patrick.net

Hedge funds are now going long, so they’re not really hedging anything anymore. It’s just a way to bypass SEC scrutiny.

Hedge funds do not necessarily hedge. However, I believe they do attempt to produce returns that are anti-correlated (or at least non-correlated) to traditional investments.

The problems with hedge funds seem to be (1) herd effect and (2) gigantic leverage.

Many hedge funds do not use more leverage than our friendly FB neighbors though. :)

Correct. Some FB's leverage is ill defined. In Calculus, they use a long arrow and a funny symbol involving an Eight lying down to represent this risk-taking behavior.

I personally am very excited about the idea of a combination cell phone/Ipod. However, it’s got to have a good user interface, and it’s got to be reliable, or else I won’t use it. My Treo is less powerful than my old Pocket PC, and has fewer features, but it works and is easy to navigate.

These PDA/phone/ipod/camera/mini-PC devices are all very cool, but one thing worries me: what if I get completely dependent on it then lose the damn thing? I've just lost the functionality of all 5 devices, plus whatever data I don't have backed up.

GC,

No inside information, just bits and pieces I pick up from mass media sources and from my SEC law class (which was largely a waste, the prof was one of very few pure market fundamentalists I've ever meet, he actually defended market timing AND Mike Milken's practices)

I heard Milken was singled out as a scapegoat. He was just too successful. The guy's junk bond operations did finance some good companies. MCI I believe was a beneficiary of that era. MCI (and Sprint) helped reduce the long-distance phone bills for millions of people.

HARM,

Always have a portable hard drive for backups. Computers always fail at some point, and they seem to fail with greater frequency if they're in close proximity to me.

I work in the IT industry but I never like electronic gadgets. Life is simpler and better without them. Technology, if properly designed, can be very helpful. But the bulk of the technology products are there mainly to separate you from your money.

I admire Mike Milken.

Oops, wrong term - not market timing

What's it called when a broker gives larger clients priority on buying and selling shares?

Selling risky bonds to stupid people is asking for trouble.

I'm neutral on Milken. But my prof basically believed that the market can do no wrong and any SEC regulation is wrong.

But the bulk of the technology products are there mainly to separate you from your money.

Cannot be more true. :)

I’m neutral on Milken. But my prof basically believed that the market can do no wrong and any SEC regulation is wrong.

Instead of regulation, SEC can help to improve transparency. In an imperfect world, some regulations may help improve investor confidence.

But your prof is mostly right, the market itself is morally neutral so pure market participants cannot possibly be "wrong".

However, the act of implementing a market can be morally-relevant.

That's assuming that (1) complete transparency is efficient or possible (I don't think it is) (2) that people can process that information effectively (3) no outside party attempt to distort the information in their favor.

I have no confidence in any of the three things happening. Furthermore, in stock market and commodity markets, you have to deal with cascading market failures and high risk behavior. These problems can be arrived privately or via public oversight, but public oversight is a bit more disinterested and less prone to corruption.

So much for the "Rising wages will spur inflation and bring about a miraculous Soft Landing" theory:

I have no confidence in any of the three things happening.

Well, our world is imperfect. :)

you have to deal with cascading market failures

Not with a Greenspan Put.

Hmmm... my link didn't post :-(

re-try: http://money.cnn.com/2006/07/05/magazines/fortune/imaginationeconomy.fortune/index.htm

Is the market morally neutral? Given that it's underpinned essentially by human greed? (Which prompts the question of what morality even is, of course.)

I am in Menlo/Palo Alto with friends…. can you recommend a sushi place or other eatery???

Sushi - Kaygetsu (Sharon Height)
Pasta - Lavanda (University Ave)

Both are on opentable.com.

Or do you have other type of food in mind?

Is the market morally neutral? Given that it’s underpinned essentially by human greed? (Which prompts the question of what morality even is, of course.)

Is greed morally neutral?

sushi is what I was looking for.

Reservation is essential for that restaurant, even on week nights.

Which prompts the question of what morality even is, of course.

I am sure we have different meta-ethical views.

DS said: Is the market morally neutral? Given that it’s underpinned essentially by human greed?

Humans (and other animals) are fundamentally greedy and selfish. Selfishness and greed are fairly effective survival traits in nature. This doesn't mean that humans (or animals) are "evil." We are all capable, at times, of putting the interests of others ahead of ourselves. But we can not be expected to do so in a predictable or systematic way.

Free markets merely acknowledge and harness our natural greedy instincts. The alternatives (communism, socialism, utopianism) attempt to deny human nature in the hopes of making it better or different.

DS said: Is the market morally neutral? Given that it’s underpinned essentially by human greed?

Humans (and other animals) are fundamentally greedy and selfish. Selfishness and greed are fairly effective survival traits in nature. This doesn’t mean that humans (or animals) are “evil.” We are all capable, at times, of putting the interests of others ahead of ourselves. But we can not be expected to do so in a predictable or systematic way.

Free markets merely acknowledge and harness our natural greedy instincts. The alternatives (communism, social-ism, utopianism) attempt to deny human nature in the hopes of making it better or different.

Free markets merely acknowledge and harness our natural greedy instincts. The alternatives (communism, social-ism, utopianism) attempt to deny human nature in the hopes of making it better or different.

Very true indeed.

alien, you should go to their webpage and see if you like the menu.

I have this horrible neighbor who is trying to sell his '63 Tbird and keeps lowering the price. The thing is if he would just be "neighborly" and let me sell my first I could get more money for me. Is there anything I can do?

-my
+mine

X,

Violence is not a solution... maybe a dead skunk or five?

The thing is if he would just be “neighborly” and let me sell my first I could get more money for me. Is there anything I can do?

You should buy his at pre-reduction price. This way, you will have two pieces of classic automotive investment.

Peter P Says:
Is greed morally neutral?

yes, that's the point. under analysis, there is no such thing as morality, only what we perceive to be moral. every instinct has evolved for a reason, some we are OK with, others we may dislike. the taboos around sexual behaviour and promiscuity, then, are also morally neutral.

nor is the housing boom 'immoral' in this view, it just is. which is very buddhist and dancing wu li masters.

'there is nothing either good or bad, but thinking makes it so'
william shakespeare

bap said:
The stupid dude in the paper that was quoted as saying, “we need higher paying jobs” is a friggin loon. The jobs set the price for the area housing. NEVER EVER has it been the other way around.

this is exactly it -- the inflationary cycle. speculators push up housing for a killing, so the price of goods and services goes up next, and wage workers then have to agitate for higher wages to pay for both the housing AND goods and services. wages eventually equalise to housing costs and cost of living, and the only net thing that has happened is that the dollar has devalued itself -- in the long run. in the short run, everyone gets mightily pissed off at an unjust social contract. it's possible the economic history of the last 400 years has been determined by this process...

The other thing they said, “predatory lending” ……. and how it “effected blacks and minorities worse” …. watch the libs suck us dry helping those who tried to ride the cash wave and got popped.

and libs are to blame for the practices of predatory, primarily republican-voting bankers and lenders? follow the trail of cash, dude... the repubs have already been there and sucked them dry first with the products...

the blacks and minorities are in the bottom end of the housing market, and they are just trying to cement some social security for their families, and who can blame them -- they are not the ones specuvesting...

This is so friggin stupid….. it’s like the Twilight Zone, man. Right is wrong, good is bad, queer is normal, lazy is productive …

yes, and libs are republicans, apparently...

Free markets merely acknowledge and harness our natural greedy instincts. The alternatives (communism, social-ism, utopianism) attempt to deny human nature in the hopes of making it better or different.

man lived in a state of relative co-operation and 'primitive communism' (Durkheim and Marx) for 200,000 years before the last, most recent 10,000 years of 'civilisation', social stratification, commodification, etc...

is it really human nature to be consistently and continually greedy, or is it being exaggerated and exacerbated by enculturation? in the state of nature, is the greed balanced by altruism? and what motivates bill gates?

and what motivates bill gates?

The desire to make this a better world?

Cell Phone Screens

How about some little browsing activity on the road and Wireless USB connection to a LCD monitor/tv for full sized display? This could occur while the phone is on a docking station, unless they've invented wireless electricity ;)

Anyway, I am in the industry also and agree about cell phones being PDA and Laptop replacement items. I see this as more so for the third world countries. Having this view on the future of computing, the new tablet PC or Nokia's browser device leave me confused.

The way I view computing is (Sizing Order):

Cell Phone -> PDA -> Tablet PC -> Laptop PC -> Desktop PC -> Server PC

I do not understand why they inserted an item between PDA and Laptop. I suspect it may have to do with the PDA OS Application support and usability is lagging, so Tablet gets the freedom to run XP and their same apps.

As for backing up, I suspect when people use devices for more information storage rather than sync the market will be created for cellphone backup units and software (for those with PCs). Otherwise, a simple backup to a home media center harddrive over wireless USB would suffice.

Boomer to Surfer-X: "I am going to set up a surface science lab in my garage"

Surfer-X to boomer: "where are you going to get the money"

Boomer to Surfer-X: "the equity in my house".

Nice.

Bap33 Says:

"...it’s like the Twilight Zone, man. Right is wrong, good is bad, queer is normal, lazy is productive … up is down …. chicks want to be dudes and vise versa …… the whole world is bassackwards."
_____

That's California!

Do the CME Housing Futures contracts actually buy hard real estate assets? I know that when you buy pork belly futures or oil futures, you are actually buying those hard assets. Could someone explain to me what you actually get when you buy housing futures contracts.

Do the CME Housing Futures contracts actually buy hard real estate assets? I know that when you buy pork belly futures or oil futures, you are actually buying those hard assets. Could someone explain to me what you actually get when you buy housing futures contracts.

"No" and "no you're not", or at least not usually.

CME Housing Futures (and options) are based on the Case Shiller Index, a methodology for determining same-house price movements within a region, then moving average to an index. The method is transparent, you can read about it on the CME site.

When you buy pork belly futures you are not buying the actually pork belly. You are buying a contract that gives you the right to assign a responsibility to deliver physical pork bellies to you in the future. The contract has value, which is linked to the underlying value of the pork. But, 99.9% of the time you have no intent of actually collecting the pork; instead you settle in cash. In fact, some futures don't let you take delivery; but most will let you take deliver, but under pretty difficult physical constraints.

The reason hedgers do this (like farmers) is so that they can offset price movement risk by putting their pork "in play" before it's ready. Similarly, a big consumer of pork, like a restaurant chain, would want to stabilize prices going forward so they'll by those futures from the farmer. They both benefit from the trade even though they never transact any pork, only cash, assuming they have both hedged to reduce their price risk.