Apple Co-Founder Says Goldman’s Apple Card Algo Discriminates(bloomberg.com)
bloomberg.com
Apple Co-Founder Says Goldman’s Apple Card Algo Discriminates
https://www.bloomberg.com/news/articles/2019-11-10/apple-co-founder-says-goldman-s-apple-card-algo-discriminates
13 comments
So a couple guys in the top .1% net worth (outliers by any measure) don’t think their spouses were treated fairly by a credit check. It must be systemic discrimination. Also NYS is not a community property state, as DHH claimed, so he is full of shit on that one.
When you mention their level of wealth, it also makes me consider their fame in the tech industry and it makes me wonder what the absolute credit limits are. They may be unusually high; and they may have gotten them in part because Apple knew who they were. Maybe their wives were treated fairly and they weren't.
Say DHH got 10K USD. Then his wife got 5K USD which is really low for someone with the assets she can likely claim. But let's say he got 1M USD and his wife got a mere 50K USD...kind of a different story then.
Say DHH got 10K USD. Then his wife got 5K USD which is really low for someone with the assets she can likely claim. But let's say he got 1M USD and his wife got a mere 50K USD...kind of a different story then.
It all depends. Do they make income from work or investments? Does the spouse have a credit history? Do they have work history?
Banks do underwriting in various ways. When I (white male) got an AMEX student card in college 25 years ago, I had a $3k limit. MBNA and Citi gave me $35,000 and $20,000, respectively.
Banks do underwriting in various ways. When I (white male) got an AMEX student card in college 25 years ago, I had a $3k limit. MBNA and Citi gave me $35,000 and $20,000, respectively.
> they may have gotten them in part because Apple knew who they were
This is bending over backwards to make up a "certain people are singled out for better treatment" story just so you don't have to admit to yourself that a "certain people are singled out for worse treatment" story is at least as plausible.
This is bending over backwards to make up a "certain people are singled out for better treatment" story just so you don't have to admit to yourself that a "certain people are singled out for worse treatment" story is at least as plausible.
I don’t know of any consumer credit product that takes assets into account.
I doubt very seriously that Apple would call Goldman and ask them to give some people special treatment. I’m not saying that Apple wouldn’t do that because it isn’t fair. They wouldn’t waste their time doing it.
I doubt very seriously that Apple would call Goldman and ask them to give some people special treatment. I’m not saying that Apple wouldn’t do that because it isn’t fair. They wouldn’t waste their time doing it.
I had mentioned on a previous thread on this topic that I've found that once you're over the "good credit" threshold, I've found that a big indicator of what credit limit you'll get on a new card is what your credit limit is on OTHER cards on your credit report. Basically, the bank is "crowdsourcing" the decision of how much credit they can trust you with to all the other banks that have trusted you in the past (whether that's the right approach or not is up to debate). I think the other idea is you have to give someone at least the same, if not higher, credit limit as the other cards they already have or they won't bother using your card.
Therefore, its possible that DHH has some ultra-premium cards with 100K limits or whatever, while his wife does not, and despite having similar credit limits "the algorithm" says "hey this guy has huge credit limits and an Amex Black card, we better give him a huge limit too."
Therefore, its possible that DHH has some ultra-premium cards with 100K limits or whatever, while his wife does not, and despite having similar credit limits "the algorithm" says "hey this guy has huge credit limits and an Amex Black card, we better give him a huge limit too."
Does it not concern you in the slightest, that when they've ended up speaking to higher and higher up people in the various organisations that they literally don't know why the algorithm decided the way it did? No one they've spoken to can figure it out, which means they themselves can't also rule out discrimination happening.
A lot of the technology we produce is fundamentally biased by our own perceptions, and in ML case most especially by the input data. The danger is a self-perpetuation of already established systemic bias. Given access to good credit is key towards economic mobility that can have massive ongoing implications. The fact that they're saying "It's just what the algorithm produces" should be triggering huge alarm bells, regardless of the veracity of any of his other claims.
A lot of the technology we produce is fundamentally biased by our own perceptions, and in ML case most especially by the input data. The danger is a self-perpetuation of already established systemic bias. Given access to good credit is key towards economic mobility that can have massive ongoing implications. The fact that they're saying "It's just what the algorithm produces" should be triggering huge alarm bells, regardless of the veracity of any of his other claims.
Does it not concern you in the slightest, that when they've ended up speaking to higher and higher up people in the various organisations that they literally don't know why the algorithm decided the way it did?
That isn't what concerns me. I wouldn't expect the CEO of Apple to explain the inner workings of any of their algorithms. That's not their function. What scares me is that people who program or specify these things don't know how the heck decisions are made.
From credit decisions to self-driving cars, we are trusting black boxes with no idea why they make specific decisions.
That isn't what concerns me. I wouldn't expect the CEO of Apple to explain the inner workings of any of their algorithms. That's not their function. What scares me is that people who program or specify these things don't know how the heck decisions are made.
From credit decisions to self-driving cars, we are trusting black boxes with no idea why they make specific decisions.
Perhaps the people who are "higher and higher up" don't know what the inputs to the algorithm were and therefore can't say one way or the other. Perhaps those inputs are sensitive PII which shouldn't be accessible to the customer support reps who are trying to answer these concerns.
Now that's probably cause for concern too, of course. Imagine if you actually saw the massive personal data trove that has been collected on you which is being used to make these decisions. Sends a shiver up the spine doesn't it?
Now that's probably cause for concern too, of course. Imagine if you actually saw the massive personal data trove that has been collected on you which is being used to make these decisions. Sends a shiver up the spine doesn't it?
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> when they've ended up speaking to higher and higher up people in the various organisations that they literally don't know why the algorithm decided the way it did?
I don’t think it’s really fair to expect a C-level exec to know the low-level details of how creditworthiness is determined. I’m sure they can paint in broad strokes, but expecting a detailed answer for why a specific person got approved for a certain amount is a bit of a reach.
In the case of Woz having a higher limit than his wife, I’m sure it boils down to the usual stuff like, oh I don’t know, not being a cofounder of a massively successful corporation and therefore being filthy rich for the last 30+ years.
There might very well be a case to be made here but not likely between two people who are so very different in financial terms (or were for most of their lives). Your credit score isn’t something that changes the instant you get married to someone who’s rich.
I don’t think it’s really fair to expect a C-level exec to know the low-level details of how creditworthiness is determined. I’m sure they can paint in broad strokes, but expecting a detailed answer for why a specific person got approved for a certain amount is a bit of a reach.
In the case of Woz having a higher limit than his wife, I’m sure it boils down to the usual stuff like, oh I don’t know, not being a cofounder of a massively successful corporation and therefore being filthy rich for the last 30+ years.
There might very well be a case to be made here but not likely between two people who are so very different in financial terms (or were for most of their lives). Your credit score isn’t something that changes the instant you get married to someone who’s rich.
> Does it not concern you in the slightest, that when they've ended up speaking to higher and higher up people in the various organisations that they literally don't know why the algorithm decided the way it did?
No, I wouldn’t be concerned in the slightest - I’d just get a card from somewhere else.
No, I wouldn’t be concerned in the slightest - I’d just get a card from somewhere else.
Artificially limiting people's access to capital is a real problem. Sure, perhaps having to go to a separate company once is a minor inconvenience. If no one questions the "algorithm" and it gains wider spread adoption, people's access to capital can very quickly deteriorate. This has real consequences to people's ability to start a business, buy a house, pay a hospital bill... And yet you are not "concerned in the slightest". Do you have a blind trust in the algorithm, or just complete apathy on how this could affect people? What are the things that concern you then?
Where did he claim NY is a community property state?
In his tweet from 3:34pm on Nov 7 that started a huge bitchfest.
And wow I read the rest of it. Woman this women that.. and yet no idea where he’s getting any evidence this issue has to do with gender.
I mean maybe they made an unfair calculation for her, why is it all of a sudden clearly a case of gender discrimination.
Either he’s having a tantrum or trying to virtue signal for some unknown reason very hard.
https://twitter.com/dhh/status/1192540900393705474?s=20
And wow I read the rest of it. Woman this women that.. and yet no idea where he’s getting any evidence this issue has to do with gender.
I mean maybe they made an unfair calculation for her, why is it all of a sudden clearly a case of gender discrimination.
Either he’s having a tantrum or trying to virtue signal for some unknown reason very hard.
https://twitter.com/dhh/status/1192540900393705474?s=20
I believe he lives in California.
I thought DHH was in Chicago, not New York? (Though Illinois is also not a community property state, so there's that.)
That aside, his evidence is limited because Apple and GS both refuse to share the rationale behind their credit decisions. It's an algorithm. So he's basing it on what he does know.
That aside, his evidence is limited because Apple and GS both refuse to share the rationale behind their credit decisions. It's an algorithm. So he's basing it on what he does know.
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He said that they live in a community property state. (I have no idea where he lives.)
https://twitter.com/dhh/status/1192540900393705474?s=20
https://twitter.com/dhh/status/1192540900393705474?s=20
Wozniak isn’t in the top 0.1%. He lost his fortune and makes money via speaking now.
That’s a bold claim. He lost a fortune that would have made him a billionaire and possibly one of the 100 richest people in the world. He is still a very, very wealthy man.
Another key point being missed by the over-entitled Ruby on Rails dev, Wozniak, and most commenters here is that just because you are filing jointly doesn't mean you get to double-dip on credit limit entitlement.
You want credit for the sum of the couple's income when filing jointly and applying for credit jointly? Great! But that doesn't mean that you get to have that full credit TWICE, separately, when each partner applies. You get it once.
You want credit for the sum of the couple's income when filing jointly and applying for credit jointly? Great! But that doesn't mean that you get to have that full credit TWICE, separately, when each partner applies. You get it once.
That would be the “Ruby on rails creator”, lol.
There’s also no way to apply jointly for the card. You can input your joint income, sure, but they’re single-user accounts. You can’t, during signup, specify a lower balance in order to “free up” that credit for another family user. The thing is literally not built for married couples, who command an outsized share of spending & wealth. Stop trying to outsmart the gimped product and skip it, there’s so many better options out there.
There’s also no way to apply jointly for the card. You can input your joint income, sure, but they’re single-user accounts. You can’t, during signup, specify a lower balance in order to “free up” that credit for another family user. The thing is literally not built for married couples, who command an outsized share of spending & wealth. Stop trying to outsmart the gimped product and skip it, there’s so many better options out there.
You can absolutely add additional users to an account including but not limited to family members. You are trying to solve a non problem.
That’s not correct, it’s on the support page under “If a family member wants to use Apple Card”:
https://support.apple.com/en-us/HT209228
I was baffled myself.
https://support.apple.com/en-us/HT209228
I was baffled myself.
You are absolutely correct how odd.
Seeing journalists source from Twitter just shows the sad state of the journalism industry. 1 tweet from a single man from an uninformed perspective triggered this cascade of misinformation.
What happened to "research" and integrity? All for that click bait and ad-money I suppose.
What happened to "research" and integrity? All for that click bait and ad-money I suppose.
Isn't it Goldman loaning the line of credit? I'm not sure why Apple is getting the flack here. Apple is essentially a dumb middleman that shouldn't care about your credit rating since they have nothing to lose if you default on the loan.
I do get Apple getting shit for partnering with a horrible company. But does anyone know if Apple has any influence over the credit limit? I am having a hard time coming up with a reason why they would.
I do get Apple getting shit for partnering with a horrible company. But does anyone know if Apple has any influence over the credit limit? I am having a hard time coming up with a reason why they would.
The whole point of Apple is that they take full responsibility for the goodness of their products and they don't pass the buck. So when they outsource something and it goes wrong Apple has to own that failure and fix it.
And yeah, that is why I said Apple gets some blame for choosing a horrible bank to partner with.
But my point is that Apple doesn't have some fancy algorithm deciding females are 1/10th a person. Goldman does..
But my point is that Apple doesn't have some fancy algorithm deciding females are 1/10th a person. Goldman does..
But its Apple Card?
Why do I care about the business relation of Apple and GS or whatever? If my MacBook CPU fails, its on Apple, not Intel. I don't care where they got it.
I don't have an Apple card though, not available here.
Why do I care about the business relation of Apple and GS or whatever? If my MacBook CPU fails, its on Apple, not Intel. I don't care where they got it.
I don't have an Apple card though, not available here.
What makes them a horrible consumer bank? They didn’t really have a consumer division before. If Apple partnered with, idk, Bank of America you could have a prior experience to project.
I'm always a little confused by stories about Apple featuring Wozniak. Does he have any special insight into the company?
Why everything has to immediately be about discrimination? If it is always giving lower number to a member of the couple that earns less regardless of sex where is discrimination exactly?
So people who are famous? get a higher credit limit probably?
You know it's really easy to test a black box for bias right. This isn't something you have to speculate about like a human's bias.
Sure. So let's see those test results then. Because right now all we have is speculation. And if there's no transparency with a company's credit decisions, then speculating with the limited data you do have is fair game.
It's only easy if you have the ability to control all of the inputs. In this case we don't even know what those inputs are, let alone the ability to control them.
> In this case we don't even know what those inputs are, let alone the ability to control them.
Eh, not quite. It’s fairly well-understood what is used to determine a credit score and basically how all that information is compiled.
1. How much money do you make?
2. How long have you been making that much?
3. Is your income irregular?
4. Have you ever taken out a loan? When’s the last time you did so?
5. Have you ever failed to pay back a loan?
6. How many loans do you currently have open?
7. Are any loans behind?
8. Do you have a revolving line of credit (credit card)? How many?
9. How much of your revolving credit is in use?
10. Are you late in paying any of your credit lines?
And I’m sure there’s more stuff I’m missing. But broadly, if you’re looking to get credit/loans, banks prefer someone who a) makes enough money to service their debt, b) doesn’t have too much debt relative to their income, c) pays their bills on time, and d) has an established history of a, b, and c for an extended period of time.
Creditworthiness is not a mysterious algorithm that few can comprehend.
Eh, not quite. It’s fairly well-understood what is used to determine a credit score and basically how all that information is compiled.
1. How much money do you make?
2. How long have you been making that much?
3. Is your income irregular?
4. Have you ever taken out a loan? When’s the last time you did so?
5. Have you ever failed to pay back a loan?
6. How many loans do you currently have open?
7. Are any loans behind?
8. Do you have a revolving line of credit (credit card)? How many?
9. How much of your revolving credit is in use?
10. Are you late in paying any of your credit lines?
And I’m sure there’s more stuff I’m missing. But broadly, if you’re looking to get credit/loans, banks prefer someone who a) makes enough money to service their debt, b) doesn’t have too much debt relative to their income, c) pays their bills on time, and d) has an established history of a, b, and c for an extended period of time.
Creditworthiness is not a mysterious algorithm that few can comprehend.
Eh, not quite. It’s fairly well-understood what is used to determine a credit score and basically how all that information is compiled.
Seeing that your first three points have nothing to do with your credit score and aren’t captured by credit agencies, you’ve kind of demonstrated that it isn’t well understood.
Credit applications usually just ask for your income. They only verify it my experience sometimes for car loans and only for the last month and they only go back three months for verifications for mortgages.
Seeing that your first three points have nothing to do with your credit score and aren’t captured by credit agencies, you’ve kind of demonstrated that it isn’t well understood.
Credit applications usually just ask for your income. They only verify it my experience sometimes for car loans and only for the last month and they only go back three months for verifications for mortgages.
It's being reported that people with equal or better credit scores are getting lower limits.
It's also entirely possible for two people with vastly different credit history _lengths_ to have approximately the same score. In other words, a 25 year old with an "800" due to having had a CC for a few years and a car loan that they've kept up with is not the same as a 50 year old with 800 who has multiple CCs with high limits, has paid off two or three cars, has a mortgage, etc.
They're both considered "top" credit risks, but obviously one of the two people has demonstrated a longer history of being such trustworthy person to lend money to (also probably makes a lot more money than the other person to boot). It's not at all uncommon for people with "identical" credit scores to have different limits.
Now perhaps there's an argument to be made for more granularity in scores to make something like this more obvious, but it is what it is.
They're both considered "top" credit risks, but obviously one of the two people has demonstrated a longer history of being such trustworthy person to lend money to (also probably makes a lot more money than the other person to boot). It's not at all uncommon for people with "identical" credit scores to have different limits.
Now perhaps there's an argument to be made for more granularity in scores to make something like this more obvious, but it is what it is.
Except he didn’t say that, and many others commenting had opposite results. Nobody knows the reason for the difference.
I wonder if crying sexism is the new best way to get your issue properly looked at. Note: I am not saying this is or isn't based in sexism, just that DHH has no idea or very limited information as to what is going on and is making some very harsh assumptions.
> just that DHH has no idea or very limited information as to what is going on
That's the main problem he has. Major decisions based on secret information. (Or secret algorithms).
That's the main problem he has. Major decisions based on secret information. (Or secret algorithms).
Why do they think filing a joint return is relevant?
Likely just pointing out that, in even more ways than should matter in this case, they and their partners are financially identical.
Filing a joint return in the US in no way implies financial unity. It just means your income is pooled for tax calculation purposes, that’s it (and only federal, you can often file separately in the same or different states). There are community property states, which NY is not. It gets hairy just about anywhere if a marriage is ended.
And if lenders based their credit decisions on the spouse’s creditworthiness, someone else would whine about that.
The sense of entitlement that’s taken hold of the world is dismaying. If you don’t like the terms Apple / GS are offering, then go somewhere else.
The sense of entitlement that’s taken hold of the world is dismaying. If you don’t like the terms Apple / GS are offering, then go somewhere else.
> If you don’t like the terms Apple / GS are offering, then go somewhere else.
If they are basing those terms based on one of the protected classes (race, gender, age) that is illegal and should be investigated.
> The sense of entitlement that’s taken hold of the world is dismaying.
I know, right. Damn these brown people, LGBTQ, women for demanding a seat at the table. Cis-het white people must be feeling particularly oppressed with all of these racist|sexist|genderist calls for reform
If they are basing those terms based on one of the protected classes (race, gender, age) that is illegal and should be investigated.
> The sense of entitlement that’s taken hold of the world is dismaying.
I know, right. Damn these brown people, LGBTQ, women for demanding a seat at the table. Cis-het white people must be feeling particularly oppressed with all of these racist|sexist|genderist calls for reform
“Damn these brown people, LGBTQ, women for demanding a seat at the table.”
Maybe if they earned it instead of demanding it they’d be taken seriously?
Maybe if they earned it instead of demanding it they’d be taken seriously?
How exactly do you earn equality?
It's not filing a joint return. It's holding all the assets in joint accounts. So they have equal ability to withdraw.
Which is irrelevant since your credit report doesn’t list your assets nor does any credit card that I am aware of ask you to list assets let alone verify them.
I think Woz probably relies on investments rather than wages for income, so holding a joint account means something a little different than it would for most people.
But I understand your point.
It's also a corner case the credit rating systems don't handle. I am reminded of many years ago when I had no credit but good income, and none of the credit card companies cared about that last point enough to trust me. These are imperfect systems.
But I understand your point.
It's also a corner case the credit rating systems don't handle. I am reminded of many years ago when I had no credit but good income, and none of the credit card companies cared about that last point enough to trust me. These are imperfect systems.
FICO is trying to fix that with Experian Boost (https://thepointsguy.com/news/how-utility-bills-might-improv...). It will let you opt in to using utility and phone bills as part of your credit score.
But this is also far from perfect. If times are tough or you’re just irresponsible, you’re going to pay your utility bills because of the extreme inconvenience of having your utilities cut off but you may not pay your phone bills.
But this is also far from perfect. If times are tough or you’re just irresponsible, you’re going to pay your utility bills because of the extreme inconvenience of having your utilities cut off but you may not pay your phone bills.
and also only works by giving them access to your checking account. anyone who uses credit cards to pay bills doesnt get a boost. doesnt seem worth losing the points over, id rather have 2% off my bills (unless the boost had a material impact on a mortgage rate, but then you would have to pay your bills for years with checking, hoping boost is still around.)
If you have credit cards, you’re already building credit so you won’t need it.
you dont gain additional credit for paying your bills on a cc, if anything its slightly stunning your utilization.
That’s what I just said. If you already have credit, you won’t need the Credit Boost of letting them see your checking account. It’s meant for people who don’t have credit.
Woz and DHH both seemed to think filing jointly should be determinative or at least relevant.
Maybe but that just shows that they don't understand credit scoring/credit card lending decisions. Whether or not you file joint taxes doesn't come into play at all.
>Apple co-founder says
Codeword for Woz
Codeword for Woz
Wozniak has got an opinion on everything and the media says we have to care because he co-founded Apple in 1976.
Really, what makes him an expert on this? Why should we pay attention to what he has to say about it?
Really, what makes him an expert on this? Why should we pay attention to what he has to say about it?
Yeah. He's a really interesting guy but he kind of falls into a category shared by John McAfee and Garry Kasparov of "interesting people with a lot to blather about."
Because it gets clicks.
His opinion is as meaningless and irrelevant here as a random person off the street.
His opinion is as meaningless and irrelevant here as a random person off the street.
I think that's extremely hyperbolic.
If your livelihood depended on an insight into the way Apple's financial systems operate, and your options were Steve Wozniak or the first person you saw on the street in a major city, you'd say "flip a coin?" I didn't think so.
If your livelihood depended on an insight into the way Apple's financial systems operate, and your options were Steve Wozniak or the first person you saw on the street in a major city, you'd say "flip a coin?" I didn't think so.
1) Apple Card is backed by Goldman Sachs. So if I was in a major city I would much rather flip a coin and hope to get a GS employee.
2) I used to work at Apple and I know people that were fired for leaking. So I would be very surprised if anyone would be stupid enough to leak the inner workings of the company to Steve. Especially from a financial products team.
2) I used to work at Apple and I know people that were fired for leaking. So I would be very surprised if anyone would be stupid enough to leak the inner workings of the company to Steve. Especially from a financial products team.
Even his opinion on Apple products is largely irrelevant nowadays as he was wrong multiple times.
Jobs left the company for all intents and purposes in the mid 80s. What would he know about Apple’s financial or technical decisions that any outside observer wouldn’t know?