social investing is an oxymoron

September 7th, 2007

Vitaliy Katsenelson

We live in the society where, to our detriment, being politically correct is often more important than being correct. So I am going to come out and make a politically incorrect statement - social investing is an oxymoron.

There is nothing social about investing. Investing is not about making popular, socially approved choices. It is about allocating capital from a less efficient use to more efficient use. Touchy-feely types of choices make us feel good about ourselves… well, until we have to retire and have to start paying for things.

link to whole post:

http://contrarianedge.com/2007/09/07/anti-social-investing/

'only a theory'

Misconceptions about Evolution:

Excerpt:
'Evolution is only a theory; it hasn't been proved.'

First, we should clarify what 'evolution' means. Like so many other words, it has more than one meaning. Its strict biological definition is 'a change in allele frequencies over time.' By that definition, evolution is an indisputable fact. Most people seem to associate the word 'evolution' mainly with common descent, the theory that all life arose from one common ancestor. Many people believe that there is enough evidence to call this a fact, too. However, common descent is still not the theory of evolution, but just a fraction of it (and a part of several quite different theories as well). The theory of evolution not only says that life evolved, it also includes mechanisms, like mutations, natural selection, and genetic drift, which go a long way towards explaining how life evolved.

Calling the theory of evolution 'only a theory' is, strictly speaking, true, but the idea it tries to convey is completely wrong. The argument rests on a confusion between what 'theory' means in informal usage and in a scientific context. A theory, in the scientific sense, is 'a coherent group of general propositions used as principles of explanation for a class of phenomena' [Random House American College Dictionary]. The term does not imply tentativeness or lack of certainty.

What's the story behind this card?

More things in heaven and earth...........

A Rayon plant by moonlight in North Carolina

Predictions from January 2007- Gradual Rise Projected for Home Sales!

Bad predictions can come back to haunt you. The man who made these predictions,David Lereah, has been replaced.

WASHINGTON, January 10, 2007 - After bottoming in the fourth quarter of 2006, existing-home sales are forecast to gradually rise through 2007 and into 2008, while new-home sales should turnaround by summer, according to the latest forecast by the National Association of Realtors. David Lereah, NAR's chief economist, said annual totals for existing-home sales will be fairly comparable between 2006 and 2007. 'We have to keep in mind that we were still in boom conditions during the first quarter of 2006 with a high sales volume and double-digit price appreciation,' he said. 'We are starting 2007 from a relatively low point, so even with a gradual improvement in sales it'll be pretty much of a wash in terms of annual totals. The good news is that the steady improvement in sales will support price appreciation moving forward.'

A jolly good time in Buffalo NY

What's not to like?

Summary of article-

LONDON - A British couple have shacked up in a budget roadside motel for more than 20 years because they love never having to do the laundry or cooking. David Davidson, 79, and his wife, Jean, 70, first tried out a Travelodge hotel while visiting a sick aunt in 1985.

"We get great rates because we book well in advance and we even have our own personal housekeeper. All our bed linen is laundered, too. It doesn't get much better than that, does it?" said former Royal Navy sailor David Davidson. The couple have spent around 100,000 pounds (200,000 dollars, 150,000 euros) renting rooms which cost them as little as 15 pounds (30 dollars, 22 euros) a night."Some will think David and Jean Davidson bonkers to have spent the last 22 years living in a hotel," said the Daily Express in its editorial.

But their room rates are "not more than many people's mortgage payments, the housework is done for them and they do not pay utility bills. "

full article link

First as Tragedy, then as Farce

Summary of article-

Florida entered a period of speculative excess in the 1920s. Jazz music best expressed the energy of the flamboyant time. Intense building began in Miami in the early 1920s and quickly led to increased real estate activity. Speculators began to buy land and to sell it for small profits within a few months.

Then the winter tourists began to invest. Profits increased as turnover time decreased. Windfall profits began to escalate to unsustainable levels and were merely a pyramiding of paper profits. Word of Florida real estate activity spread across the county and people poured in for quick profits.

The Real Estate boom was a building Ponzi scheme, named for the infamous Charles Ponzi, who founded The Security Exchange Company in Boston. The company, “dealt” in international postal reply coupons and promised its “investors” a 100% return in 90 days. Theoretically Ponzi had planned to play currency exchange rates using international postal reply coupons. By July 26, 1920 Ponzi’s house of cards began to collapse and on August 13, 1920 he was arrested after costing 40,000 “investors” $140,000,000. The 1920s theme of huge profits based on ever rising prices and an infinite supply of greater fools was set.

http://tinyurl.com/3cdugk

A Culture of Fantasy and Deception

Essay by Charles Hugh Smith

Yaddo, Yadaa, Yoda

From Robert Cringely:

Nolo mojo. Lulu.com is suing Hulu.com for trade name infringement, alleging the new site will cause marketplace confusion. For those of you not paying close attention, Lulu is a site that lets you publish and sell your own books; Hulu is the NBC/Fox site for distributing video. (Or, to put it another way, Lulu is a site for people who know how to read.) No word yet on whether LaLa, PuPu or JuJu will join the suit.

Warren Buffett MBA Talk

More Warren Buffett on Risk

George Santayana quotes

Fanaticism consists in redoubling your efforts when you have forgotten your aim.

Memory itself is an internal rumour; and when to this hearsay within the mind we add the falsified echoes that reach us from others, we have but a shifting and unseizable basis to build upon. The picture we frame of the past changes continually and grows every day less similar to the original experience which it purports to describe.

There is no cure for birth and death save to enjoy the interval.

Only the dead have seen the end of war.

Religions are not true or false, but better or worse.

Bad Science Column -Testing Social Policy

Ben Goldacre
Saturday July 21, 2007
The Guardian

Excerpt:

When you know, deep down, that your intervention doesn't work, then you're not going to subject yourself to public exposure through a randomised trial. And if you really believe your policies are effective, then when the results come back negative you're simply going to argue that trials aren't the right way to test a policy. For some cod-philosophical reason or another.

Just like the quacks. Medicine, perhaps through the ubiquity of death, has learnt to accept failure better. Most of the drugs developed don't work either, but we don't say "let's stop bothering"; we say, "great, we've stopped wasting money and side effects on ineffective treatments".

But lastly, people will object, because even when you're subjecting citizens to an experimental new policy, flagging the uncertainty with a trial reinforces the uncertainty. This was a key issue with early trials in medicine, and we overcame our irksomeness decades ago, right up at the front of the game. The crucial early trials on surgical options for breast cancer were highly emotionally charged, but necessary, simply because the options were equipoised.

If we can do Randomized Control Trial's on something as horrifying as whether women have their breasts removed then we can do RCT's on social policy.

click to read full bad science column