give you an example. Dummy's password is password, and here's his password information:
dummy:$6$kAkbkLsi$bsepfjdr87GZNikGZcc/OveT/akVbzZGaaXsjg5qSa2vV4NpKym6Rg6UOLNdXy3thUqy7PZ7PNi81q9J1DVJ30

Breaking this down -- The character $ is a separator. dummy is obviously the user name. 6 indicates that SHA512 is the hash algorithm. kAkbkLsi is the salt. bsepfjdr87GZNikGZcc/OveT/akVbzZGaaXsjg5qSa2vV4NpKym6Rg6UOLNdXy3thUqy7PZ7PNi81q9J1DVJ30
is the hash.

The salt works like this. The computer takes the password, in this case the word "password" and then either prepends or appends it to the password before running it through the hash algorithm. So, let's say prepend. This means that rather than password being hashed by itself, instead kAkbkLsipassword is hashed and the output is that crazy long string of random junk. This gets around the precomputation issue because now the hashes of the dictionary the hacker has are useless. The hacker has to go back and rehash every word in the dictionary with kAkbkLsi tacked onto the front. This still won't take that long of a time, but at least they can't do it before hand.

FLG isn't worried about the hacker getting his password because he uses a password vault program and generates random passwords for each website. So, his password at Zappos was something like 45dSIjnGkR98AQMIYhx9, which the hackers will never get. For example, this website says it would take, and FLG isn't kidding, about 89 quintillion years. And even if they did get it, it's totally useless. He's changed his Zappos password to something just as random and that password has no relation to his password at amazon or ebay or paypal. They are all totally random.

On the other hand, if FLG's password was a dictionary word or a dictionary word with a couple numbers and maybe a symbol tacked on the end, and he used that same password at Zappos and Amazon and his bank's website, then he'd be way more concerned. FLG thinks Zappos should not only force customers to change their passwords, which they did, but also strongly recommend that customers who are using that same password at other websites change those as well.

Wednesday, February 1, 2012

FLG Isn't Sure He Buys It

Anti-Climacus has a post up about how Spielberg is overrated as a director. FLG gave up on Spielberg after A.I. Artificial Intelligence. As far as FLG is concerned, he can't imagine Kubrick ending that movie anywhere other way than David and Teddy trapped at the bottom of the ocean until their batteries run out. He can't imagine it, no matter what Spielberg says.

Quote of the day

Megan McArdle:
I'm not sure I see the benefit in going out of your way just to tell the Church you'd like them to, well, go to hell.

Dear Newt:

You got your ass handed to you. FLG realizes that humility, class,and good sense aren't your strong points, but now would be the time to find some.

Sincerely,
FLG
 
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This work is licensed under a Creative Commons Attribution-No Derivative Works 3.0 United States License.