Things Could Get Very Ugly with Stocks and Banks

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Friday November 12, 2010 · 9:52 AM PST

2010/11/12 · 09:52

I'm a famous stock, commodities, and currency trader. Mostly because of trading for the Chicago Trader Richard Dennis in the 1980s. I'm generally retired from trading except for my own account. I've been working on poverty and education initiatives mostly.

I’m seeing a big divergence in the risk/reward ratio for stocks and way too much pent up risk on the fundamentals that don’t correlate with stock performance in the U.S. stock market.

The last time I felt this way, I told my father-in-law to get out of his 401K when the S&P was at 1,550. He got talked out of doing anything by his banker who didn’t know fuck-all about stocks. The market dropped within a few weeks to 1,270 and then bounced around and I got my father-in-law and took him down to the bank myself when the market came back to 1,350 and he told his banker to liquidate everything while I was there to explain to his banker that I knew more about trading than he did and that he wanted out so please stop trying to convince him to get into something else. That was in April of ‘08, by March of ‘09, the S&P had halved to 670 so I saved him half his retirement savings.

DISCLOSURE: I have no positions in any markets.

inflector

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Friday September 12, 2008 · 9:27 AM PDT

2008/09/12 · 09:27

I think we all realize that the single axis continuum of left and right does not begin to capture the differences in our political perspective. Some have proposed a different quadrant like the one at The Political Compass. Which looks something like this:

Still, I haven't been too happy with these quadrants either. It seems like we miss something important when we try to plot a single point on a chart and these quadrants just don't seem to fit. I have been working on some new concepts for my upcoming book on risk and uncertainty which I think work better here.

The idea is much like a color wheel. Using three axis we can plot any color given only three primary colors. Using a three axis graph, here is what we could plot:

inflector

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Tuesday June 10, 2008 · 8:49 AM PDT

2008/06/10 · 08:49

My wife (and co-author) Jen and I recently spent two weeks in Savannah GA doing field research for a new book that we are working on which will be published by McGraw Hill next year. The book is about the economic forces that drive our social problems and how those forces work behind the scenes to undermine much of our social programs and efforts.

We wanted to use real-life examples so we set out to study several U.S. cities that represented different segments of the U.S. but that all had problems with poverty and education. We chose Savannah GA, Detroit MI, Laredo TX, and Portland OR. The first city we studied was Savannah.

Savannah has one of the most integrated school districts in the country – on paper. It also has a growing economy centered around the port of Savannah, the second largest port on the East Coast behind New York. Yet Savannah also has one of the highest poverty rates of any city in the U.S. at 22% in the 2000 census. Looking at the breakdowns by race the poverty rates are much higher for black residents. It has some of the poorest performing schools in the state and at the same time one of the best public schools in the nation.

What we found was both disheartening, tragic and yet hopeful...

inflector

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Saturday June 07, 2008 · 1:13 PM PDT

2008/06/07 · 13:13

A lot of the angst between Hillary and Clinton in the early part of this primary focused on the differences between their respective Universal Healthcare plans. In order to unify the almost 1/2 of Democrats who supported Hillary in this primary, I propose a merging of their respective plans. This approach can serve as a sign of respect for Hillary's cause célèbre, Universal Healthcare.

As with most mergers, there will be a need for layoffs and a reduction in overhead for efficiency.

The merger plan after the jump...

inflector

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Monday May 05, 2008 · 1:02 PM PDT

2008/05/05 · 13:02

I dug up a diary I wrote on January 15th wherein I expounded on the one significant piece of Hillary Clinton's past that I personally knew was a lie at the time she told the lies.

Many now see what was obvious to me because I happened to know a bit about what to most people is an arcane subject, commodities trading in the late 70s.

It is funny to look back on all the attacks I received here for daring to "repeat Republican Attacking points". I was even TR'd for daring to repeat what I actually knew from my own personal experience.

My diary follows...

inflector

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Tuesday February 26, 2008 · 6:57 AM PST

2008/02/26 · 06:57

I was born one day before Michelle Obama, January 16th 1964.

Unlike young Michelle, I grew up as the white son of an upper-middle-class executive in the Chicago suburbs with its cookie-cutter houses in the fresh 1970 subdivision style devoid of character and large trees; a father who spent all of his time trying to give us the life he wished he had had instead of spending time with us; and a mother who was busy helping others and had little time. It was a life of white privilege. It was the only thing I knew.

Michelle Obama's statement which the Right has used against her resonated with me; and more than what she likely intended with her words.

I have never been proud of America for what it has done in the time that I have lived as an adult. There. I have said it.

inflector

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Saturday February 09, 2008 · 10:28 AM PST

2008/02/09 · 10:28

In the concluding line of the Gettysburg Address, Abraham Lincoln voiced the most eloquent and compact statement of the meaning of the American experiment in Democracy:

... we here highly resolve that these dead shall not have died in vain—that this nation, under God, shall have a new birth of freedom—and that government of the people, by the people, for the people, shall not perish from the earth.

All Americans and proponents of Democracy are familiar with those words. The problems we periodically confront in our continuing struggle to perfect our Democracy is one that centers on the very definition of the word People as Lincoln voiced above. It centers on the struggle of inclusion against the tyranny of exclusion.

inflector

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Friday January 18, 2008 · 6:26 AM PST

2008/01/18 · 06:26

I've been struggling over the last several weeks to decide if Bill Clinton is intentionally sabotaging Hillary's campaign because he really doesn't want to be the "First Laddie" or if he is simply that out of touch with modern reality.

I still don't have the answer but I have come up with a few points that support each side in my internal debate:

inflector

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Thursday January 17, 2008 · 8:27 AM PST

2008/01/17 · 08:27

Like most of you – I am sure – I keep getting emails from friends with a link to an online quiz to determine which of the Democratic Primary candidates best fits my own perspective. Invariably, the quiz tells me that my best candidate is one that is my fourth or fifth actual choice. My friends tell me that this has been their experience as well.

The quizzes are amusing but they do serve to highlight one of the major problems with the way we approach politics: the focus on the candidates' particular stands on the issues. This drives our debates, and most of the discussion in the blogosphere and television.

There are four problems with this approach:

inflector

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Tuesday January 15, 2008 · 8:00 AM PST

2008/01/15 · 08:00

In an earlier diary entry I made the following comment in response to a reader's comment where she asserted that sexism was the bigger problem:

If you look at the current situation you are far worse off being a BLACK MALE on average in this country than you are being a female on average. The only people who are arguably worse off than black males are black females. I believe that institutional racism is a worse problem than sexism for that reason.

She responded:

Sorry, statistics do not support your claim at all.

I don't want to make this a p*ssing contest between what is worse, racism or sexism. Both are nasty and hurt all of us. But the facts sure as hell do not support you. When it comes to poverty, overwhelmingly women are the largest group, in the country as well as in the world.

Since I'm working on a book on the subject of poverty and racism and how they are both interlocked in a deadly embrace, I disagreed. Nevertheless, I thought it was interesting that someone else could be so adamantly of the opposite opinion. This started me thinking...

inflector

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Monday January 14, 2008 · 11:18 AM PST

2008/01/14 · 11:18

I was once very positive on the Clintons. I was – perhaps like many of those who are drawn to Barack Obama's candidacy – 28 at the time of Bill's election and seduced by the idea of a younger president, one who would would change Washington. Over time, I came to view the Clintons as typical politicians, concerned more with their own position and power than with the job they came to do.

Hillary's failure delivering Universal Healthcare which had been the major platform initiative of Bill Clinton's campaign started my personal path toward disillusionment. But it was the commodities scandal that made me believe that the Clintons were corrupt. After learning of this, I stopped being a supporter.

You see, I am an expert commodities trader so...

inflector

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Saturday January 12, 2008 · 11:22 AM PST

2008/01/12 · 11:22

There are two major types of martial arts: hard and soft. A hard style meets force with direct force: a kick or punch with a countering blow. Tai Kwon Do and Karate are usually considered hard styles.

A soft style in contrast aims to redirect force rather than to counter it:

Soft style martial arts seek to redirect force and upset balance. The opponent's energy and attack vectors are taken and manipulated into elegantly upsetting the attacker's equilibrium. The end result is an opponent whose own momentum is used against them (in a throw or trip) or who is brought into compromising holds and chokes. Examples of soft styles include aikido, some kung fu styles, jiu-jitsu, ninjitsu, and tai chi.

These two styles of technique apply in our political battles and an analogy can be drawn between Obama's style and John Edwards style using lessons drawn from the martial arts.

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Things Could Get Very Ugly with Stocks and Banks

Political Quadrants Suck

Screwing the Kids Part I - Racism and Scholastic Segregation

HillaryCare + ObamaCare = KucinichCare

The Clinton Perfidy Has Been There All Along

For the First Time, I am Really Proud of America

Lincoln's Words and the Real Class War

Despite Appearances Bill Clinton is Not Insane

Why Candidate's Stands on the Issues Don't Matter

Which is the Bigger Problem: Sexism or Racism?

Hillary: Naive and Unapologetic or Evil and Calculating?

Political Jiu-jitsu – Embracing Right-Wing Talking Points