Wednesday, December 22, 2010

2010 Movie Recommendations

My girlfriend and I are movie fanatics. We watch around 15-25 movies every month, most of them through Netflix. I am a notoriously tough grader of movies. I only give out a handful of 5's a year, so I think that the group is pretty interesting to recap. In reverse chronological order of when I saw them:
  • Edge of Darkness, a Mel Gibson cop thriller that kept me on the edge of my seat for the duration
  • The Secrets in Their Eyes, a crime story investigating a cold rape/murder case that effectively weaves in a storyline of old love. An exceptionally well done movie that won the 2010 Oscar for Best Foreign Language Film of the Year.
  • City Island - Andy Garcia, Juliana Margulies, and Alan Arkin all star in this movie about a family who come to grips with their secrets that they keep from each other.
  • Whip It, Drew Barrymore's directorial debut. It's not just another Ellen Page coming-of age story. It's witty, funny, and downright good. I wasn't expecting much so I just got blown away.
  • The Fog of War, a documentary about Robert McNamara that makes you question what you really know or feel about the former Secretary of Defense. In some ways, a man so powerful became just a cog in the wheels of government - I wouldn't full abdicate his complicity in Vietnam but I would definitely refrain from calling him a warmonger after watching this film.
  • Tetro, a story about two brothers who reunite after many years apart. It's not a movie with a plot that is very engaging, but this Francis Ford Coppola movie definitely is.
  • Cloudy with a Chance of Meatballs, a fantastic kid comedy. You can absolutely tell that the SNL writers had their hands in the storyboards which absolutely adds to the movie's value. And
  • Will Ferrell: You're Welcome America, hilarious 90-minute video cut from an even longer stand-up routine Will Ferrell performed in NY to close out his 8-year run as the premier George W. Bush impersonator.

Monday, December 20, 2010

Haiku - Repo 105

Today, the repo 105 was back in the news with the indictment of Lehman auditors Ernst & Young for its complicity in the largest bankrupty in US history.

Leverage too high?
Bring down with window dressing -
repo 105.

Friday, December 17, 2010

Fix the damned DC Metro system

This week's commute built up and led to a "Network" moment - "damnit I'm mad as hell and I'm not going to take it anymore" so I wrote out my plan to fix the Metro system. In the interest of full disclosure I am a purely Metro train rider (commute from Takoma to McPherson Square) so my ideas are biased towards that part of the system. Though I have tried to include complaints I've heard of the bus system from sources like UnsuckDCMetro.

Here is my three pronged plan:

1. Client satisfaction

a. Make the performance at peak, weekday hours the Metro’s highest priority.

i. The goal should be one train every five minutes while “peak of the peak” charges are in effect, one train every ten minutes at other times.

ii. No customer should have to wait more than twenty minutes for a train at any station throughout the system.

b. Either reduce the fares or increase the service to the outlier stations (i.e. past Silver Spring or Grosvenor on the red line). The injustices committed to these mainstays of the Metro system are a travesty.

c. Turn on the computer systems.

i. Air brakes have made passengers sick and some customers have left the system as a result.

ii. A year and a half is long enough for the safety studies to be complete and upgrades to the software made. Let’s get our trains moving more efficiently and less like a wild amusement ride.

d. Upgrade turnstiles – the software AND the hardware.

i. NYC had a major push to reduce the ability to steal from their subway – this could reduce crime inside the Metro and make it safer for clients.

e. Improve our appearance

i. No more broken tiles or cordoned off shelters

ii. Revisit the engineering to our dark and dreary stations (Gallery Place and Metro Center). As ambassadors for our nation’s entire public transportation system these should be shining beacons of light that make domestic visitors proud and international visitors jealous.

f. Pause the silver and purple line expansions

i. We need to stabilize the existing system before making large capital expenditures on additional infrastructure

2. Financial

a. Immediately sell off 20% of non-revenue generating trucks, spare parts, and other idle equipment. Look for more to cut.

b. Immediately lay off 5% of the workforce. Keep an option to lay off an additional 5%.

c. Start the capital planning for the addition of a third rail to the system’s lines like in New York City. “Single tracking” is one of the largest complaints and a big inefficient drain on the city’s productivity when they occur.

d. Reduce fare complexity even if the changes are not revenue-neutral. Fare mapping is a waste of the customer’s time.

e. Increased transparency of the budgeting process

i. Resources should fairly match its source. For example, Vienna should have a great station.

3. Employment

a. Institute ghost shoppers – the result of their quarterly feedback forms the basis for a station manager’s pay raise or annual bonus.

b. Repeal the “bid system” for escalator maintenance. Make the people responsible for the escalators accountable. But provide them with the support they need to be successful.

c. Two strike system for sleeping/texting/reckless driving on duty – a warning and a termination. No more suspension with pay for violating rules.

d. Don’t cave to the unions.

i. There are plenty of people who both deserve and are in need of jobs. Bring on the scabs.

UPDATE 1 on 12/20/10: Addition under 2.f. More advertising revenue/corporate sponsorships. I am positive that Metro riders could deal with more billboards and skinned railcars or with the name "Citigroup L'Enfant Station" if the advertising and sponsorship revenue went towards: lower fares or structural improvements.

Tuesday, November 30, 2010

Good time to be in insurance

What a wonderful time to own hurricane insurers! 2010 marks the fifth consecutive year that the US has avoided any major hurricanes. (Source)

I once read that hurricane insurers were an excellent business to be in, because the business model is the equivalent of a put option writer who keeps all the premiums for himself but shifts all the liability onto the government because the claims usually bankrupt the firm. All upside - I think the moral hazard is readily apparent in this case.

Monday, November 15, 2010

Great Comics from the Weekend

I came back from the weekend and two of my favorite comic strips have entries that deserve to be shared. First, Dilbert really nails the federal budgeting process:

Dilbert.com


Saturday Morning Breakfast Cereal takes on economists' treatment of the lower class:


Thursday, October 28, 2010

Haiku - I Have a Bad Feeling About This

I Have a Bad Feeling About This
Bullish sentiment
highest in last three years
a contra signal.
The haiku is original, but the source of the information is Pragmatic Capitalism and the title is from Star Wars.

Wednesday, October 27, 2010

Diversification, in Sweaters

Today's [humorous] lesson in diversification comes from from today's Shoebox » Ask a shoebox writer:
"Q:What’s a safe investment in this troubled economy?

A: No matter the economic outlook, I like to put my money into a nice consignment store sweater. Not only does it cozy out the chill, but it’s also like a nice hug from the guy who died in it. And during the toughest of times, it can be reconsigned back to the store. And that’s cash in your pocket, my friend! I won’t go into detail here because the reconsignment math gets complicated by “animal damage” and “a smell” that was totally there already. But here is the cornerstone of the financial plan: remain a dependant of your parents, at least legally, and financially and literally, for as long as possible. But like any business relationship, you must distance yourself emotionally. The more you rely on your mother’s noisy coin purse and stingy thermostat, the less you must care about her constant eviscerations of disapproval. And you don’t have to worry about your plan falling apart in the long run, because she’ll no doubt feel obligated to leave you her stuff in her will. And besides, good ol’ Mom doesn’t seem to be going anywhere anytime soon because apparently intense negativity is the cure for a hundred million cigarettes and counting."

Friday, October 15, 2010

Haiku - Vacation

Vacation
No work and all play
on my week-long vacation,
improves my morale.

Wednesday, October 13, 2010

Dilbert pokes fun at internet privacy

In some ways, I really object to the sale of people's [you can read my] information that they willingly share under the premise of noncommerciality. In other ways, I understand that it is a burgeoning industry that can lead to growth of the marketing industry and their effectiveness. And that effect could lead to lower search costs as people are matched up more easily with the products they want, or didn't know they wanted.

Dilbert.com

Friday, October 8, 2010

The saddest graph you will see all day

(Click on graph to embiggen)

There is a lot of human misery in this graph. I see too many broken dreams when I look at this.
Source: Calculated Risk

Wednesday, October 6, 2010

Haiku - Bureaucratic Doctors

This gives you some idea of how my day is going. I wrote this when I was thinking about how hospitals might run if bureaucrats actually took over ALL of medicine, including delivery. Unfortunately it turned out to have a very Sarah Palin, death panel tone to it. Maybe that's just the reality or maybe it's my own convoluted preconceptions about what government medicine would be like. Or maybe it's the fact that I work for the largest government-run healthcare network and I know how it is, or just how I perceive it to be. Anyway, I have my doubts.

Bureaucratic Doctors
I'm sorry sir,
but your request has been denied
due to budget cuts.

Tuesday, October 5, 2010

Nobel Prize Prediction - 2010

Last year, I tried [and failed] to predict the winner for the Nobel Prize in Economics. I predicted John Taylor, who is most famous for his rule for approximating the short-term Fed funds rate, and Martin Weitzman, who is a luminary in environmental economics but his earlier work included studies of price vs. quantity controls and profit-sharing firms.
For reference, the Thomson-Reuters annual picks are out. I don't like them, because they are a particularly focused bet - the two halves of the Kiyotaki-Moore model represent two of the four picks. I bet that is unlikely that the University of Chicago's Freakonomics clan will receive another Nobel for Kevin Murphy's work. For reference, Gary Becker was the original Freakonomist, who pioneered the introduction of econometric techniques to other fields like sociology. He used them to study drug addiction, racial discrimination, and crime as well as more familiar economic topics like utility maximization.
OK, so my pick for this year is Robert Shiller from Yale University. Last year's pick kept a considerably safe distance from the financial crisis. I consider it a reasonably good bet that the Nobel committee won't strive so hard to keep away from macroeconomists who were right throughout the crisis. Besides the development of the famous Case-Shiller real estate indices and the dire warnings of the housing price bubble, his "pioneering research in the field of financial economics, relating to the dynamics of asset prices, such as fixed income, equities, and real estate, and their metrics. His contributions on risk sharing, financial market volatility, bubbles and crises, have received widespread attention among academics, practitioners and policy makers alike." (Wikipedia) His well-rounded and widely-received body of work is on par with past winners like Robert Lucas.
And if you haven't read his opus-extraordinaire, Irrational Exuberance, you should because it is fantastic. Also, his other book, Animal Spirits, is also quite good.
Considerable hat tip to Marginal Revolution for the inspiration and information that contributed to this post.

Monday, October 4, 2010

Haiku - Tariffs Aren't All Good

Tariffs Aren't All Good
Protectionism
doesn't just hurt foreign firms.
Trade wars make things worse.

Thursday, September 30, 2010

Milestone - $1k

Today, September 30, 2010, I achieved a personal milestone: I earned $1,000 in a single investment. Last month, I piecemail bought 600 shares of BYD (Ticker: BYDDF) which is an acronym for "Build Your Dream", at an average price of $6.26. Well, dreams actually do come true! The stock has bolted up over the past month to $8.10 (as of this afternoon) which equates to a net gain of over $1,100!

For some more personal history, the first transaction that I earned $100 on took place in 2008 when I bought 300 shares of SemGroup Limited Partners, an oil and gas services company located in Oklahoma, and sold half my stake after it ran up 50%. I later sold my entire stake after it ran up to over 200% my initial investment.

In all likelihood, it will be a considerable amount of time (hopefully not) before I realize the next milestone -$10,000.

Wednesday, September 29, 2010

Haiku - Workplace Relationships

Workplace Relationships
Sex with coworkers,
most cases, inappropriate,
and HR nightmare.

Tuesday, September 28, 2010

Haiku - Credit Risky Investments

Credit-Risky Investments
You like credit risk?
Leveraged loans/high-yield debt,
hold on for the ride.
-JDW

Thursday, September 23, 2010

Investing Vigilance

Spot on from Designing Better Futures. If you asked me, we are at the crest or just below the crest and on the way down.

Wednesday, September 22, 2010

Disturbing data observation from Bentonville

This transcript details an extremely chilling trend observed by Wal-Mart's data analysis team: an apparent spike in consumer spending at the 12:00 AM hour on the first of the month, specifically paid for by government benefits.
"And you need not go further than one of our stores on midnight at the end of the month. And it's real interesting to watch, about 11 p.m., customers start to come in and shop, fill their grocery basket with basic items, baby formula, milk, bread, eggs, and continue to shop and mill about the store until midnight, when ... government electronic benefits cards get activated and then the checkout starts and occurs. And our sales for those first few hours on the first of the month are substantially and significantly higher."
Hat tip to NPR Blog.

Tuesday, September 21, 2010

Haiku - Trust Me

Trust Me
Companies don't lie:
they know better than you do.
It's for your own good.

Friday, September 17, 2010

Interesting Sentence of the Day

Comes to us from Jay Kirk:
Ernest had never heard of such a thing. Once, he’d had a client who’d come all
the way from Australia just to punch a mountain gorilla in the face, but nothing
quite like this.

Hat tip to Ben Casnocha.

Wednesday, September 15, 2010

Modern Portfolio Theory rethought


Wednesday, September 8, 2010

Yup, it's pretty much like that


Tuesday, August 31, 2010

Bad thought - get out

Yesterday I tweeted that, as I was walking my dogs in the evening as I am wont to do, I smelled a fire burning leaves. My first reaction to smelling it wasn't "hmm, somebody is getting rid of the clutter in their yard, kind of late in summer to be burning of last year's leaves but whatever." Instead my first thought ran to: "I wonder if that's against the law here."

Wow. I recoiled at the way my township's autocratic policies have become so commonplace to me that I stopped questioning their validity and instead jumped to enforce them. How could a libertarian, who believes in extreme levels of freedom, have ceded his own thoughts to the will of his extremely liberal local government? I have to say that I'm glad that I caught myself, but I fear how that line of thinking could have evolved if I hadn't.

Some background - I live in Takoma Park (the DC side) which is also known as "the People's Republic of Takoma Park" because it's political figures are so far to the left. Takoma has some very unusual laws, e.g. you cannot trim any trees whether or not it lies entirely on your property or not, the city is forbidden from purchasing any World Bank financial instruments (?!), and is officially considered a "Nuclear Free Zone".

Monday, August 30, 2010

Interesting Sentence

This one comes from Felix Salmon, in an article titled "Why Official Statistics are like Corporate Earnings":

"Statistics can be useful, but only if nobody much cares about them."
I really enjoy this quote. I think its beauty lies in its simplicity. And how easily it cuts to the core of his position. I don't doubt that he is right in some respects, i.e. gerrymandering and perhaps some Bureau of Labor Statistics figures, but could he be right about other, more independent statistics-reporting firms? I'll have to think about that.

Thursday, August 26, 2010

Grammar

I find myself trying to construct sentences without a preposition at the end, but then they end up becoming less effective as a result. I do this all the time so it has become one of those hidden processes running in the background. That made this comic from Saturday Morning Breakfast, one of my favorites, especially funny:

Thursday, August 19, 2010

Graph of the world

This is pretty cool. By latitude it almost looks normally distributed.

The Big Test

Taking the GMAT on Saturday. I've been studying for the last month - reading the books, doing the problem sets, and taking the practice exams. I'm very confident in my progress on learning this very important test, both its content and how to take it. But that doesn't stop me from having those dreams. Shoebox really got me today:

Tuesday, August 17, 2010

The History of World GDP

A few dominant observations from this chart:
  • Italy, France, and Japan have had a consistent share of world GDP, although the Japanese industrial policy post-World War II was very successful by 1970. It has since tapered off.
  • Look at how the US took off after 1820!! People talk about China's economic miracle, but they've always had a significant share. The US was just a blip until 1820, when our economic miracle began, topping out as a share of world GDP by the 1970s. This decline has more to do with growth in the emerging economies and the breakup of the former communist states than it does with a decline in the US's output.
  • The Chinese have always been among the largest economies in the world. It's amazing what a dampening effect the revolution against the emporer through the takover of the communist regime had on GDP. And, conversely, the incredible growth that accompanied the loosening of the state's grip on the economy.
  • Similar to the Chinese story, the fact that India has always had such a large share of world GDP. Also, the negative impact that the socialist (as opposed to communist) and bureaucratic ecoomic policy had on India post-independence in the 1940s.

Tuesday, August 10, 2010

Tales of ridiculous silliness in regulation

From an article at the NYT on a Merrill Lynch off balance sheet entity called Pryxis:

One difficulty for the S.E.C. and other investigators is determining exactly when banks should have disclosed more about their mortgage holdings. Banks are required to disclose only what they expect their exposure to be. If they believe they are fully hedged, they can even report that they have no exposure at all. Being wrong is no crime.

Under these rules, a lawyer may not be able to prove that fraud existed, but any person who gives it a momentary thought can understand that this situation is ripe for exploitation. If all you need is someone willing to even entertain the notion that the bank is fully hedged, then you would never disclose your most material (and informational) positions!
As a student, you are taught about the benefits of transparency but within an organization you are taught the benefits of opacity. In the real world, theory about what is good for outside investors goes out the door when your paycheck hinges on your capitulation to the party line.

Friday, August 6, 2010

It's 10 o'clock, do you know where your money is?

This infographic is pretty cool. I don't often think about this type of thing, but it's important to know. Not in an I-can-change-it kind of way but more of a self-satisfying knowledge kind of way. Hat tip to Barry Ritholz.


Wednesday, July 28, 2010

Back to the mean

Today, on the Big Picture blog Barry Ritholz posted the graphic shown below (click to enlarge). I'm a big fan of Robert Shiller and when he speaks I listen. The projection isn't his, however, it is derived from the perceived trend of the chart. Talk about reversion to the mean! This prediction would necessitate another drop in housing prices of 25%! I'm glad I am not in the housing market at all (renting) let alone one of those unlucky millions of Americans who were unwitting buyers in 2005/06. Those people are so deep underwater they can't help from drowning when it comes to their loan-to-value ratio.

Don't give in to the - Terror

I've been posting a lot of comics lately, but I subscribe to even more. Trust me. I only pass on those fit for print. If this one doesn't make you laugh, I don't know what will. (click on the comic to see a clearer picture)


This one is from Ryan North of Dinosaur Comics fame. His stuff is consistently a hit for me.

Tuesday, July 27, 2010

A very disappointing day indeed

Yesterday the results from the June 2010 CFA Levels 1 and 2 exams became available. Story from Bloomberg here. This year, instead of being required to log in to the website (which crashed for hours last year) they email blasted everyone their scores. 42% of level 1 and 39% of level 2 of applicants passed this year, down from 46% and 41%, respectively, last year.

I was one of the 58% level 1 candidates who were unsuccessful last year. Almost exactly this time last summer I sat on the edge of my seat, along with thousands of others, facing my computer while anxiously mashing F5 over and over again causing the site to crash but hoping that others would get frustrated and quit and then the problem would resolve itself so I could see my results. I mean my achievement. But when the smoke cleared the outcome was, to put it mildly, suboptimal. I was in the top band of unsuccessful exam participants which means I was in the top 10% of failures. Hooray!

No not hooray. I was understandably upset. Other than my D in microeconomics 101, it was the first thing that I had ever attempted and actually failed at. When I texted my girlfriend, she was empathetic with my situation because she had been denied acceptance to medical school in her first application cycle (though accepted on the second try). That day, she rode the metro down to my office building to bring me a homemade lunch packed with my favorite foods. It was very nice. That helped to turn my day around.

That's not to say that it filled the hole - the deep, gaping hole of failure. I really didn't begin to feel better until I read a post on the results by the professor who ran the now defunct blog, Financial Rounds. It lists a number of reasons a non-pass (the nicer pejorative of fail) shouldn't be cause for alarm, including: incredibly smart people populate both sides of the dividing line, studying the same material again will indelibly lead you to have a better foundation to begin the next level, there is no significant difference between becoming a CFA charterholder at 28 or 28 and a half, and the best but yet incredibly dismissive reason: nobody will care but you. Thanks for those words, Joey DeVivre.

In the end, I resolved that I wouldn't resign to being labelled a failure by the CFA Institute. I said "I will rise again!" (queue the overly dramatic) And I stick by that aim. I will eventually retake the CFA, but for now I am taking the CAIA level 1 in September as a baby step towards learning the investment management industry while also credentialing up.

Daddy, what's the birds and the bees?

I hope this is exactly how it goes when I explain the birds and the bees to my hypothetical son.

Cyanide and Happiness, a daily webcomic
Cyanide & Happiness @ Explosm.net

Monday, July 26, 2010

Dilbert on achieving retirement goals

I was combing back through my RSS feed on posts I starred when I came across this great Dilbert strip. You know, I think people on Wall Street also use that expression in reference to money.
Dilbert.com

Friday, July 23, 2010

Born Anew

Last week I finished Wooden: A Lifetime of Observations On and Off the Court and now I feel like a new man. It wasn't just some coach recounting on his greatest triumphs, although there was plenty of that which is to be expected because it is the source of Wooden's authority. This book stimulated, challenged, and motivated me to change my status quo. Regarding this book, I've written one email to my mom and two to my dad. I fully plan to buy one for every member of my family at Christmas to share its tenets.

Wooden's book was earth-shakingly good. I've started to incorporate his philosophy into my everyday life, things such as:

"True success can be attained only through self-satisfaction in knowing that you did everything within the limits of your ability to become the very best that you are capable of becoming. Therefore, in the final analysis only the individual himself can correctly determine his success. You may be able to fool others, but you can never truly deceive yourself, except, perhaps, for a short time."

“Motivation must come from the belief that ultimate success lies in giving your personal best.”

“Don’t try to be better than somebody else, but never cease trying to be the best you can be.”

I've decided that I am going to incorporate this concept of success into everything I do from now on. Up until this point I believe I have just cruised on the intellect that I was lucky enough to win in the biological lottery and the bare minimum work allowable to advance at what I deemed to be an acceptable level. Tragically, yesterday I realized the worst phrase I've ever learned was - "I didn't study." When offered to my peers, it suggested that I could have done better while sheltering me from realizing the limit to my potential. My fear of failure was great. But after reading Wooden I realize that I was really failing all along. By not maximizing myself I wasn't attaining life-satisfying success. No more.

I am studying for the GMAT in order to get into a PhD program in finance. Previously I would have done as I always did, i.e. not study, and coasted to an average to slightly above average result. Screw that. On the day I registered (two days ago) I bought the Official Guide that came with an 800-question bank and the Princeton Review book. I received the books 11 hours after I ordered them - wow Amazon, kudos, seriously - and I began studying last night. I read six chapters out of the Princeton Review and did the first 40 math questions out of the official guide (38 right - but they start easy and progress in difficulty).

When I was finished studying, I pushed the book away and smiled. For the first time in my life I realized I am putting myself out there, exposing myself to the possibility of failure. The end result could fall short of my goal when you account for the increased level of effort. But Coach Wooden prepared me for that possibility already with this perfect gem of a quote - “You never fail if you know in your heart that you did the best of which you are capable.” I know I'm going to live a much fuller life going forward and it's all because of Coach Wooden and his inspirational words of wisdom.
-JDW

Friday, July 16, 2010

Being an economist in the real world

As this gentleman is demonstrating, just trying to get by without flipping out on everyone all the time for their inaccurate and outlandish statements can be difficult for an economist. This is from one of my favorite comics - Saturday Morning Breakfast.

Thursday, July 15, 2010

Energy subsidies

The burning question is: why is there any value of subsidies, direct or indirect, in the lower left quadrant?

If Congress's job is (I don't personally believe this, but I do believe a majority of the electorate does) to influence the population's behavior through the tax and subsidy systems, then why hasn't a very untenable political state been rectified? What I mean is - there is no politician in his right mind who stands up in committee and says, "damnit we need to increase oil consumption - lower the taxes, increase the subsidies. This is IMPORTANT." I think it really speaks volumes for the immutability of policies once they are established.
Hat tip to the Big Picture.

Tuesday, July 13, 2010

I passed the test

I did it. I passed the test, the test of personal character. A few weeks ago my girlfriend and I were going to pick up dog food at our local Target in the mall. When we arrived, we overheard there was a Telemundo (Latin television) festival outside and decided to check it out. We’re young which means we never carry cash so we had to stop by a Bank of America ATM in the mall on our way outside. A lady was just finishing her transaction when we arrived. When she left we approached the machine and that’s when I noticed that she hadn’t closed out by pushing “exit,” or whatever else the command is called.

This is where my test was created - do I: a.) push “another transaction” and steal her money, potentially wiping out her entire balance or b.) push exit for her and go about my own business? I mean she was the idiot who doesn’t know how to bank properly, right? Without hesitation I did the right thing – I hit exit and put my own card in the machine to withdraw $20 from my own account.

I’m very pleased to look back on that instant because it confirms to me that I have a good character and I won’t steal from ladies in the mall even if their pocketbooks are open to me and no one is watching. If you don’t know who you are until you are pressed to act on your morals and values, then I am very glad to know that I’m not a thief-who-steals-from-women-who-don’t-know-how-to-bank-properly, or as it is more generally known, thief.

Monday, July 12, 2010

Are you happy? infograph

I love this infograph for its simplicity and its message. This chart is definitely a candidate to be printed, framed, and placed in an office (or in my case, cube).
Hat tip to The Reformed Broker.

Tuesday, July 6, 2010

Dilbert on investing

Dilbert.com

Thursday, July 1, 2010

Types of Libertarians

Hat tip to Barry Ritholz.

Tuesday, June 22, 2010

Thoughts on "Crazy Heart"

I watched Jeff Bridges star in "Crazy Heart" last night. I tweeted a few thoughts while I was watching:
  • 'Interesting hypthesis: how many years of abandonment does it take before it's irreconciliable?'
  • 'I'm not a bartender, but if I ever was I would have a no-serving-men-with-children-in-the-bar rule.'

At the end of the movie I was dismayed at what seemed to be a Disney-like ending. I was upset that the director elected to go with the if-you-just-try-hard-enough-and-clean-yourself-up-you-can-do-it tired, old storyline. Doesn't that plot just give false hope to too many people? Not everyone can enter rehab, come out, and be a successful songwriter. It just doesn't happen that way. There is a point of no return. You can drink too much, smoke too much, and burn too many bridges that there is no escaping your self-inflicted terminal velocity of doom.

Tuesday, June 15, 2010

Good sentences

From The Big Picture by Barry Ritholz:
• Downgrades and negative ratings are also mostly worthless — but downgrades do have the redeeming quality of providing comic relief, to wit, the astonishingly belated downgrades of Enron, Lehman Brothers, Bear Stearns, Citi, AIG and now Greece. (Good times!)

Tuesday, June 8, 2010

Three classes of American business

Brought to you by 4-Block World.

Haiku - fiscal crises

This week's financial markets are permeated by anxiety about government's commitments to their obligations. It is happening in Britain, Hungary, and Spain; in fact, even France's CDS spreads are at an all-time high. America may be the safest place to park your dollars currently, but if the bond/deficit hawks return then we may not be spared from the microscope.

A haiku:
Pass the buck forward,
Hairy decisions postponed,
Need Harry Truman.

If you don't get it, Harry Truman was the President that popularized the phrase, "the buck stops here." This being said I'm not an anti-Keynesian or against government spending. But the day when S&P or Moody's cuts your rating or your CDS spreads blow out or you have a bond auction fail is a whole budget cycle too late. Operating in the budget world right now, I've learned that it takes a long time to turn the ship. And I wonder if our current leaders have the forsight or the Trumanesque determination to make hard choices.

Tuesday, June 1, 2010

Haiku - Reverse Course

This morning's premarkets were down 1% on worse-than-expected economic news out of China. But an ISM report that beat expectations corrected that bearish sentiment carried over from the worst May since 1940. A haiku to commemorate this trading day for the historical record:
Market likes that news.
Award us intraday gains.
Reverse morning flow.
-JDW

Friday, May 28, 2010

Haiku: the flash crash

The Flash Crash

Plunge down then snap back

twenty minutes of turmoil

appropriate name.

Libertarians have a sense of humor

I can poke fun at myself. Courtesy of myconfinedspace.com. (Click to enlarge)

Tuesday, May 25, 2010

Is height a natural advantage: Part II - Disadvantages

On Friday I posted my list of advantages of being tall. Today I tackle the disadvantages:

  • Grocery bills are more expensive. Hey, it takes more fuel to power a bigger machine.
  • I read that, as a result of more hormones throughout adolescence, tall people are more prone to hormonal cancers, e.g. breast and prostate.
  • Riding on an airplane sucks if you don’t get an aisle or the bulkhead. Or first class. But what kind of an economizing individual wouldn’t fly coach?
  • Can’t be a fighter pilot or a sub commander. Don’t you remember how cool Tom Cruise was in Top Gun or Gene Hackman in Crimson Tide? Now multiply that by a factor of 10 because I was just a kid. Yea, so that explains why my dream in 7th -9th grade was to be the CO of a submarine. That is, until I passed by the maximum height for those professions. So being tall limits your professions, e.g. I can also not be a horse jockey.
  • Throughout middle and high school, excessive goofiness is a side effect. It takes way too long for someone to be able to recalibrate after gaining inches a year. I was into college before I became comfortable with repetitive motions in precision sports, i.e. darts.
  • *tied to the ability to reach the top shelves à I can reach the top shelves, which means that any little old lady in the grocery will ask me “dearest child, will you help an old woman who can’t reach the oats?” Or any time I am sitting in my rocking chair reading and looking comfortable my girlfriend will need anything that is on the top shelf.
  • Knees, ankles, and other joints start deteriorating faster.
  • In most beds my legs hang off and I wake up in the middle of the night with icy cold feet.
  • *tied to height being an ice breaker à I am perpetually asked: “How tall are you?” and “Do you play basketball?”
  • You have to buy XL clothing for the length and if the arms or pant legs shrink even the tiniest bit then you have to buy new ones. This isn’t exactly true. I had a great grey sweater that I loved and despite the fact that the arms shrunk to ¾ length I continued to wear it for years.
  • You are a lightning rod to men with a Napoleon complex. I’ve never been challenged to a fight because of this, but I’ve been the victim of insults and social slights because of it.
  • Low entrances suck. You would think after years and years you would learn, but there is something in the human psyche that assumes all doors should be taller than we are. That’s not the case, because some architects suffer from the syndrome alluded to in the previous bullet.
  • *tied to height being a natural advantage in most physical sportsà it is a natural disadvantage in games such as hide-and-seek.
  • Your legs burn really bad when you dance.
  • I didn’t know until recently that people just stand in the shower and let the water hit their head and run down. I never knew that because I have never had a shower head that was above my own head to make this comfortable.
These reasons are more slight inconveniences in being tall more so than they are actual disadvantages, which lends support to my conclusion that being tall is a natural advantage.

Monday, May 24, 2010

Haiku - Financial Regulation

#finreg's reverse course:
sacrifice sound policies
for interest groups.
-JDW

Friday, May 21, 2010

Is height a natural advantage? Part 1 - Benefits

I've spent most of my life being tall. I'm 24 now and a full grown 6'6", although my family continually insists that I have "grown" since the last time they saw me. I wonder when that will stop. Probably after I get married.

True story: the summer between 7th and 8th grade I grew 7 inches (we have documentation) which was a very trying time for me with the constant growing pains and having to eat and sleep so much to facilitate the growth. I ended up playing Goldeneye with my friend who had foot surgery all summer. One of the best times of my life.

Anyway, I sat down yesterday to think of all the benefits and disadvantages of being tall. I wrote them down and they formed enough material for a two part entry. Today's entry details all of the advantages that I wrote down. Anything with a (*) has a reciprocal that will be on Monday's post, e.g. tall people always get shotgun even without calling it but that also means that small and compact cars are off limits. That constrains my choices on what I'll buy during my mid-life crisis. As a libertarian, I hate having my choices constrained. It means I'll probably end up being stuck with a choice between buying a new SUV or a new truck - how exotic.

Despite a long list of things that are sucky about being tall, (I hope it doesn't mean I'm a negative person) I believe being tall is absolutely an advantage in life. In fact, did you know that of the last 31 presidential elections, the taller candidate has won 26 times? Well, here is the list of advantages that I came up with, which is by no means exhaustive:
  • (Most) girls like tall guys.
  • Always able to view concerts and sporting events no matter where I stand.
  • Similarly, family and friends are able to find me very easily in crowded public places.
  • *Height is an icebreaker. Shorter people will never understand how often tall people are asked: "how tall are you?" Shameless: I even know how bad it is but I saw a guy that made me feel short so I felt compelled to ask him the question. He was 7'3".
  • I ride the Metro to work every day and I noticed that I am able to make uncommon hand placements easily, which reduces the chances that I'll get nasty germs spread by short people like children.
  • The longer strides save time. Add it up over a lifetime and I probably get a few more hours less in transit and more with the people I love because I can walk faster.
  • *I can reach the top shelves without climbing on counters or getting a stepping stool. This reduces the danger of me having a serious household accident.
  • Tall people can carry extra weight easier. For example, yesterday, a coworker was shocked after he learned that I weigh 50 pounds more than he thought I did.
  • Tall people exude more presence and are more confident when they enter a room.
  • *Height is a natural advantage in most physical sports.
  • Tall people are often been perceived as older and more experienced than their relatively shorter peers.
  • Most importantly, studies have shown that tall people earn more money, have more successful careers, have higher IQs, and live longer lives. I believe all of these factors are highly correlated with their parents income, because these children are more likely to receive the better nutrition necessary to grow as well as all of the other support they need to excel.

Thursday, May 20, 2010

Practicing good inbox maintenance

People are always on the lookout for tips on “how to be successful”. In my experience, there is one small and often overlooked factor that determines if someone is or will be successful in the days of electronic communication: inbox maintenance. I loosely define “inbox” as any of the forms that people can task others with: in-person or by phone, fax (does anybody really use this anymore?), or e-mail. I believe that the people who are the most attentive and prompt in providing responses to these requests are often the most successful. These are the people who don’t shrug their shoulders and say “I don’t want to respond to that” or “I’ll do it later” because it happens to be tedious or difficult or, sometimes, too simple a question. They are the workers who man up and power through it anyway.

As an example, the best professor I ever had and the one who was most esteemed in academic circles had the best work habits I’ve ever known. If you emailed this professor during normal working hours he would provide a written response within a half hour. Without fail. I have implemented his example in my career.

It’s not without limits. Nobody can be at their desk auto-refreshing their email inboxes every second of the day. We have bosses. We have meetings to attend. We have competing needs for our attention. Everyone understands that sometimes these things take time. But my point is not about one time. It is about the people who make good inbox maintenance a habit; day-in and day-out they are solid performers who you can count on to answer your question or follow-up.

And everyone understands that things get lost in the shuffle, too. But the people I’m talking about are those who are effective prioritizers and they only lose the least important correspondences.

Look around. See if you can observe what I’m saying. Are the people in your office who put forth the effort to respond to their clients and coworkers promptly, those people that practice good inbox maintenance, the same as the colleagues that you hold in the highest regard?

Tuesday, May 18, 2010

Haiku - Deflation

Deflation is bad.
Makes real debt burderns larger.
Less loans made = low growth.
-JDW

Monday, May 17, 2010

Ben Casnocha: 50 Ways to Expose Yourself to Randomness

I thought this blog post by Ben Casnocha was so great that I had to reprint it here in its entirety:


Cal Newport's three step way to become interesting:
1. Do fewer structured activities.

2. Spend more time exploring, thinking, and exposing yourself to potentially interesting things.

3. If something catches your attention, use the abundant free time generated by rule 1 to quickly follow up.
Below are 50 ideas for step 2. They are all direct quotes from
Tom Peters. I bolded the numbers of the best.
1. Go to the nearest magazine shop. Now. Spend 20 minutes. Pick up 20 — twenty! — magazines. None should be ones you normally read. Spend the better part of a day perusing them. Tear stuff out. Make notes. Create files. Goal: Stretch! Repeat . . . monthly . . . or at least bi-monthly.
2. Go to the Web. Now. Relax. Follow your bliss! Visit at least 15 sites you haven’t visited before. Follow any chain that is even a little intriguing. Bookmark a few of the best. Repeat . . . at least once a week.
3. Take off this Wednesday afternoon. Wander the closest mall . . . for two hours. Note the stuff you like. (And hate.) Products, merchandising, whatever. Repeat . . . bimonthly.
4. Buy a packet of 3 x 5-inch notecards. Carry them around with you. Always. Record cool stuff. Awful stuff. Daily. Review your card pack every Sunday. (Obsess on this!)
5. Going the same place for vacation next year? Why not someplace new? Why not one of those university-sponsored 12-day trips to explore some weird phenomenon?
6. Project stuck in a rut? Look through your Rolodex. Who’s the oddest duck in there? Call her/him. Invite her/him to lunch. Pick her/his brain for a couple of hours about your project.
7. Create a new habit: Visit your Rolodex. Once a month. Pick a name of someone interesting you’ve lost touch with. Take her/him to lunch . . . next week.
8. New habit: You’re in a meeting. Someone you don’t know makes an interesting contribution. Invite him/her to lunch . . . in the next two weeks.
9. You run across somebody interesting. As a matter of course, ask her (him) what’s the best thing she/he’s read in the last 90 days. Order it from Amazon.com . . . this afternoon.
10. Take tomorrow afternoon off. Rain or shine. Wander a corner of the city you’ve never explored before.
11. Go to the local Rite Aid. Buy a $2 notebook. Title it Observations I. Start recording. Now. Anything and everything. (Now = Now.)
12. Going out this Saturday night? Go some place new.
13. Having a dinner party next Sunday? Invite somebody — interesting — you’ve never invited before. (Odds are, he/she won’t accept. So what? Go for it. It’s just like selling encyclopedias. No ring doorbell = No sale.)
14. Go past a kiosk advertising local Community College courses for this fall. (Or one of the Learning Annex catalogues.) Grab a copy. Look it over this evening. Pick a couple of interesting courses and topics you’ve always wanted to know more about. Call the professor (with a little detective work, you can find her). If you’re intrigued, sign up and . . . at least . . . go to the orientation session.
15. Read a provocative article in a business journal. Triggers a thought? E-mail the author. So what if you never hear back? (The odds are actually pretty high that you will. Trust me.)
16. At church this Sunday, the pastor announces a new fund drive. Sure you’re busy. (Who isn’t?) Go to the organizing meeting after services. Sign up!
17. You’re working with your 13-year-old on his science project. You find you’re having fun. Go to school with him tomorrow . . . and volunteer to talk to the class about the topic.
18. A crummy little assignment comes along. But it would give you a chance to work with a group of people you’ve never worked with before. Take the assignment.
19. You’re really pissed off at what’s going on in your kid’s school. So run for the school board.
20. You aren’t really interested in changing jobs. But there’s a neat job fair in the next town this weekend. Go.
21. An old college pal of yours invites you to go on a long weekend by the lake. You never do things like that. Go.
22. A really cool job opening overseas comes up. It fits your skill set. You couldn’t possibly consider it. You’ve got a nine-year-old and your husband is content with his job. At least call someone . . . and find out more about it.
23. You’re on the fast track. But a fascinating job opens up . . . far away. It looks like a detour. But you could learn something really new. Really cool. Go talk to the guy/gal about it. (Now.)
24. The eighth grade teacher is looking for chaperones for the trip to the natural history museum. You’re a law firm partner, for God’s sake, making $350,000 a year. Volunteer.
25. You love taking pictures. You pick up a brochure advertising a four-day photography workshop in Maine next summer. Go to the workshop.
26. A friend of yours, a small-business owner, is go-ing to Thailand on a sourcing trip. She invites you to join her. Go.
27. There’s a great ball game on ESPN in an hour. Forget it. Go on that walk you love . . . that you haven’t taken for a year.
28. I’m not much on planning. But how about sitting down with your spouse/significant other and making a list of three or four things you’ve "been meaning to do" that are novel . . . then coming up with a scheme for doing at least one of them in the next nine months?
29. You’ve a-l-w-a-y-s wanted to go to the Yucatan. So at least call a travel agent . . . this week. (How about right now?)
30. You know "the action is at the front line." Spend a month (two days a week) on a self-styled training program that rotates you through all the front-line jobs in the hotel/distribution center/whatever.
31. Ask a first-line supervisor who the most motivated clerk in the store is. Take him/her to lunch . . . in the next three weeks.
32. You spot a Cool Article in the division newsletter. Call the person involved. Take her/him to lunch. Tomorrow. Learn more. (Repeat.) (Regularly.)
33. You and your spouse go to a great play this Saturday. On Monday, call the director and ask him/her if you can come by and chat some time in the next two weeks. (If the chat goes well, ask her/him to come in to address your 18 colleagues in the Accounting Dept. at a Brown Bag Lunch Session later this month.)
34. Institute a monthly Brown Bag Lunch Session. Encourage all your colleagues to nominate interesting people to be invited. Criterion: "I wouldn’t have expected us to invite — — ."
35. Volunteer to take charge of recruiting for the next year/six months. Seek out input/applications from places the unit has never approached before.
36. Consider a . . . four-month sabbatical.
37. Get up from your desk. Now. Take a two-hour walk on the beach. In the hills. Whatever. Repeat . . . once every couple of weeks. (Weekly?)
38. Seriously consider approaching your boss about working a day a week at home.
39. Take the door off your office.
40. You’ve got a couple of pals who are readers. Start a Reading Group that gets together every third Thursday. Include stuff that’s pretty far out. (Invite a noteworthy local author to talk to your group now and again.)
41. Join Toastmasters. (I know it’s a repeat. It’s important!)
42. Pen an article for the division newsletter.
43. In the quarterly alumni magazine, you read about a pal who’s chosen to do something offbeat with her life. Call her. Tomorrow. (Or today.)
44. Buy that surprisingly colorful outfit you saw yesterday. Wear it to work. Tomorrow.
45. Develop a set of probing questions to use at meetings. "Will this really make a difference?" "Will anybody remember what we’re doing here two years from now?" "Can we brag to our spouse/kids about this project?"
46. Assess every project you propose by the "WOW!"/ "Is it Worth Doing?" criteria.
47. Call the Principal Client for your last project. Ask her to lunch. Within the next two weeks. Conduct a no-holds-barred debriefing on how you and your team did . . . and might have done. Now.
48. Call the wisest person you know. (A fabulous professor you had 15 years ago?) Ask her/him to lunch. Ask her/him if he or she would be willing to sit with you for a couple of hours every quarter to talk about what you’ve done/where you’re going. (Try it. It can’t hurt.)
49. Become a Cub Scout/Brownie troop leader. Or direct your kid’s play at school. The idea: spend more time around children . . . they’re fascinating . . . spontaneous . . . and wise.
50. Build a great sandcastle!

Friday, May 14, 2010

What should Lebron do?

Last night, as I listened to the commentators of the Celtics-Cavs game give relentless speculation about Lebron’s post-season activities I began to develop my own theories. Lebron brought the game back to within four points in the middle of the fourth quarter with two back-to-back 3s, but the Cavs failed to capitalize on that momentum and went down. As Bill Simmons said this morning, “Mike Brown and the rest of the team gave up in the last minute. They were done and they wanted to get off the court.” The Cavs lost in 6 and now we will see who was right.

In my view, the question of what Lebron will do really comes down to his values. If he needs the validation that he is a great player by having the largest contract in the league, then he will seek the team that offers him the most dollar signs. And I think that this is what the people who propose that he will go to the Knicks or Nets are really counting on. They are making an assumption that Lebron will follow the money trail. I think this is flawed for multiple reasons: 1.) he knows he is the best player in the league by winning back-to-back MVP trophies, 2.) he already has more money than anyone but Mike Tyson could spend through his endorsements, and 3.) I hold a different assumption. I assume, perhaps incorrectly, that he values what he does on the court more than the stuff that he gets off the court for his work. I bet that when you're at the summit of your profession, especially for a sizable length of time, and there is no one around you then you start to measure yourself in historical terms. Lebron doesn't want to be like Karl Malone or Charles Barkley. It's not enough to win solo trophies year after year. After all, if you are chasing the greatest ever: MJ is remembered for his six NBA TEAM championships, not for his five MVP titles.

So if Lebron values his basketball legacy the most then he should take a pay cut in order for his team to have the best chance to build quality players around him a la Tom Brady. If the best player in the league did this early enough into the post-post-season, it would send a signal to the best free agent pool ever that he was serious about building talent around him in order to make the championship run. I mean think about it: as ESPN reports: Dwyane Wade, Chris Bosh, Amare Stoudemire, Paul Pierce, Ray Allen, Tyson Chandler, Richard Jefferson, Joe Johnson, Tracy McGrady, Yao Ming, Dirk Nowitzki and Michael Redd can all become free agents in 2010. With the right mix of star power a real dream team could be born in the league, not just a collection of star-power for international competition. If Lebron has advisors with his best interests at heart I think he will probably come to a similar conclusion.

Monday, May 10, 2010

Haiku - EU Rescue Package

As everyone knows by now, the EU finance ministers, in an effort to avert a crisis, announced last night that they were putting together a TARP-like €750 billion ($955 billion) bailout package for their member countries facing debt problems. Story here from the WSJ: "The plan would consist of €440 billion of loans from euro-zone governments, €60 billion from an EU emergency fund and €250 billion from the International Monetary Fund." After the announcement, markets around the world ran up 3-5% on bolstered confidence that the contagion would not spread.
One billion dollars,
are you sure that is enough?
will it save the day?
-JDW

Friday, May 7, 2010

Chart - Greek Ruins

Too funny. Hat tip to The Big Picture.


Great prose

Ben Casnocha is a great thinker and, surprisingly, only 22 years old. File this under sentences to ponder:
4. Sometimes when I am riding in a car as a
passenger I feel a bit chilly so I turn off the fan. In response, my friend who is driving will infer I am uncomfortable and take an action that he intends to help me. For example, if I turn off the fan and put on a sweatshirt he will assume I am chilly and, despite neither of us having talked about it, he will go turn on the heat. Yet when I turned off fan and put on sweatshirt I did so assuming all else would remain the same. I assumed static conditions. When the driver acted in response, it actually became too warm. In a system with multiple nodes anything you do will be interpreted and responded to by others. For every action there's a reaction. That's why it's so important to communicate your thoughts and narrate your actions. Otherwise, you end up in a car that's too hot.
Great stuff. Corollary: despite being single throughout college I always used to jokingly tell my friends that the cornerstone to a great relationship is communication. Coming from someone who seemingly lacked any experience in adult relationships whatsoever, they thought it was funny. Though I was probably being more sincere than I seemed at the time.

Haiku - Market in Turmoil on May 6

What the f!@# happened?
Fine one minute, drop the next
All confidence gone.
-JDW

Wednesday, May 5, 2010

Times I'm Happy

Venn diagrams are in, so I decided to try my hand at them. (Click to enlarge)
As you can see, of the time that I spend on the Metro, 0% of that is shared with the time that I am happy. In statistics, they call it mutually exclusive: events that cannot occur at the same time. By virtue of being on the worst public transportation system in the world you cannot be happy. And you can be happy as long as you're not on the red line, or any line or bus that makes up DC Metro.

Tuesday, May 4, 2010

Yesterday's tweeting activity

I was dumbfounded yesterday when the Dow was up 145 points after the bailout of Greece by the IMF and a consortium of European countries was announced. In response, yesterday evening I posted:
When will markets realize that already indebted euro countries are piling more
leverage on their house of cards to save it one more day?

Well, I received a startingly quick answer. Today, in fact, is when the markets are becoming aware of the tenuous position that the Euro-zone have placed themselves in. With the Dow and the S&P 500 off roughly 2% as of this writing (11 AM) and the euro plunging below $1.31, Bloomberg reports that debt contagion concern is to blame.

Friday, April 30, 2010

Come one, come all

It is old news that last weekend Arizona passed a discriminatory immigration bill which makes not providing proper documentation to a government official a misdemeanor punishable by up to a $5,000 fine. Here is an article discussing the extreme fracture and fervor it has created in America in a little under a week. In discussing the bill's significance with my girlfriend, she was shocked to find my extremely liberal views towards immigration.

Surprising to her, I am pro-immigration along all the spectrums, but especially pro- high-income and technically skilled immigrants. I make the distinction "among all the spectrums" because I read many articles on repealing the skilled workers' quota (which includes sports athletes to the exclusion of doctors and engineers) but not as many that propose increasing America's overall cap. I view this as a subtle slight (at best) against potential Latin American emigrees - racism and xenophobia at worst.

The homeland security argument is a valid point, but I view the costs, both in human and financial terms, as far outweighing the benefits of detering a (in my opinion) low probability terrorist event.

I never knew that the inscription on the Statue of Liberty was so long. All I knew were the succinct verses towards the end (in bold) which really capture the warm and accepting message that I've appropriated as my own opinion towards immigration. I wish America would welcome all who seek her refuge today, for it was her who took on my ancestors when their dream was to come across the Atlantic in a boat to seek a better life.
The inscription in its entirety:

Not like the brazen giant of Greek fame,
With conquering limbs astride from land to land;
Here at our sea-washed, sunset gates shall stand
A mighty woman with a torch, whose flame
Is the imprisoned lightning, and her name
Mother of Exiles. From her beacon-hand
Glows world-wide welcome; her mild eyes command
The air-bridged harbor that twin cities frame.
"Keep, ancient lands, your storied pomp!" cries she
' With silent lips. "Give me your tired, your poor,
Your huddled masses yearning to breathe free,
The wretched refuse of your teeming shore.
Send these, the homeless, tempest-tossed to me,
I lift my lamp beside the golden door!"

Wednesday, April 28, 2010

Haiku - Ode to Ben Nelson


Ode to Ben Nelson

Wall Street's in your debt.

Your no to regulation,

a stroke of genius.




It probably has nothing to do with the $500,000 to $1 million in Berkshire stock that Senator Nelson owns (Source: WSJ). Nope, it couldn't be self-interested greed. It must be for the burgeoning derivatives trading industry in Nebraska. He is simply defending his state's interests.

/tongue-in-cheekoff

Goals update

This morning I officially passed one of my short term goals of 10 Twitter followers. I didn't cheat by posting my Twitter account on my other social media accounts, i.e. Facebook, LinkedIn, or this blog. I grew it organically: followers came and went, but it was a slow and steady climb. I hope they like my style - just thoughts. I don't engage in re-tweeting or in responding to conversations that my followers are not privy to. It took 16 weeks and 98 posts to attract 10 steady followers, now the goal is 100. Will it take 10x the amount of time? I doubt it, probably by the end of the year if I catch on with a group, more if I don't.

Tuesday, April 27, 2010

Haiku - Promotion

Do you deserve it?
The elusive promotion,
Work harder, next year.
-JDW

Monday, April 26, 2010

Haiku - Dr. Copper

Rich Doctor Copper
metal with a doctorate
predicts future moves.

Thursday, April 22, 2010

Why DO they use bull and bear imagery?

I never knew. Well I guess I learned something today.

Tuesday, April 20, 2010

Limerick - Warren Buffett



Dubbed the Oracle of Omaha,
for the expected returns he foresaw,
with his partner Munger,
and a rich man's hunger,
his wealth grew and grew in awe.
-JDW

Monday, April 19, 2010

The Speed of Life

Today I’m going to do something a little different. I usually don’t tackle personal, philosophical issues on my blog, but this is a topic that I’ve thought a lot about and it might help me to form a cohesive article about it.

I was born and raised in Ashland, a small town of around 30,000 and declining, in eastern Kentucky. If you have ever traveled on I-64 you can identify the town by the refinery that greets you as you descend from West Virginia. The town’s largest employers when I was growing up were Ashland Inc. and AK Steel which have subsequently either a.) merged and moved or b.) closed forever. It’s a sad fact of life that many towns who depended on industrial and manufacturing jobs now face.

Needless to say, the prospects for career advancement there are limited. This has contributed to what I would label a crisis of brain-drain, where the highest-caliber students leave the area for demanding academic programs. I’ve found that most people’s college connections lead them to jobs close to their alma mater so they stay within a limited radius of their college. The important point is that the highest performers don’t ever move back to eastern Kentucky, because there are no opportunities that bring them back.

Going off-track for a bit – Facebook offers me the opportunity to observe the lives of the people and friends that I’ve made over the years, from Kentucky and the liberal arts college I attended. It’s sort of a people-watching experience, only creepier because it’s online. The main observation that I can make with is that the people who stayed in Ashland are more likely to a.) be married and b.) have children than those that I went to college with (just for reference, I am 24 which is where I am speaking from). My dad says that we all need a ruler to measure against and his ruler was his parents – his point was that he got married at 23 and had his first child (me) at 29. Taking this further, perhaps what I’m observing is the juxtaposition of these two widely-different community rulers at work, where the parents and community members have previously exhibited this behavior and it’s a situation in which history is repeating itself.

But this explanation doesn’t fully convince me. Let me return to where we jumped off track: the people who remain in Ashland are left with limited opportunities in the service-oriented economy. They are left with the option of searching for a different raison d'être other than a rewarding career or resigning themselves to a life of drugs and alcohol, which unfortunately, strikes far too many people in the area. The pursuit of the former most commonly results in pregnancy, which has the side-benefit of (potentially) locking-down a male partner. In a region where people top out their potential incomes quickly, obesity is endemic, and life expectancies are lower than the national average, the potential of starting adulthood early cannot be overstated enough.

Compared with my current, urban location in DC, the difference in lifestyles of twenty-somethings couldn’t be more stark. Here, and observing my college friends who have since spread out, it is all about your career – getting a good first job, performing at a high level, and seeking promotions. Dating takes a backseat as a generation of children of divorce tries to avoid the sins of their fathers. Either that or they want to be secure before they settle down. Emerging from college in the midst of the most severe recession in decades has ingrained the notion that security must be attained or you risk putting not just yourself, but your entire, burgeoning family in jeopardy. I’ve heard it both ways. But mating isn’t even on these people’s radar screens – most people would describe it as a “long term goal”, something 5 or more years out (late 20s/early 30s).

As educated people delay family formation in order to pursue career goals while those in eastern Kentucky choose to begin their family lives earlier, income inequality between these two groups will rise and continue on into the next generation. The educated families will have more resources to invest in their children, providing a higher standard of living which has numerous positive benefits in terms of life development. The Ashland families will not have the same level of resources and so it will continue to propagate the cycle.

It’s a very sad situation, but I have many friends and family members who live in Ashland. I hope to return to Kentucky someday and the plan is to found a private equity firm to invest in local businesses. I was blessed enough to grow up in a safe, friendly town with a good public school. As a result I feel a JFK-like obligation to go back because “to those that much has been given, much is expected”. And make some money. And live closer to my family.

Friday, April 16, 2010

Haiku - Goldman Sachs makin' headlines

Man, I'm sorry to see the bad press today for the kings of the universe. The SEC launched a lawsuit against Goldman alleging that $GS omitted “key facts related to subprime securities” (i.e. their customer, John Paulson & Co. created and packaged, and then bet against, the subprime MBSs that $GS then sold to investors) eventually resulting in the investors in the CDO losing $1 billion. You can read about it here from the NYT or here from Breitbart.
So I wrote a haiku about it:

Sneaky maneuver,
why defraud your investors?
you'll lose customers.

*I was debating "you've lost people's trust" for the last line, because it's probably more true than the alternative, but settled for the customers bit.

Wednesday, April 14, 2010

Haiku - The Peacock

I'm not a fan of attention-seeking people. On the whole, they tend to be very shallow "look-at-me" types, whereas I gravitate towards people that I consider to have substance. In college it was easy to identify them with the monicker "theatre-types."
Rather, I enjoy people that are comfortable with themselves, that (to some extent) know who they are and what they want. The non-bull-artists don't try to impress you, they aren't one-uppers, they don't talk over you or too loudly trying to have people outside your conversation hear them; instead, they listen.
This haiku is for all those big talkers that I'll probably never be friends with, unless I need a marketer.
The Peacock
Hurricane-force winds
utter garbage streaming forth,
Just shut up, blowhard.
-JDW

links of the day 04-14-10

Great opine from Arthur C. Brooks on how America actually feels about taxation (WSJ)
With rates at zero, investors must take a lot of risk to simply beat inflation (EconomPic)

An analysis of Sorkin vs. Krugman: a debate on the bailour (Village Voice)
Sorkin originally here (Dealbook)
Krugman's response here (NYT)

Why do colleges care so much about extracurricular activities (MR)

The WSJ makes fun of Syracuse students protesting Jamie Dimon as the commencement speaker next month. She gets her two cents in:

“He is a figurehead of an industry that has failed the American people in a lot of ways.’’ said Ashley Owen, a Syracuse senior in a phone call from campus. “I personally know students who have had to drop out of school because their parents have lost their jobs in the financial crisis. To have Dimon as our commencement speaker is really insensitive."

And THEN they pull the punch:

“The big banks that are still growing and growing, and I don’t think that the monopolization of any industry is a good thing,’’ she said.
After several minutes into the interview, Owen apologized for having to get off the phone. She had 20 more pages to finish of Karl Marx’s “Das Capital” for a class assignment.

Haiku - OTC Derivatives

Over-the-counter?
I wasn't born yesterday.
Clearinghouse for me.
-JDW

Tuesday, April 13, 2010

Haiku - Obama's courtesy



Obama's Courtesy
Bow to the Premier
America is humble
reverse Bush's course.
-JDW

Haiku - VAT

Governments need it.
More revenue, from inputs,
--> Value-added tax.
-JDW

Friday, April 9, 2010

Barbie gets a career change -- computer engineer

This morning's Wall Street Journal ran an article on the open vote to decide Barbie's new career path. I believe the article is way off base though because they report, numerous times, that:
Why grown women felt so strongly about having themselves represented by a doll—especially one that feminists have always loathed—speaks volumes both about the power of the iconic Barbie doll and the current state of women who work in computer and information sciences.
The anecdotes that ran in the article are also exclusively female. These statements give the impression that it was a girls-only vote for girls' favorite childhood toy.
That is simply not the case. I even voted in this election for computer engineer Barbie after I was sent the link from my MIT-educated programming friend. Beyond this narrow example, I'm aware of at least a few online communities (and am a passive viewer of one) that engage in "raids" designed to hijack campaigns, votes, and the like. I believe, if it were possible to analyze ex-post the demographics of the ballot-throwers, the members of these communities would account for a significant majority of the voting behind computer engineer Barbie.
Do you remember when the Spice Girls reunion tour placed a ballot on their website for the location of an open date for a concert? Baghdad won over Montreal by a wide margin. Do you remember those demonstrations by Guy Fawkes mask-wearing males protesting the Church of Scientology? I do, and Fires of Heaven and 4Chan forums were behind these.
The power of the internet and especially the internet's more active communities is strong and it shouldn't be underestimated.
-JDW

Thursday, April 8, 2010

United and US Airways' merger is bad for the consumer

From today's WSJ:

Both companies' CEOs—US Airways' Doug Parker and UAL's Glenn Tilton—have loudly championed the need for consolidation tamong domestic carriers to cut capacity and allow fares to rise.
The older I get and the more experiences I have the more poignant and applicable Adam Smith's wisdom from The Wealth of Nations becomes. In it he warns, "People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices."
Why do the two airlines want to merge? So that they can cut "capacity" (routes) effectively sharply contracting the supply on some of the more sparsely traveled lines so that they can raise the prices. I'm no knee-jerk populist but if the two executives are already talking about conspiring against the consumer then it might be worthwhile for the regulators to take a closer look at this merger.