Financial Market Casino

A lot of people say "The financial markets are one big casino." That analogy is incomplete. It's more accurate to say "The financial markets are a rigged casino."

If you go to a casino and play craps and bet intelligently, the casino's advantage is 1% or less. The casino doesn't need to cheat. The odds of the game are stacked in their favor. Without cheating, and if the bet size is small compared to the casino's bankroll, then the casino is statistically guaranteed to win. They might have bad days, but they're mathematically guaranteed to win.

The banksters aren't content with 1%. They cheat.

The casino cheats. Certain privileged players are allowed to win, giving the illusion that it's fair. Having some winners helps convince the suckers it's fair.

Suppose you're playing bankster poker. You get a royal flush. The dealer says "You lose. J8752 beats a royal flush." A slave would say "I'm sorry for my mistake. Thanks for correcting me!"

It isn't just a rigged casino. Once in a while, the government gives favored players free money. They stack up their government-gift chips and say "Look at what a smart gambler I am!" The government doesn't disclose how many free chips each player gets. Even the cheaters don't know how much their fellow cheaters got.

Once in awhile, one of the less influential cheaters is exposed and arrested. The other cheaters say "This proves that all cheaters get caught! We aren't cheaters. We would have been caught if we were cheating!"

Even though the game is hopelessly rigged, sometimes an honest and intelligent person wins. The cheaters say "How did that guy win? He must be cheating without our permission!" That person is convicted and jailed.

"The financial markets are a casino." is an unfair analogy. Most casinos are content to win their 1% advantage, and don't otherwise cheat. The financial markets are a rigged casino. Certain favored players get free chips from the government. They also cheat and win.

No Phone For You!

It turns out I wasn't eligible for a phone upgrade. Only my mother's line was eligible (she never upgraded).

Actually, I didn't like either the Blackberry or Motorola Android. The envTouch had a nicer keyboard than both of them. The lack of arrow keys was disturbing.

Mark Cuban And The BCS

Mark Cuban offered to bankroll a college football playoff. It was a cheap publicity stunt for him. He won't accomplish anything.

If he did it as a publicity stunt, good for him.

If he seriously accepted colleges to accept his offer, he's an idiot.

Why would colleges share the playoff revenue with him? If colleges needed to raise $1B to finance a playoff, they could easily get that money from ESPN or another network.

In a for-profit business, if you double your revenue, the CEO doubles his salary. It's either salary-cash or salary-options.

Colleges are technically non-profit. Suppose each university made an extra $5M/yr by adopting a playoff. Could the college president double his salary? No, he can't. Students would say "Why am I paying $50k/yr in tuition, just so the president can make $5M/yr."

Colleges are technically non-profit. There's a political limit to how much the college president and athletic director may pay themselves. They're already at that limit.

That's the advantage of the BCS/bowl system. The college president appoints his idiot brother-in-law to be on the bowl committee. Those bowl committee directors get paid a lot of money, but they only actually work a few days a year.

There's no point having the playoff money go to the colleges. The college president can't use that many to pay himself a higher salary. The bowl system maximizes the college president's profit. He can appoint his friends to be on the bowl committee.

If there was a unified playoff system, then there would be fewer people on the committee. The college presidents wouldn't be able to steal as much.

That's the whole obstacle preventing a college football playoff. Colleges are technically non-profit. There's no incentive to maximize revenue. The current system is perversely optimal, because it maximizes the amount the college presidents may steal.

Even if the college presidents did want to reform the system, they'd do it themselves. They wouldn't share the profits with Mark Cuban. They don't need his money or support.

Did Sam Alosi Cheat?

According to NFL rules, on a punting play, only two players on the kicking team are allowed downfield before the kick. These players are the "gunners".

The return team typically assigns two players to block each gunner. If the gunner runs out of bounds, he is still allowed to later make a tackle.

This leads to a problem. Some players intentionally run out of bounds, so they can avoid the blockers.

Sam Alosi instructed the Jets players to stand right by the field. This prevents the gunner from running too far out of bounds. Allegedly, other teams do the exact same thing.

Miami's gunner was running too far out of bounds. Sam Alosi then intentionally tripped him.

Was Sam Alosi cheating? Was it self-defense? The Miami player was cheating. He was intentionally running out of bounds, to avoid a blocker.

This is a defect in the NFL rules. A player is allowed to intentionally run out of bounds, and then later make a tackle. The NFL should strictly enforce "You can't intentionally run out of bounds." The NFL probably should restrict the blockers. For example, they could use a rule similar to a pass play. Maybe the defenders should only be allowed to block the gunner once within 5 yards, until the receiver touches the ball or the ball hits the ground. Maybe the defenders should only be allowed to block the gunner once within 20 yards, and then may block him more once he's further downfield.

Sam Alosi is not solely responsible for the tripping incident. The Miami player was cheating; he was intentionally running out of bounds to dodge blockers. There's a defect in the NFL rules. The gunners are encouraged to run out of bounds to dodge tacklers. The blockers are given too much discretion to block the gunner aggressively. Allegedly, other teams use the "players line up by the sideline" trick. Sam Alosi is not solely to blame for this incident. The NFL is partially at fault, because they allow players to run out of bounds on punting plays.

Hindenburg Omen

I've seen a lot of discussion of the "Hindenburg Omen". It's complete nonsense.

The Hindenburg Omen says "If X happens, then there's a crash." The fallacy is that there have only been a few severe crashes. Using "Da Vinci Code" style reasoning, you may see patterns that aren't there. Correlation doesn't imply causation.

If pattern X was a lousy predictor, nobody would mention it. If X happened to work in the past, then people tout it heavily. That's no guarantee that X will be a predictor in the future. There's selection bias.

If you do a historic back-test, there's bias. In 2004, a 20 year historic back-test would have concluded "Housing prices always rise." A historic back-test does not include "The US dollar collapses in hyperinflation." Hyperinflation seems practically guaranteed in 15-20 years. A historic back-test misses "black swan" events.

The Federal Reserve is inflating desperately, to bail out the banksters. They will push up the stock market and create the illusion of economic growth. Suppose there's 30% true inflation, 3% CPI, and the stock market goes up 15%. State comedians say "Hooray for the stock market!", while the stock market underperforms true inflation.

I predict that the stock market, measured in FRNs, will rise. High inflation will push up the stock market eventually. The stock market, measured in gold, will continue to crash. Over the past 10 years, the S&P 500, quoted in gold, has declined by nearly 1% per month! That trend is accelerating.

The Hindenburg Omen is nonsense. State comedians are promoting it to scare people. Over the past 10 years, gold has been a *MUCH* better investment than stocks. It's a severe discrepancy that State comedians/communists ignore. I predict that gold/silver will continue to be a much better investment than the stock market.

When comedians say "The Hindenburg Omen is a good stock market predictor.", they're using sampling bias. It isn't valid reasoning.

FSK Asks - New Cell Phone, Android or Blackberry?

I got a "special offer" from Verizon. Even though my contract hasn't expired, I may get a new phone before December 24. I'm going to the Verizon store on Sunday with my sister to get a new phone.

I'm still undecided between getting an Android or a Blackberry. My sister wants Android, so it'll probably be Android. It's "buy one get one free", so I save $100-$200 if I get the same phone as her. We're on the "family share" plan.

My LG envTouch is a POS. I was considering calling Verizon and asking for an early upgrade. It's a moot point now. It seems they made that offer to all customers, and not just LG envTouch users. If you didn't upgrade within the last 6 months, you're eligible, according to the mail flyer.

I'd have to upgrade from the $10/month data package to the $30/month data package. I'd have to get a new 2 year contract, a 1.3 year extension. I've been whining about my current phone, so of course I'm getting a new phone.

My sister and mother want to stick with Verizon, so I'm definitely staying with Verizon. I really would like a Nokia Maemo/Meego phone, but those aren't available on Verizon.

Even if I do get an Android phone, what kind of Android should I get? LG is out. What are the other choices?

Here's what I want from a phone:

1. Write blog drafts on the subway and upload them to my PC and then to Blogger.
2. Use it as a phone.

Every Android model should be able to do that.

I'm also considering Blackberry. I probably won't get a Blackberry. My sister wants Android and I'm undecided between Android and Blackberry.

The main Android choices, based on the offer, are Sansung Continuum Galaxy ($200), Motorola Droid Pro ($180), or Motorola Droid X ($200). I'm not getting another LG phone. The Blackberry choices are the Curve 9330 ($50) or the bold 9650 ($100). It seems that only the Droid Pro and Blackberries have a real keyboard. The virtual keyboard seems like a bad idea because I plan on doing a lot of typing.

What kind of phone do you think I should get? Android or Blackberry? I'm definitely upgrading this Sunday.

Unemployed Again!

I was working as a contractor/consultant at a large financial institution. My pimp/headunter told me that my contract is expiring. They did give me 2 weeks' notice, rather than "security immediately escorts you out". My contract ends just before Christmas.

My pimp said "The money in the budget was used up." They don't have to give a reason for firing me. He said they might hire me back next year. I shouldn't wait. I'm starting to send out resumes. Unless I have a specific restart date, the value of that offer is $0.

My project manager didn't even know I was getting fired, until I told him. He seems eager to keep me, because I'm getting a lot done. However, he's probably SOL. I was doing almost all his work for him.

I was doing fine at work. Even after taking time off for my panic attack, I was able to function normally. They didn't seem to mind that I missed a week and a half due to illness.

My parents assume, by default, that I did something wrong. That's an unhealthy attitude. I thought I was doing well. They don't have to give a reason for firing me. Maybe the headhunter is telling the truth, when he says "That's the way the budget worked out." However, they could have converted me to a full-time employee, but didn't.

With high emotional awareness, that works against you. Almost every hiring committee has a psychopath. The psychopath would be eager to not hire me, because I can tell he's a psychopath. The psychopath can tell that I can see through him.

I thought I was doing well. It's actually irrelevant. They have an explicit State-backed monopoly.

It makes no difference if they hire great people or unskilled pathetic losers. The project I was QAing is a total trainwreck. I can identify the "I'm covering up failure." tone of voice in the developers. I submit a bug report and they deny it's a problem or deny they're responsible for it. It's an excellent example of corporate CYA, rather than getting the job done. I don't have write permission on the server, so I can't create my own test cases.

Anyway, it makes no difference. They have a monopoly. They don't need to hire competent people. I'm back to the usual headhunter grind.