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You've spent years saving up to finally buy a home. You're having a baby in a few months, and you really need the space. You have the down payment ready, your c

by macNchz 11y ago

You've spent years saving up to finally buy a home. You're having a baby in a few months, and you really need the space. You have the down payment ready, your credit is great, you've ticked all the boxes on the application, but you're turned down for the loan. Why? Maybe you walk home through a bad neighborhood. Maybe you sometimes grab a beer at a bit of a divey bar near your office. Maybe you've visited an old friend who's been in some trouble recently. Whatever the case may be, your face has been in a photo with some questionable folks, whether it's a security camera or a stranger's Facebook photo. So the bank's computers noticed, and flagged you as a risk. People who hang around questionable people aren't very good at repaying their loans.

newman314 11y ago
Decent example. I generalized this as "You have something you really want (everyone has different goals). Right when you think you are about to achieve your goal, it is taken away (because of something stupid you did in the past; everyone has done something stupid at one point). This is why unchecked data collection is bad"
- caskance 11y ago
  The problem is that there is no reason to believe that is more likely than the opposite case of "You have something you really want (everyone has different goals). Right when you think you are about to fail to reach your goal, it is achieved (because of something clever you did in the past; everyone has done something clever at one point). This is why unchecked data collection is good"
  - newman314 11y ago
    Information in this case as in many is asymmetrical hence leading to the phrase "information is power". Lack of information does not grant the same benefits/advantages as possession of information. Why do you think so much effort is expended to possess information?
    - deleted 11y ago
      [deleted]
    - caskance 11y ago
      You missed the point. In the original loan example, the lender may want to screw you, but they also know that the one that screws you least is the one you will do business with. And your good character, as determined by omnipresent surveillance, allows them to safely offer you a better deal. It's like the "good student" etc discounts that car insurance gives now.
analyst74 11y ago
But doesn't this cut both ways? If you don't hang around questionable people, you'd qualify for better rate for loans. Or if your credit score is not very high, but the fact you don't hang around questionable people brings your credit file up a notch and make you qualify.
- ineedtosleep 11y ago
  "Questionable people" is hardly a concrete descriptor, nor is it something immediately obvious. Let's say I meet a guy at a party. Facial scanners detect me with him. He seems like a nice guy, but he is currently on trial for a number of white collar offenses -- I know none of this. "The machine" does and will now assume I hang around questionable people.
  - caskance 11y ago
    The chances are just as good - not necessarily 50/50, but close to population baseline - that the person you met actually was a nice guy and "the machine" assumes you hang around with good people. If your chances are actually higher than population average to hang around with bad people, the machine is probably correct for assigning you a higher risk. Which all misses the point that as soon as he walked into the party, your own ocular implants would have performed the same recognition and you would have known to stay away from him.
- bostonpete 11y ago
  Yeah, in my mind, this completely negates the argument. If I don't engage in a given statistically risky behavior today, I'm paying more for insurance because some people do and the insurance company doesn't know who should be paying for that risky behavior so we all pay a little more. To me, the more compelling angle to attack surveillance has to appeal to people's desire to keep some portion of their lives from being made public (rather than appealing to their wallet).
  - terryf 11y ago
    But the whole point of insurance is to collectively spread the risk, so that when things do go bad, you are not on your own. By definition, people in aggregate pay more for insurance than what the insurance pays them back (otherwise the company would go bankrupt!). Insurance is paying for peace of mind. Most people are paying more premiums than insurance is paying them back.
shabbyrobe 11y ago
I've tried this one on lay people before. The problem I have is that they usually can't get past their firm belief that these things are technologically impossible, even after you explain to them that they are. "That all sounds like science fiction, that can't happen in the real world." Also it can fall down if you don't stick only to directly relatable details: "but I don't walk through a bad neighbourhood, so this wouldn't affect me and therefore I don't see how it could be a problem". The instant it ceases to speak to their experience directly, you've lost them.
- hackuser 11y ago
  > it can fall down if you don't stick only to directly relatable details: "but I don't walk through a bad neighbourhood, so this wouldn't affect me and therefore I don't see how it could be a problem". The instant it ceases to speak to their experience directly, you've lost them. A tangent: I enounter this too, all the time, with intelligent, well-educated people. It's as if people don't understand what "example" means, or can't project concepts from an example to a broader class. What am I misunderstanding?
  - caskance 11y ago
    That this kind of risk is zero-sum. If higher rates are charged to people who meet these criteria, those of us who don't will get better rates from competitive lenders.
- imron 11y ago
  > "That all sounds like science fiction, that can't happen in the real world." Tell them that the mobile phone they have in their pocket also seems like science fiction - and it was 20-30 years ago. Now it is science fact. Facial recognition is getting the same way. If anything, based on all the shoddy movies that 'zoom in, enhance' with photos, the public should be primed to accept facial recognition quite easily.
  - duderific 11y ago
    Ha, when watching those shows, I am always the nerd telling my wife how it's impossible to zoom in and enhance, because you can't create more information than existed when the photo was taken. I'm not sure that she gets it.
Houshalter 11y ago
On the other hand you are just as likely to get a loan you otherwise wouldn't have because you haven't been seen with questionable folks. In any case that kind of policy is already illegal. And it's not even technically feasible at the moment. Even if it was, it's very unlikely there is a strong correlation between being seen with some random person in a photo, and your likelihood of paying a loan. There is plenty of questionable shit happening right now in the NSA and stuff. I don't see why we need to resort to fearmongering about absurd hypotheticals.
- terryf 11y ago
  The banks are doing things, perhaps not exactly what was described, but your facebook history, linkedin, other social media accounts are taken into account when applying for a loan. Even when you browse the bank's web page, where you hover the mouse, what pages you look at and variour other metrics. One example of a company providing such service is http://www.bigdatascoring.com/ http://www.bigdatascoring.com/
  - Houshalter 11y ago
    In my opinion that is a very good thing. If they can make fewer loans to people who are high risk and lower interest loans to people who are not, everyone wins. The source of the data doesn't matter.
- tbrake 11y ago
  > On the other hand you are just as likely to get a loan you otherwise wouldn't have because you haven't been seen with questionable folks. I would imagine the list of things that will count against you in those situations will always be much longer than the list of things that can count for you, i.e. just because A can count against you doesn't mean that ¬A will count for you; ¬A will just be 0 points and the assumed baseline.
  - msellout 11y ago
    They're actually trying to give you the lowest rate they can while staying profitable, you know, to be competitive with other lenders. There's no baseline, all our characteristics are inputs to a function that estimates risk of default. Then the lender chooses what rate to offer based on their portfolio design. In one sense, it's a zero-sum game. If person A is a better debtor, A gets a better rate than B. However, a more sophisticated portfolio will try to find anti-correlated debtors. Rather than lending to 100 low-risk people all similar to each other, I'd rather diversify and include some very different people that may be higher risk on an individual basis; the aggregate risk can be much lower than individual. To that end, the more the lender can learn about me, the more chance I have to reveal how anti-correlated I am with others.
dpflan 11y ago
This pitch reminded me of the cartoon in beginning of the documentary Terms and Conditions May Apply - a concise documentary related to the topic of how your data can be used by the company whose services you are using. The cartoon may be good to use too. 1. Cartoon: https://www.youtube.com/watch?v=6y2M8BUcXG4 https://www.youtube.com/watch?v=6y2M8BUcXG4 2. Documentary site: http://tacma.net/ http://tacma.net/
Pxtl 11y ago
This isn't a good example because the technology already exists to deliver this service to lenders - read up on Canadian Tire's JP Martin. He did the first experiments with rewards-credit-cards and data mining, and found he could pretty-well correlate certain behaviors with missed credit-card payments. Apparently there's a dive bar in Montreal that indicates you're a screw-up if you drink there.

by macNchz 11y ago

newman314 11y ago

Decent example. I generalized this as "You have something you really want (everyone has different goals). Right when you think you are about to achieve your goal, it is taken away (because of something stupid you did in the past; everyone has done something stupid at one point). This is why unchecked data collection is bad"

caskance 11y ago
The problem is that there is no reason to believe that is more likely than the opposite case of "You have something you really want (everyone has different goals). Right when you think you are about to fail to reach your goal, it is achieved (because of something clever you did in the past; everyone has done something clever at one point). This is why unchecked data collection is good"
- newman314 11y ago
  Information in this case as in many is asymmetrical hence leading to the phrase "information is power". Lack of information does not grant the same benefits/advantages as possession of information. Why do you think so much effort is expended to possess information?
  - deleted 11y ago
    [deleted]
  - caskance 11y ago
    You missed the point. In the original loan example, the lender may want to screw you, but they also know that the one that screws you least is the one you will do business with. And your good character, as determined by omnipresent surveillance, allows them to safely offer you a better deal. It's like the "good student" etc discounts that car insurance gives now.

analyst74 11y ago

But doesn't this cut both ways? If you don't hang around questionable people, you'd qualify for better rate for loans. Or if your credit score is not very high, but the fact you don't hang around questionable people brings your credit file up a notch and make you qualify.

ineedtosleep 11y ago
"Questionable people" is hardly a concrete descriptor, nor is it something immediately obvious. Let's say I meet a guy at a party. Facial scanners detect me with him. He seems like a nice guy, but he is currently on trial for a number of white collar offenses -- I know none of this. "The machine" does and will now assume I hang around questionable people.
- caskance 11y ago
  The chances are just as good - not necessarily 50/50, but close to population baseline - that the person you met actually was a nice guy and "the machine" assumes you hang around with good people. If your chances are actually higher than population average to hang around with bad people, the machine is probably correct for assigning you a higher risk. Which all misses the point that as soon as he walked into the party, your own ocular implants would have performed the same recognition and you would have known to stay away from him.
bostonpete 11y ago
Yeah, in my mind, this completely negates the argument. If I don't engage in a given statistically risky behavior today, I'm paying more for insurance because some people do and the insurance company doesn't know who should be paying for that risky behavior so we all pay a little more. To me, the more compelling angle to attack surveillance has to appeal to people's desire to keep some portion of their lives from being made public (rather than appealing to their wallet).
- terryf 11y ago
  But the whole point of insurance is to collectively spread the risk, so that when things do go bad, you are not on your own. By definition, people in aggregate pay more for insurance than what the insurance pays them back (otherwise the company would go bankrupt!). Insurance is paying for peace of mind. Most people are paying more premiums than insurance is paying them back.

shabbyrobe 11y ago

I've tried this one on lay people before. The problem I have is that they usually can't get past their firm belief that these things are technologically impossible, even after you explain to them that they are. "That all sounds like science fiction, that can't happen in the real world." Also it can fall down if you don't stick only to directly relatable details: "but I don't walk through a bad neighbourhood, so this wouldn't affect me and therefore I don't see how it could be a problem". The instant it ceases to speak to their experience directly, you've lost them.

hackuser 11y ago
> it can fall down if you don't stick only to directly relatable details: "but I don't walk through a bad neighbourhood, so this wouldn't affect me and therefore I don't see how it could be a problem". The instant it ceases to speak to their experience directly, you've lost them. A tangent: I enounter this too, all the time, with intelligent, well-educated people. It's as if people don't understand what "example" means, or can't project concepts from an example to a broader class. What am I misunderstanding?
- caskance 11y ago
  That this kind of risk is zero-sum. If higher rates are charged to people who meet these criteria, those of us who don't will get better rates from competitive lenders.
imron 11y ago
> "That all sounds like science fiction, that can't happen in the real world." Tell them that the mobile phone they have in their pocket also seems like science fiction - and it was 20-30 years ago. Now it is science fact. Facial recognition is getting the same way. If anything, based on all the shoddy movies that 'zoom in, enhance' with photos, the public should be primed to accept facial recognition quite easily.
- duderific 11y ago
  Ha, when watching those shows, I am always the nerd telling my wife how it's impossible to zoom in and enhance, because you can't create more information than existed when the photo was taken. I'm not sure that she gets it.

Houshalter 11y ago

On the other hand you are just as likely to get a loan you otherwise wouldn't have because you haven't been seen with questionable folks. In any case that kind of policy is already illegal. And it's not even technically feasible at the moment. Even if it was, it's very unlikely there is a strong correlation between being seen with some random person in a photo, and your likelihood of paying a loan. There is plenty of questionable shit happening right now in the NSA and stuff. I don't see why we need to resort to fearmongering about absurd hypotheticals.

terryf 11y ago
The banks are doing things, perhaps not exactly what was described, but your facebook history, linkedin, other social media accounts are taken into account when applying for a loan. Even when you browse the bank's web page, where you hover the mouse, what pages you look at and variour other metrics. One example of a company providing such service is http://www.bigdatascoring.com/ http://www.bigdatascoring.com/
- Houshalter 11y ago
  In my opinion that is a very good thing. If they can make fewer loans to people who are high risk and lower interest loans to people who are not, everyone wins. The source of the data doesn't matter.
tbrake 11y ago
> On the other hand you are just as likely to get a loan you otherwise wouldn't have because you haven't been seen with questionable folks. I would imagine the list of things that will count against you in those situations will always be much longer than the list of things that can count for you, i.e. just because A can count against you doesn't mean that ¬A will count for you; ¬A will just be 0 points and the assumed baseline.
- msellout 11y ago
  They're actually trying to give you the lowest rate they can while staying profitable, you know, to be competitive with other lenders. There's no baseline, all our characteristics are inputs to a function that estimates risk of default. Then the lender chooses what rate to offer based on their portfolio design. In one sense, it's a zero-sum game. If person A is a better debtor, A gets a better rate than B. However, a more sophisticated portfolio will try to find anti-correlated debtors. Rather than lending to 100 low-risk people all similar to each other, I'd rather diversify and include some very different people that may be higher risk on an individual basis; the aggregate risk can be much lower than individual. To that end, the more the lender can learn about me, the more chance I have to reveal how anti-correlated I am with others.

dpflan 11y ago

This pitch reminded me of the cartoon in beginning of the documentary Terms and Conditions May Apply - a concise documentary related to the topic of how your data can be used by the company whose services you are using. The cartoon may be good to use too. 1. Cartoon: https://www.youtube.com/watch?v=6y2M8BUcXG4 https://www.youtube.com/watch?v=6y2M8BUcXG4 2. Documentary site: http://tacma.net/ http://tacma.net/

Pxtl 11y ago

This isn't a good example because the technology already exists to deliver this service to lenders - read up on Canadian Tire's JP Martin. He did the first experiments with rewards-credit-cards and data mining, and found he could pretty-well correlate certain behaviors with missed credit-card payments. Apparently there's a dive bar in Montreal that indicates you're a screw-up if you drink there.