Thoughts about the markets, automated trading algorithms, artificial intelligence, and lots of other stuff

  • An Experience Worth Paying For …

    What does $1.2 billion buy nowadays? Apparently, an amazing stadium that will change the way you experience events.

    As I was leaving the first preseason football game played in the new Dallas Cowboys stadium, one of the guys I went with said "that was the best football game I've ever seen." He was wrong; it was, however, probably the best experience he's had at a football game.

    I've been to hundreds of professional sporting events. Yet, Jerry and Stephen Jones, HKS Architects, and the rest of the team that built that stadium found a way to surprise and excite me, while exceeding my expectations on almost every level.

    Years ago, I read a book called "The Experience Economy: Work Is Theater & Every Business a Stage", which explains that as the world cascades towards sameness, a business can achieve a sustainable competitive advantage by differentiating the experience it provides to its customers. The Cowboys have done that with this stadium.

    There's a certain amount of theater, pageantry, and spectacle that you expect from a professional sporting event. Even the word "event" implies that, doesn't it?

    Well the Cowboys got it right; and it was larger than life.  Watching people as they walked in the stadium, it was amazing to see how many of them said "Wow!" And during the game, I can't tell you how many times I heard somebody say "this is incredible" … and they weren't talking about the game.

    Do You Watch the HD Screen … Or the Field?

    A few weeks ago I wrote about the stadium.  This time I'm writing about what it is like to attend an event there.  One thing worth noting, the GINORMOUS HD video screen is so clear and so large that it changes how you see the game (I certainly never paid attention to cheerleaders before this, and the video is so clear you can literally read the tattoos on a player's arms during a play).  Frankly it was slightly unnerving because I couldn't figure out how
    best to watch the game. I found myself drawn to the massive video
    screen rather than the field. I literally had to train myself to watch
    the play on the field, and then to allow myself to look up to see the
    replay (often from multiple angles).

    090822 Cowboys Stadium Opener

    You know how some movies whisper "wait for the DVD" while other movies were clearly built for the Big-Screen. This stadium changes how you consume a live event product (like an NFL game), and makes it worthwhile to be there.

    It is hard to control what happens on any given Sunday, but with this, the Jones have created a sustainable brand promise and set a new standard.

    You've got to experience it for yourself. 

    My guess is that it will change stadiums around the world. Bravo.

    For More On This:

  • Habits: Too Much of a Good Thing?

    Do You Have a Habit of Creating Habits?

    I do; I'm a creature of habit more often than I like to admit.

    For example, I tend to order the same thing at restaurant each time I go there. So, when I want good pizza, I go to Parma's; and when I want a great burger, I go to Mooyah.

    090816 MooYah Burger 300p

    By the way, that is a picture of my son eating a 4-Stack, one-pound burger (and me remembering when I could do that too).

    Habits happen at work too.  As a trader, I draw charts a certain way, prefer certain patterns, and respond predictably to certain emotional triggers.

    What habits do you have?   Perhaps more important to ask is: What percent of your habits have become so habitual that you no longer notice that they are habits?

    Relying On a Routine is a Blessing and a Curse.

    I'm typically a happy person. I feel like I roll with the punches well. Part of that is "true"; and a bigger part is due to creating a routine that supports my natural rhythms.

    An Exception Highlights the Rule: This week my brother had a baby, and I made a quick trip to LA with the family to celebrate. Even though it was a happy occasion, it is pretty clear that when I travel, and my routine is interrupted, I am much easier to upset.

    On the other hand, I'm also much more likely to experience something new when I'm taken out of my routine.

    Too Much of a Good Thing. How Can Relying On Your Best Qualities Hurt you?

    How many opportunities to create something better do you miss because you like doing what you are doing?  A related question is how many opportunities do you miss because you don't recognize the rut you are in?

    There are several types of progress; for example, Process Improvement and Discontiguous Innovation. In Process Improvement, creating habits and routines is the stated purpose … choosing the right ones is the art.  With Discontiguous Innovation, it is about leaving the old behind and simply finding a way to get a better result. In my experience the hardest part often simply is remembering that there might be a better way.

    Routine is fine as long as it is a conscious choice.
    Otherwise, it can limit your options unnecessarily.

  • Habits: Too Much of a Good Thing?

    Do You Have a Habit of Creating Habits?

    I do; I'm a creature of habit more often than I like to admit.

    For example, I tend to order the same thing at restaurant each time I go there. So, when I want good pizza, I go to Parma's; and when I want a great burger, I go to Mooyah.

    090816 MooYah Burger 300p

    By the way, that is a picture of my son eating a 4-Stack, one-pound burger (and me remembering when I could do that too).

    Habits happen at work too.  As a trader, I draw charts a certain way, prefer certain patterns, and respond predictably to certain emotional triggers.

    What habits do you have?   Perhaps more important to ask is: What percent of your habits have become so habitual that you no longer notice that they are habits?

    Relying On a Routine is a Blessing and a Curse.

    I'm typically a happy person. I feel like I roll with the punches well. Part of that is "true"; and a bigger part is due to creating a routine that supports my natural rhythms.

    An Exception Highlights the Rule: This week my brother had a baby, and I made a quick trip to LA with the family to celebrate. Even though it was a happy occasion, it is pretty clear that when I travel, and my routine is interrupted, I am much easier to upset.

    On the other hand, I'm also much more likely to experience something new when I'm taken out of my routine.

    Too Much of a Good Thing. How Can Relying On Your Best Qualities Hurt you?

    How many opportunities to create something better do you miss because you like doing what you are doing?  A related question is how many opportunities do you miss because you don't recognize the rut you are in?

    There are several types of progress; for example, Process Improvement and Discontiguous Innovation. In Process Improvement, creating habits and routines is the stated purpose … choosing the right ones is the art.  With Discontiguous Innovation, it is about leaving the old behind and simply finding a way to get a better result. In my experience the hardest part often simply is remembering that there might be a better way.

    Routine is fine as long as it is a conscious choice.
    Otherwise, it can limit your options unnecessarily.

  • Capitalogix Commentary 08/16/09

    The unemployment numbers came in slightly better than expected, and the market reacted very favorably. Then quietly, adjustments were made for other months, which were very unfavorable. Moreover, examining recent numbers a little closer suggests that some portion of the slowing growth of unemployment is probably due to the way the number is constructed. Some people are being dropped from the ranks of the unemployed, even though they haven't found jobs, because their unemployment is now long enough that they no longer qualify for benefits.

    Let Go from the Unemployment Ranks

    Market Commentary.

    There has been a lot of bad news in the press lately.  Nonetheless, the markets have held up well. There have been several
    sharp drops, which made me expect much worse; only to be met with
    another rally. As much as my gut wants to warn about "head fakes" and
    "finding the last buyer", this is the type of market action we see during
    bull market trends.

    Comparison of World Index Performances.

    The next chart shows how some of the big, thickly-traded, world equity indices (like the DAX, CAC, and FTSE) have performed year-to-date.  I like using a chart like this to get a sense of the bigger picture.  Last week's chart showed that the Emerging Markets have done much better so far this year.  Both charts show highly correlated trading.

    090815 World Indices Lag Emerging Markets

    The chart
    is interactive; so by clicking the picture, you can drag the
    yellow-highlighted date range slider to see how the change
    plays-out over time.  Try going back 232 days (which is the past year
    of trading days).  You can also add or change the markets this
    comparison uses.

    Disaster Readiness.

    "If this were an actual emergency" … would you have learned anything from the events of the last year?  As a trader, I've been burning the midnight oil and studying the bear market data to
    figure-out which of our systems held-up best during those periods.  In addition, I'm looking for early indicators that would signal a
    phase shift out of the bullish trend.

    090816 Exchange Certified Bullion Governments are probably going through a similar exercise, even though the Fed says the recession is ending and that it would take a step back toward normal policy as things return to normal.  Frankly they'd hope so, because the alternative is pretty scary.  How many things are left in their bag of tricks?

    Exchange Certified Bullion.

    Coincidentally, I'm hearing a lot more about investors and hedgers taking delivery of precious metals, like gold, silver, platinum, and palladium. Why? Apparently, unlike ETFs (like GLD), buying Warehouse Depository Receipts conveys title to specific, numbered, metal bars, which means they are not reportable as financial assets, yet you can still pledge them as collateral or sell call options against them.

    Business Posts Moving the Markets that I Found Interesting This Week:

    Lighter Ideas and Fun Links that I Found Interesting This Week

    • FriendFeed Updates Status: Married to Facebook. (NYTimes)
    • Hold Innovation Tournaments to Find the Most Promising New Opportunities. (Wharton)
    • Sony Adopts Open Book Strategy Against Amazon. (MediaPost)
    • Mobile Phones Get Augmented Cyborg Vision. (BBC)
    • DriveSharp Claims It Can "Train the Brain to Think and React Faster On The Road". (WSJ)
    • More Posts with Lighter Ideas and Fun Links.

  • Capitalogix Commentary 08/16/09

    The unemployment numbers came in slightly better than expected, and the market reacted very favorably. Then quietly, adjustments were made for other months, which were very unfavorable. Moreover, examining recent numbers a little closer suggests that some portion of the slowing growth of unemployment is probably due to the way the number is constructed. Some people are being dropped from the ranks of the unemployed, even though they haven't found jobs, because their unemployment is now long enough that they no longer qualify for benefits.

    Let Go from the Unemployment Ranks

    Market Commentary.

    There has been a lot of bad news in the press lately.  Nonetheless, the markets have held up well. There have been several
    sharp drops, which made me expect much worse; only to be met with
    another rally. As much as my gut wants to warn about "head fakes" and
    "finding the last buyer", this is the type of market action we see during
    bull market trends.

    Comparison of World Index Performances.

    The next chart shows how some of the big, thickly-traded, world equity indices (like the DAX, CAC, and FTSE) have performed year-to-date.  I like using a chart like this to get a sense of the bigger picture.  Last week's chart showed that the Emerging Markets have done much better so far this year.  Both charts show highly correlated trading.

    090815 World Indices Lag Emerging Markets

    The chart
    is interactive; so by clicking the picture, you can drag the
    yellow-highlighted date range slider to see how the change
    plays-out over time.  Try going back 232 days (which is the past year
    of trading days).  You can also add or change the markets this
    comparison uses.

    Disaster Readiness.

    "If this were an actual emergency" … would you have learned anything from the events of the last year?  As a trader, I've been burning the midnight oil and studying the bear market data to
    figure-out which of our systems held-up best during those periods.  In addition, I'm looking for early indicators that would signal a
    phase shift out of the bullish trend.

    090816 Exchange Certified Bullion Governments are probably going through a similar exercise, even though the Fed says the recession is ending and that it would take a step back toward normal policy as things return to normal.  Frankly they'd hope so, because the alternative is pretty scary.  How many things are left in their bag of tricks?

    Exchange Certified Bullion.

    Coincidentally, I'm hearing a lot more about investors and hedgers taking delivery of precious metals, like gold, silver, platinum, and palladium. Why? Apparently, unlike ETFs (like GLD), buying Warehouse Depository Receipts conveys title to specific, numbered, metal bars, which means they are not reportable as financial assets, yet you can still pledge them as collateral or sell call options against them.

    Business Posts Moving the Markets that I Found Interesting This Week:

    Lighter Ideas and Fun Links that I Found Interesting This Week

    • FriendFeed Updates Status: Married to Facebook. (NYTimes)
    • Hold Innovation Tournaments to Find the Most Promising New Opportunities. (Wharton)
    • Sony Adopts Open Book Strategy Against Amazon. (MediaPost)
    • Mobile Phones Get Augmented Cyborg Vision. (BBC)
    • DriveSharp Claims It Can "Train the Brain to Think and React Faster On The Road". (WSJ)
    • More Posts with Lighter Ideas and Fun Links.

  • What If You Outsourced Your Job Overseas?

    News satire from The Onion. It is funny, well done, and like most good humor … it has an insightful kernel of truth.  This one provides a different perspective on employment and outsourcing.


    More American Workers Outsourcing Own Jobs Overseas

  • What If You Outsourced Your Job Overseas?

    News satire from The Onion. It is funny, well done, and like most good humor … it has an insightful kernel of truth.  This one provides a different perspective on employment and outsourcing.


    More American Workers Outsourcing Own Jobs Overseas

  • Capitalogix Commentary 08/09/09

    The rally continues, and the S&P 500 has gotten back above 1000.  Pretty impressive on many fronts.  How does it compare to other markets though?  This chart shows how several other world markets have done so far in 2009.

    090808 World Markets Comparison

    The strength of the rallies don’t make sense to me based on logic.  But trends don’t depend on logic. So, I dusted-off my copy of Trend Following and will simply ride the bucking bronco.

    Why Citigroup’s Volume Is Significant.

    Last week saw some interesting trading in Citigroup, as it recorded an “utterly insane” amount of volume – 2.7 BILLION – in a single day. That huge volume value caused problems throughout the financial information world. Financial systems are designed to handle certain ranges of values. If a number is outside that range, it “overflows” the data field for that value. Citigroup’s volume overflowed, which should tell you something about how likely that level of trading is to occur.

    I watch volume patterns.  Capitulation bottoms typically happen on huge volume spikes.  I don’t know if the reverse holds true as well.  But the markets are extended so I’m watching things a little more closely.

    What About Gold?

    If the Markets start a deeper pull-back, then Gold looks poised for a break-out to the upside.  Here is a chart showing a potential Reverse Head-and-Shoulders bottoming pattern.  There recent shoulder is a triangle pattern, which indicates we should expect expanded volatility soon.

    090808 Gold Trying to Break-Out

    Business Posts Moving the Markets that I Found Interesting This Week:

    • Can ‘Cash for Clunkers’ Help Jump-start the Auto Industry? (Wharton)
    • More Stimulus: Senate Adds $2 Billion to ‘Clunkers’ Plan. (WSJ)
    • Job Losses Slow to 247,000; Unemployment Rate Dips. (WPost)
    • Will Apple’s iTouch Tablet Will Become Its Flagship Product? (Seeking Alpha)
    • What the Hotness of Your Waitress Says About the Economy? (NY Mag)
    • More Posts Moving the Markets.

    Lighter Ideas and Fun Links that I Found Interesting This Week

  • Capitalogix Commentary 08/09/09

    The rally continues, and the S&P 500 has gotten back above 1000.  Pretty impressive on many fronts.  How does it compare to other markets though?  This chart shows how several other world markets have done so far in 2009.

    090808 World Markets Comparison

    The strength of the rallies don’t make sense to me based on logic.  But trends don’t depend on logic. So, I dusted-off my copy of Trend Following and will simply ride the bucking bronco.

    Why Citigroup’s Volume Is Significant.

    Last week saw some interesting trading in Citigroup, as it recorded an “utterly insane” amount of volume – 2.7 BILLION – in a single day. That huge volume value caused problems throughout the financial information world. Financial systems are designed to handle certain ranges of values. If a number is outside that range, it “overflows” the data field for that value. Citigroup’s volume overflowed, which should tell you something about how likely that level of trading is to occur.

    I watch volume patterns.  Capitulation bottoms typically happen on huge volume spikes.  I don’t know if the reverse holds true as well.  But the markets are extended so I’m watching things a little more closely.

    What About Gold?

    If the Markets start a deeper pull-back, then Gold looks poised for a break-out to the upside.  Here is a chart showing a potential Reverse Head-and-Shoulders bottoming pattern.  There recent shoulder is a triangle pattern, which indicates we should expect expanded volatility soon.

    090808 Gold Trying to Break-Out

    Business Posts Moving the Markets that I Found Interesting This Week:

    • Can ‘Cash for Clunkers’ Help Jump-start the Auto Industry? (Wharton)
    • More Stimulus: Senate Adds $2 Billion to ‘Clunkers’ Plan. (WSJ)
    • Job Losses Slow to 247,000; Unemployment Rate Dips. (WPost)
    • Will Apple’s iTouch Tablet Will Become Its Flagship Product? (Seeking Alpha)
    • What the Hotness of Your Waitress Says About the Economy? (NY Mag)
    • More Posts Moving the Markets.

    Lighter Ideas and Fun Links that I Found Interesting This Week

  • How Much Is a Burger at the Cowboys’ New Stadium?

    "Everything's bigger in Texas" takes on new meaning while touring the new Dallas Cowboys football stadium. The stadium cost over $1.1 billion to construct; and it makes a big statement.  In addition to being massive (large enough that the Statue of Liberty would fit comfortably inside), the new structure is quite distinctive and technologically innovative.

    090808 Cowboys Stadium

    From inside the stadium,
    with the roof closed, it was designed to look like the old Texas
    Stadium's roof (with its visual trademark hole).  However, it can be fully-shut or fully-opened.  Actually, it does a lot more than open; it slides back and then the end-zone entrances shift sideways to create the appearance of a totally open stadium, all the way out to the parking lots. My sons and I tried to figure-out how they did this … and surmised that they spent a whole bunch of money and a lot of time to make this stadium act like a Transformer. 

    Another technological marvel is the high-definition video screen hanging above the field. It is a massive, and currently the world's largest screen.  It measures more than 11,500 square feet (72feet
    tall and 160 feet wide) and weighs over 1.2 million pounds.  In addition to experiencing the event live, they've tried to make the multimedia experience in the stadium better than you'd get on your television set.  It will be easy to follow the action from any seat in the stadium.

    090808 Cowboys Stadium Video Screen

    By the way – that screen, alone, cost more ($40 million) than the entire construction of the Cowboys' previous home, Texas Stadium ($35 million).

    In addition, the Cowboys owner, Jerry Jones, has shown that he is an innovative business man as well. He focused on selling far more suites than stadiums before this had available. Moreover, even though the stadium is designed to hold approximately 80,000 people for normal events, it can expand to hold over 100,000 people for special events (like next year's Super Bowl).

    He extended an olive branch to the common man. Not in the price of a pizza, which costs $60 at the stadium.  However, the Cowboys now offer a "Party Pass" that allows access to the game for $29, so long as you're willing to stand in the concession areas.  Believe it or not, that Party Pass idea is getting great press and opens the live game experience to a whole different range of socioeconomic backgrounds. At least until they see how much a burger costs of the stadium.  I cut off the price of the alcohol or you'd need a drink. 

    090808 Price of a Burger

    Here is my impression of watching a game there.

    Other Information: