Wednesday, December 11, 2013
Tuesday, December 10, 2013
It's interesting that all three come from periods of warring city-states. Makes FLG think of The Third Man.
The most important thing, FLG believes, is Machiavelli's rejection of a teleology. To be honest, it makes it almost impossible to put him in either Plato's or Aristotle's camp based on this alone.
As far as FLG is concerned, about the only thing Machiavelli and Plato have in common is the idea that one ruler is best for maintaining order. (Although, regular readers will remember that FLG views the philosopher king, and indeed the entire structure of the Republic, far less literally than most people, more as a way to illustrate the correct ordering of an individual soul than the structuring of an actual republic.)
Aristotle and Machiavelli are far more in agreement in their approaches, both of which FLG would characterize as more bottom up, observational, and even empirical. The big issue, again, is Aristotle's teleological thinking versus Machiavelli's non-teleological. Aristotle without the teleology, very well might be Machiavelli, but on the other hand Aristotle without the teleology is nonsensical as well, like the Bible without God.
All of this is pretty obvious so far. What FLG is thinking about is whether Aristotle's teleology is essential to his conception of the spoudaios. The question is whether the spoudaios is "excellent/good" or "serious" or whether we are talking about the man or the citizen.
FLG was mulling over some paragraphs:
Whether the virtue of a good man and a good citizen is the same or not. But, before entering on this discussion, we must certainly first obtain some general notion of the virtue of the citizen. Like the sailor, the citizen is a member of a community. Now, sailors have different functions, for one of them is a rower, another a pilot, and a third a look-out man, a fourth is described by some similar term; and while the precise definition of each individual's virtue applies exclusively to him, there is, at the same time, a common definition applicable to them all. For they have all of them a common object, which is safety in navigation. Similarly, one citizen differs from another, but the salvation of the community is the common business of them all. This community is the constitution; the virtue of the citizen must therefore be relative to the constitution of which he is a member. If, then, there are many forms of government, it is evident that there is not one single virtue of the good citizen which is perfect virtue. But we say that the good man is he who has one single virtue which is perfect virtue. Hence it is evident that the good citizen need not of necessity possess the virtue which makes a good man.
Since there are many forms of government there must be many varieties of citizen and especially of citizens who are subjects; so that under some governments the mechanic and the laborer will be citizens, but not in others, as, for example, in aristocracy or the so-called government of the best (if there be such an one), in which honors are given according to virtue and merit; for no man can practice virtue who is living the life of a mechanic or laborer. In oligarchies the qualification for office is high, and therefore no laborer can ever be a citizen; but a mechanic may, for an actual majority of them are rich. At Thebes there was a law that no man could hold office who had not retired from business for ten years. But in many states the law goes to the length of admitting aliens; for in some democracies a man is a citizen though his mother only be a citizen; and a similar principle is applied to illegitimate children; the law is relaxed when there is a dearth of population. But when the number of citizens increases, first the children of a male or a female slave are excluded; then those whose mothers only are citizens; and at last the right of citizenship is confined to those whose fathers and mothers are both citizens.
As to the question whether the virtue of the good man is the same as that of the good citizen, the considerations already adduced prove that in some states the good man and the good citizen are the same, and in others different. When they are the same it is not every citizen who is a good man, but only the statesman and those who have or may have, alone or in conjunction with others, the conduct of public affairs.
Monday, December 9, 2013
Sunday, December 8, 2013
I made a similar claim in my general exams and was given the question, "And would you say that Machiavelli was an Aristotelian or a Platonist?" What would you say?
FLG's knee jerk reaction is that since he believes Machiavelli is the root of modern science and empiricism, Machiavelli would most definitely be an Aristotelian. BUT...FLG vaguely remembers Machiavelli drawing a sharp distinction between himself and Aristotle on some issue. Although, he could be remembering that. In either case, FLG needs to think about this more.
Saturday, December 7, 2013
Tonight, he saw this book at Barnes & Noble:
Herman (How the Scots Invented the Modern World, 2002) boils Western philosophy and culture down to two competing notions: the idealism of Plato and the empiricism of Aristotle. Plato, says Herman, asks, “How do you want your world to be?”; Aristotle, on the other hand, asks, “How do you fit into the world that already exists?”FLG'll need to download the Kindle edition.
Wednesday, December 4, 2013
He says the US has too many banks. How does he define too many? Doesn't really say. In fact, the number of banks has fallen to 6,891 today from 14,482 in 1984.
But he makes three points:
- They are poorly managed
- They can't be regulated
- They can't compete
He makes his first point by arguing, basically, that if the people with degrees from HBS and Wharton can't run the Wall Street banks, then the people at these little banks must be even worse. He then says that since these small banks are funded by FDIC deposits this creates a problem because nobody has an incentive to pay attention to what's going on. The glaring omission here is that smaller banks are simpler operations. They take deposits and make loans. They operate very much as if Glass-Steagall had never been repealed.
His second point is basically the high overhead costs associated with regulation is a real problem for small banks and politically we are sensitive to that. Matt argues this is because we are perversely committed to these small banks. FLG thinks this illustrates one of his big issues with regulation generally -- it acts as a barrier to entry and benefits large, incumbent firms whose own bureaucrats can speak the government bureaucratic language. The effect of regulation, especially after regulatory capture, is to protect the status quo power dynamics of the players in the industry.
The last point, that they can't compete, FLG is somewhat sympathetic to. There are economies of scale to banking, but he's seen differing views on how much matters in research literature. There is certainly a lower cost of funds in the market for the too-big-too-fail banks, which has been empirical verified. But since these smaller banks are getting most of their funds from deposits and they stay within that limit, he's not sure it matters.
The only way FLG can make any sense of what Matt is arguing is if he began a thought experiment of the ideal bank size to comply with all sorts of regulations Matt might come up with. The sweet spot for that would be just big enough not to be too big too fail, which is pretty pretty much the "US Bankcorps and PNCs and Fifth Thirds and BancWests of America" he likes.
Saturday, November 30, 2013
The assumption, and FLG does mean assumption because its almost never explicitly articulated, that the alliance won the Cold War (therefore it was successful) and contains the world's most powerful militaries of democracies, so its continuing existence must be good. This piece from June is representative of the type sympathetic to NATO. FLG will jump right to the conclusion:
We must urgently redefine what NATO can do realistically, both militarily and politically, to ensure that NATO will be institutionally relevant in the future.The mental model people seem to use is that NATO is like an aircraft carrier. It can launch airstrikes, provide natural disaster assistance, and project power by its mere presence. FLG, however, views it more like a pair of pizza shears when we are all out of pizza. Good for the purpose it was designed, but not much else. To be clear, it's not a question of whether the constituent militaries lost their capabilities, but that without the existential threat of the Soviet Union and Warsaw Pact there's no political focus and never will be.
You see the borderline delusional thinking prevalent with NATO supporters in the piece that FLG quoted from earlier. At the beginning, we have this:
Hi, my name is NATO and I have a defense spending and political leadership problem.Okay, FLG is on-board. He thinks, however, let's put the damn alliance out of its misery. Supporters instead offer this:
Step Four: Despite the difficulties, stay positive. Perpetual optimism is a force multiplier.Holy fuck! Maybe we could solve the alliance's problem by booking it on Oprah.
NATO Delenda Est.
Friday, November 29, 2013
The president said something recently that I believe was interesting and underreported. At a Democratic campaign fundraiser, the president said he was “not a particularly ideological person.” Assuming he meant it, that was a remarkable thing to say, given that Republicans think of him as a classic liberal ideologue. How did so many get the wrong idea? The president doesn’t see an ideological bent in his actions; he sees himself doing what needs to be done without any ideological motivation.This is a self-conception that FLG, probably unsurprisingly, attributes to time horizons. Here's what FLG wrote a few years ago about Ezra Klein's claim that Republican preference for smaller government is counter-balanced by a preference for larger government, not broadly, only where it makes sense.
Liberals, always desiring to be rational, empirical, and scientific, naturally focus on what can be easily measured. This necessarily means limiting one's focus. For example, when conservatives worried/worry about death panels because of health reform, Ezra points out that the bill in question doesn't contain anything like them. That's an empirical, fact-based statement. But it also doesn't address the real issue, which is that health care reform will require cost controls and those cost controls presumably will fall on those who account for the most costs, which means people toward the end of life, which means death panels. It's not about the specifics of the health care bill, but the incentives it sets up. The road where it leads in the long run.and
My point here is that despite the pretensions of those who would use government of they're being rational, scientific, and most importantly practical, they in fact hold an ideological position that policy makers can gather enough information and use it effectively enough that unintended consequences are mitigated. And to do that one must necessarily limit the scope of their analysis, for practical reasons, to the near term.It's a question of Bastiat's seen and unseen consequences:
In the economic sphere an act, a habit, an institution, a law produces not only one effect, but a series of effects. Of these effects, the first alone is immediate; it appears simultaneously with its cause; it is seen. The other effects emerge only subsequently; they are not seen; we are fortunate if we foresee themWhen you start trying to foresee the the longer term effects of a policy the certainty of any policy position, especially with something as complicated as health care, becomes far less certain. But here's the thing, what you often here in response to concerns about longer term effect from these so-called practical, non-ideological people is one deep skepticism or outright hostility. It is unavoidable that the precision with which we can predict the effects of a policy diminishes with the longer the time horizon of the analysis becomes. For the non-ideological, practical liberal this lack of certainty and precision of effects far off in the future means they can be dismissed.
The concern about death panels was dismissed as fear mongering or lying. The practical, non-ideological response was that there were no death panels in the law. But that isn't exactly the point the critics were making. The issue is that the trajectory of the health law and the stated goal of cost control through increased government involvement in the health sector logically leads to something like death panels. That it does not exist in the law, as an empirical fact, is almost irrelevant.
To these practical, non-ideological thinkers, however, concerns about long-term consequences, which are not empirically verifiable in the present, is misguided at best, often viewed as irrational, and at worst view as downright immoral.
So, Obama is downright blind to his ideology because his entire way of thinking is rooted in an empirical, short-term analysis. Long-term concerns are almost inherently non-empirical (because how can you empirically measure concerns about the distant future), and so are dismissed as self-evidently irrational. Thus, he is non-ideological because he reaches the only conclusion dictated by the demonstrably empirical facts and the an analysis limited to the short-term effects of his policies.
Wednesday, November 27, 2013
At the outset, more or less, Keynes writes:
My purpose in this essay, however, is not to examine the present or the near future, but to disembarrass myself of short views and take wings into the future. What can we reasonably expect the level of our economic life to be a hundred years hence? What are the economic possibilities for our grandchildren?So, he's taking a long view, and, in fact, proceeds to look back at basically all of known history very quickly. FLG will fast forward to:
The modern age opened; I think, with the accumulation of capital which began in the sixteenth centuryAnd looking forward to the year 2030 he thinks we will have solved the problem of how to produce enough to satisfy our basic wants as a race:
I draw the conclusion that, assuming no important wars and no important increase in population, the economic problem may be solved, or be at least within sight of solution, within a hundred years. This means that the economic problem is not-if we look into the future-the permanent problem of the human race.
Thus for the first time since his creation man will be faced with his real, his permanent problem-how to use his freedom from pressing economic cares, how to occupy the leisure, which science and compound interest will have won for him, to live wisely and agreeably and well.
purposiveness means that we are more concerned with the remote future results of our actions than with their own quality or their immediate effects on our own environment. The “purposive” man is always trying to secure a spurious and delusive immortality for his acts by pushing his interest in them forward into time. He does not love his cat, but his cat’s kittens; nor, in truth, the kittens, but only the kittens’ kittens, and so on forward forever to the end of cat-dom.For Keynes this is view is not misguided or problematic, but downright immoral, even if they are necessary to get to the economic land of milk and honey he envisions. Once there, however, this view must be discarded.
I see us free, therefore, to return to some of the most sure and certain principles of religion and traditional virtue-that avarice is a vice, that the exaction of usury is a misdemeanour, and the love of money is detestable, that those walk most truly in the paths of virtue and sane wisdom who take least thought for the morrow. We shall once more value ends above means and prefer the good to the useful. We shall honour those who can teach us how to pluck the hour and the day virtuously and well, the delightful people who are capable of taking direct enjoyment in things, the lilies of the field who toil not, neither do they spin.
Saturday, November 23, 2013
Change is hard and often messy, and a movement and a messenger — the progressive cause and this president — whose whole identities are about change will always be linked to any discomfort that change brings.
Every policy change — particularly large ones — will have winners and losers. For now, the Republicans will keep highlighting the losers. Democrats must keep highlighting the winners, while reminding people that data points are not the data set. In the end, this health care law will be judged by its overall effects on the population and the economy, which I wager will be a net positive.
While undoubtedly unfair and hyperbolic on his part, but in the context of the Obamacare debate as well as filabuster change, FLG was immediately reminded of this passage in Orwell's Politics and the English Language:
‘While freely conceding that the Soviet regime exhibits certain features which the humanitarian may be inclined to deplore, we must, I think, agree that a certain curtailment of the right to political opposition is an unavoidable concomitant of transitional periods, and that the rigors which the Russian people have been called upon to undergo have been amply justified in the sphere of concrete achievement.’
Obviously, the Democrats aren't Stalinists and the curtailment of political opposition in the current case is limited to progressive politicians and media talking heads whining about obstruction and changing parliamentary rules. Losing one's current health care plan is so different in scope from execution and imprisonment that they are materially different, but there is a slight connection in that they only differ along the need to break a few eggs to make an omelette attitude by how bad the egg break is.
Although, FLG will say, given his focus on time horizons, he is sympathetic to Blow's take that let's look at the longer-term impacts of the law, not what's happening at the beginning. It just so happens that FLG thinks they'll be a net negative.
Wednesday, November 20, 2013
Sunday, November 17, 2013
FLG: Sure, but not until it gets warm again.
Miss FLG Maior: In the summer?
Miss FLG Maior: I'm going to charge five cents for the lemonade.
FLG: That seems a little low. You might want to charge a bit more. How about fifty cents?
Miss FLG Maior: BUT DADDY, that's what Lucy charges Charlie Brown!
FLG: Well, sweetie, that show is from a long time ago. Five cents isn't what is used to be.
Miss FLG Maior: But it's five cents!
FLG: Yes, but there's this thing called inflation.
Miss FLG Maior: What's inflation?
FLG: After a time, money isn't worth what it used to be.
Miss FLG Maior: But mummies last a really long time.
FLG: Not mummies, money.
Miss FLG Maior: I thought you said mummies!
FLG: No, money isn't worth what is used to be.
Miss FLG Maior: But it's five cents. Five is five.
FLG: Yeah, but it doesn't quite work that way.
Miss FLG Maior: You aren't making sense, Daddy.
FLG: You sound like Aristotle.
Miss FLG Maior: Who is that?
Friday, November 15, 2013
[P]eople differ in one crucial way. “The marginal propensity to consume,” according to the paper, “is substantially larger for low-wealth than for high-wealth households.” Rich people behave like the hyperrational agent. They plan for the future. They save during a stimulus, thinking about the taxes to come. And they can borrow during a fiscal contraction.
Poor people are what economists call “borrowing constrained.” They tend to have more needs than are being met, so when money arrives, they spend it. When the government stops spending and credit is hard to come by, the mythical everyman, like the rich person, continues to spend. But most real people don’t have access to credit, and they hunker down. Carroll’s findings have been confirmed by other academics in the last two years who looked at Italian and U.S. data.
FLG has a question about the causality implied above. Isn't it just as reasonable to argue that people who plan for the future would build wealth and thus be rich. As in being rich doesn't cause somebody to have a lower marginal propensity to consume, but rather having a lower marginal propensity to consume (.i.e the person saves more) makes them rich?
FLG gets how if you look at the different populations at a point in time - here are rich people, here are poor people, that at that moment the issue is borrowing constraints, but what led up to it is the question.
That is why the humanities and social sciences are an essential part of undergraduate education. Most successful careers, including in technology and engineering, do not result simply from technical knowledge. They require leadership skills, social and emotional intelligence, cultural understanding, a capacity for strategic decision-making and a global perspective.
Years ago, FLG went further and argued innovation comes from liberal arts, not technology. He still holds that view.
It's not that he knows everything. Who does? But he was in that course with people whom he considers to be experts on banking and finance and FLG was totally up to speed and able to predict where the conversation was going to go next. Moreover, FLG realized during the Coursera course he recently took on internationalization of the renminbi that he knew probably 90% of the content. The new stuff was rather esoteric, for example, how offshore renminbi settlement works in Hong Kong.
FLG first decided to learn about the international financial system about ten years ago, and the idea of becoming an expert was never in his mind. But he went back counted how many university courses related to international finance, banking, and trade he's taken over those years, and it's more than 20. (This count omits general economics courses.) He's read dozens of books and countless articles on the topic.
This realization is a shock. He was even half toying with the idea of studying for another degree in a few years, either part-time or online, tailored specifically on the international financial system, under the assumption that he had more to learn about the international financial system. But now he realizes he probably knows about as much as any university courses are going to teach him. The only place he could learn more would be to do a PhD, and even then he thinks he would only earn more mathematically advanced theory of what he more or less already knows.
More broadly, however, FLG has been in too many meetings where somebody, usually an executive type or super-excited-pr-person, asserts that the organization has be to on social media. When pressed further for their justification --- it seems cool. When pressed further for their plan --- let's post some shit and see what sticks. FLG is sure there are some smart social media strategists out there somewhere, but he's only see snake oil salesmen and posers.
Sunday, November 10, 2013
My research on Civil War writing leads me to one conclusion. If you are literate today, it does not mean you can write -- not even close to it in many cases. But if you were literate in 1863, even if you could not spell, you often could write descriptively and meaningfully.
In the century and a half since, we have evolved from word to image creatures, devaluing the power of the written word and turning ourselves into a species of short gazers, focused on the emotions of the moment rather than the contemplative thoughts about consequences and meaning of our actions. Many everyday writers in the mid-19th century were far more contemplative, far more likely to contextualize the long-term meaning of their actions. They meticulously observed and carefully described because, although photography was the hot new medium during the Civil War, words remained the dominant way of communicating thought, memory, aspiration, hope.
Friday, November 8, 2013
America and the rest of the world should be less concerned about a rising China than about a sputtering—or even a crashing—China that could someday turn the world economy's greatest growth center into a global albatross.
FLG thinks the quote overstates it, but as long-time readers know he has been far more skeptical of the inexorable rise of China and even more skeptical of this translating into post-American period where China is more influential worldwide. Two things lead him to this skepticism. First, everybody so convinced of the Chinese economy has basically been projecting forward linearly, but long run economic development at the country scale looks more like a logarithmic function, not linear. FLG believes, based ultimately on a WAG, China is in or approaching the part of the curve that implies less growth. Second, China is going to grow old before it gets rich and is seeing so many new internal problems that whatever new wealth they generate will be primarily directed toward domestic, not foreign, issues. Sure, they'll be able to build aircraft carriers and project a bit more power in the region, but worldwide superpower they will not be in FLG's lifetime.
Thursday, October 31, 2013
Also, while on the way to work, FLG was behind a car whose license plate frame read "I'd rather be driving a fleshlight." He wishes he took a picture.
On a related note, while FLG was searching the web to see if he could find a picture of said the license plate frame, he learned that there is a shower mount for the fleshlight. Object sex, the gift that keeps on giving.
Monday, October 28, 2013
Thursday, October 24, 2013
Gensler and Stein say they are concerned that the latest draft of the [Volcker] rule wouldn’t prevent another episode like last year’s “London Whale” trades at JPMorgan Chase & Co. (JPM) that cost the bank more than $6.2 billion in losses, said one of the people, who spoke on condition of anonymity because the deliberations aren’t public.
FLG has said it before, the Volcker rule sounds great in theory or to a lawyer, but is basically impossible to implement in reality. No regulator is going to be able to tell the difference between hedging and risk taking. The only way to really implement it would be to forbid depository institutions from using derivatives at all, which, FLG would argue, make the system more, not less, risky.
This whole thing is a fucking fool's errand.
Wednesday, October 23, 2013
FLG had a couple of questions. First, what about Asians? Don't Asian diets have a high rice component? Second, how could the medical establishment have been so far off?
Turns out Asian diets are lower in sugar, which may be a catalyst for all carbohydrates becoming problematic. Also, Asians have lower BMIs, but higher body fat percentages. So, their level of leanness might be overstated in the data.
As far as the medical establishment being so far off, the best explanation is a donut. Basically, if you see that people who eat more donuts have heart attacks and you are looking for a casual dietary factor, it could either be the fat or the carbs. Back in the 50s, the fat hypothesis caught on and the carb hypothesis was ignored.
But there is a larger issue. FLG remembers sitting in his econometrics class when the professor, in a bit of a digression, said that a lot of medical research has problems with the statistical analysis, particularly omitted variable bias. But there is even a larger issue with correlation not equaling causation. One example that comes to mind is the claim that flossing prevents heart disease. FLG has seen several attempts to explain a causal link, but the most likely explanation, at least in FLG's opinion, is that people who floss are fundamentally different than non-flossers. To use a Smithian term, they are more prudent.
As similar thing applies to donuts. Maybe it's not the fat or the carbs, per se, but that people who eat lots of donuts are less concerned about their health than people who don't eat as many. This creates a whole host of potential omitted variable problems
As FLG started looking at some of these studies himself, it became clear that Taubes was correct. A lot of public health recommendations are based on very constrained or inconclusive findings extrapolated to far larger recommendations based upon assumptions and an overly precautionary stance by health experts, who seemed rather oblivious to potential unintended consequences. It also turns out that recent clinical trials seem to support the claim that carb restriction appears to be the most effective.
This led FLG to reduce his sugar, flour, rice, and potato intake about a month or so ago, and sure enough he's been losing weight pretty steadily. He still eats pizza and has beer on the weekends though.
Monday, October 21, 2013
Second, FLG found this article listing the 21 inanimate objects that Miley Cyrus has violated, which he posts without further comment.
Wednesday, October 16, 2013
Better to be broadly right than precisely wrong.
Never run for trains.
Always wear a pocket square.
Always be polite to waiters / waitresses.
Always say 'Please' and 'Thank You.'
Hold the door for people.
If you can't spot the sucker in the first half hour at the table, then you ARE the sucker.
Better to keep your mouth shut and be thought a fool than to open it and remove all doubt.
Try never to hurt anyone's feelings unintentionally.
If you don't make yourself laugh, then who will?
He's sure there are more, but that's it for now...
Tuesday, October 15, 2013
Monday, October 14, 2013
But Whoa, Nelly! here:
"The notion is, let’s transform higher education into job training,” Bruce Ackerman, a professor of law and political science at Yale, told me disapprovingly. That sort of sentiment, he said, was detectable in President Obama’s recent remark that it might be wise to shorten law school from three years to two.
FLG must admit that he considers law schools a special case, for the worse. Medical schools teach future doctors. Dental schools future dentists. Law schools often operate under the conceit that they don't train future lawyers so much as teach students how to think. An advanced, glorified continuation of undergrad for really smart students, which to some extent is true, but FLG also believes the model would fail if it were for the self-selection of students. Take the entering class at any top law school, lock them in a room for three years, and when they come out they'd still be successful in most any field that requires thinking. But if it were about just training future lawyers, which is what it really should be, FLG seriously doubts three years would be required.
- Concerns about measuring college effectiveness based on salaries is a concern.
- Law school is job training.
- Professors are a deeply interested party whose opinions should be taken accordingly.
Sunday, October 13, 2013
Thursday, October 10, 2013
FLG read an article recommending that people concerned about the looming debt issue use a collar to hedge. FLG has never really understood the point of a collar. He's sure there's some circumstance when it would make sense, but he's never thought of one.
For those of you who don't know what a collar is, here's a stylized example.
Imagine you own $100,000 worth of a stock. Let's say 1,000 shares that cost $100 per share. You are worried about it falling. You need to get somebody else to agree that come hell or high water, they'll buy your shares at some price, let's say $90. So, you buy a put option. In this example, you buy the option to sell your stock for $90 at anytime during the next three months. This is the floor of how much you can lose. It's very much like insurance. And like an insurance policy, it costs money. You need to pay the insurance premium. Where do you get the money?
This is where the collar part comes in. You don't want to pay the insurance premium out of pocket. Instead, you sell, to somebody completely different, the right to buy your 1,000 shares at $110 at anytime during the next three months. And let's say this selling of the right to buy your shares at $110 brings in exactly the same amount of money as it costs to get somebody else to agree to buy your shares for $90 at anytime during the next three months.
A shocking number of people think of this having paid out no money to hedge the downside risk. No matter what happens, you'll never lose more than $10,000. But you also traded the upside, as in you'll never make more than $10,000 either. So, for the next three months you are collared between a $10,000 loss and a $10,000 gain.
Here's what FLG does not get. When would you want to do this?
If you think the stock is going up, then why limit your upside to $10,000 and why hedge the downside?
If you think the stock is going down, then isn't it better just to sell the stock, get out now, and have $100,000 rather than $90,000?
If simply don't know what it is going to do over the next three months, but want to hold it long-term, then FLG asks why you'd even worry about the next 90 days at all? Just hold it for the long-term. Why hedge short-term volatility?
If you want to get out within 90 days, but don't know what's going to happen. Then, again, just get out now.
FLG can't see a reason to collar any single position. He could see, maybe, where if you had, say 100 different stocks and knew that you'd have to exit some positions in the next three months, but didn't know which ones in advance, that you might hedge against short-term volatility across the entire portfolio. Might make sense.
One other argument FLG has heard, is that you might want to make a bet on a stock, but that it's very speculative. It could swing really up or really down. You might win or lose big, so you collar to manage the risk. Here's the thing though. You could do the exact same thing by making a smaller bet. Instead of $100,000, do $10,000 or $1,000. Why put in a large bet, but then collar it?
FLG still doesn't get the collar thing.
Wednesday, October 9, 2013
Monday, October 7, 2013
It is necessary to return a republic to its principles
It is sometimes wise to feign madness
Newly acquired liberty required the deaths of the sons of Brutus
Sunday, October 6, 2013
Now, FLG fully realizes that a price north of $200 for a tie is downright crazy for some people. Here's the thing though, while not all of them are to FLG's taste, the vast majority of Charvet ties are aesthetically pleasing. Likewise, if he won the lottery, then he'd be buying a bunch of Loro Piana stuff. And these George Cleverley and John Lobb shoes cost a fucking fortune, but are fucking gorgeous. In these cases, FLG can understand asking whether the stuff is worth the price, but it's all classy, nice stuff.
But a lot of this high-end designer shit, FLG just does not get:
$1,100 for moonboot looking sneakers?
$600 baggy sweatpants?
$1000 boots that look like they've been dipped in acid?
$2300 for boots that FLG can't even describe?
$765 T-shirt with a picture of a dog on it?
$330 for one with a lobster?
Who buys this shit? Rappers and rockstars? FLG really wants to know who is willing and able to pay for these things.
Thursday, October 3, 2013
And there's a reason he forgot the number. A potential default would have financial and economic consequences, but the process for reaching an agreement on the debt ceiling is a political one. In what world are economists experts on the intricacies of current political issues and wrangling? Who the fuck cares what economists think on that point? Might as well have asked movie theater attendants or heart surgeons or professional gamblers.