The Singularity

Read this Time article with an open mind.  I’m not suggesting Ray Kerzweil’s “The Singularity” hypothesis is anything more than that, one man’s view of the future.  But, I definitely find it very interesting to contemplate…if you have an open mind.

Time magazine

James Simons of Renaissance Technolgies

This is a 2008 Bloomberg article on hedge fund manager James Simons.  Like many, his was an interesting path to the top.

News Archive – Bloomberg

Friday Morning Reads

I’m not sure if the race is limited to these two, but this is worth a read.

China vs. the U.S.: The Case for Second Place

Shockingly, another central bank begins the easing process.  While I get the near term possibility of deflation, I have yet to hear how we avoid significant global inflation when so many countries ease simultaneously.  Pay attention to how many countries are complaining about waning exports, which is typically to blame upon relative strength in the subject currency.  Yes, I know, it’s dry.  But, you can almost just read the headlines for confirmation on this.  I suggest you read the articles to make sure you understand them, but at a minimum observe the trend AND consider what it means to you.

Singapore Cuts Growth Forecast, Central Bank Eases Currency Policy Stance

An interesting article on the shrinking middle class:

Growing Income Gap May Leave U.S. Vulnerable

This does assume that people are more logical than impulsive with respect to decisions like this.  Generally speaking, I doubt this…but it’s interesting thought.

Refinancing Chills U.S. Home Purchases

I know, I know, what credibility?

Kocherlakota: Recent easing hurts Fed credibility

 

 

 

 

 

India’s Inflation Exceeds 9% for 10th Month, Increasing Pressure onRates

China CPI rises 6.1%

Water-Starved Texas Rice Crops Erode U.S. Harvest Prospects as Prices Gain

Malcolm Gladwell on Spaghetti Sauce…great/nerdy speech

Malcolm Gladwell on spaghetti sauce

John Paulson…Yes “The” John Paulson of The Greatest Trade Ever

 

The Man Who Made Too Much

Has John Paulson lost his magic touch? – Telegraph

Monday Morning Reads

This article comes via the Ukranian Kyiv Post since STRATFOR requires one to become a member to gain full access.  In any event, this is an interesting development in Egypt:

STRATFOR: Violence against Egyptian troops marks new phase in protests

Gretchen Morgenson out with a short piece questioning Geithner’s assertion that US exposure to the European crisis is “very modest”.  This sounds so familiar to Helicopter’s 2007 speech where he stated:

” At this juncture … the impact on the broader economy and financial markets of the problems in the subprime markets seems likely to be contained.”.

17 Countries, but Even More Unknowns

Again, the global savior is under a watchful eye:

Special report: China’s debt pileup raises risk of hard landing

China Home Prices Drop for First Time in a Year in September, Soufun Says

High frequency trading has to be brought under control, but Europe’s answer is ridiculous.  In an attempt to help long term investors (including small investors), they have proposed a financial transaction tax on ALL market related transactions.  Why not a tax on high frequency trades???  It will be interesting to watch unfold and see if and where the idea spreads.

Clamping Down on Rapid Trades in Stock Market

So they’re going to do something.  They have a plan…they just don’t want to tell anybody what the plan is.  Sounds reasonable.

Merkel: Euro Leaders Will Do All Necessary to Support Banks

Merkel, Sarkozy promise new crisis package, offer no details

Secondary Education Ideas

I know I tend to think differently than many of the people I speak with over the course of a week; I usually take comfort in that fact.  One topic that  refrain from debating of late is the value of a college education.  I’ve had a bad feeling about this for a while now and the more I think about it, the more I question.  The entire secondary education system (business) seems a little too fat and appears to have lost touch with what the real world is going to demand of our kids.  My focus on this is likely tied to my personal situation as I watch my kids march toward this phase of their lives at what seems like the speed of light.  While I’ve dedicated much of my “lecture time” toward explaining the necessity of a college education, I find myself pondering the value.

The idea is great, but the actual product seems weak.  I’m thinking that a more realistic plan might be a buffet style approach where you select those classes that fit your needs and avoid the expense of classes covering The History of Paddling in the 17th Century.  While this type of approach won’t work for our future doctors, dentists and engineers, I think the idea probably makes sense for tomorrow’s entrepreneurs.  This approach would not only produce huge cost savings, but would allow people to focus their resources (time & financial) into their respective and unique areas of interest.

I realize that many people are going to question this tack as it dismisses the value of “the college experience”.  In a perfect world, I agree that the “college experience” would be great.  In reality, the student loan world is about to implode and we’re going to have to trim the fat big time.  I acknowledge that the upper crust will continue to have the opportunity to follow the popular path.  While I have nothing against this group of people, they are not a true representation of today’s youth.  No, most of tomorrow’s students will be middle and lower-class kids.  This is the group to think about going forward as tomorrow’s Steve Jobs (who had his own unorthodox education…see Stanford speech from 10-6-11 post) will come from this group…it’s a game of numbers.

I’m not sure what the actual answer is.  I wonder about the prospect of spending (perhaps investing) say $160,00-$200,000 into the college experience versus helping my kids focus on their interests and then supporting them with some seed capital to “give it a go” so to speak in an attempt to avoid working for the man.  Life is short and I think the most enjoyable route is usually the least crowded.  I want my kids to follow their dreams not the sheep.

TD

Wall Street Journal

Very Interesting Wired Article

Wired is reporting that a computer virus has infected the cockpits of America’s Predator and Reaper drones:

Exclusive: Computer Virus Hits U.S. Drone Fleet

Don’t Get Lost in the Noise

I thought I’d remind anyone who needs it that the daily headlines that SEEM to drive the day-to-day volatility are really meaningless in the grand scheme of things.  There are stories that can help you navigate these times by either confirming what you’re thinking or making logical cases for a change in thought.  Having said that, much of today’s media is simply noise.  You know what’s going on; don’t drink Z koolaid.  I’ve summarized below the conglomeration of ridiculous facts that unfortunately make much of the day-to-day minutia meaningless:

• The math behind our current debt structure (in both term and scale) does not work…just doesn’t.  If we weren’t able to continue borrowing, we’d no longer be able to pay existing bondholders….hmmmm, what’s the word I’m looking for, rhymes with Fonzi?
•  There is a massive disconnect between the “leaders” of this country and the people whose interests they are supposed to serve.
• Special interest groups ensure that the real problems facing our country will not be addressed appropriately.
• Our populace (generally speaking) is becoming dumbed down or otherwise disinterested…at the worst possible time.
• The only governing body that will be extending us a “helping hand” will be a wolf in sheep’s clothing…watch it unfold.  As the global financial system begins to breakdown, a friendly face will emerge with a plan and it will be a beaut.

I sincerely hope you are able to think about things like this without discounting anything that doesn’t fit into your personal vision of the ideal future.  I come across many people who view these realities as “chicken little” commentary.  That’s an unfortunate psychological coping mechanism, but I get it…sleeping at night is nice too.

It’s not all bad news.  The sun is out today and the Tigers just knocked the Yankees out of the MLB playoffs.

Have a great weekend!

TD

Thursday Morning Reads…short list

Although this shouldn’t surprise anyone, the math is pretty staggering.  If you think this is a sustainable situation, think again.  If you understand how ridiculous this situation is, start to give serious consideration of  how things will look when these parasites are removed from the teet….Occupy Wall Street is just the beginning.

Nearly Half of U.S. Lives in Household Receiving Government …

This is a timely article for those fascinated by the recent move in stocks (UP, UP, ….and away???).  The power of the short squeeze is not to be ignored.

The triumph of Dennis Slothower