fanboy123

It would force a flattening out of the pay structure in the US. It is up for debate whether or not its a GOOD thing. But that is what it would accomplish because envy is so disruptive in the workplace.

Try cutting wages on middle/lower tier workers if they know exactly how much upper mgmt makes. Tough to look a man in the eye while trying to extract some value out for yourself.

I had a similar thought with regards to high stakes gambling (pool, poker, golf, backgammon and prop trading). When you learn to do any of these one has to learn how to deal with making decisions under time and money pressure. Everybody that has ever played a sport competitively has made mistakes under duress that are difficult to explain later because your mind shuts off during that period. This is probably a limbic response to stress - your first instinct under danger is to switch to flight/fight and may not be using the framework that 10k hours (or however much time spent) built. Everyone can get better at moderating their response to this but I suspect that some people are naturally better suited at shrugging off the blaze of autonomic responses and still be able to focus on the task at hand properly. The people who attempt to put in 10k and fail because they can't handle pressure aren't accounted for. It makes for a nice book but saying 10k hours is all it took Michael Jordan or Gretzky or Mozart to hit their "master level" ignores this survivorship bias.

I think Jason has a good point that hitting a golf ball and being able to function under pressure are two very very different abilities and professional golf is most likely selecting for both abilities.

There are over two thousand four year colleges in the US. Saying we have (random number) 80 of the top 200 colleges in the world doesn't mean the system as a whole is producing adequate results.

Performance metrics should always be stated/calculated to reflect efficiency.

Was surprised at same types of thing the first time I visited. I believe this question is answered by this new york times article below about Japanese lost and founds. I've asked my friends about the phenomena and they attribute it to a sense of duty/routine - normally nobody even thinks twice about turning in a lost item.

http://query.nytimes.com/gst/fullpage.html?res=990CEED71131F...

People didn't believe in 07/08 that much of the price movement was due to the devaluation of the dollar. Perhaps the real bump in prices is due to the devaluation and perceived future devaluation of developed economy currencies. QE/helicoptering money/printing money to stave off deflation ain't free.

A lot of the speculation on comm is because monied people believe that US monetary policy will end with uncontrolled inflation rather than the soft landing the fed is hoping for. To my understanding this is a greater picture case of supply and demand. It's just that the product isn't crude it's insurance.

Really expensive timepieces should have gone out with the quartz watches that came in during the 80s. They haven't because some of the rich and powerful use an inferior technology (from a timekeeping perspective) to show how successful they are.

While hackers may just use their phones it is unusual to see a wealthy banker, talent agent or lawyer without a nice watch. I would assume it is more prevalent in jobs that require a lot of signaling for negotiation.

Actually I would think the US version would be a nice watch. The article seems to stress that it is a status indicator for business purposes.

PGs essay is great. To better understand how companies got good at selling us stuff I recommend watching the BBC special "the century of self." It goes over the how and the (amazingly recent) when of developed consumerization. It's available on google video :)

That use of capitalistic/libertarian ideals for efficiency in business would lead to major social unrest. Keeping dead weight (much of society) working keeps the masses and their pitchforks away from the houses of the ruling class.

I always wonder if they wouldn't be hated if they just charged the venues requiring it to be absorbed into ticket sans label. Instead of being listed as a "surcharge." Nobody hates mastercard or visa (outside of the payments industry).

My current MBA has an overheating problem because they didn't bother to design with heat dissipation in mind. Going to wait and see if similar complaints come up about current gen.

Wow great article thanks for the link. I don't know if I agree with the statement that nerds are separated from the pack by some sort of seperate value system. I remember all the middle-upper class kids that were attractive were automatically popular unless there was something very abnormal about them. Life is pretty harsh, if you are awkward or funny looking you START off placed in a box, which makes it much more likely over time to find comfort in a book/computer rather than "being like everybody else."

I think that a large component of feeling like you ended up with a different mindset due to "innate desire" is rationalization after being kicked out of the herd.

"My understanding of these things is that this kind of debt is mostly unsecured."

The debt is secured by the home itself. It is a mortgage-backed security. In some places it is a non-recourse loan which means that once you hand over your house the lenders have no claim to the rest of your assets unlike a credit card loan.

This might make understanding easier.

Start 100M mortgages. 100M bonds (in reality for "safety" it was more like 95M in bonds.) 80M was part of the upper class. 20M was part of the lower class.

If 30M of mortgages went busto without EVER paying a single payment and houses sold were worth 20M then 100% of the lower class got destroyed. Assuming the other 70M worth of mortgage holders kept paying until principle was returned the upper class never saw a single cent of loss and the lower class never gets paid a single cent of principle or interest.

It is a clever piece of financial engineering that allows risky loans to be "safe." It is also why writeoffs can be complete for the lower class even though the asset (house) is sold with a positive value.

It is complicated. You are correct in that when the house is sold investors get a recovery. Not all investors are created equal though. Difference pieces of a deal were paid different interest rates (according to risk) and as such they get allocated recoveries in a specific order. If you notice Toxie stopped getting payments a few months in and is declared dead a few months afterwards. This happens when the amount of losses eats through your piece of the pie. When the house gets sold is is sold for something less than the mortgage was worth. The losses get allocated to the riskier pieces of the deal which protects the lower interest rate/more "protected" higher pieces of the deal.

Also banks got bailouts which cushion them against losses but do not prevent losses. A loss on an asset is a loss on an asset. The federal reserve buying mortgage bonds was not considered a bailout per say but are helping to prop up prices which indirectly help the banks.

"Real Estate investment cycle is very long, 6 to 10 years, and very predictable. You are 25. There are plenty of time to catch a few cycles."

I was not going to downvote because of disagreement. It sounded like shilling with no reason to back it up.

I have no idea what you mean by predictable or how you have a timeline. You mentioned housing starts so I will assume you were specifically speaking to residential real estate. It sounds simple to say look at rent to income or housing starts for an indication of housing price trends but really if you dont know what you are doing dont bother.

You mentioned interest rates for example. You do realize that a conforming home loan is sub 4.5% right? Well, you might not know that for most parts of the country (prices behave differently in land constrained regions and or low population density) the biggest factor in predicting nominal home prices changes is the interest rate on a home loan. Home value and interest rates are inversely correlated just like most asset classes but a little more so since we have a social obligation to make it easier to own a home. Anyways, my point was if you think we are japan and will have 15+ years of low interest rates that might be ok to neutral for home prices. Keep in mind japanese housing prices countrywide have been falling since 1991. If interest rates happen to move upward anytime soon housing prices will be crushed. We have no room for interest rates to go downwards anymore. Also we have a ginormous shadow housing inventory that is being held by banks who have tattered balance sheets. There are a lot of homes that should be going through the foreclosure pipeline that are being held because a flooding of the market with empty homes would destroy the value of the mortgage obligations that are being held. Someday these will be sold however. It wont be pretty for the housing market or for the owners of the whole loans.

Ramblings. But my point was that nobody really has any idea whats going to happen in the future. The government has a plan of its own with its own agenda. The banks and servicers all are trying not to get crushed under an avalanche of bad assets and are hoping they can earn/appreciate their way out of it. Maybe underwater home owners in non-recourse states will wise up and walk away. There is some hoopla in the industry about the lack of ability to foreclose due to crappy title transfers (exchange of ownership of debt from one play to another) and this could effect the ability to lend since people are already nervous about unknown consequences for lending in this political environment. Houses are nice. You can live in them (and for a primary res I dont think pricing should really matter over 30 years although the math to be sure is somewhat complex). But nobody really has any idea where prices are going or to what magnitude. But maybe you know something I don't.

Oh, fyi there are case-shiller options and futures available on the CME. It avoids a lot of the bothersome carrying costs of actual ownership.

wow i wish i had the ability to downvote.

technically he said people buy stocks because they think stocks will increase in value. it is an useless/obvious observation but different from what you stated.

like cuban i do wonder why individuals think they can beat the market. well connected and well capitalized groups have access to far more information than is publicly available. with the rise of hft and the like not only are you under attack by players who understand the fundamentals better but also by people who can game the exchange platforms themselves.

Seconded. This book was great and I probably wouldn't have bothered with it if Warren Buffett didn't mention that it changed his life.

I have always read that the first step to being nice is to realize you aren't that smart and .....

This did not work for me. Life teaches you that you are smart. While young you are segregated and ranked according to academic ability so its difficult to ignore that sometimes you are much more intelligent than the avg person.

Trying to not be offensive is probably less important than trying to get somebody to like you. At least in your mind that should be your only goal and I think it helps you focus on things you can do fairly easily to build relationships. There are many ways to do this but you should be playing to your strengths. For my first experiences in an office I learned to like sports. You'd be surprised how many relationships with men of any age can be smoothed over by asking if they saw the game from the night before and exchanging a simple opinion. Note - if you pick a team make sure its the local one. Being a sox fan in nyc will not win you friends.

As I dealt with more people of all types I found that how much I personally liked people was not always directly related to their intelligence. Once you hit that point you should start to understand humility.

The debt was put into structured securities which means the banks/investors did not own individual loans. Letting people prepay for less than par would have caused infighting between the investors and was not legal for the servicers (administrators for these structures) to do.

My lifetime might not be long enough for "the long run." Any longer than that and your 200 years means very little.

Seems like the story of a brave woman. I am not sure how this addresses the NY article however.

I have no idea how wall st and retail banking got mixed up in everybody's minds. Stegall only allowed the two to be run under the same roof...

Why keep money in a mattress when the FDIC and its insurance is backed by the full faith of the USGovt? If you buy a share of stock well, that is different.

When you buy a share of stock, what does that mean? How is the value derived (of the share)? How does the system that tells you that value work? Most people can't answer these questions and yet invest money anyways.

The banking/financial system provides plenty of valuable services. That it also participates in value-destroying activities is always partially the fault of the consumers who want these activities to exist in the first place.

"In other words, he figured out pretty quickly that this is not an algorithm game or speed game - it, like many things on Wall Street - is a 'who you know' game. No matter how smart, how fast, how sophisticated you are as an outsider, the likelihood is that someone on the inside has a similar trade idea and can do it faster and cheaper than you."

For every wall st question posted to HN this is the answer. It's a lot of money in somebody else's backyard. The game's played in that backyard are always rigged against the outsider.

How is it not true? When ranking avg test scores & gpa the average asian and white scores are usually higher than other ethnicities at top tier universties.

I dont see why things like this always come up. That there is preference exhibited during admissions is fact. It is by design. The real question is if these practices have the desired effect on society.

That was part of the study. Researchers observed more irrational actions compared to say rural china or vietnam. Having that feeling that things wont change will cause you to give up and do what is deemed irrational.

There have been some poverty studies in India that shows that the lack in belief that "things could be different" may be the cause of some irrational behavior.

What I wonder from the article is what happens if you take a poor person and pay off everything and get them started with an education. Do they fall right back into debt? I have always suspected that having a child while a teenager is too big of a cost to dig your way out of.

Moody's is not going anywhere. Many regulations and investment charters require an NRSRO opinion. Inclusion of MCO got me to stop reading the article.

I also had the same question regarding restaurant software. I thought perhaps that nobody really developed for this market because it all gets bundled into pos software/services. Additional insight is appreciated.