26 October 2016

Thought For The Day, 26 October 2016

The latest in The Donald's mindless jabbering is the execution of "oversampling" in polls. As any drug developer knows, with enough observations one can find stat sig in a ham sandwich. That's what oversampling does: narrows the CI/lowers p-value. It doesn't change the point estimate one way or the other systematically. Oversampling won't make The Donald look like a bigger loooooser or Hillary a bigger winner. It will only solidify the accuracy of the point estimate. Moreover, the technique isn't, on the whole, used in public facing polls, but by campaign's internal polls where it wants more accurate estimates of sub-groups known/suspected of being heterogeneous.

So, I just did a simple search, and lo and behold, Pew Research (The Donald's source of oversampling evil) had this to say:
Oversampling is the practice of selecting respondents so that some groups make up a larger share of the survey sample than they do in the population. Oversampling small groups can be difficult and costly, but it allows polls to shed light on groups that would otherwise be too small to report on.

Even the non-brained dead rightist organs (or some anyway) know the truth.
The conservative blogosphere is lighting up again with accusations of polling bias against Republican presidential candidate Donald Trump in his race against Democratic opponent Hillary Clinton. However, Trump supporters should avoid giving into this temptation to assume unfavorable results must be biased results. Clinton really is leading Trump, and by nearly 6 percentage points.
[June, 2016]

25 October 2016

Treading Water, part the second

Well, the NYT has finally caught up with these endeavors. As mused here more than once, The Giant Pool of Money is still out there, and continues to grow. Landon Thomas reports the extent, but fails to direct the reader to the elephant in the room: the CxO class has run out of ways to turn fiduciary capital into profitable physical capital. Fiduciary investing is just Ponzi with ribbons.
"Asia and Europe keep exporting their savings to the rest of the world," said Brad W. Setser, an expert in global financial flows who worked at the United States Treasury from 2011 to 2015. "All this money sloshing around looking for a home is not healthy -- it indicates a real lack of demand in other parts of the global economy."

IOW, the idle rich keep demanding real return rates of interest for their idle cash. Not going to happen.
"It has really caused spreads to move," [Ken Monaghan, who oversees high-yield bonds for the global fund manager Amundi Smith Breeden] said, using Wall Street jargon to describe what happens when the interest rates of these bonds decrease as investors pile in. "We are seeing institutional investors come to us and ask for levels of risk that they have never asked for before."

Only when the CxO class figure out how to generate real growth in physical investment will there be real growth in the global economy. It helps if that growth ends up in the hands of the 99%.

23 October 2016

Brexit, part the Second

A couple of notes on Brexit.

Peter S. Goodman wrote a few weeks ago on the impact of the divorce on London's financial industry.
"There were the people who thought Brexit would be reversed," [ Adam S. Posen] continued. "There were the people who delusionally thought there would be a soft Brexit, and all the northern Europeans would be nice to them. And there were people who believed that this crew in charge of the British negotiations were somehow going to strike a good deal. All of the delusions have run out of material."

And, in a couple of minutes, Bourdain will be surveying The City, as it is called, to see what the mood is post-Brexit vote. Judging from the many bumpers CNN has run, it's not likely cheery.

The Joker

Regular reader may have noted an absence from these endeavors over the last week or so. Was off on the island, sans computer, which wouldn't make much difference since the island has, on a good day, arthritic innterTubes service. It does, thanks be to God, get newspapers delivered each morning on the boat. But the boat doesn't have a consistent schedule over the week. Sometimes the newspapers arrive in mid-morning, others nearer to noon. Since I'm on the island once a year, generally, memorizing said schedule isn't a big priority. Yesterday was going back to the mainland day (sniff!), and the later arrival of my beloved NYT. Since this is after even a late breakfast, I toddle on down to the grocery and end up waiting for the bundles to arrive. This week finds a couple of other geezers (only geezers read from dead trees; or perhaps only geezers read) often joining me for the bundles of joy.

So, yesterday I was there when the stock person wheeled in the basket of bundles, not off wandering. One of the geezers got his New York Post, which came off the top of the bundles. The stocker took his time digging through the bundles. The geezer allowed that his beloved Mets had failed in this year, which led me to remark, "what a contrast; Trump and the Mets!!". For those not of the tri-state area, the New York tabloids are not all of the right. Just the Post. The Daily News is even more rabidly anti-Trump than the Times. Who knew? Well, the other geezer. While waiting for the Times to reach the surface, he offered up the following story of his own creation.

Trump has won the election (I know, it's a nightmare story) and is settling in to the White House. The first night he just can't fall asleep, so is pacing about the residence.

In due time he spies the apparition of George Washington approach him. Not quite scared, but desperate for relief, he asks President Washington for advice; how to get to sleep. Washington responds, "Donald, you should increase your defense forces. The people will support your efforts." Trump thanks Washington, wanders to the bedroom, and does fall blissfully to sleep.

The next night, same problem. Same pacing, but different president appears. This time it's Jefferson. And Trump poses his problem yet again. Jefferson offers, "Donald, you should give much added support to education. The people will support your efforts." As before, Trump manages to sleep.

The third night, still that problem. Yet another president joins him with advice. It is Lincoln who offers, "Donald, go to the theater."

10 October 2016

GOP Triage

Some time before the 2010 mid-terms, I chatted with "tech" folks at the DNC about the, by then obvious, problem: the RNC and the Kochs and such had taken control of Washington by the simple expedient of taking over state governments. Moreover, the threat to participatory democracy was greater than it seemed, since controlling state senates, and then Washington Senators, became rule by the right wing Elite. The states that have been taken over are in the South and Mountain West; rural, God, Guns, and No Abortion knee jerks.

I don't know whether it's been accepted as standard jargon, but Gore was hurt by the electoral college by "over votes", which happen in large population states that are strongly partisan. Those states are overwhelming Democratic, while the Republican skewed states are of much smaller population. Over votes occur when the popular vote for the candidate in a large population state greatly exceeds 50%. Such a pattern is sometimes called "wasted votes". The electoral winner ends up with close margins in small states, wiped out in large states, but enough small state wins to reach the 270 needed. What the Southern founders wanted: rule by the landed gentry.

My chat with the DNC, on a method to triage campaign spending at the state level so as to not get shellacked, fell on deaf ears. A bit later, the nice folks at simple-talk posted the approach as an article. And the Republicans have continued to hose the Democrats in the mid-term and down-ticket races.

Until now. Lots of reporting stating that the GOP Elite have recognized what has been mused in these pages for months: King Donald of Orange threatens to drive both houses of Congress to the Democrats. If any of you dear readers are of the knee jerk right, you'd best not ignore the problem, or you'll lose not only the three elected branches of government, but Garland will be pulled off the table and Obama will be up for the Supremes, and he'll get in. Is a little bit of pussy worth the price?

08 October 2016


In keeping with a few musings in previous postings to these endeavors, both quant and historical analysis in the wake of the Brexit vote concluded that nothing good would come of the effort for most Brits. A few months along, and that appears to be the case. Surprise. Give it a read, but for those who aren't interested, here's the punchline:
The stakes are considerable. Britain ships nearly half its exports to other European Union members.
this misses the fact that nearly one-third of the goods and services consumed in Britain are imported. In dollar terms, the price of those goods and services is spiking. Eventually, economists assume, this inflation will work its way through the economy, further depressing growth by crimping consumer spending and potentially sowing unemployment.

Germany and France have made it clear that the Brits won't get to have their cake (free trade) and eat it (immigration wall) too. Although Boris Johnson says:
Our policy is having our cake and eating it.

Not bloody likely Boris.

06 October 2016

My Dear Lou

OK, so back in the mid-60s, my musical taste went to what we would likely today call "adult contemporary folk", which was saloon singers doing Pete Seeger style songs; a sort of folk music despised by true believers. My favorite brand was "The Limeliters", a trio of late 30-somethings. Not many of my peers had heard of them, except possibly from myriad commercials, and not knowing who the singers were. Only one of the trio still lives.

A few minutes ago, during the usual horrible Thursday NFL game, I watched the commercial for "Mafia III", and was shocked. After the trio disbanded in 1963, they later had some reunion concerts and recordings in the 70s and 80s. One of their gigs was to record "Everybody Wants to Go to Heaven" by Charles Larson as part of a songwriting competition.

Somehow the producers of "Mafia III" found the tape, and sampled out Lou Gottlieb's phrasing of the tagline, "but nobody, aaah nobody wants to die". Gottlieb died in 1996, way too soon.
The idea is to make "Nobody Wants to Die" available for download, though details are still being worked out.

That would be so cool. A 70s reunion of a 60s trio doing a songwriting contest winner backing a 2016 video game. Only in America.