Katla webcam

Keep your eye on volcano Katla! Will it blow?

 

Iceland

Iceland sits on the edge of a tectonic plate: Click to enlarge. During the late 18th Century, continuous volcanic eruptions in Iceland heavily damaged a quarter of the island nation, and blotted out the sun's light for several years. Can you pronounce Eyjafjallajökull ? There may be other nearby eruptions ... soon. Like the much larger Katla: President of Iceland, Ólafur Ragnar Grímsson, said that the current eruption was just a warm-up for the eruption of Katla. Luckily, he's not a geologist. There's a Katla webcam here. What about this one? Grímsvötn: In the year 2004! It grounded plane traffic. -------------------------------- In May, Heidi & I are planning a cruise to some Greek islands. I stare intently at the ash cloud to see if'n it'll reach Venice (where our cruise begins). Note#1: SFC/FL200 means from the Surface to 20,000 feet. Note#2: Read the Reykjavík Grapevine. --------------------------------

 

Derivatives

I was just reading Paul Krugman's article (love that guy!) and noticed his comment about: ... derivatives, the complex financial instruments Warren Buffett famously described as "financial weapons of mass destruction". I recall when I thought derivatives meant dy/dx. I also recall this humorous look at derivatives. Well ... it makes me laugh. Here's what I larned. ----------------------------- It's been said that: Math may have caused the financial crisis. Conclusion? Math is dangerous!

 

World in the morning

Every morning I check the World, to see who's up at this time o' the morning. Then I check the U.S. futures. Then I check preMarket trading for a BIG coal stock. 'cause I like my coal stocks, eh? Then I check to see how coal has been doin' recently. Then I get ready to Buy or Sell, my finger poised on the broker's button(s). Alas, it don't do me no good ...

 

Ponzo Illusions

I recently ran across slick examples of the Ponzo Illusion. This is Mario Ponzo's original: Here are others: Okay, so I'm hooked on illusions ------------------------------------------ So, does this guy get smaller as he gets closer? Just kidding

 

Probabilities

I often think I should announce that I have a wunnerful scheme that's guaranteed to make money 95% of the time!, over 10 years. Then you try it and lose money. Then I say: "Too bad. You're in that last 5%." You say: "So what's that 95% all about?" Then I say: "It means that if you repeated my scheme a jillion times, you'd make money 95% of the time.". Cute, eh? I know perfectly well that you can't repeat it a jillion times ... so I'm correct, in my announcement. Indeed, I'm always amused when gurus say that there's a 95% probability that your retirement portfolio will survive 40 years with an x% withdrawal rate. Now, if you believed in a hundred reincarnations ... Aah, but what if you repeated my scheme hundreds of times? Then, if it were efficacious, you should be able to make money, eh? Indeed, even if my scheme worked, say 60% of the time, you should make money if'n you applied it hundreds of times. Okay, so I been thinkin' about that Blake ritual for Buying and Selling stocks mutual funds. Blake identified funds where the probability of success was over 60% (based upon analysis of historical data) ... then he traded like crazy!! Alas, that'd require that trading fees were minimal. Yesterday, Ron McEwan wrote to me about the Blake ritual: The US government employee retirement plan (Thrift Savings Plan) is the largest pension plan in the world. You could trade in and out of about 10 different funds as much as you want with no charges. One day someone at the Fed found out that some guys had made themselves over 3 million dollars using a similar strategy. It wasn't illegal, but shortly after it was discovered, the Plan changed the rules to make it unprofitable. Ron also provided these: Click!   Click!

 

A buying strategy

Somebody wrote and asked about some Gil Blake method for buying and selling. Of course, I had never heard of the guy ... but I did find these comments by Blake: "If the Dow climbs 10 points, what's its expected further excursion before reversing?" and "... once they've gone, say, 1 percent in one direction, they're likely to go 2 percent further before they go back again." Huh? Is that true? So I decided to check out that observation by looking at, say, GE stock. Well, not exactly that observation. I looked at the total gain over a moving n-day window. When the gain exceeded 1%, did the gain for the (moving) time period continue to increase? If that happened most of the time, then should one buy when that occurs? Would that be following some "trend"? But what's a good value for n? Should we look at the gain over a window of n = 3 days or maybe n = 4 days ... or what? Anyway, to make a long story short, I got some charts that look like this: Now I gotta massage that spreadsheet. If we see a nice n-day gain, how much more can we expect? Click for a pretty picture.

 

Surfboards

I have a friend who builds surfboards. A few years ago he asked me to write a spreadsheet that would help design the "shape" of the board ... so I wrote this. Although I didn't think it was particularly useful, it was fun. Today I get a message from somebody at the Atlantic Surfing Museum asking to stick a link on their site. He said the surfboard thing was cool. Now, I see it was not only fun but also cool.

 

Distributions

Once upon a time I looked at the problem of finding the relationship between the Standard Deviation of stock returns and stock prices. Indeed, Bollinger Bands use the SD of prices (over the past umpteen day) to provide Buy & Sell signals. Anyway, the problem (mathematically speaking) might go like this: You have a set of returns, {X}, with a known distribution. You pick n at random and calculate: Z = (1+X1)(1+X2)...(1+Xn). Them's the prices, eh? So what's the distribution of the Zs? After thinking about it, off and on (for years), I figured I was just too schtoopid to solve the problem -- even if I assumed the set of returns were Normally distributed. (Math-types always make such simplifying assumptions.) Then I recently ran across some papers about the distribution of the product of just two random variables. It involves (are you ready?) K0. He's a Bessel function. I met him before. Then I run across a paper dealing with the distribution of the product of three random variables. It involves Meijer G-functions. Huh? I ain't never met her before. Somehow, I feel better ... and I'll give up this quest 'cause I now know I am too shtoopid

 

$USD/$CAD

Heidi keeps a $USD bank account and sticks money there when the Canadian dollar is doin' good .... for trips to visit our kids South o' the Border. Now she's heading out the door ... to the bank.

 

U.S. deficit

The U.S. has (finally!) joined the rest of the civilized world in providing universal health care. So will it break the bank? Will the U.S. suffer from massive deficits? Can the U.S. recover from this gargantuan expenditure? Has such a projected deficit (over 12% of GDP) happened before?

 

Happy Easter

 

Guess the price

I was feeling pretty schmart. I had guessed the price movement of some of my favourite stocks. Then I thought: "I should try that Guess-the-Price game." Now, with all that practice, I'd be a whiz. I was disappointed to learn that I was still lousy. Okay, now you try. Here are the weekly stock prices for 32 weeks. What'll it be in 4 weeks? Click the chart to see. Here are more: So ... are you lousy too?

 

bit torrent

Since buying that neat gadget I figured I should know something about bit torrent ... especially since there's so much Internet traffic involved with this stuff. It's really quite amazing ... so (as is my wont), I wrote what I found. Is it accurate? Who knows?

 

I'll be back

This is my last blog entry for a while. I bought an Archos so we can watch movies while travelling ... especially if we're next to a TV set. The I started downloading movies. I guess that's illegal because I first got a warning message from my ISP. Then I got a knock on the door : the family lawyer. Apparently I am to be taken to some U.S. district court. Others who have done this P2P thing ...