Monday, May 28, 2012

Phthalate vs people and society. Obamacare

Berkeley biostatistics professor Shanna Swan did a study measuring the anogenital distance in male infants and finds that they are becoming less male. A leading culprit is Phthalate, found in plastics and bottles of all sort. I am glad it was not common when I was young. I never drank soft drinks from a plastic bottle. Back in the old days all the bottles were glass (I quit soft drinks at age 18). I believe modern chemicals are causing many such problems in modern people. Moderns are like aliens in our midst, a different species. They look and behave strangely. Then they get strange diseases leading to Obama-care. They cannot perform physically or mentally.

http://en.wikipedia.org/wiki/Phthalate

cumulative effects of phthalates and other antiandrogens. Studies of girls have found correlations between precocious puberty and exposure to phthalates.

In a study published in 2005, lead investigator Dr. Shanna Swan reported in the "Swan Study" that human phthalate exposure during pregnancy results in decreased anogenital distance among baby boys. In this study, phthalate metabolites were measured in urine samples collected from the pregnant women who gave birth to the infants. After birth, the genital features and anogenital distance of these women's babies were measured and correlated with the residue levels in the mother's urine. Boys born to mothers with the highest levels of phthalates were 7 times more likely to have a shortened anogenital distance. anogenital distance is routinely used as a measure of fetal exposure to endocrine disruptors

Authors of a more recent study of boys with undescended testis hypothesized that exposure to a combination of phthalates and anti-androgenic pesticides may have contributed to that condition.

In November 2009, Swan et al., in the International Journal of Andrology, in a paper titled "Prenatal phthalate exposure and reduced masculine play in boys", "... suggest that prenatal exposure to antiandrogenic phthalates may be associated with less male-typical play behaviour in boys. ... [and] ... suggest that these ubiquitous environmental chemicals have the potential to alter androgen-responsive brain development in humans."

link between the obesity epidemic and endocrine disruption and metabolic interference. "in a national cross-section of U.S. men, concentrations of several prevalent phthalate metabolites showed statistically significant correlations with abnormal obesity and insulin resistance."

Large amounts of specific phthalates fed to rodents have been shown to damage their liver and testes,[2] and initial rodent studies also indicated hepatocarcinogenicity.

In 2007, a cross-sectional study of U.S. males concluded that urine concentrations of four phthalate metabolites correlate with waist size and three phthalate metabolites correlate with the cellular resistance to insulin, a precursor to Type II diabetes. The authors note the need for follow-up longitudinal studies, as waist size is known to correlate with insulin resistance.

A 2009 study published in the Journal of Pediatrics found that prenatal phthalate exposure was related to low birth weight in infants. Low birth weight is the leading cause of death in children under 5 years of age and increases the risk of cardiovascular and metabolic disease in adulthood. Researchers at the University of Michigan School of Public Health found that women who deliver prematurely have, on average, up to three times the phthalate level in their urine compared to women who carry to term.

In 2009, South Korean scientists reported findings of a statistically-significant correlation between urine phthalate concentrations in children and symptoms of ADHD.

fluoride dangers. Drink milk (naturally low in fluoride)

Fluoride and heart disease: Governments contaminate most city water with too much fluoride. Dr. Mercola makes a strong case against fluoride in the first article below.

Milk has much less fluoride than city water according to the second article below. The cow filters fluoride out of the water that it drinks. The cow also filters out germs and toxins.

I drink only tap water and buttermilk.

Lake Tahoe water is not fluoridated, comes out of the lake clean. They use ozone to kill off any bacteria. Ozone is a natural germ killer (oxygen O3). “Water, air, and cleanliness are the chief articles in my pharmacopoeia.” by Napoleon I

The rich 1% in Lake Tahoe drink clean water from the lake. Poor people drink fluoridated city water and get heart disease. Water bottled in plastic is usually contaminated with toxins and bacteria. Milk straight from your own cow solves these problems.

http://articles.mercola.com/sites/articles/archive/2012/05/21/fluoride-health-hazards.aspx?e_cid=20120521_DNL_art_1
Journal of the American Dental Association, October 1, 1944, stated: "Drinking water containing as little as 1.2 ppm fluoride will cause developmental disturbances. Journal Nuclear Medicine Communications: researchers found that fluoride may be associated with an increased cardiovascular risk as it causes hardening of your arteries. Reviewing the imaging data and cardiovascular history of patients who received whole-body sodium fluoride PET scans, the researchers found a significant correlation between a history of cardiovascular events and presence of fluoride uptake in coronary arteries.

http://www.fluorideresearch.org/281/files/FJ1995_v28_n1_p010-016.pdf
Beijing, China and Houston, Texas, USA. SUMMARY: Fluoride analyses were carried out on 42 different types and brands of milk obtained from supermarkets. The average fluoride content of dairy milk is 0.030 ppm, with a range of 0.007 to 0.068. Soy milk contains as much as 0.491 ppm fluoride (Table 1), easily exceeding the safety level for prevention of dental fluorosis.

Sunday, May 27, 2012

Quadrillion 94% of derivatives held by by 4 big banks

The large numbers, "quadrillions" are "notional values," not what a bank may lose. The derivatives swap some fraction of a percent of the notional value (like a face value). The quadrillion $ notional value would amount to shuffling a trillion $ around between large banks. They owe that trillion $ to each other as counterparties to the transactions. Some banks may win while others lose. On balance it would be a wash. No bank would have to fail if they redeemed all derivatives, although some might face problems in the future due to lack of hedging.

For example, suppose a bank owns a $1000 fixed rate 5 year Treasury Bond that pays 2% (a loan to the government). Then suppose the bank issues 4 year CDs to customers for 1%. This is the typical occurrence -- banks borrow short to lend long. This poses a risk to the bank that in the 5th year that market CD interest rates may rise to 3% or more which would mean that the bank would have inflows of 2% and outflows of 3%, a loss. So the bank finds a counterparty who will do a "plain vanilla" "fixed for floating" interest rate swap to hedge that 5th year risk. Random Walk theory: If there is a 50% chance that interest rates stay where they are at 2% or below then taking the floating leg of the swap means that the bank will have lost the opportunity to make 2% and will be stuck with $0, $1,... up to $20 that it could have made if it bought a fixed 2% rate bond for that 5th year. So the plain vanilla swap floating rate leg puts a $20 cap on its losses because it effectively gives the bank a floating rate bond for that 5th year allowing it to earn market interest rates to payoff the CD depositors. On the other hand, the bank will have saved a disaster if market interest rates skyrocket up to 10% then the bank would have to pay $100 to depositors to get their CD money for that 5th year. The bank is much better off losing $20 than losing $100. (Interest rates sometimes do increase considerably.) Most of the time it will get about 2% because the interest rate will not move much according to the random walk. By taking the floating rate leg of the plain vanilla swap the bank gives up the possibility of making $20 that would happen if interest rates drop to zero to prevent the possibility of losing $100 due to a drastic jump in interest rates to 10%. In addition to the opportunity cost of favorable interest rate moves, the banks also must pay personnel, rent, and computer costs, etc. Swaps cost money but reduce risk of large losses.

In neither case is the entire notional value of $1000 at risk. It is just the cash flow from interest rates that is at risk. And it is not even the whole interest payment because interest rates do not fluctuate that much, especially for the longer maturities. Banks deal in basis points, 1/100 of a percent with very tight spread. It is fine tuned and no longer profitable so nobody can make money gambling against them on plain vanilla swaps.

The market is not in danger, or the economy. If one side of the market loses a few basis points the other side of the market will gain those basis points. It is just moving a few dollars from one banker to another. There are huge volumes of such swaps. Every few seconds another swap will move money and commitments from bank to bank so that on balance not much changes. This goes on all day round the clock all over the world without incident. It is cheaper than the Chicago futures and options exchanges but not as transparent because it is just transactions between a few large counterparty banks.

The troubles such as in 2008 were caused by different breeds of derivatives, such as "naked" credit default swaps. AIG for example was issuing such default swap insurance contracts even though it was not a party to the underlying instruments (mortgages). And AIG is not a bank and was not reporting to the regulators and was trading in London because there is less regulation than in the USA. These problems still remain, although at a smaller scale. Smart banks got out in the 2008-2012 "great unwind" of their contracts and banks are still reducing their positions in the worser instruments. Politicians need to flat outlaw some of this remaining paper. Instead Frank-Dodd leaves it up to the regulators who are proven clueless idiots without spine.

Citizens should take their money out of large banks and invest in acres, cows, horses, water that are needed for survival regardless of what happens in the banks.

http://en.wikipedia.org/wiki/Swap_(finance)

-------------------------
A couple of points to bear in mind: About 70% of those derivatives are interest rate swaps. (bets on the direction of interest rates). Of the estimated 1.2 Quadrillion in total derivative value the five major banks own approximately $700. trillion. This dwarfs their non derivative assets which number about a trillion. (J.P Morgan about $250 billion). Total derivative value is well in excess of total GDP of all countries. J.P Morgan alone is insuring about $500 billion in derivative bets on Greece. Are American taxpayers now on the hook for derivative losses? The current issue that is most polarizing to Americans though is what is Obama's stand on Gays? Geez!

Saturday, May 26, 2012

94% of derivatives held by by 4 big banks!

They are just moving risk around from bank to bank via swaps, etc. They are not reducing risk. Someone must bear the risk that is inherent in mortgages, loans, etc.

I would go further than the Volcker rule and make it more precise. Banks should hedge only on the large futures and options exchanges such as Chicago Board of Trade or Mercantile Exchange. They should not be writing secret contracts between each other, spinning a web that will trap the taxpayer into bailouts in case those banking contracts blow up.

In general, assets need to be moved from the natural shorts to natural longs. Mortgages should be held by older people or the rich who are living off the rents via a variety of funds and institutions. Investors want to bear the risk of that mortgage to get the higher return. They may want a portfolio of such mortgages or part of a pool of mortgages to diversify away some risk. Banks are not natural shorts or longs for mortgages -- banks are a conduit connecting the shorts and longs. Banks do must either hold a mortgage or sell it. If they hold it they can hedge using the exchanges. They should not be gambling on credit default swaps.

Somebody must bear the risk (preferably not the taxpayer). If bankers cannot find buyers for risky assets then they should not be creating those assets and paying themselves for creating such worthless assets. There is too much paperwork shuffling between institutions to do a relatively simple task of channeling loans and money between borrowers and lenders.

Banks need to connect the natural longs and shorts for the various kinds of borrowings. The money needs to flow as simply as possible. There is no economic advantage to complicated channels of funds flows and these huge piles of derivatives.

--------------
Thanks for the article. Yes, the four biggest banks are the culprits. But more importantly, the other smaller banks are correspondet banks with these larger banks in New York and depend on them for liquidity. This is where the rub comes in. Most smaller banks are depositor banks that have balance sheets intertwined with a New York correspondent bank, which are not regulated from using the smaller bank's money for investment purposes. Failure in retrospect from eliminating those restrictions under Glass-Steagle. The Volker Rule is supposed to limit that, but it is not enough. I agree, the European banks are key here because much of these investments are made in overseas banks and financial institutions, which are "supposedly" protected by a hedge. (More commonly called a derivative). Too, I obect to using interest rate swaps for protection of investments, which is nothing more than a transfer of ther risk to another bank. The bigger culprit is that the financial institution holding the other side of the hedge does not have collateral. If they fail, we have nothing more than another bailout like AIG. What a mess!!!

--------------------------------------

We can't see who is naked until the tide goes out. If Romney gets elected and starts cutting budgets seriously then the economy will look a lot different. A lot of parasites will not seem so rich if they quit getting something for nothing. Quite a few big government programs could be eliminated and the economy would be much better off. Seems to be a lot of money around. Not sure how much of that is crop supports and money won in the real estate and other bubbles.

The first test may come before the election if a big European bank collapses setting off a domino style chain reaction that would reach USA. Big banks are sitting on a lot of paper that is not all it is cracked up to be.

Why can't big banks make money without derivatives? Smaller banks do.

http://www.huffingtonpost.com/2009/09/28/derivatives-bailed-out-ba_n_300420.html

Four banks control the market: JPMorgan Chase, Goldman Sachs, Bank of America and Citibank account for 94 percent of the total derivatives reported to be held by U.S. commercial banks, according to national bank regulator the Office of the Comptroller of the Currency.

The credit risk posed by derivatives in the banking system now stands at $555 billion, a 37 percent increase from 2008. "By any standard these [credit] exposures remain very high," Kathryn E. Dick, the OCC's deputy comptroller for credit and market risk, said in a statement.

The complex financial instruments, which take the form of futures, forwards, options and swaps, derive their value from an underlying investment or commodity such as currency rates, oil futures and interest rates. They are designed to reduce the risk of loss for one party from the underlying asset.

Trading in an unregulated $600 trillion market, they were partly blamed for igniting the financial crisis a year ago. The New York Times reported earlier this month:

http://www.nytimes.com/2009/09/12/business/12change.html?_r=1&pagewanted=all

One year after the collapse of Lehman Brothers, the surprise is not how much has changed in the financial industry, but how little. Backstopped by huge federal guarantees, the biggest banks have restructured only around the edges. Employment in the industry has fallen just 8 percent since last September. Only a handful of big hedge funds have closed. Pay is already returning to precrash levels, topped by the 30,000 employees of Goldman Sachs, who are on track to earn an average of $700,000 this year. Nor are major pay cuts likely, according to a report last week from J.P. Morgan Securities. Executives at most big banks have kept their jobs. Financial stocks have soared since their winter lows. The Obama administration has proposed regulatory changes, but even their backers say they face a difficult road in Congress. For now, banks still sell and trade unregulated derivatives, despite their role in last fall’s chaos. Radical changes like pay caps or restrictions on bank size face overwhelming resistance. Even minor changes, like requiring banks to disclose more about the derivatives they own, are far from certain.



Wednesday, May 23, 2012

tony lawson on economics and the crisis

Excellent critique along the lines of his previous work. Much sounds like what I have thought for a long time despite my interest in mathematics (My DRI Cambridge MA modeling experience was heretical to the purists). Another big critique is also linked below. They, of course, do not do economics the right way. More like complainers than doers.

---------------------------------

http://www.paecon.net/PAEReview/issue50/Lawson50.pdf

The fundamental failing of modern economics, or at least of its dominant mainstream project, is not that it was unable successfully to predict the recent crisis but that it is ill- equipped to illuminate much that happens in the economy at any time.

http://www.debtdeflation.com/blogs/wp-content/uploads/papers/Dahlem_Report_EconCrisis021809.pdf

The Financial Crisis and the Systemic Failure of Academic Economics*

David Colander, Department of Economics Middlebury College Middlebury, VE, USA

Armin Haas Potsdam Institute for Climate Impact Research Potsdam, Germany

Katarina Juselius Department of Economics University of Copenhagen Copenhagen, Denmark

Thomas Lux1 Department of Economics University of Kiel & Kiel Institute for the World Economy Kiel, Germany

Hans Föllmer Department of Mathematics Humboldt University Berlin Berlin, Germany

Michael Goldberg Whittemore School of Business & Economics University of New Hampshire Durham, NH, USA

Alan Kirman GREQAM, UniversitĂ© d’Aix-Marseille lll, EHESS et IUF Marseille, France

Brigitte Sloth Department of Business and Economics University of Southern Denmark Odense, Denmark

Abstract: The economics profession appears to have been unaware of the long build-up to the current worldwide financial crisis and to have significantly underestimated its dimensions once it started to unfold. In our view, this lack of understanding is due to a misallocation of research efforts in economics. We trace the deeper roots of this failure to the profession’s insistence on constructing models that, by design, disregard the key elements driving outcomes in real-world markets. The economics profession has failed in communicating the limitations, weaknesses, and even dangers of its preferred models to the public. This state of affairs makes clear the need for a major reorientation of focus in the research economists undertake, as well as for the establishment of an ethical code that would ask economists to understand and communicate the limitations and potential misuses of their models.

bicycles heavy duty rentals sharing

These heavy duty aluminum bikes are all most people need. I may want to use one competing in triathlons even though they are not a high speed bike.

http://en.wikipedia.org/wiki/Bixi

The one-piece aluminum frame and handlebars conceal cables in an effort to protect them from vandalism and inclement weather. The heavy-duty tires are designed to be puncture-resistant and are filled with nitrogen to maintain proper inflation pressure longer.[15] Twin LED rear lights are integrated into the robust frame, which weighs approximately 18 kg. The bikes are designed by industrial designer Michel Dallaire and built in the Saguenay, Quebec region by Cycles Devinci, with aluminum provided by Rio Tinto Alcan.[16] Bixi systems are now found in the cities of Boston, London, Melbourne, Minneapolis, Montreal,Ottawa / Gatineau, Toronto and Washington, D.C./Arlington, as well as at the campuses of Washington State University and Research In Motion.[3]

http://www.businessweek.com/articles/2012-05-17/new-yorks-citibike-a-two-wheeled-tank

In July a fleet of 10,000 “Citibikes” will be released on the streets of Manhattan and Brooklyn. They’re part of a new public bike-share program funded jointly by Citibank and Mastercard, who paid $41 million and $6.5 million, respectively. The bikes are manufactured by Quebec-based PBSC Urban Solutions—also known as Bixi—which provided the vehicles for 10 similar programs in cities including Melbourne, Boston, and London. They were conceived by industrial designer Michel Dallaire and engineers at the bicycle maker Devinci. Together they set out to create a virtually indestructible machine, capable of surviving the hydra-headed assault of neglect and vandalism.

“This bike is too strong for one person only,” says Bruno Gauthier, chief engineer at Devinci. “It’s like a Hummer. It’s too much power. This bicycle is built for the urban jungle.”

Deflation, oil price falling. Crash ahead?

The dollar is rising as commodities crash in this Obama depression. USA is not as depressed as Europe that may crash soon. The greek debts must be resolved one way or another. Somebody will pay. Lenders may take a loss. Greeks will have to cut consumption, perhaps drastically.

Oil is down considerably and some say $80 or even $40 Oil is coming.

The strong dollar is making foreign autos cheaper (Greeks can't buy because they are too much in debt). Today we were talking at the Veterans Center about a Daimler Benz Smart Fortwo micro-car parked there. They are selling like hotcakes around here. Also I see a lot of tiny new Fiats that are selling well too. I remember those from circa 1970. Autos in general are selling well. The average auto age is over 10 years and gets poor mileage so it is time to replace them. That will also reduce the demand for fuel, causing further downward pressure on oil prices.

Horses might work for some and would be a life saver in smoggy Fresno and Los Angeles. Problem is the houses and roads nowadays are not designed properly for horses. Horses don't need gasoline and have built in computers so riders can yak away on cell phones without causing an accident. I lived near the polo field and stables in San Francisco, and parked at the stables at Stanford University.

[gallery]

Monday, May 21, 2012

94% of derivatives held by by 4 big banks!

We can't see who is naked until the tide goes out. If Romney gets elected and starts cutting budgets seriously then the economy will look a lot different. A lot of parasites will not seem so rich if they quit getting something for nothing. Quite a few big government programs could be eliminated and the economy would be much better off. Seems to be a lot of money around Branson. Not sure how much of that is crop supports and money won in the real estate and other bubbles.

The first test may come before the election if a big European bank collapses setting off a domino style chain reaction that would reach USA. Big banks are sitting on a lot of paper that is not all it is cracked up to be.

Why can't big banks make money without derivatives? Smaller banks do.

http://www.huffingtonpost.com/2009/09/28/derivatives-bailed-out-ba_n_300420.html

Four banks control the market: JPMorgan Chase, Goldman Sachs, Bank of America and Citibank account for 94 percent of the total derivatives reported to be held by U.S. commercial banks, according to national bank regulator the Office of the Comptroller of the Currency.

The credit risk posed by derivatives in the banking system now stands at $555 billion, a 37 percent increase from 2008. "By any standard these [credit] exposures remain very high," Kathryn E. Dick, the OCC's deputy comptroller for credit and market risk, said in a statement.

The complex financial instruments, which take the form of futures, forwards, options and swaps, derive their value from an underlying investment or commodity such as currency rates, oil futures and interest rates. They are designed to reduce the risk of loss for one party from the underlying asset.

Trading in an unregulated $600 trillion market, they were partly blamed for igniting the financial crisis a year ago. The New York Times reported earlier this month:

http://www.nytimes.com/2009/09/12/business/12change.html?_r=1&pagewanted=all

One year after the collapse of Lehman Brothers, the surprise is not how much has changed in the financial industry, but how little. Backstopped by huge federal guarantees, the biggest banks have restructured only around the edges. Employment in the industry has fallen just 8 percent since last September. Only a handful of big hedge funds have closed. Pay is already returning to precrash levels, topped by the 30,000 employees of Goldman Sachs, who are on track to earn an average of $700,000 this year. Nor are major pay cuts likely, according to a report last week from J.P. Morgan Securities. Executives at most big banks have kept their jobs. Financial stocks have soared since their winter lows. The Obama administration has proposed regulatory changes, but even their backers say they face a difficult road in Congress. For now, banks still sell and trade unregulated derivatives, despite their role in last fall’s chaos. Radical changes like pay caps or restrictions on bank size face overwhelming resistance. Even minor changes, like requiring banks to disclose more about the derivatives they own, are far from certain.

Sunday, May 20, 2012

Financial Engineering Hawaii

Looks like Hawaii has gotten into teaching financial engineering at $40,000 for a 1 year program. Seems like an unlikely state to study finance but maybe their banks are doing better than New York banks. Seems the biggest New York bank, JP Morgan, cannot manage risk even though they were supposedly the best at managing risk employing a large staff of financial engineers. I read the losses on one hedging operation may be up to $5 billion now. What if they lose some of their $70 trillion in derivatives value outstanding? What if banks start failing in Greece, Spain, Italy,..? Derivatives will lose value and start a chain reaction of bank failures in USA, UK,... I think we are facing another big collapse because banks have not unwound their derivatives positions so losses can snowball as values roll downhill. The mathematics taught in these classes are PDEs assuming a bell shaped heat equation. They need to put a bigger probability mass on downside risk. I think these 1 year quickie financial engineering programs are part of the problem of increased risk. Students can't learn finance that quickly. Especially since they do not require an undergraduate degree in Finance. They need a solid 6 year training program: bachelors + masters. This could be squished into a 5 year program by requiring summer school.

http://mfe.shidler.hawaii.edu/program.html

A prospective Shidler MFE student will preferably have an undergraduate degree in a quantitative field such as Mathematics, Physics, or Computer Science. Students with undergraduate degrees in Finance and related fields will also be considered.
























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Fall 2012 – Spring 2013$733$8,796


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Fall 2012 & Spring 2013$1,239$14,868
Summer 2013$1,239$8,673



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Shidler’s rigorous MFE program is designed to compete with the nation’s top schools, employing world-class professors and practitioners to guarantee the highest academic standards.

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  • Laptops are provided for the duration of the program

  • We are one of the few programs to offer a course on weather derivatives and environmental finance

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  • Lectures are recorded in our high tech class room for students to review

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The MFE is an intensive one-year program, commencing in August and finishing exactly one year later. Our full-time academic calendar consists of a Fall Semester, Spring Semester, a Summer 1 term, and a Summer 2 Internship term from mid-July to the end of August. We are also accepting part time students. *Part time students are considered on a case by case basis. For additional information contact us.

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PDEs & Stochastic CalculusProgramming in FinanceCapital Markets & Portfolio OptimizationFinancial Derivatives
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Stochastic Modeling in Finance & Related FieldsMaster Project in Cooperation with IndustryPublic Presentation
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Tuesday, May 15, 2012

Too Big To Manage. Regulations. Texas Banks

According to the below, Texas banks are more profitable. I agree with the Dallas Fed President who says some of these banks are too large to manage. I was appalled in 1999 when Bill Clinton signed the bill to terminate Glass-Steagall. Such rules are a response to crisis and are designed to prevent future crises. As that crisis recedes into memory then politicians over-liberalize. The question today is what are the optimal rules and regulations that banks should follow in our modern technological society. Most hedging can be accomplished by simple options. If they want to hedge, they should buy an option and pay for it up front like an insurance policy. If the price moves against them then the option will cover their losses. Otherwise the option expires worthless as a price for insurance.

Instead bankers have been writing complicated contracts with big numbers on them so they can get big bonuses. Sometime in the future those contracts will involve the transfer of funds for gains or losses. Even if they lost money, they still got their bonus and they got the experience so they even if they get fired they will get hired again because they got the most experience. Then repeat. There is no good justification for many of these risky contracts. There is no good way to calculate the risk or return.

Probably regulators should restrict the allowable instruments to a short list of what can be understood and then get out of the way and let banks run their business. The list of activities that needs to be financed is little changed: business loans, mortgages, autos, tuition, credit cards, stocks, bonds, etc. The list of states and cities is the same. Slicing and dicing these fund flows into small pieces and re-bundling them into new securities has become a mess (e.g. they don't even know who owns some mortgages). Paper written on probabilistic scenarios is worse (e.g. credit default swaps) and a big source of recent losses. Banks need to get back to business and politicians need to balance their own budgets.

http://en.wikipedia.org/wiki/Glass%E2%80%93Steagall_Act

the Glass–Steagall Act was repealed through the Gramm-Leach-Bliley Act in 1999 by President Bill Clinton. Many commentators have stated that the Gramm-Leach-Bliley Act’s repeal of the affiliation restrictions of the Glass-Steagall Act was an important cause of the late-2000s financial crisis.[6][7][8]

http://www.garp.org/risk-news-and-resources/risk-headlines/story.aspx?newsid=46459

May 12--FORT WORTH -- The nation's biggest banks are getting so huge that their top managers can lose track of what's happening floors below them, Richard Fisher, president of the Federal Reserve Bank of Dallas, said Friday.

His comment was in response to a question about the $2 billion trading loss disclosed by JPMorgan Chase late Thursday. He prefaced his remarks by saying he wasn't speaking about a specific institution.

"At what point do you reach a size you don't know what is going on beneath you? And if you get to that point, you're too late," Fisher said after a morning speech to the Texas Bankers Association meeting at the Fort Worth Convention Center. "What I am very worried about is that you can reach a size of complexity that risk management becomes a mathematical modeling exercise and you lose touch with your customer," Fisher told his audience.

He criticized preferential treatment that large banks receive when borrowing from the nation's central bank, because it creates the implication that when something goes wrong, they are too big to fail. Meanwhile, he said, regional banks "are too small to save."

"This to me is not the American form of capitalism," he said.

Fisher referred to the Dallas Fed's annual report, issued in March, which called for scaling back mammoth banks.

The main article by the bank's director of research, Harvey Rosenblum, concludes, "The ultimate destination -- an economy relatively free from financial crises -- won't be reached until we have the fortitude to break up the giant banks."

Fisher said: "We realize our approach is radical. We are calling for a significant downsizing of institutions. It's not the perfect outcome. It's the least worst outcome."

Large banks weren't his only target.

Fisher called Congress "incompetent" for failing to come up with practical fiscal policies, a lapse that would leave two generations carrying the debt burden. He blamed both parties for the situation.

The sole historical difference between them, Fisher quoted a researcher once telling Treasury Secretary George Shultz, was that Democrats enjoyed spending more than Republicans did.

"We at the Dallas Fed don't believe the so-called Dodd-Frank Act is the answer to the problem," Fisher said. That financial reform legislation, passed in 2010 after the financial crisis, is far too complicated, he said.

The only upside, he joked, is that Americans are dealing with only one unworkable government, while euro-currency countries are stuck with 17.

During his speech, Fisher told the bankers that Texas-based banks outperformed the nation with a return on assets last year of 1.1 percent, compared with 0.9 percent for the country as a whole.

"This is pretty good performance, considering what the industry recently went through," he said. It was the fifth consecutive year the state did better than counterparts nationwide.

And at the height of the crisis in 2009, "Texas banks earned a profit of $1.4 billion while the entire U.S. banking industry lost $11.5 billion."

The reason Texas lenders outperformed last year, he said, is that the noncurrent loan rate was 2.4 percent, down from 3.1 percent in 2010, compared with a national rate of 4.1 percent and 4.9 percent, respectively. Charge-offs were 0.7 percent of all loans in Texas in 2011, compared with 1.6 percent nationwide.

Monday, May 14, 2012

Gas Tax Low in Wyoming

Wyoming has no income tax. Low taxes on gas, sales, and property. Lots of rich 1% "live" there. Lots of ski condos. Cool summers. No heat destruction of valuables, books, papers, photos. Healthy high altitude sunshine. Low allergies. Low arthritis. Wyoming has the world's largest coal mines that pay the taxes so people can enjoy services without paying for them.

AAA bonds, banks

Attached chart shows AAA bonds total return has grown an investment of 200 in 1997 to 520 today. CCC bonds earned a little more but with more volatility.

Could banks earn enough money by conservative investments such as Bonds, Bills, Loans, Options? Do they need exotic derivatives such as credit default swaps, sliced up mortgage derivatives, etc? Derivatives are claims on assets. Why not just invest in the asset?

Are they shooting themselves in the foot? Should they be more carefully regulated? If JPMorgan can make billion dollar mistakes then dumber banks can make bigger mistakes and go bankrupt. Should taxpayers demand that politicians to fix this mess to prevent future bailouts?

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Sunday, May 13, 2012

triathlon vegan crisis sauerkraut fermented

"Be careful about reading health books. You may die of a misprint." ---Mark Twain

Diets, like religions, are often not based on facts but on hype, spin, and talking heads. The ultimate test of diet and exercise regimes is strength and endurance tests such as the ironman triathlon series. I may run one this year. Was going to wait a year to allow some training. I quit running in 1983, quit swimming in 1994, and quit biking in 1999. I probably should train for a few years before competing but I feel ok, just need time to train. Times are around 6 hours with some taking 10 hours. Seems possible if I don't have a heart attack or sprain. http://www.ironmanbranson.com Ironman 70.3 Branson

Excerpt below from an excellent interview by Dr. Mercola of Vegetarian Dr. Rowan who worked in India treating young vegetarians for diabetes, heart disease, etc. One problem is too much starch. Another problem is oxidized fats (which are common in processed foods and restaurants.) Vegetable oils are dangerous if cooked so should be consumed raw. Saturated fats are safer as we have known since 1982 Durk Pearson Sandy Shaw Life Extension book. Saturated fats (butter, bacon, coconut...) do not become rancid so easily. They also discuss fermented vegetables such as sauerkraut. Probably one should learn how to make this at home. I can buy kimchi from Korean grocery store.

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India has an epidemic of vascular disease. A lot of people claimed that being vegetarian makes you healthier. I have been to India. I went to do some volunteer work in a charitable hospital. At this charitable hospital, they are vegetarian but they do eat dairy. Like most of India. You can't imagine how bad it is. They are as slender as you and me. These people are vegetarian, close to vegan and yet they are losing their limbs from vascular disease and getting heart attacks in their 30s.

http://articles.mercola.com/sites/articles/archive/2012/03/17/dr-rowen-on-natural-health.aspx

Thursday, May 10, 2012

IPO, TV, Computer: Dangers from electronics

Facebook is threatened by mobile (cell phones). Cell phones are ideal for social networking but the screen is too small to show ads so facebook cannot make ad money off their mobile apps. CNBC Cramer even admitted it today on TV even though he is probably getting money to push facebook and gold. Many will make money off the facebook IPO if they can find a greater fool to buy the stock before it crashes.

I like my iPod touch which is like the iPhone but works off home wireless, not cell phone towers. I have 3 phone numbers on it in California, Wyoming, and New Mexico. More importantly I have 100 apps for news, email, chat, calculators, bar code scanners and many other functions. The retina display is great, as is the sound quality and camera. It is a small light rugged stainless steel device with camera that I can carry everywhere. Of course it can play music well, which was its original purpose. I actually do not use it very much because it has terribly slow performance. It is easier just to go to a big computer that is much faster and a bigger screen.

For a phone, I use a Deutsche Telekom T-Mobile cheap Nokia candy bar cell phone and keep it turned off unless I am expecting a call. I don't like to wear electrical watches. I try to avoid the computer (been using them full time since 1970), and often do not have a TV or radio. I prefer natural light and keep most electrical stuff turned off and unplugged when not in use. I like math because it is still mostly paper and pencil. I get paper magazines and journals.

I think there are many problems with much modern technology. Harvard is probably right on the article below.

open.aspx?ffcb10-fe5516787d6206757110-fdc915717660017f7715787d67-febb15747d630d7a-fe57157677630c7b7217-fe2311727d66027b7d1271-ffcf14







































In this issue:
Light from laptops, TVs, electronics, and energy-efficient lightbulbs may harm health
View this email as a Web page »
















HEALTHbeatHarvard Medical School
May 4, 2012


HomeHealth NewslettersSpecial Health ReportsHealth BooksBrowse By TopicBlog
Light from laptops, TVs, electronics, and energy-efficient lightbulbs may harm health

Humans once spent their nights in relative darkness. No longer. When the sun sets, TVs, computers, mobile devices, and artificial lighting burn on. The May issue of the Harvard Health Letter reports that this aspect of modern life may be great for efficiency, but not for health. At night, light throws the body’s biological clock—the circadian rhythm—out of whack. Sleep suffers. The combination of poor sleep and exposure to artificial light exposure may contribute to a number of health problems.

Studies have linked working the night shift and getting exposed to light at night to several types of cancer (including breast and prostate cancer), diabetes, heart disease, and obesity. It’s not exactly clear why nighttime light exposure seems to be problematic. It could be because exposure to light at night curbs the secretion of melatonin, a hormone that influences circadian rhythms.

But all light is not created equal, says the Health Letter. Blue wavelengths—which are beneficial during daylight hours because they boost attention, reaction times, and mood—seem to be the most disruptive at night. While light of any kind can suppress the secretion of melatonin, blue light does so more powerfully. In an experiment, researchers exposed people to 6.5 hours of light—either blue or green. The blue light suppressed melatonin for about twice as long as the green light and shifted circadian rhythms by twice as much.

While fluorescent lightbulbs and LED lights are much more energy-efficient than incandescent lights, they also tend to produce more blue light. That means the proliferation of electronic devices with screens, as well as energy-efficient lighting, is increasing exposure to blue wavelengths, especially after sundown.

What can you do? The editors of the Harvard Health Letter make the following recommendations:


  • Use dim red lights for nightlights. Red light has the least power to shift circadian rhythm and suppress melatonin.

  • Avoid looking at brightly lit screens beginning two to three hours before bed.

  • If you work a night shift or use a lot of electronic devices at night, consider wearing blue-blocking glasses.

  • Expose yourself to lots of bright light during the day, which will boost your ability to sleep at night, as well as your mood and alertness during daylight.



Read the full-length article:Blue light has a dark side
.

California debt based dream -> Bankruptcies

I agree. Liberals have taken over because the population is liberal. They are greedy and want more debt to pay for it. They cannot learn from their mistakes. They can continue to raise taxes (a dozen states are worse). I am surprised they have not lifted the 1% limit on property taxes yet. They are still running deficits so are increasing debt. Interest rates will increase at some point causing even more pressure to raise taxes. They will still have gay diseases and lots of gays. They have had smog since I can remember and it is getting worse in the Central Valleys. The big earthquake will happen and they will get more dependent of the federal government. There will be some race riots and some civil wars. It could get bad. There will be droughts. There are increasing infrastructure problems that will at some point cause catastrophe. The education system is in the dumps. Facebook IPO cannot fix this. I don't see how these and many more problems will be solved in my lifetime. California is a place to visit, maybe, but not a good place to live.

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I think you are wrong. It will continue to wallow along in ineptitude and survive one way or another for a very long time. It is very hard to get rid of government no matter how bad unless they are killed off and that only happens in war.

Subject: RE: Living the California debt based dream - adjustable rate mortgages and bankruptcies. Bankruptcies in California increased 557 percent from 2006 to 2011.
Date: Thu, 10 May 2012 11:24:58 -0700

I think, overall, it’s a good sign. That is, moving in the direction of final collapse. Once our state govt. proves its complete and total inability to do anything useful, it absolutely will be dissolved and replaced – with a totally different breed. The welfare/enviro geeks never to be seen again. Nobody will want to identify with the gang “that couldn’t shoot straight.”

The welfare mentality is hastening their demise so I think there’s hope yet. I meet a dozen or so people daily and the majority laugh at the foolishness of our “authorities.” When they fail to deliver, as the European authorities are starting to face, they lose control and that’s a good thing. I am ready for a Renaissance, just need to be patient!

Subject: Living the California debt based dream – adjustable rate mortgages and bankruptcies. Bankruptcies in California increased 557 percent from 2006 to 2011.

nice graphs on here, you may like the article






Living the California debt based dream – adjustable rate mortgages and bankruptcies. Bankruptcies in California increased 557 percent from 2006 to 2011.



http://www.doctorhousingbubble.com/california-bankruptcy-data-california-housing-values-adjustable-rate-mortgages-2012/?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+DrHousingBubble-HowILearnedToLoveSocal+%28Dr.+Housing+Bubble+-+How+I+learned+to+Love+SoCal%29

Living the California debt based dream – adjustable rate mortgages and bankruptcies. Bankruptcies in California increased 557 percent from 2006 to 2011.

The California housing market sits in an odd stage of limbo. You can see that the public for the most part is fully aware of the situation like an Alamo standoff in real estate. People fully acknowledge now that banks are holding off a tremendous amount of inventory. There is little that is secretive about [...]

Wednesday, May 9, 2012

Survivalism

Remember the lion, king of beasts. He kills the prey, eats the liver and runs away before the scavengers outnumber him. If you fire your gun, they will know where you are and you will be surrounded and outnumbered. You should not alert the enemy to your location. The lion is surrounded by enemies like big city citizens. But a true survivalist can relocate to the huge safe areas in the USA that have friends, not enemies. Guns are not as important as location. Guns are not needed in the best locations.

The most survivable areas have the best ecosystems and low populations but higher quality people. Some of the best areas are losing population. Some of the world's best soil is in Iowa and Northern Missouri and NE, MN, etc. There are many university towns with great schools, medical care, telecommunications and transportation. Further you are surrounded by small and large farmers and police and governments who have run those areas for 100 years. Hundreds of miles from the worst adversaries. If SHTF the enemy cannot go far -- usually no gas and they would not know or want to go. They know the police and you can see vehicles coming. You need distance from adversaries and your own survivable ecosystem that is cheap and in abundance in the USA. This has been the family farm for hundreds or thousands of years. A proven concept that does take work so is declining in popularity in favor of the gay couch potato lifestyle in Los Angeles.

Survivalists die younger, on average. The time spent on survivalism is also wasted time. Back in the 1980s I read at the ridiculous book Lucifer's Hammer back in the 80s and lived in Springville for a year (very hot and polluted) and still have a survival lot up higher. I read a book by a deceased survivalist name forgot -- his wife published after he died (shot himself?) Most survivalist literature is naive in the scenarios they portray and do not portray the more likely scenarios. They have no concept of how society works and cannot forecast anything accurately.

When SHTF in New Orleans most problems were in the city limits. The Quake in SF 1989 did not cause social breakdown. Was little loss of services except for loss of Bay Bridge and nearby freeways. Tornadoes, wildfires, ice storms, mainly affect those in the immediate vicinity. All these crises are well covered by the news. Riots such as in the 1960s and Rodney King were worse than tornadoes. Worser problems will damage mobility, most likely cutoff of gasoline, electricity, phones, water, and food. So the enemy will not be able to go far and will not know what is going on or be able to coordinate attacks on targets more than a mile or two from where they "live". They will be the ones shooting at cats and rats and fighting each other each other over who gets to eat those rats. Midwest family farms would not be impacted by most scenarios. Inner city and poorer urban areas such as Fresno would see the most problems. The worst scenarios can be avoided by moving to the right community.

I live next to a fresh water lake with a million trout per fisherman hundreds of miles from inner cities. My father and grandfather born nearby fished the same streams, and great grandfather east in Tennessee. My surname is Scotch-Irish who pushed west before George Washington became president. Before then my ancestors were border-people fighting big government that I still see on TV in "Braveheart" and before then they fought off the Romans in the movie "The Eagle" that resulted in Hadrian's Wall
http://en.wikipedia.org/wiki/Hadrian's_Wall
The Missouri Ozarks have been an armed camp from the beginning with the most bellicose population. There would be no way for outside bandits to get this far, and if they did they would not last long. Even in Japan where they had professional bandits and the farmers had no where to run, the farmers still won as in the famous movie
http://en.wikipedia.org/wiki/7_Samurai
The three surviving samurai are left to observe the villagers happily planting the next crop. The samurai reflect on the relationship between the warrior and farming classes: though they have won the battle for the farmers, they have lost their friends with little to show for it. "Again we are defeated," Kambei muses. "The winners are those farmers. Not us."

The Ozarks has 5 of the 10 richest billionaires, the world's largest company, and much economic activity so would have the full force of the federal government to keep it safe and running.
http://www.forbes.com/forbes-400/

Living in expensive, important zip codes is a great idea. They own the government who will come to their rescue. The people are more friendly and helpful there even when there is no crisis and well policed. Then there are zillions of cheaper places that are just as good that can be uncovered by internet research and travel.

Crossbows get to hunt earlier in deer season. In a crisis you could eat well by crossbow and nobody would know, even in fairly populated areas such as around here, especially with a solar powered freezer. Food and water and electricity are the first things you will need in a crisis, and you will need year after year. Assuming you have stayed out of the most dangerous areas to live where a gun may give you 5 more minutes before you are surrounded.
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I know you jest. If one has sufficient firepower and no conscience or is desperate they take what they want. They will show up at your farm and make it their plantation. You may be spared if you are of value operating their new farm. This scenario is played out countless times today and in history. What does news that two survivalist shot themselves and their families have anything to do with the issue of the value of guns in a SHTF scenario. Crossbows have stealth value but they are too slow to reload and the archer could be easily rushed while attempting to reload. I see your strategy in using an air rifle and living off rats and cats. After all the gun owners have shot themselves and their families presumably the meek would inherit the earth.

facebook IPO. Social Network value

We may be seeing an example of almost "pump and dump." The IPO will be sold to the rich 1% -- big banks, institutions and rich people. Then those shares will be quickly resold to the poor 99% Facebook users, private investors,... Because there are so many Facebook users there will be lots of demand for the stock. Those left out in the initial sales will be eager to buy, so the rich 1% will make a quick profit, thus boosting California and USA income tax receipts. Some of the poor 99% will also make some money as they find greater fools to sell it to. Eventually the initial excitement will die down and the price will fall. Over the years it may dwindle down to pennies on the dollar. Facebook will eventually have to make some profits to stay in business and keep their stock price up there. That is not a sure thing.

Facebook should be able to stay in business but most investors will be lucky to get back half of their investment. It is just an example of the herd instinct of the sheeple. Most lack the mental abilities to think on their own. They just follow the leader to their destruction. Cunning brokers and bankers make lots of money off herding.

I am reminded of the hoopla surrounding Times Warner purchase of AOL for $164 billion in 2000. Then they sold it for less than $3 billion in 2009. $160 billion of wealth and thousands of jobs disappeared.
http://www.informationweek.com/news/internet/ebusiness/222001597.

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Also, I am puzzled at the rush to buy Facebook stock. I fail to see how any stock can grow sufficiently to cover 150 times earnings, especially since its popularity is now peaking and further growth is not there.....

Tuesday, May 8, 2012

facebook IPO. Social Network value

Excellent one sentence summary:
One who joins facebook may just become the "product" and not the "customer".

People become like farm animals. They get free food (free postings on Facebook) in exchange for loss of privacy, freedom from ads and manipulation, and maybe lose their lives. They get herded around and fleeced so some call them "sheeple." Facebook ads are cheaper and more effective than TV, radio, and websites so Facebook may be able to make some money by reducing revenue to TV, radio, and google.

But with a fickle consumer and ease of entry into online offerings, Facebook may not be worth nearly as much as the lemmings are paying for the IPO. Facebook may follow myspace into oblivion after a few years of modest profits.

People can email and network for free. They can build a much better website for $5 per month. Facebook does have the advantage of easier search than google if you are trying to find a person. Google has polluted many websites with ads. Facebook may grow at Google's expense. But Facebook's contribution to the economy is probably modest. Facebook may cause more medical damage to users sitting down too much staring at screens than what little positive assist it may give to the economy.

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I agree. Facebook is the latest fad. I don't particularly see the advantage of it all. One who joins facebook may just become the "product" and not the "customer".

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Are investors like lemmings, herding themselves off a cliff? Or is Facebook worth all it is cracked up to be?

Facebook is all about ads. Facebook ads are better targeted due to demographic information collected at sign up. Also Facebook reads whatever people post online which is quite a lot. With this information Facebook can feed better ads.

So Facebook depends on the herd instinct. Little bands of disconnected people all over the world pay attention to each other to interpret their reality. These little groups can be fed directly targeted ads. So Facebook can try to influence the ringleaders to buy or recommend products. This is very valuable to companies (and politicians). The mass media miss these little bands and instead targets the masses... TV, radio, magazines, newspapers... and their message is usually lost (studies have shown that). Similarly Google search turns up a bunch of junk web sites that do not provide good information or good ads. Google search does not elicit rankings of bad sites where they can be clobbered by users. Google does not know as much about its users as does Facebook so its ads are not worth as much. In contrast, Facebook does not relay on extraneous sites with ads. Facebook depends on real people connected into gangs, herds, social networks.

I think this Facebook is worth something, but probably not as much as investors are going to pay. It is easy for competitors to enter the market with similar or better offerings. Facebook is not making much money now and even that can go to zero quickly if the right competitor comes along. I am surprised how fast Myspace went downhill. Many of the other social networking IPOs are selling below their initial price (Groupon...) Looks like this new dot com boom will not last as long as the last boom.

The main problem with companies that rely on advertising for revenue is that market is not that big. Getting people to buy product X instead of product Y does not grow the economy, it just shuffles money from one company to another. It is about slicing the pie not growing the pie. The average family spends $4000 per year on gasoline, and even more on food, shelter, clothing, education, drugs, doctors, etc. Ads are negligible.

http://www.usatoday.com/money/perfi/stocks/story/2012-05-03/facebook-ipo-pricing/54737512/1

The social-networking company plans to sell shares for $28 to $35 each, using the ticker symbol FB. That will raise roughly $10.6 billion, making it the fifth-largest initial public offering U.S. IPO

The price also values Facebook at about $86 billion, making it the most valuable U.S. company to ever go public. "Many people want to own this unique company, and it has the momentum,"

Facebook's recent first-quarter results also were a bit of a disappointment because of the decelerating growth rate in the numbers. "Their March quarter numbers weren't good,"

Monday, May 7, 2012

university decline

California is running a deficit and needs to cut costs to balance the budget.

What is CSU complaining about? CSU is still one of the cheapest college systems in the USA. They should expect tuition to rise to national averages. They are also one of the best paid administrators and faculty so there should be some downward pressure on budgets to reduce the number of administrators and their pay.

They should be complaining about how little students learn at the CSU. Poor education has been going on for decades. Poor education has led to poor performance of the state economy that has caused the current budget crisis.

http://www.npr.org/2012/05/02/151870548/cal-state-faculty-on-strike-amid-a-scary-future

California State University, the nation's largest four-year, public university system, is in trouble. Wednesday, professors authorized a strike over working conditions and pay, and students began a hunger strike demanding a tuition freeze.

The faculty authorization allows for two-day strikes at each of the schools in system, one after the other. A strike date is pending, though, and will only take place if negotiations fail.

This unfolding crisis is the result of massive state cuts in funding that have pushed higher education in California to the breaking point.

Cal State University has 23 campuses and more than 420,000 students. It's one of three public institutions of higher education in the state — the University of California system and community colleges are the other two.

But in the last 10 years CSU has hit a wall. Mr. Lovell teaches criminal justice at Cal State Fullerton. "And in the 10 years that I've been here, I've received a 3 percent raise," he says. "I can't afford a home; I can barely afford to rent."

Florida work, retirement, beaches Panhandle vs Miami, Orlando.

I agree on the problems of humidity although that is the price of living on a warm beach. If you are right on the beach then it will not be quite so warm. Tahoe has some very nice beaches with no humidity but too much snow and cold in the winter.

As I get older I will tolerate more warm, humid to avoid cold, ice, snow. In warm humid then dress appropriately in swim attire. Older people do not have to dress up in wool suits and commute during hot times of the day in hot vehicles. However warm humid grows mold, allergies, snakes, bugs... that are harder to avoid. Need to examine the home carefully.

The Florida racial mixture and crime problems can be reduced by picking the right beach. Many of the rich white 1% live there and would not if they could not avoid crime and other problems.

You can also have a summer home in a ski resort in Wyoming or New Hampshire to avoid the warmer summers. Use Florida in the winter and Wyoming in the summer. Rent out the ski condo in the winter and the Florida home in the summer to Disney world vacationers. Many have lived this way for generations and often make some money off of it. One way the rich get richer. Wyoming has excellent LLC law and lots of ski condos. New Hampshire has no income or sales tax and lots of ski condos. Ski means money and no allergies good health. Beach means money and good health sunshine. Make the best of both worlds.

Thanks,

I’ll continue watching the situation closely. I spent 6 months in Orlando and must say that of all places I worked in the SE, Orlando was the most tolerable. There was a lot of availability for aerospace products and components, which I needed (and still do now and then.). Still it was humid, and my clothes stuck to me all the time, something that I never really got used to. I had to run the AC 24 hours so I can see any power failures would be nearly as dangerous as Phoenix. It was difficult to sleep at night with AC constantly running and I never did fully adjust. Georgia was much worse but seriously, anywhere east of the Rockies seems to have a muggy humid climate that disagrees with me.

Orlando had a wide variety of “imports” in their population that came to work at Disney I guess. A lot of tourism, so people were fairly diverse, and even a bit open minded. Flying sucked, just like Georgia, thanks to daily afternoon thunderstorms. The power would go our for a half hour and then you could spend the afternoon resetting everything and checking for damage. I never understood the geological strata down there, though. Supposedly it’s all limestone, and water would perk down like I’ve never seen before. You could grow crops that require good drainage but you’d need a good supply of water and it mostly tasted like baking soda. Whenever a sinkhole would open up, which was fairly often, it would eat a house or two and then the insurance companies paid off, and the local real estate developers would subdivide the frontage on the new manmade lake, calling it “Lake Caribe Estates” or something like that. To me it seemed pretty calloused and opportunistic, but they seem to have developed a culture around it.

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Florida has zero income tax and no snow and many more useable beaches than California. Much less expensive than California and better air quality. Probably the most popular state for retirement. Numerous interesting areas. Space coast houses are real cheap as the shuttle program shuts down. Space coast is near Orlando Disney World big city services. Miami is rich but Cuban dominated. West Palm Beach is Jewish. Tampa is more WASP.

I am starting to think about the Florida Panhandle -- beaches, universities, more of a conservative southern WASP culture than a Cuban culture. Numerous military bases and tourism provide a stable economy and conservative environment and disciplined people. Will check to make sure not to locate near a base that is closing down (many will close down soon but not yet announced). Sunshine Vitamin D helps prevent cancer, heart attacks, and other diseases! Feel peer pressure to stay in shape!

On the downside Florida has heat and humidity for most of the year and expensive air conditioning bills. You will encounter hurricanes and threats of hurricanes and must be ready to evacuate. Probably best to live inland and drive to the beach instead of living on the beach. Get a ski condo quarter time share for summer. Rent out your Florida home to tourists when weather is hot while you summer in New Hampshire, Wyoming or somewhere cool! I know some of the rich 1% who do this. Most of their luxury yachts are also rented out part time to defray expenses. Rent out your 2 homes to tourists for top dollar in the peak seasons for ski, beach.

Galveston, Houston Texas is the same as the Florida Panhandle except Texas has a much better economy and more jobs and services and drought. The Florida Panhandle is poorer than Miami, Orlando, and Houston. New Orleans probably poorer yet. Much of the South and Gulf is like California

Saturday, May 5, 2012

Internet Ripoffs

It is a typical disinformation web site to help enable the rich 1% to ripoff the poor 99%. They stampede the sheeple into bad investments using fear, greed, hysteria, irrational exuberance... the "carrot and stick" approach.

Instead people need to pay off loans, sell cars and houses, and buy cows, horses and acres with water in mild weather stable ecosystems with good education, low crime, low taxes and white people. It appears that the sheeple have been stampeded in the wrong direction.

Facebook, web sites, TV, radio,... are cheap ways of stampeding the sheeple. You can set up your own web site for $5 per month and make money from it by google adsense. Diets, investments, porn, and gambling are the most popular online ripoffs. Facebook helps the sheeple stampede into those ripoffs.

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http://en.wikipedia.org/wiki/Penny_stock
thinly traded, they are targets for price manipulation. Individuals or organizations have bought up hundreds of thousands, or even millions of shares, and then used websites, press releases, and e-mail blasts to drive interest to the company's stock. Very often, faulty or misleading information is provided, resulting in investors buying shares in the underlying company. The increased demand pushes the price up, while the original individual or organization doing the "pumping" sells their holdings. The expanding use of the Internet has made penny stock scams easier to perpetuate. Though not a scam per se, one notable example is a rapper's use of Twitter to cause the price of a penny stock to increase drastically. The rapper had previously invested in 30 million shares in the company, and as a result made $8.7 million in profit.

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OK, I am becoming worried after all the info in the news in the last few months. I hope all of you in the big cities are ready. You may have to leave, and the roads will be parking lots. Move now to safer areas.

http://www.beaconequity.com/we-are-preparing-for-massive-civil-war-says-dhs-informant-2012-05-03/

“We are Preparing for Massive Civil War,” Says DHS Informant

Posted by Dominique de Kevelioc de Bailleul on May 03, 2012 | 141 comments

In a riveting interview on TruNews Radio, Wednesday, private investigator Doug Hagmann said high-level, reliable sources told him the U.S. Department of Homeland Security (DHS) is preparing for “massive civil war” in America.

“Folks, we’re getting ready for one massive economic collapse,” Hagmann told TruNews host Rick Wiles. Sign-up for my 100% FREE Alerts

Thursday, May 3, 2012

Facebook IPO. Social Network Value

Are investors like lemmings, herding themselves off a cliff? Or is Facebook worth all it is cracked up to be?

Facebook is all about ads. Facebook ads are better targeted due to demographic information collected at sign up. Also Facebook reads whatever people post online which is quite a lot. With this information Facebook can feed better ads.

So Facebook depends on the herd instinct. Little bands of disconnected people all over the world pay attention to each other to interpret their reality. These little groups can be fed directly targeted ads. So Facebook can try to influence the ringleaders to buy or recommend products. This is very valuable to companies (and politicians). The mass media miss these little bands and instead targets the masses... TV, radio, magazines, newspapers... and their message is usually lost (studies have shown that). Similarly Google search turns up a bunch of junk web sites that do not provide good information or good ads. Google search does not elicit rankings of bad sites where they can be clobbered by users. Google does not know as much about its users as does Facebook so its ads are not worth as much. In contrast, Facebook does not relay on extraneous sites with ads. Facebook depends on real people connected into gangs, herds, social networks.

I think this Facebook IPO is worth something, but probably not as much as investors are going to pay. It is easy for competitors to enter the market with similar or better offerings. Facebook is not making much money now and even that can go to zero quickly if the right competitor comes along. I am surprised how fast Myspace went downhill. Many of the other social networking IPOs are selling below their initial price (Groupon...) Looks like this new dot com boom will not last as long as the last boom.

The main problem with companies that rely on advertising for revenue is that market is not that big. Getting people to buy product X instead of product Y does not grow the economy, it just shuffles money from one company to another. It is about slicing the pie not growing the pie. The average family spends $4000 per year on gasoline, and even more on food, shelter, clothing, education, drugs, doctors, etc. Ads are negligible as a percent of the overall economy.

http://www.usatoday.com/money/perfi/stocks/story/2012-05-03/facebook-ipo-pricing/54737512/1

The social-networking company plans to sell shares for $28 to $35 each, using the ticker symbol FB. That will raise roughly $10.6 billion, making it the fifth-largest initial public offering U.S. IPO

The price also values Facebook at about $86 billion, making it the most valuable U.S. company to ever go public. "Many people want to own this unique company, and it has the momentum,"

Facebook's recent first-quarter results also were a bit of a disappointment because of the decelerating growth rate in the numbers. "Their March quarter numbers weren't good,"

Wednesday, May 2, 2012

Taxes, Cheapest Gas Prices

Taxes, regulations, crime and disease boost prices for products that otherwise would be flat across the USA. My health insurance dropped from $700 to $292 per month when I moved from California to Missouri (same company, same policy). Branson Missouri schools look like palaces. California schools look like slums. Branson has lakes and clean air with green trees pumping out oxygen while California has smog and disease (horses could cure California smog!)

Your NYT slideshow says cheap gasoline is found in the Rocky Mountains such as Santa Fe. The Rockies are healthy -- high altitude sunshine, uncrowded, clean water, open space. Most have clean air except for Denver and Salt Lake City. Mostly lower taxes and less regulations and good economies especially Wyoming which is dry and windy with little snow. High altitude is closer to the sun so you get more Vitamin D naturally. Cows and Horses graze on clean grass without agricultural pollution.

Why don't they show a map instead of making you go thru a slide show? Save time and more informative. I like the gas buddy map better that allows you to learn that Missouri and Oklahoma are the best!
http://gasbuddy.com/gb_gastemperaturemap.aspx

Joe

http://www.thefiscaltimes.com/Media/Slideshow/2012/02/22/10-Cities-with-the-Cheapest-Gas-Prices.aspx





10 Cities with the Cheapest Gas Prices

Santa Fe, NM

$3.250/gallon

By BLAIRE BRIODY, The Fiscal Times

Tuesday, May 1, 2012

Banker pay - Lehman payouts spark outrage

Bankers say they are smart so they deserve big paychecks. If they are so smart, why are they bankrupt? Were they just crooks raiding the bank's assets and letting the taxpayer pay off the liabilities of the bank? Why did Barney Frank and Chris Dodd encourage banks to acquire worthless mortgages on the poor minority houses? Was it because their states are financial centers that benefit from such activity? Those states collect taxes from both the banks and the employees of the banks. Other states that were not in the subprime bubble did not benefit from the boom but paid for the bailouts and bust. Is this fair?

Seems to me that compensation should not be awarded out of returns on the mortgage. Each month the traders, brokers,... should get some percent of the payment made by the borrower to the bank. Would be a few dollars per mortgage for services rendered and would not produce any million dollar paychecks, or 51 million dollar paychecks.

http://www.garp.org/risk-news-and-resources/risk-headlines/story.aspx?newsid=45841

Calls for reforming Wall Street pay packages reverberated across Washington and the financial district following the disclosure that 50 Lehman Bros. employees were awarded nearly $700 million in the year before the investment bank collapsed.

Lawmakers and other experts said disclosure at major banks and financial institutions should be beefed up significantly, in part to spotlight potential risks employees may be taking in pursuit of supersize paychecks.

The Los Angeles Times reported Friday that dozens of traders and others at Lehman were paid $8.2 million to $51.3 million, including one person who earned more than the chief executive, and 42 people who were awarded at least $10 million. The 50 employees were awarded more than $1.6 billion in cash and stock in the three years before Lehman's demise.

"It never ceases to amaze me," said Phil Angelides, chairman of the Financial Crisis Inquiry Commission. "You clearly have corporate leadership that's out of control, reckless without accountability and, in the course of driving the firm over the cliff, they're taking as much money as they can out of it."