Drama vs. real life

Derek Sivers wrote this of Kurt Vonnegut talking of Drama vs. real life... thought it was interesting perspective.

How Doctors Die

I saw this article claiming doctors tend to be far less aggressive on themselves than on the average patient when treating terminal situations. I don't know if this claim is substantiated by a study, but the article claims:

"It’s not a frequent topic of discussion, but doctors die, too. And they don’t die like the rest of us. What’s unusual about them is not how much treatment they get compared to most Americans, but how little. For all the time they spend fending off the deaths of others, they tend to be fairly serene when faced with death themselves. They know exactly what is going to happen, they know the choices, and they generally have access to any sort of medical care they could want. But they go gently."

This is a really good article that's worth a read.

Making a mess

My wife tells me sometimes you have to make a mess to clean up a mess... Well I'm making a mess. I really need to clear some some stuff out of the house. Putting some things up on ebay.

and sometimes things just need to be thrown away.

government, democracy, and the will of the people

which is the higher goal of democratic government?
- to reflect the will of the people, or
- to protect from the will of the people?

Democracy - in my mind at least - has little meaning absent a bill of rights. As new democracies form around the world I wish more emphasis was given to the later.

Interesting observation from Jeff Bezos of Amazon

"If everything you do needs to work on a three-year time horizon, then you’re competing against a lot of people. But if you’re willing to invest on a seven-year time horizon, you’re now competing against a fraction of those people, because very few companies are willing to do that. Just by lengthening the time horizon, you can engage in endeavors that you could never otherwise pursue."

Here's the Forbes interview - good stuff.

Jinx

I think the post about trying to pay off the house caused the universe to reassert its primacy. Found out the main heating/cooling unit for the house needs replacement. ;-)

Pay off house by end of next year

My wife and I were talking and assuming all goes well (meaning my job holds out that long - vehicles hold out - no other unexpected runs on the bank acct ) we're going to try to pay off the house by the end of next year. We just sent in another payment against principle and I'm really OK with diverting cashflow there.

At this point, there's really only a couple key concerns in my mind:
- maintain sufficient liquidity in event of emergency (emergency fund). This is my top concern by a far stretch, esp. given job uncertainty.
- I used to have a concern about alternative stock market returns I'd be missing out on, but I'm really 50/50 on the market right now anyhow, so using extra cash to remove a certain mortgage debt seems a reasonable way to go. While a surge in the markets could happen, I don't expect it, and even if it did I'd still be holding alot of cash, so going ahead and paying down the house makes sense in this context also given a guaranteed return of whatever our mortgage rate is vs. almost 0% for holding cash right now.

I still plan to fund the 401k, maintain investing accts, and fund other retirement accts, but just be willing to send in extra payments against principle as liquidity permits.

I like the flexibility that having cash-on-hand brings - but think it's time to spend it down some to get rid of this debt overhang of the home mortgage. As much as anything I think the mortgage weighs on my mind, pre-occupies my thinking and decision-making, and strangles my perspective.

Yeah, I'm 40 and it's mid-life crisis time - if such a thing exists - but debt is an insidious little thing that creeps in and has a way of taking over. It has kept me on the hampster wheel - that much is for sure. But I'm not built to handle debt very well, so getting rid of it will hopefully free my soul a bit to do better and more interesting things with my life.

Karl Denninger goes off

This rant by Karl Denninger is good. Karl has been on the Armegeddon watch for a long time and I just hope he's not right that everything is a house of cards, but I do like reading his perspective. Warning, this will likely scare your pants off.

The catalyst at present is that Greek default begins the process that brings the whole system down and that govts are so weak now they can't prevent it. His thesis that the bankers and over-leveraged financial hucksters have scammed and skimmed for so long that they've killed the beast that they make a living from - and it's our own fault for not stopping them and letting them get away with it.

Portfolio update

It's been a long time since I've updated my investing info on here. Early in the year I raised cash levels and have been running at a high cash level most of the year. I've been moving in and out of positions, but overall had not real strong convictions.

Here's my holdings right now from largest to smallest.

AAPL - Apple
INTC - Intel
NEU - Newmarket Corp (petroleum additives and products)
TEO - Telecom Argentina (telecom)
CHL - China Mobile (wireless)
MFB - Maidenform Brands (apparel)
ASML - ASML Holding (semiconductor equipment)
MDF - Metropolitan Health Networks (healthcare provider)
GPS - The Gap (retail)
MED - Medifast (diet/health foods)

One big move I made recently was to exit a large position in Ebix. I'd just reached max pain with the losses on that one and with so much else on the market cheap I felt like I'd move that money into something else for the time being. Ebix seems very inexpensive to me, but there's very big money on the short side of that one pushing that stock around in a big way.

All-in-all I'm still about 50% cash as it's not clear there's much upside to things right now, although there do appear to be alot of inexpensive stocks.

I've been adding to TEO and INTC several times of the past few months, and gotten yanked around by market moves in AAPL, but I'm liking alot of valuations I see. Some I'm looking to add to in near future include those I hold plus MSFT. I'm really wanting to get MSFT a point or two lower from where it's now. Things move on and off of my radar but for the most part I remain confused by how much value the big techs seem to have in them - especially AAPL, INTC, MSFT, and others. There's alot of other very interesting stuff out there - including more semi-equips AMAT KLIC LRCX, some retailers GES ROST, some basic material companies CF CLF FCX, healthcare AGP LHCG AFAM, other telecoms AMX, oil CVX XOM CEO.... lots of value - but I'm just trying to be deliberate with buys and maybe sell some rallies.

Our government doesn't work because...

I saw this in the paper today and it caused me to smile and at the same time I thought he was onto something...

"Our government doesn’t work — not because we have dysfunctional politicians, but because we have dysfunctional voters." - NEIL deGRASSE TYSON

If we elect a bunch of folks that can't get along, don't expect them to get along. It's one thing to disagree, another to allow for concensus despite disagreements. We won't vote for that guy though.

Full Rotation movie of Asteroid Vesta

compiled from photos from the Dawn mission. The grooves running around the "equator" of the asteroid are interesting - kindof like debris may have bounced around the asteroid for huge amounts of time in low gravity gradually carving out the apparent channels.

Click for rotational movie. (Click the lower right corner of the video window to make it full screen.)

Here's also a really nice hi-res photo

Patently absurd

Here's a really good article from NPR about the sad state of patent law in the U.S.. Especially software patents and tech companies. It appears tech companies are buying patents to defend themselves against the other guy's patents, and all the cost is really doing very little to spur innovation or bring anything new to market because so many patents are vague, broad, and obvious.

from the article:

"we talked to a half dozen different software engineers. All of them hated the patent system, and half of them had patents in their names that they felt shouldn't have been granted. In polls, as many as 80 percent of software engineers say the patent system actually hinders innovation. It doesn't encourage them to come up with new ideas and create new products. It actually gets in their way.

Many patents are so broad, engineers say, that everyone's guilty of infringement. This causes huge problems for almost anyone trying to start or grow a business on the Internet.

"We're at a point in the state of intellectual property where existing patents probably cover every behavior that's happening on the Internet or our mobile phones today,"

iPads instead of stacks of printed presentations

Here's an interesting article on a small local government buying Apple iPads to distrubute meeting documents and is doing away with printed agendas and presentations for meetings.

from the article
"At the end of the day, when you are printing agendas around 200 pages apiece and after the meeting they go into the recycling bin, you say, “Why are we doing it like this?” We have to run 20 agendas at 200 pages per agenda. That’s 4,000 pages just on that one, and that’s not including the time to put it together. And you usually don’t get it right the first time because everything changes. I would think it takes over eight hours per packet. "

Quote: Paul Tudor Jones

I was re-reading Paul Tudor Jones' interview in Jack Schwager's book "Market Wizards" and came back across this quote which I remember from the first time I read it. He pretty much called the 2008 financial collapse more than a decade in advance.

"Everything gets destroyed a hundred times faster than it is built up. It takes one day to tear down something that might have taken ten years to build. If the economy starts to go with the kind of leverage that is in it, it will deteriorate so fast that people's heads will spin. I hate to believe it, but in my gut that is what I think is going to happen."

"I know from studying history that credit eventually kills all great societies. We have essentially taken out our American Express card and said we are going to have a great time.... (snip) We borrowed against the future, and soon we will have to pay."

- master trader Paul Tudor Jones - interviewed approx 1989-1990.

Distribution of Stock Price Movements

So maybe this will be a boring post, maybe not. I found it interesting as I'd tried to google information on this subject before and had been unable much that was useful.

My basic question was "what is the distribution of stock price movements?" (what % of the time do they go up, down, and by how much when they do?)

I didn't really feel like a "normal" distribution made sense as down moves "seem" larger and more violent than upward movements in stock prices. (A normal distribution is the normal "bell shaped" distribution we've all come to "assume" in many cases so we can use basic statistical tools such as standard deviations and allows us to constrain probabilities - example if a normal distribution applied we could assume 95% of price movements would fall within +or- 2 standard deviations of the mean of the distribution. This is particularly useful understanding risk).

Well, I was reading Jack Schwager's "The New Market Wizards" this morning - the chapter on trader William Eckhardt and the topic comes up, and when asked about statistics and stock price movements - and he is talking about only using "blunt statistical instruments" and says "I believe that price distributions are pathological." Ha. I kindof cracked up when I read it, but he goes on to talk about fractals and the problem seems to be that sample variance increases as data increases when you look at stock price movement. The more you look at, the more weird, unusual, unexpected moves you find... The implication of this being "it means that lurking somewhere out there are more extreme scenarios than you might imagine". This book came out in 1992, so the term "black swan" wasn't used then, but what he was talking about is the "black swan" concept that's so popular now after the financial collapse of 2008. Market outcomes that you think might be so highly improbable as to not exist might in reality be far more likely than we expect.

By now I've read alot of the stories of these traders in both "Market Wizards" and "The New Market Wizards" and one theme that they keep coming back to is cut your losses fast - and keep your risk small so that no one event can wipe you out. It seems the field is littered with traders who can make money for years but then "blow up" when they run into something unexpected and haven't properly respected risk. Assume risk is much larger than you expect it is, because how you manage risk makes the difference between surviving and getting wiped out.

MIssissippi River Flooding and Hurricanes

I work in the insurance industry and a couple weeks ago the issue of this year's hurricane forecasting came up. At the time we were going through some of the worst MS river flooding in years, perhaps back to 1927. My thought is that MS river flooding should be correlated with hurricane activity as the MS river dumps so much water into the Gulf of Mexico - a major storm path for the hurricanes. My initial thought was this should impact hurricane activity because the temperature of water in the gulf is associated with hurricane severity and formation. If the MS river is dumping alot of excess "cooler" water into the gulf it should be associated with lowered hurricane activity.

Average year: From what I can tell an "average" year for storm activity is "The official NHC seasonal averages are 11 named storms, 6 hurricanes, and 2 major hurricanes." I think the 11 named storms include tropical storms, not just hurricanes. Recently it seems almost all forecasts have been higher than this, but I guess the above are much longer term averages.

I didn't investigate any of this throughly, mostly just quickly looked some stuff up - but thought it was interesting non-the-less. MS river flooding does seem correlated with below average storm and hurricane activity - at least from what I can tell - I'd be betting the "under".

Bad MS flooding years:

1927: I started by looking at 1927 hurricane data - because 1927 was the worst year for MS river flooding in U.S. history. I honestly didn't know if they even kept hurricane records back then, but they did have records. The hurricanes didn't have names, but they did show tracks... we had 4 hurricanes that year, and interestingly all of the hurricanes stayed in the Atlantic / not entering the gulf of Mexico.

1951: A "moderately active" hurricane year. This is apparently the most active hurricane year of the MS river flood years looked at - 8 hurricanes in all, but interestingly none of the hurricanes made landfall in the US as a hurricane. Strong "stay in the Atlantic" tendencies here too.

1973: The 1973 flooding of the MS was some of the worst in U.S. history so I also looked there. Interestingly only 4 hurricanes that year also - although 1 did reach strong category 3 status out in the Atlantic. Like in 1927 there was a strong tendency for storms to stay in the Atlantic.


1983: 1983 MS river flooding was charactarized as the 2nd worst MS river flooding in the past century, so we look here also. Similar trends arise. 3 hurricanes that year - and the "lowest accumulated cyclone energy count since 1950". 2 of the 3 hurricanes did enter the gulf that year though.

1993: Another bad MS river flooding year per Wikipedia. 4 hurricanes that year with tendency to stay out in the Atlantic again.


Atlantic Hurricane Seasons

1927 4 hurricanes
1951 8 hurricanes
1973 4 hurricanes
1983 3 hurricanes
1993 4 hurricanes
2011 ?

1927 Wikipedia entry
1951 Wikipedia entry
1973 Wikipedia entry
1983 Wikipedia entry
1993 Wikipedia entry

Scrabble Triple Triple word score

Hey all, played scrabble w/ wife and Dad today. I'm normally not a big board game guy, but had something pretty cool that I don't recall ever happening while playing Scrabble. Check out the board below.


"Divulged" on the right covers two triple word scores and also used all 7 tiles. This is probably my biggest word ever - 167 pts. 13 x 3 x 3 +50pt for using all 7 tiles.

"Tempter" on the bottom was also a 7 tile word (along with "It" on the bottom) which gave me another 50 pt bonus. I don't think I'd ever had multiple 7 tile words in a game either.

Cooking Pizzas on Mother's Day weekend

When I was younger one of my favorite meals was home-made pizza. There was a lot to prepare with pizzas so usually me and my Mom, or me and my Mom and my brother would all help put the pizzas together.

I made some pizzas today - here's how it went - in picture collage style.



...and adding more toppings


..and the final product

Been adding back to my portfolio

I'd raised alot of cash a few months back, but now moved some of that back into the market recently.

This week I've added to or opened positions in the following stocks:

MSFT - Microsoft - back in again. I like the softy. It just looks cheap to me and I can't figure out why.
AAPL - aaahhhh! I broke down and bought the Apple too! First time for me, but it looks cheap too.
EBIX - Added some more back to my position today.
MDF - Metropolitan Health - I doubled up my position here. This is a deep value play for me.
MED - Medifast
DST - DST Systems

I've got my eye on a few others, but sticking my toe back in the market with these.

Photopic Sky Survey

Look at this Photopic Sky Survey of the night sky. Zoom in a few things. Find the Orion Nebula or Andromeda. This is impressive.

And according to this article, all the photos were taken by an amateur astronomer, Nick Risinger. Thanks Nick - very cool!

Hoveround

I saw an ad for the Hoveround watching the NFL draft today. Am I the only one that it upsets a little bit that they advertise "at little or no cost"? I'm all for devices that help folks get mobility, but with all the budget issues we face should they be provided at "little or no cost"?

I go on record and say no. Why wouldn't I want one if it was nearly free?

Uranus Visible at Dawn on Saturday

Uranus Will Be Visible at Dawn on Saturday.... Just thought I'd warn you.

Phantoms - Rose Reiter

This is the first song I ever heard by artist Rose Reiter many years ago, and I became an immediate fan. I heard it as I was clicking through tunes on www.unsignedbandweb.com - a website that hosts songs for unsigned artists. There's often a lot of "not so good" to wade through to find the gems, but then some-times you find something like this - something of such clear talent and quality that it makes you wonder why some songs/artists get a big push by a label, and why others remain heard by only a few.

This is Phantoms by Rose Reiter - one of the best songs that few people have heard.

Messy stores = more sales

As an investor in retail stores I found this article in today's NYTimes very interestng. It speaks to several retailers, but in particular Wal-Mart's efforts to make their stores more appealing and less "messy". Of the nicer/more orderly stores:

“They loved the experience,” William S. Simon, the chief executive of Wal-Mart’s United States division, said at a recent confer-ence. “They just bought less. And that generally is not a good long-term strategy.”

Here's the full story: Retailers Pile Stuff in the Aisles.

There's an investment angle to watch for here too. WMT pays a nice dividend, is cheap by my metrics, and has a powerful brand and competitive moat if they'll just get back to basics.

Mars with an ocean

Here's an interesting map, utilizing NASA survey data, showing what Mars may have looked like with an ocean.

Through the Rainbow

Today I drove through a rainbow. I didn't think it was possible, but today I honestly think it occurred. There was no pot of gold or leprechaun though that I could see, and certainly no gateway to Asgard.

Anyhow, I was driving home from work and it was monsoon season. Water standing in the road several inches deep in places because it can't drain fast enough.

It's raining so hard I can hardly see and then all of a sudden as I'm driving by the lake and nearing crossing the dam on my way home the rain lets up and I'm in bright sunshine. Wind and mist is still blowing, but there clear bright sunshine too. In front of me across the dam less than 100-200 yards away is a big fat rainbow, almost touching the ground/road.

As I cross the dam I expect the rainbow to "back away" from me as I approach because I thought rainbows were all about the angle between the misty rain, observers eye, and the sun/light source. Anyhow as I approached the rainbow to my surprise didn't run away from me. I swear I think I drove right through it. Maybe my eyes were playing tricks on me but I thought I saw some of the color even as I was very close to entering where I perceived the rainbow to be touching down.

About a mile down the road I saw another big, bright rainbow, so all-in-all a pretty cool trip home.

Three stories in a day

Flamingos falling from the sky in Siberia
Apparently some bird's internal compass can get reversed

The Far Side of the Moon - very cool pic recently released by NASA.
We're all familiar with the side of the moon facing earth, but have you ever seen the other side? It's far more cratered (if you think about it it makes sense) and looks quite a bit more foreign than the familiar moon we've come to know.

A 26 pound rabbit.
I'm not kidding. He was one big bunny.

Inside story on the space race

Here's a story from NPR regarding an early Russian cosmonaut who plunged to his death in the early stages of the space race between the U.S. and Soviet Union. The story puts a human face on the highly politicized competition between super-powers.

Here's Vladimir Komarov's story: "I'm not going to make it back from this flight."

Solar Power projection

Here's an interesting Solar Power projection from Scientific American. If costs keep falling in a predictable manner, solar power may be highly price competitive within the next decade.

The shape of the curve is interesting though. Has solar hit a plateau, or are costs continuing to fall?

The Walking Cactus

Check out this odd new Cambrian explosion creature whose fossils were discovered in China. It's been dubbed "the walking cactus"

Portfolio update 2011 02-25

I haven't updated in a while, so figured I'd better do so. Honestly I haven't been that engaged with what's going on with the market since I've raised to a high cash level waiting for a pullback.

My only stock holdings currently are (in order of size of position)

EBIX Ebix - IT software services
TEO Telecom Argentina - telecom / wireless
DO Diamond Offshore - offshore drilling - gulf exposure
CSCO Cisco - Networking
LHCG LHC Grp - Home Health
MDF Metropolitan Health Networks - health services - microcap

and that's it. I hadn't seen anything I couldn't live without, so I've just been on the sidelines, but some interesting companies have slid back in price since the start of the year so repurchase opportunities may be near.

Spiders/Snakes, or Need some cheap glasses?

This study surprised me some. I figured we were hard wired to be afraid of snakes and spiders, but it turns out we're just predisposed to learn to be afraid of them very easily, but we're not born with the fear. I would've guessed we were born with it.

Plus I saw this and thought it was a great deal. Need some cheap glasses? Check out this offer from Sears. 2 pair + lenses for $99

Can a giraffe swim/float?

I saw this question on a science link on Scientific American the other day. "Can a giraffe swim? or float?"

The knee-jerk reaction is to say "of course it can" because can't all animals swim/float? But then I started thinking about it and how tall, muscular and dense they look at the zoo - my next thought was a) in a giraffe's environment when would it ever need to swim? B) if it walked into the water wouldn't it just go in while still walking on the ground and hold it's neck up, and C) if it did get in too deep of water wouldn't it's big neck cause it to be front heavy and make it tip forward like a front-engine car sinking face-first into the water?

For what it's worth, here's a study that attempts to determine. Apparently nobody's ever seen a swimming giraffe - but they haven't put a giraffe in deep water to check either.

Portfolio update 2011 01-07

Haven't posted here in a while. Figured I'd update some changes made in the past few weeks. Essentially have raised some cash and am just hanging out for some more attractive opportunities to buy.

Here's what I hold now in order of position size:

EBIX Ebix (IT)
UFPT UFP Tech (packaging)
CHL China Mobile (telecom)
TEO Telecom Argentina (telecom)
SHOO Steve Madden (shoes)
DO Diamond Offshore (drilling)
CSCO Cisco (internet / routers)
LHCG LHC Group (home health)
MDF Metropolitan Health Networks

I'm about 50% cash - just waiting for pullbacks somewhere and better buy prices. Of the above the only "large" or "big" commitment for me is Ebix. Everything else is a standard to small size position. I still like MSFT/INTC which were twi of my other larger holdings, but sold my remaining at the end of the year due more to the way the charts were behaving than anything. My general feeling was that there was alot of complacency about risk at the end of the year so I liquidated some spots and am just taking a wait/see approach now and am fine holding cash with intent to deploy should good opportunities present.