Some polls are moving the Democrats' way (HT: Instapundit).
Certainly the chest-beating triumphalism on some conservative/libertarian blogs has roused my concern.
Such echo-chamber chest-beating preceded the blowout victory of Congressman Doug Hoffman.
And they don't call the GOP the Stupid Party for no reason.
September 27, 2010
September 17, 2010
New Scapegoat: High-Frequency Trading
My reaction to a Yahoo/CNBC piece follows. It has been submitted as a comment but has not yet appeared.
A sensible individual investor, as I understand the term 'investor', will buy a stock and hold it for at least a year so as to get the tax savings on long-term gains.
I don't see how such an investor will be damaged by high-frequency trading that scalps a tenth of a cent or so off the price he pays at any given moment. As far as I can see, the long-term value of a stock remains determined by the company's economic performance.
Even a day trader, who is taxed at the short-term capital gains rate, should be able to adjust to high-frequency biases of a fraction of a cent. Anyway, if high-frequency traders have learned to do faster and better the kinds of things that day traders do manually, so what?
Like any innovation, high-frequency trading has benefits and disadvantages--and unintended consequences. It sounds like regulators are learning to get a handle on the unintended negative consequences. A transformational technology like high-frequency technology should continue to be scrutinized by regulators, but afaic regulators should only intervene if it is "reasonably" clear that more harm than good would come if they do not act. Flash crashes are a case in point. However, it sounds like high-frequency trading is being invoked as an all-purpose scapegoat. ("I don't understand how this stuff works and I can't afford the technology, so that must be why I lose money in the market." Whaaat?!)
Investing and trading are challenging and risky under the best of conditions. We do not have the best of conditions: the country has been misgoverned and the economy has been mismanaged for ten years. The people responsible (for) the misgoverning and mismanaging are happy to create scapegoats. It's taken (little) for ordinary citizens, who miss the prosperity we had back when the country was run competently, to be taken in.
A sensible individual investor, as I understand the term 'investor', will buy a stock and hold it for at least a year so as to get the tax savings on long-term gains.
I don't see how such an investor will be damaged by high-frequency trading that scalps a tenth of a cent or so off the price he pays at any given moment. As far as I can see, the long-term value of a stock remains determined by the company's economic performance.
Even a day trader, who is taxed at the short-term capital gains rate, should be able to adjust to high-frequency biases of a fraction of a cent. Anyway, if high-frequency traders have learned to do faster and better the kinds of things that day traders do manually, so what?
Like any innovation, high-frequency trading has benefits and disadvantages--and unintended consequences. It sounds like regulators are learning to get a handle on the unintended negative consequences. A transformational technology like high-frequency technology should continue to be scrutinized by regulators, but afaic regulators should only intervene if it is "reasonably" clear that more harm than good would come if they do not act. Flash crashes are a case in point. However, it sounds like high-frequency trading is being invoked as an all-purpose scapegoat. ("I don't understand how this stuff works and I can't afford the technology, so that must be why I lose money in the market." Whaaat?!)
Investing and trading are challenging and risky under the best of conditions. We do not have the best of conditions: the country has been misgoverned and the economy has been mismanaged for ten years. The people responsible (for) the misgoverning and mismanaging are happy to create scapegoats. It's taken (little) for ordinary citizens, who miss the prosperity we had back when the country was run competently, to be taken in.
September 16, 2010
Simply Put, and Well
'Langshorn', an American who had visited China, wrote:
(A number of people in that thread correctly respond that one shouldn't get carried away. One who does get carried away rhapsodizes about life in Thailand: yes, life in the Thailand that is currently wracked by extreme political factionalism.
Economic downturns seem all but inevitable given the rapid rate of China's growth. They were part of US growth in the 19th century. A key test for China will be how they handle such downturns.)
But Langshorn's perception of the USA remains apposite.
It is difficult living in a nation in decline.His entire comment is worth reading.
(A number of people in that thread correctly respond that one shouldn't get carried away. One who does get carried away rhapsodizes about life in Thailand: yes, life in the Thailand that is currently wracked by extreme political factionalism.
Economic downturns seem all but inevitable given the rapid rate of China's growth. They were part of US growth in the 19th century. A key test for China will be how they handle such downturns.)
But Langshorn's perception of the USA remains apposite.
September 12, 2010
Naive Question about the Bush Tax Cuts
If they were so wonderful, why did federal employment on Bush's watch rise more rapidly than private-sector employment? (See this and this too.)
September 11, 2010
September 4, 2010
Comments: September 2010
On the ambiguous gender of a spambot.
On the Russian invocation of intellectual property as a pretext to suppress political dissent. On Microsoft's response (waiving their IP claims in the relevant case).
sigh More reasons why Congressional budgets cannot circumvent potential Presidential vetos: here and here.
On the murder of West Pointer Erik Scott by Las Vegas police: here, here and here.
On the Obamas' dining on lobster: here, here, and here. Come to think of it, the Obamas got off to a good start with Michelle's vegetable garden and beehives. Power corrupts.
On a difference between November 1994 and November 2010: the Internet. (Scroll down to 'gs on 4 September 2010'.)
On Paul Krugman and the proper deference due to the so-called best and brightest: here and here.
On David Brooks.
On the difference between the two major parties.
On the Russian invocation of intellectual property as a pretext to suppress political dissent. On Microsoft's response (waiving their IP claims in the relevant case).
sigh More reasons why Congressional budgets cannot circumvent potential Presidential vetos: here and here.
On the murder of West Pointer Erik Scott by Las Vegas police: here, here and here.
On the Obamas' dining on lobster: here, here, and here. Come to think of it, the Obamas got off to a good start with Michelle's vegetable garden and beehives. Power corrupts.
On a difference between November 1994 and November 2010: the Internet. (Scroll down to 'gs on 4 September 2010'.)
On Paul Krugman and the proper deference due to the so-called best and brightest: here and here.
On David Brooks.
On the difference between the two major parties.
September 1, 2010
Paul Ryan's Future
He should run for governor at an opportune time and then, if successful in office especially wrt his fiscal policies, run for President.
Its Name is Earl
There's a Category 4 hurricane off the Florida coast, due south of Central MA about where the Great Hurricane of 1938 was. There's a chance the storm will graze Cape Cod and/or strike northern Maine or Nova Scotia.
Nobody inland is especially worried for two reasons IMO: improvements in computational forecasting, and improvements in communications that allow information to be broadly & quickly disseminated, especially via the Internet.
Here's hoping that the technology is correct. Here's hoping that my area is spared. (Hopefully the 2008 ice storm filled our quota of generational disasters.) Here's hoping that nowhere is seriously damaged.
Nobody inland is especially worried for two reasons IMO: improvements in computational forecasting, and improvements in communications that allow information to be broadly & quickly disseminated, especially via the Internet.
Here's hoping that the technology is correct. Here's hoping that my area is spared. (Hopefully the 2008 ice storm filled our quota of generational disasters.) Here's hoping that nowhere is seriously damaged.
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