Steam Catapult » History

Emergent Properties

David Pinsen — Sat, 31 Dec 2011 01:23:36 +0000

Seeking Alpha published an article of mine touching on this earlier this week, but the tweet below and the chart that follows it illustrate the tl; dr version. Portfolio Armor was designed to help investors hedge, but other uses for it have emerged. One is as a warning flag for investors in securities with high optimal hedging costs.

I noted that warning for investors in Sears (SHLD) in this tweet on December 18th:

Looks like a red flag for $SHLD longs. MT @portfolioarmor Hedging Bruce Berkowitz stks.co/1avF $AIG $BAC $C $BAM $CIT $BRK.B $JOE

— David Pinsen (@dpinsen) December 18, 2011

And then on Tuesday of this week, SHLD fell out of bed, dropping 27% in one day on news that the company was closing 100+ stores following awful Christmas season sales.

The left side of this chart reminds me of the rock in Close Encounters

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Me on Bloomberg TV

David Pinsen — Fri, 09 Dec 2011 22:16:50 +0000

Well, my tweet, actually. This one got mentioned Margaret Brennan’s “InBusiness” show yesterday morning:

@margbrennan You nearly died once from riding 90 mph on the NJ Turnpike without a seatbelt. Was that emblematic of your approach to risk? $$

— David Pinsen (@dpinsen) December8, 2011

I was hoping to embed a clip of Ms. Brennan reading that tweet (Bloomberg helpfully added some footage of Corzine’s horrible wreck), but I couldn’t find it on YouTube or Bloomberg TV’s website. So instead, here’s the tweet from her producer letting me know the tweet was going to be aired:

@dpinsen that question was brilliant! you’re in the show at the top of the 10a!

— Sonja Van Sacker (@svansacker) December8, 2011

BTW, the ability to embed tweets like those examples above was just added to Twitter. Fred Wilson blogged about it earlier today.

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Regretsy’s updated, ‘Mother of all 9/11 Posts’

David Pinsen — Sun, 11 Sep 2011 17:00:24 +0000

Regretsy updated its “The Mother of all 9/11 Posts” for the 10th anniversary of 9/11. Before clicking you may want to read this intro of the post which describes what’s to come:

To commemorate the 9th anniversary of what I like to call “The Unpleasantness”, I’m going to subject you to an extensive, handpicked assortment of Nine-Elevenalia.

I must preface this post by saying that I did not create anything you see here. Like every Regretsy post, I’m only the curator of this exhibit.

If you’re offended by anything you see here, or you think it’s too soon, or you knew someone who knew someone who almost died, or you have proof that the Jews all got an email warning them to stay home that day, or Building 7 was actually made of sugar, I don’t know what to tell you. Start with the man in the mirror.

Anyway, there is a lot of crap here, so I’ve taken the liberty of grouping this garbage into the following categories:

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My last visit to the WTC

David Pinsen — Sun, 11 Sep 2011 16:54:35 +0000

After the first attack in 1993, the World Trade Center instituted some elaborate security measures. For example, all visitors were given laminated photo IDs after checking in, that they were required to show to the guards at the relevant elevator banks. Security tightened at all office buildings in New York after 9/11, and more buildings started issuing photo ID cards or stickers, but before 9/11, the WTC might have had the tightest security of any commercial building in NYC. The image below is of the photo ID card I got the last time I visited the World Trade Center, in June of 2001.

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Updates for 7.22.2011

David Pinsen — Fri, 22 Jul 2011 23:48:17 +0000

– Richard Florida was back this week, with another implausible job creation idea. My article about it on Seeking Alpha: “Richard Florida’s Latest Job Creation Idea“.

– In an earlier article (“Helping House Majority Leader Eric Cantor Hedge His Treasuries Exposure“), I mentioned a way to hedge against a U.S. default by using Portfolio Armor to find optimal puts on the Treasury Bond-tracking ETF TLT. The cost of that hedge dropped over the next week, so I picked up a few of those puts last Friday. Their low cost suggests that options investors think there’s very little chance of default, but Intrade bettors appear less sanguine about that.

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Me in the FT

David Pinsen — Wed, 06 Jul 2011 15:33:07 +0000

The Financial Times published this letter of mine today:

From Mr David Pinsen.

Sir, Larry Pierson (Letters, June 30) argues against the use of government spending as a form of economic stimulus, noting that Barack Obama’s fiscal stimulus failed to stem the rise in unemployment.

He then broadens his argument against fiscal stimulus by stating that only the second world war and the “certainty of military production” ultimately ended the Great Depression – but what was that military production if not a form of fiscal stimulus?

Perhaps the apparent failure of President Obama’s fiscal stimulus was due more to America’s yawning trade deficit, which ensured that most of the factory jobs the stimulus created would be in China rather than in the US. We are now even importing infrastructure from China. According to a recent newspaper report, the new San Francisco-Oakland Bay Bridge is being constructed in segments in Shanghai, and then being shipped to California for assembly.

The newspaper report I alluded to in the letter was this one, from the New York Times: “Bridge Comes to San Francisco With a Made-in-China Label”. The photo below came from that New York Times article.

Jim Wilson/The New York Times

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Cheese and the Chinese

David Pinsen — Sat, 28 May 2011 00:29:43 +0000

There was an interesting article in last weekend’s Financial Times (“Global Menu: Kicking up a Stink”), about a British food writer who bought an assortment of cheeses to China and conducted a tasting with some Chinese chefs, most of whom had never eaten cheese. The writer’s idea was that the Chinese eat a lot of “stinky” foods, such as fermented bean curd, so maybe they’d like stinky cheeses. Below are a couple of brief excerpts, with a few thoughts by me.

At the Xianheng, a waitress cut the cheeses into pieces, and the assembled tasters began to pick them up with their chopsticks, sniffing and tasting. And where I had been impressed by what cheese and stinky soya products had in common, these culinary professionals were immediately struck by their differences. “Although in some ways you could say the flavours of cheese and fermented beancurd are similar,” said Mao, “vegetable stinky foods are very clean and clear in the mouth (qing kou), and they disperse quickly, while milky foods are greasy in the mouth (ni kou), they coat your tongue and palate, and they have a long, lingering aftertaste.”

This seems like an odd way to expose people to cheese for the first time. Why not balance the ni kou of the cheese with slices of pear or apple, or a glass of red wine? Or serve the cheese on crackers, crusty bread, or toast, to offer a contrast in textures?

Two other chefs said the cheeses had a heavy shan wei (muttony odour), an ancient term used by southern Chinese to describe the slightly unsavoury tastes associated with the northern nomads. Another said that the selection “smells like Russians”. “The difference,” he added, “is that the stinky things Chinese people eat give them smelly breath, while stinky dairy things affect the sweat that comes out of your skin.”

The connotations of diary products with Russians and “northern nomads” (Mongolians, presumably, along with, perhaps, a few others of the Chinese ethnic groups I’d never heard of) is quite a contrast with the connotations of fancy cheeses in the West. Here we generally associate fancy cheeses with advanced countries such as France and Italy, while the Chinese think of yak herders.

The Chinese chef who thinks that non-dairy stinky foods don’t “affect the sweat that comes out of your skin” must be unfamiliar with kimchi, and those who eat it as a staple.

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