Occupy Wall St.

[Abdel]

What you are suggesting is

What I am suggesting is, if people want a governement moral hazard, they have to understand that it will backfire as it always do.

Plus, why you assume that people should put their money in ONE bank is far beyond me. The answer to my question is you would construct a portfolio, and have to optimize it. Now, assuming the banks don't fight back with minimum balance requirements etc. (which they already do so that's not a reasonable assumption, but it will completely destroy even the academic value of your argument) I'm almost certain you know nothing of how to practically do that. Hell you don't even seem to know about the existence of concentration risk. And if even someone who is probably 10th percentile in the population like yourself doesn't know anything about portfolio theory, what hope in hell does 50th percentile citizen of country X have? None. And lets not even talk about the bottom 10%.

Lol, what? Where did I said that people should only put their money into ONE bank? I wasn't giving portfolio strategy advices.

What I'm saying is, with no deposit insurance, people will be forced to do their homework. Now for people who don't know how to do that, the market will generate mechanisms that will allow/help them to make that choice. What type of mechanisms you may ask? I don't know.

To say that I don't know anything about portfolio theory is slightly incorrect IMO. Specially when my returns in the last 3 years (strictly with common stocks) dwarfs the return of alot of funds. That's maybe because I wasn't brainwashed by the nonsense they teach in the portfolio theory class. :D

FDIC exists for a reason

For political reasons. Plenty countries have no FDIC and it works just fine. How come there was no chaos in New Zealand? They had no FDIC until 2008. How did they survived all that time? Or maybe all the people there are portfolio managers, so they know what they're doing? lol

And of course, as always, you are completely discounting any possible malicious intent, as well as conveniently discounting the economic incentives for ratings agencies!

o, what about those fantastic ''independant'', governement approved rating agencies : moody's and co? Who rated subprime mortgages AAA. Who rates the most indebted countries AAA while a country like China who is economicly a thousand times more sound then lets say France, has a lower rating then France. lol

The good thing about the market, is if there is rating agencies that emerge in the market, they play by the market rules. If me & you start a rating agency, we want our reputation protected. Competition will force the cheaters out. Look at the current situation, there is no competition in rating agencies and we're stuck with S&P, Moodys and Fitch, who have as much crediblity as you in this forum, lol, jk.

What it all boils down is that your theory, while being perhaps academically curious, has more holes than Swiss cheese.

hahaha, alright, thanks for the conversation.

 

[Abdel]

... right. Wishful thinking on your part

Not an argument.

reality is the opposite of your projections.

http://www.ecb.eu/pub/pdf/scpwps/ecbwp047.pdf

Really?

This econometric analysis was made in 2001, only on european banks and way before financial models where as complex as they are today. Also, the correlation is not even strong.

So right off the bat, it doesn't hold any real weight.

And for the record, the EU just announced that european banks will have to take a 50%-60% haircut on the money they lent to greece.

But no worries, they will bail them out with EU tax payers money.

European banks are on the brink of bankruptcy eventhough there was a deposit insurance. I wonder why they made such lousy & RISKY investments with 'their' money? Either they are incompetent or =)

Actually I wonder if they would of risked their money if they knew that the governement wouldn't bail them out nor insure bank depositors.

Keep in mind that you justifying your grasp of portfolio theory with a naked return only proves me correct...

Huh? Bottom line is, I had much higher returns than most of the top funds out there.

 

[euroazn]

Huh? Bottom line is, I had much higher returns than most of the top funds out there.

While I agree with most of your political arguments, this was a fail

 

[Abdel]

While I agree with most of your political arguments, this was a fail

How is it a fail.

He keeps telling me that I don't understand the portfolio theory wich consist of:
'' a theory of investment which attempts to maximize portfolio expected return for a given amount of portfolio risk, or equivalently minimize risk for a given level of expected return, by carefully choosing the proportions of various assets''.

So I just pointed out to him that my returns compared with so called trained professionals disproves his argument wich was based on no facts.

 

[Abdel]

reality is the opposite of your projections.

http://www.ecb.eu/pub/pdf/scpwps/ecbwp047.pdf

I re-read the study, and found that eventhough it was published in 2001, the data they used was from 1992 to 1998.



 

[Abdel]

 

[alain]

I listened to NPR reports about OWS. Even though their message is not well defined, it seems all of them have a common concerned. lack of jobs. They complained they have been unemployed for some time and want a solution.

In the same news program, Alabama tomato growers complained nobody wants to work the field since their primary source of labor were illegal immigrants and a new law in Alabama makes it difficult to illegals to live in that State. Another concern of tomato growers has to do with Americans not wanting to do that type of job. They show up on day and usually quit before the day is over.

Draw your own conclusions.

 

[bigbadwolf]

In the same news program, Alabama tomato growers complained nobody wants to work the field since their primary source of labor were illegal immigrants and a new law in Alabama makes it difficult to illegals to live in that State. Another concern of tomato growers has to do with Americans not wanting to do that type of job. They show up on day and usually quit before the day is over.

The shifts are long -- about 12 hours -- in very hot and humid weather (95 F) and often dealing with toxic pesticides and chemicals. In addition there's an emphasis on speed. Even young illegals often drop because of heat stress or the pressure of work. The pay can be as little as $4 an hour for an illegal. For roughly the same reasons work in slaughterhouses and meat processing plants is often done by illegals.

 

[euroazn]

How is it a fail.

He keeps telling me that I don't understand the portfolio theory wich consist of:
'' a theory of investment which attempts to maximize portfolio expected return for a given amount of portfolio risk, or equivalently minimize risk for a given level of expected return, by carefully choosing the proportions of various assets''.

So I just pointed out to him that my returns compared with so called trained professionals disproves his argument wich was based on no facts.

>expected return
>given amount of portfolio risk
Just because you had a higher return doesn't mean a) you didn't simply take on more risk and b) didn't simply get lucky. Portfolio theory is simply optimizing your utility from risk/return under your budget constraints, and you clearly don't prove you did that.

 

[Abdel]

Just because you had a higher return doesn't mean b) didn't simply get lucky

 

[euroazn]

Perhaps you'd like to read this excerpt from the great Buffet himself (quoted in this blog post): http://stockvaluer.blogspot.com/2006/04/buffetts-coin-flipping-contest.html

 

[Abdel]

Perhaps you'd like to read this excerpt from the great Buffet himself (quoted in this blog post): http://stockvaluer.blogspot.com/2006/04/buffetts-coin-flipping-contest.html

Let me remind you that Buffet's company got bailed out.

He was going to lose his butt if it wasn't for governement intervention. If he's such a great investor, how come he didn't saw the crisis coming? In other words, he was clueless.

 

[euroazn]

Let me remind you that Buffet's company got bailed out.

He was going to lose his butt if it wasn't for governement intervention. If he's such a great investor, how come he didn't saw the crisis coming? In other words, he was clueless.

He did see the crisis coming; he just doesn't care. His investments are generally ultra-long term.
But again - did you actually bother reading that?

Because if you did you'll realize you're an egotistical orangutan.

 

[Abdel]

He did see the crisis coming; he just doesn't care.

So, he sees the crisis coming. A crisis that will make his company go bankrupt and doesn't care about it? And you want me to pay attention to what he has to say?

Because if you did you'll realize you're an egotistical orangutan.

''Abusive ad hominem (also called personal abuse or personal attacks) usually involves insulting or belittling one's opponent in order to attack his claim or invalidate his argument.

This tactic is logically fallacious because insults and negative facts about the opponent's personal character have nothing to do with the logical merits of the opponent's arguments or assertions.''

I hope you'll apologize.

 

[euroazn]

So, he sees the crisis coming. A crisis that will make his company go bankrupt and doesn't care about it? And you want me to pay attention to what he has to say?

''Abusive ad hominem (also called personal abuse or personal attacks) usually involves insulting or belittling one's opponent in order to attack his claim or invalidate his argument.

This tactic is logically fallacious because insults and negative facts about the opponent's personal character have nothing to do with the logical merits of the opponent's arguments or assertions.''

I hope you'll apologize.

Actually that's not ad hominem, but a reference to the essay, which you would have recognized if you actually read it.

 

[Abdel]

Actually that's not ad hominem, but a reference to the essay, which you would have recognized if you actually read it.

o ok, so if I read somewhere the description of a faggot giving by someone and I call you a faggot, it's not an insult.

You would of recognized yourself if you actually read that paper, correct?

Clearly, you didn't told me '' Buffet describes you as a egotistical orangutan''.

Anyways, lol

 

[mfegrad]

euroazn,

just ignore him. it was blatantly obvious from his first few posts that he had little to nothing to offer. nothing has happened since to alter that theory.

 

[Abdel]

euroazn,

just ignore him. it was blatantly obvious from his first few posts that he had little to nothing to offer. nothing has happened since to alter that theory.

Well, by saying that I have nothing to offer in terms of arguments, you just insulted all the people who took the time to reply to my posts. From Alexei, to dominic to euroazn to etc etc. Because hey, if they take the time to argue with a phony, they must be phonies as well, right?

Also, there is no arguments in your post (talk about having nothing to offer).

Anyhow, keep insulting people while hiding behind your username and no pic and please, next time, keep your condescending manners to your family and friends.

 

[euroazn]

Anyhow, keep insulting people while hiding behind your username and no pic and please, next time, keep your condescending manners to your family and friends.

Not only was that rude, but more to the point, wrong.
He's a CMU MSCF alumnus and has offered himself as a contact if you check the Quantnet CMU wiki.

But mfe you're right this is the last such post that I'll be responding to.

 

[Abdel]

Not only was that rude, but more to the point, wrong.

If he would of came with arguments, I would of responded with arguments.