Showing posts with label Barry Ritholtz. Show all posts
Showing posts with label Barry Ritholtz. Show all posts

Monday, January 11, 2016

Guns and Stocks

Two recent articles grabbed my attention, preaching to the choir in my case. 

First, the endless posturing of Republican candidates as to who loves God and Guns the most, or is it Guns and God?  Ted Cruz is particularly blunt on these topics, saying something to the effect that no person is fit to be President who does not get down on his (or her) knees each morning to pray and his contention that all us “good guys” need guns to take care of the “bad guys.”  In regard to the latter, the Canadians see it for what it is, a spot on article in their National Post: More guns aren’t the answer. For Canadians, America’s gun cult looks like a collective suicide pact:  The America of the NRA’s imagination is a mythic, death-match arena populated by “good guys” and “bad guys,” “monsters” and “patriots.” As in a videogame or superhero comic book, everyone apparently falls into one category or the other. And since the patriots are more numerous, the theory goes, life is arithmetically safest when Americans are all armed to the teeth, ready to rake others with gunfire at the slightest provocation  

It goes on to conclude that when pro-gun activists and politicians make their case, they often regress into adolescent fantasy worlds — where ordinary Joes and Janes are transformed into heroic commandos. In real life, ordinary people faced with a mass-shooter situation are more likely to wet their pants. [Emphasis, mine – and this conclusion is documented in the article]

I’ve written about this so many times that I’m afraid of repeating myself, so instead I paste below just some excerpts. They certainly explain why the National Post article speaks so directly to me.  Read the National Post’s article though, it’s how we’re seen from our neighbor’s viewpoint.  We are so often chasing our own tails that we lack the necessary perspective.

Tuesday, December 8, 2015
It Can’t Happen Here?

Unfortunately, the horror in San Bernardino has fed into all of this, “legitimizing” such dangerous rhetoric and escalating it to personal attacks on President Obama (who now has low polling numbers about keeping America “safe,” the exact inverse of what those numbers were after bin Laden was nailed) - and subsequent accusations that any call for stronger gun control laws is merely politicizing the San Bernardino tragedy.

But such calls have gone on for years with fierce Republican and NRA opposition.  I do not naively believe that better gun control laws and enforcement would magically eliminate such tragedies, especially in the short term.  But I do believe that the Second Amendment, which was written in the days of musket rifles and flintlock pistols, needs serious updating.

At that time, we needed an armed militia and also the founding fathers believed that an armed citizenry would be deterrent to the rise of a despotic government.  The world has changed since then, weapons of war unimaginable to our forefathers, and, now, mostly in the hands of the military and law enforcement.  To make some of the same weapons legitimately available to the citizenry no longer serves the purpose of protecting us from a despotic government as the military will always have superior weaponry (is an converted AR-15 adequate protection against a tank?). The proliferation of automatic weapons just further endangers us all, giving us a false sense of security by just having one in our closet.

No, this is a country of laws and checks and balances and we have to depend on our tried-and-true institutions as well as the much maligned (by Trump in particular) fourth estate to keep our government transparent and trustworthy. If some fringe element threatens us in our homes and public places, we need better intelligence to prevent it and rapid response law enforcement to protect us.

Fully automatic weapons (ones that operate as a machine gun) need to be banned, and guns should be registered just like a car, an equally dangerous thing.  That means getting a license, passing a rigorous background check and license renewals (a gun owner having to report if it is sold, just like a car).  Guns for self defense, hunting and target practicing are understandable but how can one argue that an automatic weapon is needed?  Certainly not for hunting (where is the sport in that?).  Do we really want our neighbors to be totting an automatic weapon citing Florida’s ambiguous “stand your ground” law as a justification?

Will that keep guns out of the hands of the “bad guys” as the Republicans like to call them?  No, but it’s a start and of course the devil is in the details of how such gun control is administered.  Senseless to get further into it here – I’m merely expounding an opinion.

Friday, October 2, 2015
Carly Sidesteps

Switching gears to one of the major issues of our times, gun control.  I’ve written about this topic before and it is sad that we make no progress in this area and now, still, another mass slaughter, this one at the Umpqua Community College in Oregon.  CNN now reports that the police have identified thirteen (!) weapons connected with the murderer.

As President Obama wearily declared in his news conference, these incidents have become routine in this country and our response is routine:  commiserate with the families and do absolutely nothing to diminish the problem.  Thank you NRA and its obedient congressional cronies.  

I’m no Pollyanna when it comes to this subject.  People should have the right to have registered weapons for target practice and hunting, and for self protection (with licensing akin to getting a driver’s license, testing etc.), with stringent background checks before any weapon could be bought.  Assault weapons should be banned.  Would those steps eliminate the problem?  No.  But it’s a start.  On a macro basis, it is a cultural problem (just look at popular culture which glorifies violence and guns), as well as educational and income equality feeding the problem. 

Monday, January 20, 2014
"Existential Illegitimacy"

There have been twenty mass shootings since Obama became president and he is helpless to do anything about it without the complete cooperation of Congress.  After the shooting in Newton, Connecticut, only a few miles from where we lived for twenty plus years, there was a ground swell (verbal only) in Congress to do something to control the sale of certain automatic weapons, but by the time the NRA got finished with their lobbying campaign, that effort was AK47ed to death.  Explain that failure to the parents of the children slaughtered.

Thursday, January 17, 2013
You Call That a Gun?

Florida airwaves are chock full of reports of surging gun sales and crowded local shooting ranges before the sword of Damocles (Obama) comes swiftly down.  Interestingly, or tellingly, it is the sales of the AK47 type of military weapons that are selling most briskly and at record prices, soldier citizens plunking down $1,000 or more for their favorite assault weapon.  Apparently, their rationalization for needing a military weapon is, well, for their inevitable confrontation with the US Military.  These particular stalwart supporters of the Constitution (a.k.a. conspiracists) "know" of clandestine government plans to send troops door-to-door to confiscate their booty.  The problem with that is if they are harboring AK47s, perhaps the military might come knocking on their doors with a tank?  Now that's a gun!

In a more serious vein, it's about time after all the empty talk that the Second Amendment to the United States Constitution is brought into the 21st century.  The framers of the Constitution could never have envisioned what now constitutes the word "arms."

Then my favorite blogger, Barry Ritholtz wrote a sobering article for the Washington Post on the first week’s slide (crash?) of the stock market. 

The essence of it is – well, these things happen; ignore the swings and stick to your “strategy.”  While I of course defer to Ritholtz’s expertise and mostly agree, I would suggest that it may not be that “easy” this time. Tried-and-true asset allocation models no longer seem to be valid.  Governments manipulated the markets to such a degree on their way up that the unwinding of those actions (particularly evident in China) have resulted in asset categories becoming highly correlated.  I will not quote the piece here, but I wrote about this a couple of years ago in Reflections of a Relic Investor

I agree with Ritholtz though that acting on investment decisions while emotions are running high is hazardous to one’s financial health. 

Thursday, July 3, 2014

Independence Day Reverie

I’ve increasingly avoided political topics recently.  To what end I’ve argued with myself.  Here we’re about to celebrate our independence while, as citizens and voters, we are held hostage by an intransigent Congress that can’t even address some of the basic needs of our society.  High on my priority list is our decaying infrastructure, inability to control the widespread distribution of assault weapons, addressing immigration reform with some realism, and an economy that is being held together by artificial means. And those are just the domestic issues.

But I’m not alone in ranting with disappointment.  Barry Ritholtz wrote an insightful article on this subject for Bloomberg View, Is This the Worst Congress Ever?  I can’t wait until he expands on his thoughts as he promises in a future article, particularly on the Federal Reserve’s role in this.  Read his commentary.  It is well worth while.

Meanwhile, we “celebrate” the 4th with the long drive from Florida to Connecticut.  I now dread the drive up I95.  In years gone by we actually enjoyed the trip but now it is mostly drudgery having to share crowded roads and hotels with people who rarely smile at you or might even just shoot you, depending on how the dice rolls nowadays.  Fewer seem to exhibit some simple common courtesy.  It’s become worse over the years, or perhaps I’ve become embittered with age, I can’t tell.

It’s an in-your-face-I’ve-got-mine-so-to-hell-with-you attitude, so incongruous with the spirit of the 4th.  I was reminded of this on a recent drive to the airport to pick up my son. I saw a bumper sticker on a pickup truck – probably from the time of Obama’s 2008 presidential race when he had emphasized it is a time for change.  Easy to remember, cleaver I thought, but a worryingly way of thinking of about half the State it seems:  I’ll keep my God, I’ll keep my guns, I’ll keep my money, YOU can keep the change!

I’m all for freedom of speech.  But this “in-your-face” slogan anecdotally underscores everything that is dysfunctional with our present political system.  Compromise and consideration of the other person’s point of view be damned! The story of our forefathers’ struggle to conceive a new nation out many points of view is what July 4th must be remembered for the next time we, the citizens, go to the polls to vote.  E Pluribus Unum!  Unless we can find common ground so our legislature works, and we can stop the march towards divisiveness and corporatocracy, July 4th will be nothing more than a fireworks show for the general amusement of a non-enlightened population.

Saturday, April 12, 2014

The Random Nature of It All

Hat tip (again) to Barry Ritholtz who as a "financial guy" (actually schooled in law) has a logical way of looking at the inexplicable. He puts his spotlight on the recent gyrations of the stock market and the blather of the financial channels --  all constructing a "story" to "explain" sudden up or down moves in what, short term, is really a guessing game.  Media noise --  a  form of cognitive dissonance, contradictory "explanations" some of which appeal to investors and therefore feed the furnace of their convictions.  Which begets even more gyrations. As Ritholtz so accurately puts it: "people create a happy little bubble of delusion."  His article "What's Your Stock Market Story?" is well worth reading and keeping in mind when making one's next trade.

Speaking of the inexplicable, how do we mere mortals understand the consequences of a term that suddenly surfaced on the waters of our online lives: Heartbleed?  Perhaps a binary Loch Ness Monster?  How vulnerable is any online financial transaction or, for that matter, routine things like writing emails or even posting this innocuous blog?  And all of this the result "of a two-year-old programming error?"  Two years and we've all been lulled into a "happy little bubble of delusion" that all those "Secure Sockets Layer" web sites to which we've committed sign-ons, passwords, credit cards, etc. might have all been vulnerable and no one seems to have a full understanding of the consequence.  No consequences?  Armageddon? Somewhere between? A random programming error -- or an intentional one  -- that could have been silently exploited for two years?  Talk about a potential Black Swan. Here's Scientific American's take on it.

On to the random nature of one's career.  Looking back from the so called "golden years" how many can say that his/her career and how it unfolded was one of unsullied choice?  Choices do have to be made, but those are ones circumstances concoct, almost like one's DNA randomly assigned at birth.  I could have ended up as a photographer, a librarian, or even in the insurance business -- there were paths in front of me to each of the foregoing, but I choose publishing, my first job being the result of a chance interview.  From there, I was able to make choices over the next 35 years, but, even then, I was given a random set of options.  Do I choose from behind door #1, #2 or #3?

Once I was running a publishing company, one of the choices I made was to pursue international opportunities.  Japan became one of our largest overseas markets and so I occasionally made trips to Japan, sometimes alone, sometimes with Ann and eventually both of us with our son, Jonathan.  The Japanese culture had a profound impact on us all. 

Fast forward to last night.  All those random choices.  No wonder when our gourmet club was deciding on the next "theme" -- one that was to be held at our home -- we suggested Japanese.  What a feast it was.  Our friend Lois made 3 platters of sushi: delicious fish, tuna, grouper and salmon.  We served a very good chilled sak√© with that and during dinner which everyone drank and  enjoyed.  Then Susan made authentic Miso soup along with tasty shrimp gyoza.  Gail brought short ribs with a Japanese barbecue sauce and a very refreshing side of cucumber salad. 

Ann made one of my favorites -- a genuine yaki udon dish with a homemade yakisoba sauce, tender pieces of chicken, red pepper, onion, bean sprouts, broccoli, shiitake mushrooms and scallions and of course udon noodles!  She also made traditional sticky rice (enough for twenty people!) along with glazed chicken drumsticks, serving it with a very nice Green Tea in beautiful tea cups that Susan brought.  For dessert, Ann served sweet pineapple and John made Green Tea Ice Cream that was out of this world.  Ann was in her authentic Japanese Happy Coat while our son, Jonathan, had given me some traditional bamboo flute music to play in the background, greatly adding to the evening's atmosphere.


Wednesday, January 23, 2013

Inaugural Day Thoughts

Our friends, John and Lois, hosted a second Inaugural party, some thirty guests to witness the ceremonial swearing in of the President and his speech.  What a difference four years make.  Last time it was a euphoric party, imagine, a young black president, imbued with liberal ideals, but with an economy that had already shown signs of complete collapse the joy was somewhat restrained by worry.

Four years later, the intransigence of government compromise has given way to more temperate expectations.  However, none of this detracted from the day, a remarkable, very moving, and humbling exercise of the democratic process with the pageantry instilling a quiet pride and hopefulness in us and the sea of faces that swept across the National Mall.

Everything about it was just about perfect, even the weather cooperating.  President Obama's speech was aspirational and progressive, touching upon many of the themes of his presidency and introducing the sorely needed goal of combating climate change.  Perhaps he will make that the hallmark of his second term as universal healthcare was in his first.  In spite of the overwhelming need to face this issue realistically, action has been lacking.  Here is an interesting pro/con alignment of opinions on this subject (hat tip Barry Ritholtz's The Big Picture).

This will become yet another clash in Congress.  To fully understand the severity of political polarization, one only has to read comments about Obama's reelection such as Texas Representative John Culberson's: I grieve for the country....We’re going to throw the emergency brake on as best we can and fight him every step of the way.  Welcome to your second term, Mr. President!

A key phrase from the Inaugural speech, we, the people, understand that our country cannot succeed when a shrinking few do very well and a growing many barely make it, was also Obama's central point when he was campaigning and will probably be the fulcrum of budgeting and tax reform.  But this is going to be a more complex problem as there are systemic reasons behind this widening gap that go far beyond the reach of mere tax reform legislation.  The New York Times magazine section this Sunday carried a relatively brief but pointed article on "skill-biased technical change:" The rise of networked laptops and smartphones and their countless iterations and spawn have helped highly educated professionals create more and more value just as they have created barriers to entry and rendered irrelevant millions of less-educated workers, in places like factory production lines and typing pools.

Thus, workers having technology skills, mostly those in information industry professions, law, finance, engineering, and medicine, have disproportionately benefited from those skills at the expense of blue collar workers who have been forced into the service economy at lower wages.  Having technology skills is tantamount to buying on margin, being able to leverage those skills for much greater compensation.

So when President Obama tries to put through legislation to reverse this course, it has to take into account not only tax reform, but massive educational reform and the effects of that will not be immediate, but rather long term, maybe measured in generations, like the progress made in civil rights.  Do we have the fortitude and patience?

And, then there is the deficit and reducing the National Debt.  We could embrace the best parts of the Simpson-Bowles plan (so eagerly commissioned by both parties as the National Commission on Fiscal Responsibility and Reform, and then the results so immediately distanced by both)  No one wants to face up to their recommendations.  Our massive National Debt in part was incurred to save our financial system from ruin, but it did not occur overnight.  Quick and easy fixes are impossible. But, if we get the direction right, and gradually phase in some of the Commission's recommendations, perhaps we can then move forward on that front.

But do our politicians have the right stuff?  This is where presidential leadership is so sorely needed. President Obama threw down the gauntlet in his speech about the need for action -- even "imperfect" action -- a veiled suggestion of compromise.  There were two beautifully crafted paragraphs about the dangers of taking intransigent positions based on ideology in his speech:

That is our generation’s task -- to make these words, these rights, these values of life and liberty and the pursuit of happiness real for every American.  Being true to our founding documents does not require us to agree on every contour of life. It does not mean we all define liberty in exactly the same way or follow the same precise path to happiness.  Progress does not compel us to settle centuries-long debates about the role of government for all time, but it does require us to act in our time.  

For now decisions are upon us and we cannot afford delay.  We cannot mistake absolutism for principle, or substitute spectacle for politics, or treat name-calling as reasoned debate.   We must act, knowing that our work will be imperfect.  We must act, knowing that today’s victories will be only partial and that it will be up to those who stand here in four years and 40 years and 400 years hence to advance the timeless spirit once conferred to us in a spare Philadelphia hall.

Finally, a bit of serendipity.  Does life imitate art? I had noted that Aaron Sorkin's 1995 classic The American President, directed by Rob Reiner, was on TV the same night as the inaugural.  We've seen it before but Ann and I, in a "presidential inauguration mood," said, what the heck, we'll watch it again (thanks Encore, no commercial interruptions).  Talk about a feel good movie and how incredibly relevant although made almost twenty years ago.   The focus of fictional President Andrew Shepherd's administration is to pass a crime bill (with assault weapon gun control) and an environmental bill that mandates the reduction of hydrocarbon emissions. Meanwhile, a right wing political demagogue, Senator Bob Rumson, is running against Shepherd's reelection, appealing to "family values" of Americans, by attacking Shepherd's relationship with Sydney Ellen Wade (Shepherd is a widower in the film).  Have things changed so little in the almost twenty years since the film's making?  Unresolved issues of gun control, environmental protection, and campaign character assault go on and on.

The film's President Andrew Shepherd initially takes the high road, concentrating on the issues rather than the personal attacks until he appears at an unscheduled and impromptu news conference and gives an impassioned, unrehearsed speech.  Perhaps all our politicians should see this movie once every four years (I realize that Sorkin writes with his own political agenda -- even I think that eliminating handguns cannot be on the lumped in with assault weapons --  but taking that into account, still there is much to be gleaned from this wonderful and eerily relevant script).  Here is what "President Shepherd" says:

For the last couple of months, Senator Rumson has suggested that being president of this country was, to a certain extent, about character, and although I have not been willing to engage in his attacks on me, I've been here three years and three days, and I can tell you without hesitation: Being President of this country is entirely about character. For the record: yes, I am a card-carrying member of the ACLU. But the more important question is why aren't you, Bob? Now, this is an organization whose sole purpose is to defend the Bill of Rights, so it naturally begs the question: Why would a senator, his party's most powerful spokesman and a candidate for President, choose to reject upholding the Constitution? If you can answer that question, folks, then you're smarter than I am, because I didn't understand it until a few hours ago. America isn't easy. America is advanced citizenship. You gotta want it bad, 'cause it's gonna put up a fight. It's gonna say "You want free speech? Let's see you acknowledge a man whose words make your blood boil, who's standing center stage and advocating at the top of his lungs that which you would spend a lifetime opposing at the top of yours. You want to claim this land as the land of the free? Then the symbol of your country can't just be a flag; the symbol also has to be one of its citizens exercising his right to burn that flag in protest. Show me that, defend that, celebrate that in your classrooms. Then, you can stand up and sing about the "land of the free". I've known Bob Rumson for years, and I've been operating under the assumption that the reason Bob devotes so much time and energy to shouting at the rain was that he simply didn't get it. Well, I was wrong. Bob's problem isn't that he doesn't get it. Bob's problem is that he can't sell it! We have serious problems to solve, and we need serious people to solve them. And whatever your particular problem is, I promise you, Bob Rumson is not the least bit interested in solving it. He is interested in two things and two things only: making you afraid of it and telling you who's to blame for it. That, ladies and gentlemen, is how you win elections. You gather a group of middle-aged, middle-class, middle-income voters who remember with longing an easier time, and you talk to them about family and American values and character. And wave an old photo of the President's girlfriend and you scream about patriotism and you tell them, she's to blame for their lot in life, and you go on television and you call her a whore. Sydney Ellen Wade has done nothing to you, Bob. She has done nothing but put herself through school, represent the interests of public school teachers, and lobby for the safety of our natural resources. You want a character debate, Bob? You better stick with me, 'cause Sydney Ellen Wade is way out of your league.

I've loved two women in my life. I lost one to cancer, and I lost the other 'cause I was so busy keeping my job I forgot to do my job. Well, that ends right now. Tomorrow morning, the White House is sending a bill to Congress for its consideration. It's White House Resolution 455, an energy bill requiring a 20 percent reduction of the emission of fossil fuels over the next ten years. It is by far the most aggressive stride ever taken in the fight to reverse the effects of global warming. The other piece of legislation is the crime bill. As of today, it no longer exists. I'm throwing it out. I'm throwing it out writing a law that makes sense. You cannot address crime prevention without getting rid of assault weapons and handguns. I consider them a threat to national security, and I will go door to door if I have to, but I'm gonna convince Americans that I'm right, and I'm gonna get the guns. We've got serious problems, and we need serious people, and if you want to talk about character, Bob, you'd better come at me with more than a burning flag and a membership card. If you want to talk about character and American values, fine. Just tell me where and when, and I'll show up. This is a time for serious people, Bob, and your fifteen minutes are up. My name is Andrew Shepherd, and I am the President.

What a way to cap off Inauguration Day.