Trading is Hazardous to Your Wealth

I finally found an article that cites the trading studies I had heard about, you can read it here. Some good insight:

http://www.travismorien.com/FAQ/trading/futradersuccess.htm


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Economists' Forecast Accuracy

Get yourself a copy of the May 09 issue of The Elliott Wave Theorist (EWT) for a brilliant discussion on economists' forecast accuracy. It contains these gems:

"Economists generally stay bullish on the macro economy. In most environments, this is an excellent career tactic. The economy expands most of the time, so economists can claim they are right, say, 80 percent of the time, while missing every turn toward recession and depression."

and uses this analogy:

"Suppose you eat at an outdoor cafe daily, but it happens that on average once every 100 days a terrorist will drive by and shoot all the customers. The economist has no tools to predict these occurrences, so he simply stays bullish and tells you to keep lunching there. He's right 99 percent of the time. He is wrong only 1 percent of the time. In that one instance, you are dead."


from: www.elliottwave.com


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Investor Sentiment at March 09 Lows

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Sobering Chart

from Gary Schilling:



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Global warming; Email overload

miscellaneous points:

There is $28 trillion in real estate/infrastructure at risk from a half meter rise in sea level.
-Bloomberg magazine (March 2010)

These days, 2.3 seconds seems to be the average time between sending out an email and getting a response.
www.freddestin.com/blog/2010/02/in-search-of-stillness-or-why-personal-high-availability-is-a-generally-a-bug.html




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Quote - black swans

"The only black swans are the history that we have not read."
-a modern interpretation of a Harry Truman quote (by William Bernstein)

or this:
"Financial markets are plagued not by “black swans”—seemingly inconceivable events that come up very occasionally—but by vicious snow-white swans that come along a lot more often than expected."
-the Economist


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Westland Meat Packing

"…a recent investigation of Hallmark/Westland Meat packing Company, once rated as a supplier of the year for school cafeterias in the United States. A rule of thumb in meat processing plants is that only “standers” can go into the meat supply. That is, if a cow cannot stand up, it is probably diseased and should be euthanized, not processed. But because of an incentive program in the company, employees had developed a rather liberal definition of what constitutes a stander. In this case, it appears that employees had decided that if they could prop a cow up with a forklift or shock it into standing up, it was a stander."

from Marianne Jennings, Of Candor and Conflicts: What Were We Thinking?

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