Blowup in progress

Rational Capitalist Speculator: Weekly Bull/Bear Recap: October 17-21, 2011

Sat, 22 Oct 2011 17:36:35 +0200

Rational Capitalist Speculator: Weekly Bull/Bear Recap: October 17-21, 2011:

Bull

+ So far for the reporting season, 63.7% of S&P 500 companies have beaten consensus earnings per share estimates, which is stronger than the past 2 quarters. Meanwhile, revenue per share has come in line with average beat rates. This earnings season has been been positive for equity…

Excellent summary, as usual!

"[An old friend] tells you everything changed for him the day he realized he was destined to marry..."

Sat, 22 Oct 2011 17:31:49 +0200

“[An old friend] tells you everything changed for him the day he realized he was destined to marry Angelina Jolie. It might occur to you to ask, why does he believe this? Angelina Jolie is, after all, one of the most beautiful and famous people on the planet. She’s not incidentally married to Brad Pitt. They have something like 27 children. What if your friend, sensing your skepticism, said, “Clearly you don’t understand. This belief gives my life meaning. I now know my purpose in life: it’s to be Angelina’s husband”? What if your friend said, “This belief has made me a better person. I’m now incredibly kind to children, anticipating having to raise Angelina’s once Brad leaves”? Or what if your friend said, “You can believe whatever you want, but I wouldn’t want to live in a universe where I don’t marry Angelina Jolie”? It should be quite clear that your friend has lost his mind and is probably a dangerous person. Yet this is precisely the type of talk that so often passes for wisdom in religious circles, and may attempt to pass for wisdom here. Beliefs are not like clothing. Comfort and utility and attractiveness cannot be our conscious criteria for adopting them.”

- Sam Harris, Wolf in Sheep’s Clothing (via cocknbull)

Total mortgage in Nevada now exceeds total value of all homes

Fri, 01 Jul 2011 14:43:06 +0200

1. Nevada
> Pct. Homes Underwater: 63%
> Total Property Value: $100.7 billion
> Mortgage Debt Outstanding: $115.5 billion
> Median Home Value Drop From Peak: -50.3% (the largest drop)
> May Foreclosure Rate: 1 out of every 103 homes

No state has suffered more, in every aspect, from the effects of the recession. Like Arizona, Nevada’s property value has plummeted since the middle of the decade, losing more than $150,000 on average (more than 50%) in just five years. Nevada is also the only state in the country in which total homeowner debt is actually higher than the total property value of owned homes – nearly 2 in 3 mortgaged homes is underwater. In May alone, nearly 1% of every owned home in the state was foreclosed, the highest rate in the country.

Obama's Biggest Error. (Click on me)

Wed, 22 Jun 2011 08:33:23 +0200

Obama's Biggest Error. (Click on me):

rationalcapitalistspeculator:

Appointing a bunch of financial-industry-infected pushovers on your economic “dream team”.

What I’ve been saying ever since the beginning of his term.. :/

"We systematically overestimate the value of access to information and underestimate the value of..."

Fri, 06 May 2011 08:20:15 +0200

“We systematically overestimate the value of access to information and underestimate the value of access to each other.”

- Clay Shirky (via biesnecker)

dailymeh: Ria van Dijk, Self-portrait at a fairground shooting...

Thu, 05 May 2011 14:21:50 +0200

dailymeh:

Ria van Dijk, Self-portrait at a fairground shooting gallery, 1936.

I saw this at C/O Berlin, and it was great because it was so unexpected. Most of the gallery space was taken up by a Robert Mapplethorpe retrospective that spanned from tender portraits of Patti Smith to hardcore S&M. In a couple rooms towards the back on the second floor, though, was an exhibition of vernacular photography. The shooting gallery was a curious fairground attraction where one would shoot at a bullseye or at theatre figurines, and if you hit your target, a picture would be taken, so you’d get a self-portrait of yourself shooting. The exhibition had a functioning shooting gallery in one room (I didn’t try). In the other room was a series of amateur pictures by a woman named Ria van Dijk. She began taking self-portraits at shooting galleries in 1936, when she was 16 (above). She has continued every year since, with the exception of 1939-45, and she’s still going strong at 90. Every year was represented by one photograph. None of the photographs are particularly great by themselves, but the effect of more than seventy years of near-identical self portraits was pretty powerful.

Low Carb veggie pasta!

Wed, 04 May 2011 03:58:05 +0200

Low Carb veggie pasta!

At the Zons beach of the Rhein

Tue, 26 Apr 2011 14:50:10 +0200

It was a very calming atmosphere watching the day fade away as ships slowly passed by.

Basic sign language

Sun, 24 Apr 2011 15:41:34 +0200

Basic sign language

Aljazeera fails to understand market mechanics in "The scam behind the rise in oil, food prices"

Wed, 20 Apr 2011 16:04:20 +0200

Aljazeera fails to understand market mechanics in "The scam behind the rise in oil, food prices":

—- via http://english.aljazeera.net

What Phil sees is a giant but intricate game of market manipulation and rigging by a cartel – not just an industry – that actually has loaded tankers criss-crossing the oceans but only landing when the price is right.

“”There is nothing that the conga-line of tankers between here and OPEC would like to do more than unload an extra 277 million barrels of crude at $112.79 per barrel (Friday’s close on open contracts and price) but, unfortunately, as I mentioned last week, Cushing, Oklahoma (Where oil is stored) is already packed to the gills with oil and can only handle 45M barrels if it started out empty so it is, very simply, physically impossible for those barrels to be delivered. This did not, however, stop 287M barrels worth of May contracts from trading on Friday and GAINING $2.49 on the day. He asks: “Who is buying 287,494 contracts (1,000 barrels per contract) for May delivery that can’t possibly be delivered for $2.49 more than they were priced the day before? These are the kind of questions that you would think regulators would be asking – if we had any.” “”

—

Nope, that’s not how it works. Its actually pretty simple. If there are more contracts traded than physically delivered, for all those virtual barrels of oil, it’s a ZERO SUM game. For every contract bought, and money made, there’s a contract sold, and money LOST. This has nothing to do with where prices are, because not only is it profit-neutral, it’s also price neutral. For every buyer, there’s a seller.

What moves prices is supply and demand. And that demand isn’t artificial by authorship of some “cartel” (even though there are oil cartels and lobbying beyond any sanity in the world capital of insitutionalized corruption). That demand is caused by one single thing: The federal bank of the U.S. driving down interest rates on almost everything so that they create an artificial economic recovery by making people and companies take on loans that they don’t need. Bernanke even said in plain English he wants to drive stock prices up artificially so that people would feel that they are more wealthy and a recovery is there so they would start spending and actually create the recovery he made them believe in by his measures. (Which has been proven to not work on an economic level, but that’s another story.)

This also has the side effect that all the capital - which HAS to go somewhere - cannot stay where it used to stay, in short-term interest bearing bonds and the like. The interest on those has been driven to effectively be negative by Ben Bernankes actions. So the money can’t stay there usefully. It has to go SOMEWHERE though- so it goes into everything else there is. Also, all the paper issued by governments, for those same reasons, is seen by an ever growing amount of people as potentially worthless, because more and more of it is being printed.

So what do people do? They swap the paper money, of which there is a massive oversupply, and less credibility of it being worth something, into something for which there definitely will be long-term demand.

And that is oil and all the other tangible goods a.k.a. commodities. It’s nothing but the consequence of bailouts and artificially low interest rates.

Yes, it is speculation. Speculation by the government(s) - first and foremost by Ben Bernanke and his ivory tower academics, that if you make people *believe* that there is a recovery by driving stock prices up, that they can create a recovery out of thin air.

Shooting stars time!

Sun, 17 Apr 2011 00:48:04 +0200

Sternschnuppen im Anflug [image: Sternschuppen: Lyriden regnen herab]

REUTERS Sternschuppen: Lyriden regnen herab *Spektakel am Nachthimmel: Bis Ostern regnen Abertausende Körnchen Kometenstaub auf die Erde. Wolkenlose Nächte versprechen ideale Voraussetzungen, um die Sternschnuppen zu erspähen.* [image: Info] In den nächsten Tagen können Nachtschwärmer ihre Wünsche gen Himmel richten. Ein alter Glaube will es, dass einen Wunsch frei hat, wer eine Sternschnuppe erspäht. Vom 16. bis 25. April ist der Sternschnuppenstrom der Lyriden zu sehen. Seinen Höhepunkt erreicht er am 23. April, also in der Nacht zum Ostersamstag. Die beste Beobachtungszeit ist die Stunde nach Mitternacht. In the next few days, night owls can turn their eyes to the sky.An old superstition has it that a wish is free to who spots a shooting star. From 16 to 25 April the meteor stream of the Lyrids is to be seen. It reaches its climax on 23 April, in the Easter Saturday night. The best time is the hour after midnight.»

Warum ich das Geheule der Ärzte nicht mehr hören kann

Sun, 17 Apr 2011 00:10:02 +0200

via payer.de

Eine Statistik (aus glaubwürdiger Quelle) sagt mehr als 1000 Worte.

Es ist mit Sicherheit kein Zufall, daß Ärzte sich immer über alles mögliche beschweren, aber komischerweise dabei NIE mit absoluten Einkommenszahlen argumentieren. Der nächste Arzt, der sich bei mir beklagt, darf sich gern weiter beklagen, nachdem er mir verraten hat, wie viel er im letzten Jahr brutto auf seiner Steuererklärung angegeben hat.

Why the U.S. has too many cars and too few college degrees

Sat, 16 Apr 2011 19:49:39 +0200

http://mfeldstein.com/why-higher-education-is-in-trouble-in-one-graph/

via bigpicture.posterous.com

Those numbers speak pretty clearly, don’t they?

I was gonna write “I wonder how those numbers look over here” - but actually, that’s a pretty easy one. The “college tuition” line still hovers basically around the zero mark..

A sunny spring day walk

Thu, 14 Apr 2011 01:28:59 +0200

It was a nice and sunny and warm spring day a little while ago, and I visited the wood floor with my DSLR..

See the full gallery on Posterous

Low carb bread, first attempt

Wed, 13 Apr 2011 22:33:15 +0200

Drama sky

Wed, 13 Apr 2011 04:14:05 +0200

Drama sky

Klassisches Aprilwetter

Tue, 12 Apr 2011 17:06:14 +0200

The Easiest Way to Succeed as an Entrepreneur...

Sun, 10 Apr 2011 23:16:33 +0200

The Easiest Way to Succeed as an Entrepreneur http://www.jamesaltucher.com/2011/04/the-easiest-way-to-succeed-as-an-entrepreneur/ I was the worst pizza delivery guy. Fraternity guys would chase after me as I was peeling out of their driveways after a delivery. Why? The sauce and cheese fell all to one side. I couldn’t help it. I also never got tips. Wende, my partner in our restaurant delivery business, always got tips. But she was beautiful, blonde, great smile, had personality, etc. And I secretly loved her. I couldn’t compete. I always hoped I would deliver to a frat party where all the girls were running around naked. But that never happened. We also started a debit card for college kids. From the first day we were open for business we had college kids signing up for our card (there were no credit cards for kids then). And anyone who had our debit card could order food from the 20 or so restaurants in town and we’d deliver, but with a 25% markup. I loved delivering food because it gave me twenty, or even forty minute breaks from my girlfriend. We were having troubles at the time. I’d sometimes stop the car between deliveries and just read. I was a screwed up 19 year old then. Now I’m only a mildly-screwed up 43 year old. I’ve had seven startups since then. And some profitable exits. And another 20 or so that I’ve funded. When I think “entrepreneur” I think Mark Cuban or Larry Page or Steve Jobs. I don’t usually think of myself. In part because I feel shame that after all of these startups I don’t have a billion dollars. Many startups fail. But I’ve had a few successes as well. Successes in a startup makes you feel immortal. I was going to make this post: “the 12 rules to being a good entrepreneur” and I outlined the 12 rules that have consistently worked for me. But rule #1 is taking up 1500 words already. Tim Sykes tells me I need to break these posts up more. So this one rule is going to take up the whole post. But, for me, this is the most important rule. The MOST IMPORTANT RULE: Have a customer before you start your business. This is a corollary of the phrase, “ideas are a dime a dozen”. There is another corollary: lazy is best. If you have to work for two years before one dollar of revenue comes into business then thats too much work. I’m lazy so I like money coming in with as little work as possible. Mark Zuckerberg, of course, is different. He put in years of work before dollar one of revenue came in. But we’re different people. In about twenty minutes I’m going to go to the local café here, The Foundry, and bring a pad, order a coffee and muffin, and write down ideas for businesses. Then I’ll probably throw the piece of paper out. Because ideas are useless. They are just practice to keep your idea muscle in shape. FAKE RULE: People say, “Execution is important”. That’s not really true either. Execution is useless. It’s a commodity. The only thing that’s important is money. You get money by having a customer. You get a customer by satisfying a need that’s so important to them they would be willing to pay for it. If you have a customer that’s willing to pay you money, then execution becomes a lot easier. Life as an entrepreneur is hard. Why make it harder for yourself? I like stability as much as I like taking risks. So for me, I need a customer. It’s a matter of how much risk you want to take. In an earlier post I suggest reasons why people need to quit their jobs and jump into the abyss. If a customer happens to be waiting for you in the abyss then you won’t be lonely there. Loneliness is bad for a startup. Example: How Stockpickr Started Tom Clarke, the CEO of thestreet.com called me up in mid 2006. He wanted to meet and brainstorm ideas with me. So I had about two weeks to prepare. I called up a development firm in India. MySpace had just been acquired by NewsCorp so I sketched out what I considered the “MySpace of Finance”. I threw in every idea from my own trading. In other words, I wanted to create a site that I would use as a professional trader and so I knew other traders would benefit from it. And, I had a theory about making a quality financial site that basically had no news in it. I’m going to be blunt: 99% of financial news is useless and misinformed and misleading, if not outright lying. My ideas for the site were purely based on my own ten years experience as a professional trader. In fact, I had just turned down working for a multi-billion dollar hedge fund based on a specific strategy I had. Instead, I implemented that strategy within stockpickr.com. Within a week, for free (because I told the company in India that I would be building the site with them if they sent back good screenshots, which was true), the company sent me back screenshots. I met with Tom and told him, “I’m almost done with the site. Here it is.” (I exaggerated) And I showed him the screenshots. I had set up meetings with Yahoo and AOL as well to discuss them so it wasn’t a stretch to say, “I’m also talking to Yahoo and AOL.” Nobody wants to be the first customer, so you have to create the aura of many customers. And so he said, “why are you talking with them? You’ve been with us forever. Lets do this together.” So we negotiated right there. I said, “great, how about you guys take 10% of the company and put all your extra ads on all of our pages and let me link from every article back to Stockpickr.com (the name of the company).” He said, “I thought we were partners. Lets do it 50-50.” So right away, I had given up 50% of the company. Most people I spoke to thought this was a horrible idea. In fact, one of my employees quit because I did this: but giving 50% of your company away is often better than giving 10% of your company away. When you give 50% of the company away, your partner is obligated to follow through and be a real partner. He can never forget about you. Its also always a good thing when the most popular person in financial media, Jim Cramer, was also a 50% partner in my business since he was the founder of thestreet.com. If you can get the top person in your field to take equity, you’re golden from day one. Again, its all about making life easy. With family responsibilities, health, life in general, why make things even harder for yourself? Its like that saying when you owe the bank a million, they own you. When you owe the bank a billion, you own them. Three years later I watched another company thestreet.com only took 10% of almost disappear because Thestreet.com was not obligated to follow through. So, at that point, without even having a site finished (or even started): I knew I had three things going for me: A) I was going to get traffic. I could write three or four articles a day and link each one back to stockpickr all over the article. The street.com got 100mm pageviews a month so I knew I would get some percentage of that. B) I was going to make money. If I got even 3 million pageviews a month and the average CPM of thestreet.com (according to their SEC filings) was $17, I would make about $50 thousand a month with expenses nearing zero. What if I put 3 ads a page on the site? Then I would make even more. Slap a 40x multiple on a growing company and before I even started I had real value. C) Profitability and growth from day one meant I could put the company up for sale almost immediately. But that’s another story. With my first successful company, Reset, I had about 10 paying customers before I finally made the jump to running the company fulltime: HBO, Interscope, BMG, New Line Cinema, and Warner Brothers were all paying customers before I jumped ship from HBO to run Reset fulltime. (the Wu-Tang Clan was a paying customer) When I started my fund of hedge funds I didn’t put one dime into the expense of setting it up until I had the first $20 million commitment. $20 million with a 1.5% management fee meant an instant $300 thousand in revenues, plus extra money for legal fees, etc. Enough to pay a salary or two. It took a year of cultivating my network before I had that commitment, but it worked. This is just me, personally. Some people don’t mind starting a company without any customers. I’m too conservative for this. I’m happy to even give up equity to get that first customer. 50% of a profitable company is better than 100% of a company that will probably quickly go out of business. How do you get that first customer? - Who? List the 20 CEOs or high level executives you would like to meet. If you have a rolodex, great. If you don’t, then you might have to write to 40 people. This is why its important to Exploit your Employer and use some of the other ideas mentioned throughout this blog. But its ok if your rolodex is cold. Many successful businesses I’ve been involved with started with cold emails. - Ideas. Develop 20 ideas for each person. Get your idea muscle in shape first. - Communicate. Write them all, giving at least 10 of the ideas, in detail, and how you would implement them. Sometimes you have to dig for their email address. Like I did here. - Meet. All this does is get you the meeting. Once you’re in the door, the conversation can go anywhere. Of the 20 people you write, rule of the universe is you’ll get six meetings. - Ask. In the meetings ask the question, “what one product can I build for you that you will definitely buy?” Remember, execution is a commodity. Because of globalization you can build anything for cheap. I built the first working version of Stockpickr.com for $3000 in Bangalore. Throw in another $150 from a design made in Siberia. You need zero skillset for that. Just a good idea muscle, an ability to sell, and modest ability to manage a project. - Never say No. Never. If someone says, “can you do this?” Yes. “But can you do this?” Yes. Can you do it for this? Yes. - Follow up every day. Nice to meet you. Here’s my sketch of what you want. Is this right? Should I start today? - Equity. If necessary, give up equity for that first customer. Or first two customers. - Done. If more than one CEO wants the same product or service, and the price is right, then now you have a business. Build the product, sell it, and you’re in shape. - Repeat. You’re not really “Done”. Every day you have to go back and see if your customer is achieving more success BECAUSE of your products. If he is, then ask him what else he needs and then build it. If he isn’t, then ask him what else he needs and builds it. Your easiest new sales will be with your old customers. This has worked for me on three different occasions. And each time resulted in great profits for me. By the way, this technique has also worked for people who have contacted me with their own ideas. Listen. You’ve been hypnotized. You’ve been told you need a corporate job. You need a college degree. You need stability. You need the white picket fence. You need the IRA and the health insurance. Snap your fingers in front of your face. The American Religion is a myth, just like the movie, Thor, is based on a myth. Stability is only in your mind. There’s $15 trillion dollars in our economy, recession or no recession. Its falling like snow. Reach out with your tongue and taste it. —- Follow me on twitter. Ask me any question you want there or in the comments here.

Rabatt-Anarchie im Spiegel

Sun, 10 Apr 2011 19:19:44 +0200

Köstlich! :)

—————-

Die Werbeaktion ist auf zwei Tage befristet. Vielleicht, damit nicht noch mehr Leute auf die Idee kommen, sie beim Wort zu nehmen. Ich jedenfalls kann auch am zweiten Tag nicht widerstehen und suche die Filiale 181 auf. Dort entdecke ich eine schicke Tischleuchte für 14,49 Euro. Leider noch zu teuer, ohne Stecker wäre es weitaus billiger. Um bloß nichts wieder falsch zu machen, wende ich mich mit der Stehtischlampe und einem Seitenschneider, der fast daneben lag, an eine Mitarbeiterin. Mitte 30, blond. “Gilt dieses Angebot noch mit 25 Prozent für alles ohne Stecker?”, will ich von ihr wissen. “Ja, aber hier ist ja ein Stecker dran, das sehen Sie ja.” Mein Vorschlag: “Ja, deswegen wollte ich den abschneiden.” Ihre Antwort gleicht einer Drohung: “Dann dreh ich Ihnen den Hals um.” “Wieso?”, will ich wissen. Sie kommt nicht mehr dazu, den Dialog mit mir fortzusetzen. Denn ich zeige ihr, dass ich es ernst meine, und trenne den Stecker der Lampe mit Hilfe des Seitenschneiders im Bruchteil einer Sekunde ab. Übung macht auch hier den Meister. Ich halte ihr den Stecker hin: “Soll ich den hierlassen?”

Via http://m.spiegel.de/wirtschaft/service/a-754593-3.html

Financial media is [..] entertainment ( @jaltucher )

Wed, 06 Apr 2011 19:16:26 +0200

Here’s the reality: most people should not buy stocks. Financial media is financial entertainment. If someone tells you should buy a stock you should take that same money and go on a nice vacation instead. As someone who has been involved in every aspect of the financial media community for ten years I can tell you that most people have no clue what they are doing and should not be listened to except in special circumstances.

via jamesaltucher.com

I think I’ll refer people inquiring about stocks to this @jaltucher quote in the future. It’s very true, and he knows what he’s talking about.