Thoughts about the markets, automated trading algorithms, artificial intelligence, and lots of other stuff
Here is a Dilbert-style parody of how a corporate team uses an expert.
What happens when people don't have a clue about problem solving (or 'definition'), realistic goal setting, or practical reality?
You end up with ridiculous tasks that are literally impossible. And that's exactly what "The Expert" nails perfectly.
Funny (and sometimes too true).
Just got back from a quick trip to New York City. While there, I got interviewed at the Market Technicians Association annual meeting.
For what it is worth, the prevailing sentiment there was quite bullish (though most were expecting a pull-back, or correction, soon).
On a side note, I took advantage of the proximity to the Carnegie Deli.
I only ate half, but didn't want to waste any … so I had it wrapped, and took it home.
Long story short, even if it doesn't smell bad, you shouldn't eat corned beef that was left unrefrigerated for more than a day.
I lost seven pounds yesterday!
I'd be an idiot savant if I were good at something enough to be a savant.
Here are some of the posts that caught my eye. Hope you find something interesting.
Did you see the 60 Minutes report on Michael Lewis' new book, "Flash Boys," that reveals some of the ways that high speed traders work the stock market to their advantage.
Here is an excerpt from the intro.
Steve Kroft: What’s the headline here?
Michael Lewis: The Stock Market is rigged. The United States stock market, the most iconic market in global capitalism is rigged.
Steve Kroft: By whom?
Michael Lewis: By a combination of these stock exchanges, the big Wall Street banks and high-frequency traders.
Steve Kroft: Who are the victims?
Michael Lewis: Everybody who has an investment in the stock market.
The 60 Minutes piece has a interesting explanation of what is happening.
For an even better one, click to watch this Michael Lewis interview on Bloomberg, where he defends his claim that the market is rigged.
via Bloomberg Television's “Market Makers.”
Let me know if you want to talk about high frequency trading or what is likely to happen as a result of press coverage like this and the ensuing regulatory scrutiny.
We live in interesting times.
via BusinessInsider.
In this trading methodology, missing 'big win' days does so much damage because those missed gains aren't able to compound during the rest of the investment holding period.
Here are some of the posts that caught my eye. Hope you find something interesting.
Image by Simon Miller via Flickr
The Economist's Big Mac index seeks to make exchange-rate theory more digestible. They say, tongue-in-cheek, that it is arguably the world's most accurate financial indicator to be based on a fast-food item.
The Big Mac index is based on the theory of purchasing-power parity (PPP), according to which exchange rates should adjust to equalize the price of a basket of goods and services around the world. For them, the basket is a burger … a McDonald’s Big Mac.
According to this measure, the most undervalued currency is India's Rupee at about 67% below its PPP rate. In India, a McDonald’s Big Mac costs just 95 Rupees on average, the equivalent of $1.54 at market exchange rates. In America, the same burger averages $4.62.
The interactive graphic, below, shows by how much, in Big Mac PPP terms, selected currencies were over- or undervalued.
The index is supposed to give a guide to the direction in which currencies should, in theory, head in the long run. It is only a rough guide, because its price reflects non-tradable elements such as rent and labor. For that reason, it is probably least rough when comparing countries at roughly the same stage of development. The Economist has added an adjustment option to account for this in the interactive version of the data.
Tech can be sexy … but this headline surprised me. "Tokyo Robots Drawing Crowds at Cabaret." Would you pay to watch "female" robots at a club?
No, not those kind of robots … there is a video.
Here are some of the posts that caught my eye. Hope you find something interesting.
It might seem difficult to define what makes a smart company, but you probably know one when you see it.
When such a company commercializes a truly innovative technology, things happen … leadership in a market is bolstered or thrown-up for grabs. Competitors have to refine or rethink their strategies.
Here is a list compiled by the editors of MIT Technology Review.
They didn’t count patents or PhDs; instead, they asked whether a company had made strides in the past year that will define its field.
“Vision is not enough; it must be combined with venture. It is not enough to stare up the steps; we must step up the stairs.” ~ Vaclav Havel
This list highlights companies where important innovations are happening right now, regardless of reputation. Perhaps that is why familiar names (such as Apple and Facebook) aren’t on this list.
It is kind of fun to read through what is being created now.
There are more millionaires in the United States than ever before.
via Spectrem Group.
The number of households with net worth of $1 million or more, excluding their homes, is at a record 9.63 million, according to a new report.
That eclipses the old mark of 9.2 million in 2007 before the global financial crisis, according to Spectrem Group research. The tally of millionaires slipped to 6.7 million in 2008 as the financial crisis struck.
This study reinforces other data showing that the wealthy in the U.S. are doing well.
