John Nash

When a kid received a ‘B’ grade in the arithmetic class of fourth standard, the teacher shared with his mother that the kid couldn’t do his work well, and was socially awkward and immature. His mother declared that he is unconventional and finds his own way to solve problems.

The kid grew up and in his Master’s degree program, when fellow students found him dull and reclusive, his Professor of Mathematics, Richard Duffin, declared that “This man is a genius”. After joining Princeton University, this man sought an interview with Albert Einstein to explain the errors in the general theory of relativity.

Fast forward, and this man earned his PhD in Mathematics at the age of 21, and grew up to become one of the greatest mathematicians of the 20th century, and won the Nobel Prize for Economics in 1994. His name is John Nash and his stupendous achievements were an inspiration to scores of mathematicians, economists, scientists, biologists and political scientists over the years. Some consider him as good as Adam Smith!

No doubt Professor Nash was overwhelmed by his personal struggles—as depicted in the award-winning Hollywood movie “A Beautiful Mind”; however, celebration of his exceptional ideas—which could be much more astounding, useful and contributing to science and society had he not been crippled by his mental illusionary problems—is more important.

John Nash is considered a pioneer of Game Theory. He was a mathematician despite the fact that he won the Nobel Prize in Economics. He is known for the theory of Nash Bargaining—using which both parties would benefit equally if they accept the deal—mathematically showing the result. Though, Nash Bargaining has limitations in the form of the external conditions in any competitive situation, his phenomenal contribution to Game Theory solves this problem of external conditions. He developed the Nash Equilibrium, a new concept in the Game Theory, in which out of the given choices each player has in a game, everyone is making their best choice.

Before Nash Equilibrium, the Walrasian Equilibrium was prevalent, in which everything sellable is bought, all the money involved is used in transactions and the markets are deemed efficient. However, Nash Equilibrium suggested that outcomes may not be the best always—there might be non-optimal outcomes; they may be worse for all parties involved if taken individually, which is the case in the famous Prisoners’ Dilemma. Other examples include failed markets, because no party trusts the other; and economies harming each other owing to over-competing with each other, thus actually indulging in destructive competition. Though isolated models of strategic interaction pre-existed, Professor Nash developed a system. Now even Google relies on the Nash Equilibrium to make its decisions on auctioning its advertisements.

John Nash (86)—and his wife, Alicia Nash (82)—died in a car crash on May 24, 2015 while returning after receiving the Abel Prize—the esteemed Mathematics Award—for making contributions in the theory of non-linear partial differential equations.

He liked to work on basic mathematical problems. When he was an undergraduate, he independently proved Brouwer’s fixed-point theorem—you may stir a cup of coffee for any length of time, but a small part would be unmoved resting where it was initially. Another example includes a mathematical proof in the field of abstract geometric objects such as submanifolds of Euclidean Space. In layman language, even if you make multiple folds of a piece of paper with lines drawn on it, the lines will always be of the same length.

He also won the John von Neumann Theory prize in 1978 and the Leroy P Steele prize in 1999.

IMAX Enters Hong Kong

IMAX has filed an application with the Hong Kong Stock Exchange (HKEx) for an initial public offering (IPO) of its China unit in Hong Kong (IMAX China Holding), as it plans to participate in the world’s fastest growing movie markets. Imax made about 30% profit last year through its China unit, which is not surprising as since 2012 it has nearly doubled its number of theatres in the Greater China region. Currently, IMAX has 239 theatres in China, Hong Kong and Taiwan, and it plans to build 219 more theatres in China itself. China is a critical growth market for IMAX, and if plans go well it will be the largest market for the company.

There are a total of 934 IMAX theatres in 62 countries.

China is a $10.35 trillion economy making it the second-largest economy in the world, USA being the first with $17.41 trillion size and owning approximately 22.44 percent of the gross world product. In 2014, China’s box office revenues increased by 36% to $4.8 billion. IMAX is already listed on the New York Stock Exchange, and after its announcement of an IPO in Hong Kong, its shares jumped up 9%. IMAX tickets are on the higher side as the experience it promises is extraordinary. Each ticket costs $24 or about Rs. 1500.

The IMAX Experience

IMAX is an acronym for Image MAXimum; and is used for both IMAX Corporation (a Canadian company) and a motion picture film format and a set of cinema projection standards created by IMAX Corporation. IMAX is capable of recording and displaying images of far greater size and resolution than the conventional film systems. IMAX is the most widely used system for special-venue film presentations.

IMAX management has been signalling for some time now that it wanted to list its Chinese subsidiary on the Hong Kong Stock Exchange. IMAX China Holdings is incorporated under the laws of the Cayman Islands, and the China subsidiary is being used to oversee the expansion of IMAX’s business throughout Greater China.

A Strategic Move

Before the IPO, in a strategic move, IMAX sold its 20% stake for $80 million to two companies, CMC Capital Partners which is a media-and-entertainment-focused investment fund, and FountainVest Partners which is a China-focused private equity firm. These investments were strategic as IMAX not only found partners for its operations in China, it also received on-the-ground guidance in China which is important to grow in the Chinese market.

As per Chinese rules, it’s mandatory for any foreign firm to work under a Chinese firm, thus the stake selling was done as a key prerequisite for completing an eventual IPO in China. As per the deal, IMAX would expand its screen counts in China, and would screen both Hollywood and Chinese movies to satisfy the local regulations and the market demands.

IMAX is known in the market for its giant-screen experiences in the film sector. Fox had introduced in 1929, the first 70 mm film format, Fox Grandeur, which wasn’t successful. Later, in 1950s Cinemascope and VistaVision with 35 mm films and multi-projector systems such as Cinerama were introduced. In 1967, a company called Multiscreen was founded to cater to the demands of a better visual experience through multi-projector and multi-screen systems. This company later changed its name to IMAX and in the course of time developed its current giant 2D and 3D screens with high cinematic techniques.

Smile to Counter Your Stress

Is your work killing you? Or, do your wife and kids eat away your energy? Experts say you can simply smile through your stress and be healthy in the long-term. Minor stresses attack every person throughout the day; however, some people fail to maintain cheerfulness or calmness and live in a state of elevated levels of inflammation.

Inflammation means an immune-compromised state of a body part, i.e. it fails to protect itself via the immune system of the body. Long-term or chronic inflammation leads to life-threatening ailments such as obesity, heart disease and cancer.

Inflammation

According to Nancy Sin from the Pennsylvania State University in the US, a person’s frequency of stress is not as much related to inflammation as it is to his/her responses to stress. Thus, more than anything else what is important is how a person reacts to stress. In the short-term, when the body falls ill or when the person exercises, the body repairs itself to a high immune system. However, in the long-term, heightened inflammatory immune responses are adverse to health.

Those individuals who find it difficult to regulate their responses to stress, age early and have cardiovascular diseases, frailty or cognitive decline. The participants in the study reported daily stresses and emotional reactions for eight consecutive days. Later, participants’ blood samples were collected during a separate clinic visit and were tested for inflammatory markers. It was found that those participants who responded to stress in a positive way and chose to smile away the daily irritants and problems were healthier than those who let the stress affect their emotions and in turn their body.

Forced Smiles

Similar studies have been conducted by other researchers as well. Kraft and Pressman experimented with 169 volunteers, and trained and tested them. In the training stage, some were taught to hold fake smiles on their faces, while others were asked to smile naturally and a third set of people were asked to smile genuinely while feeling the smile.

It was found that holding a neutral, fake or forced smile would only exercise your muscles around your eyes and mouth. The genuine smiles with feeling made positive emotions flow through the participants’ entire body. During the research, the participants were given stressful tasks such as using their non-dominant hand to trace a path while looking in a mirror, or multi-tasking or plunging one’s hand into a bucket of ice water, while holding the smile on their face. Heart rates of participants were monitored during the experiment. The results showed that those participants who had genuine smiles on their faces recovered quickly from those stressful situations they were subjected to. Those who kept their faces neutral were the next to recover and in the end those who had forced smiles on their faces. Smiling through a traffic jam even for a limited time is more helpful than fretting about it or keeping yourself busy in something else. Of course, you may smile your way and smile the stress away!

Banker’s Fallacy

We all want to have happy happenings in our life, and when something good happens we want to preserve that feeling or emotion for as long as possible to prolong our positive attitude for other things we do in life. We want to forget negative experiences and be positive in the hope that all our further decisions will be good if taken with a light, happy and positive mindset.

However, a recent new study has brought forward the “banker’s fallacy”, according to which we are naturally inclined to deliberately go for “happy endings” thus ascribing greater value to experiences than they are worth. It further means that we overvalue our last experiences in any situation with a final happy ending mental note in the hope that it will positively affect our next experience.

Decision Making

Now, our brain works like a logbook, where it keeps storing every new experience and keeps ranking them against the previous few for context. Thus, over a period of time we collect a mix of positive and negative emotions. This affects our decision-making power because last good experiences make us high-esteemed and we are more prone to take risks, and last few bad experiences make us low-esteemed and we tend to hold back.

The fallacy is named after bankers who are generally trained to close on a positive note. However, anyone who is doing it is actually thinking of the immediate next few results only. Thus, happy endings are actually trapping people into making lousy long-term decisions. People are focusing on immediate growth at the expense of longer-term stability, and our quick decisions may actually be strategically wrong affecting us adversely in the long run.

The Research Study

The study was conducted by Martin Vestergaard from the University of Cambridge, who found that most people in the test fell foul of the banker’s fallacy and made poor, short-term decisions as a result. The experiment involved participants trying to accumulate money by gambling between two sets of gold coins of varying sizes at high reaction times. The researchers found that the most immediate experiences carried much more weight in decision making than they should have, which means that a recent happy ending has a hugely disproportionate influence. The final result were thus false and delusional beliefs that in turn led to wrong decisions despite historical experience that could convince us of the contrary.

The results of the study are beneficial in all spheres of life including social, political and familial decision making as well. People in a relationship tend to make lighter decisions which may have long-term impact when they are happy with each other. However, the right decisions would be those which are taken considering the history of relationship. The same logic applies to political and social decisions too. However, the results of the study apply more to individual decisions rather than organisational or structural decisions, where a body of decision makers generally makes policy-based decisions. Though group decisions may also be affected by banker’s fallacy, the chances are less as several people are involved simultaneously and each one’s experience may differ on the last outcome.

Let your heart pour out #Twitter

The Micro blogging website operator Twitter seems to have digested the fact that something’s just can’t be summed up in 140 characters. According to a recent report by Re/code (technology portal), company executives are working on a new product which will allow its users to write more than 140 characters. As an initial step, the company seems to be working on elimination of hyperlinks from its character count. However, it will be really interesting to see how twitter will keep its eccentricity alive after scraping its signature character limit to better compete in the socially vivacious world. Though, the company is yet to throw light on the same, twitter fans will definitely wait for the new product.