Category Archives: Rogues and Rascals

Medicare For All?

When you see the bizjets parked all over the nearest airport around a big sporting event, chances are that most of them are serving executives of healthcare companies. The current healthcare system is one giant rip-off that costs twice as much as any other and delivers inferior outcomes overall. It is responsible for the majority of personal bankruptcies.

I am no fan of government, but even government incompetence would be better than the outright larceny embodied in the current system. Unfortunately, there is zero chance that it will be changed. The healthcare companies, led by the “insurers” and big pharma will simply pay whatever it takes – and it won’t be much compared to their rapacity – to buy the votes to stop any such initiative. Their larceny is exceeded only by the corruption of the political system.

Enough Already

How long can Trump and Xi continue to goose the markets with optimistic statements without actually achieving a substantive deal?

Either there’s something else going on or the algos are gullible enough to jack up prices with any hopeful words, but never disappointed with the inevitable walkbacks?

The Price Is Not Right

Note that the government funded cartels are stealing everyone’s money.

Trumpets Off

Yet again, President Trump tweets out positive words about progress on a trade deal with China ten minutes before the S&P futures open. What BS. The algos react and spike the futures. This is now a pattern and is clearly a deliberate manipulation of the stock market. He’d better not disappoint, is all I can say.

The other pattern is the Friday VIX crush, consistent every week this year.

I’m flat so it doesn’t affect me immediately, but the more overbought the market gets the more vulnerable it is.

Goodbye Blockchain

Really? From MIT Technology Review via Slashdot:

Early last month, the security team at Coinbase noticed something strange going on in Ethereum Classic, one of the cryptocurrencies people can buy and sell using Coinbase’s popular exchange platform. Its blockchain, the history of all its transactions, was under attack. An attacker had somehow gained control of more than half of the network’s computing power and was using it to rewrite the transaction history. That made it possible to spend the same cryptocurrency more than once — known as “double spends.” The attacker was spotted pulling this off to the tune of $1.1 million. Coinbase claims that no currency was actually stolen from any of its accounts. But a second popular exchange, Gate.io, has admitted it wasn’t so lucky, losing around $200,000 to the attacker (who, strangely, returned half of it days later).

Just a year ago, this nightmare scenario was mostly theoretical. But the so-called 51% attack against Ethereum Classic was just the latest in a series of recent attacks on blockchains that have heightened the stakes for the nascent industry. […] In short, while blockchain technology has been long touted for its security, under certain conditions it can be quite vulnerable. Sometimes shoddy execution can be blamed, or unintentional software bugs. Other times it’s more of a gray area — the complicated result of interactions between the code, the economics of the blockchain, and human greed. That’s been known in theory since the technology’s beginning. Now that so many blockchains are out in the world, we are learning what it actually means — often the hard way.

Yes it was a “theoretical” problem – that is, well-established mathematical proof existed that such an attack could not be prevented. This is what happens when you have developers – and marketeers – who have no background in computer science.

Sad

New Jersey is the latest state to enact a $15/hour minimum wage. Generally speaking, businesses are unlikely to employ people who don’t add value – in other words, bring in more revenue than they cost.

So the effect of this increase will be to add low-skilled people to the ranks of the unemployable, trapped in poverty. But they’ll vote for higher taxes and benefits.

Socialism

Socialism is a simple concept. The idea is that, since all people are equal, they are all entitled to an equal share of the nation’s wealth.

This then boils down to a simple equation:

Socialism == No Toilet Paper.

And we all know what happens when the TP runs out.

If You Have To Ask…

The 300-ft yacht “Equanimity” is up for judicial sale as a result of the 1MDB scandal in Malaysia. She is listed at the discount price of $130 million, down from a recent $250 million. The vessel can accommodate up to 22 guests and 31 crew, with amenities that include a beach club, health center with gym, massage room, sauna, hammam, plunge pool and beauty salon. Other amenities and equipment include a hospital, a helipad (certified for an Airbus EC-135 or equivalent), and a circular swimming pool.

Just sitting at the dock, running costs are a staggering $729,000 per month.

Huh

Somebody was working awfully hard in the last half hour to get a positive close today, although they missed by one lousy point (0.04%) on the S&P. I wonder why?

Loose Cannons

In the days of fighting sail, the ship’s main armament typically consisted of rows of cannons lined up on each side of the ship. These cannons fired through ports in the side of the hull and were mounted on wheels so that they could be pointed and able to recoil when fired. Normally, they were constrained by heavy ropes. But from time to time one or more would get loose. Each cannon could weigh as much as three tons and would then roll around the gun deck as the ship pitched and rolled, crushing anything or anybody in its way. The gundeck would be crowded most of the time – each gun on a large ship had a crew of 14 men who not only worked but ate and slept near their gun. Needless to say, a loose cannon could do much more damage than any broadside from an enemy ship.

In the market, the black boxes or “algos” are the equivalent of the loose cannons of yore. They are out of control and roll around in herds, as many of them share similarly programmed rules. You can watch the “herding” in the stock market by watching the “Tick” as it moves to extremes in both directions – that’s the herd. You hear about “flash crashes” – that’s a herd of algos running over some security or asset class. They pose a huge danger to the financial system, and need to be reined in. The mistake that the regulators make is to only consider them as single entities, without comprehending the emergent phenomena arising from unintentional herding behavior.