On moving on today's data.

Researchers depend on on major statistical technique for determining if a comparison is valid: Regressions and their coefficient.  But the flaw in statistics, really is determining the mean, and evaluating the mean against the population.

The problem with todays business has the flaw of not enough data.  Volatility in many markets are based on the latest data.  We speed to sell or buy based on what we hear today.  

The problem with this is figuring trends. A simple way to think about it is a question we hear at the doctor.  "Do you consume alcohol regularly?"  Well there is no exact answer for that.  If you drink a pint a day, well yea.  If you drink 5 pints one day a month, well thats regular too... somewhat.  What if you drink a bottle of scotch and get hammered once a year on your birthday, or every six months? Thats regular too. The point here is that "regular" is more about volume over time than frequency.

If we use this concept to define market data, we see big changes based on the latest data.  We try to be ahead of the curve by buying or selling at the latest data point.  Such tactic is stupid. Data tends to trend over time and blips in either direction can have no effect on the average, especially if the average is based on a broad timeline.  Two percent today, could be wiped by -2 tomorrow and +1 on the day after.   

Since there is an obvious cost to trading, it would make sense to save the transaction costs and hold.

Why big business is needed to fix the US economy.

When the recession began sometime in 2006, and economists were debating whether we were in a recession, I recall many of them talking about the consumer would be the key to keeping the US economy growing.  Three years later there is still talk about the consumer driving the economy.  We keep hearing that consumer spending is about two thirds of the economy and of that one half of the retail sales in this country significantly impact the psychology of investors, bankers and the stock market.  We hear that consumer spending needs to be increased, yet we hardly hear from economists, a plan for increasing spending.

From a fundamental perspective, or perhaps from my pure science background, I see that if we expect the economy to grow, the powers that be (government, big business, bankers, corporations) need to support the consumers.  And they need to provide this support in a synergistic way.

Here’s why.  

If the government supports the consumer, by creating capital improvement jobs, supporting unemployment, more stimulus, it makes the country broke.  This means that the fed will have to print more money  thus devaluing the US currency; congress will have to raise taxes, because money does not come from thin air. Cutting spending will create more unemployment which would lead to the government needing more money to support unemployment. Thus, if we rely on government alone to lead us to fast growth, it just wont happen, or we would need a new kind of politician who doesn't mind loosing their job by raising taxes. In essence, we cant rely on Washington alone.

If we expect the banks to give consumers direct credit, so that they Jill public can go out and buy shoes at the mall, that too will be bad.  First Jill needs the credit to fix her home so that her family can make it comfortable.  Since she cant “flip” the house in six years, her family has to decide how they will make the 1000 sq foot house comfy until she can get a better job. Of course if credit is going to be used, especially at today’s rates,  it had better be important.  Say for a big purchase of a durable  good- to replace a broken water heater perhaps?  Or maybe for a project that will reduce energy consumption, like a new energy star appliance, insulating the attic, or new low-e windows.  Since 9.5 percent of people have no jobs, plus the additional 1.4 million that don't have jobs and but don't count in the statistic, credit probably wont happen.  And since many people foreclosed on their home reducing their 650 credit score by 150 or more, credit wont happen. And since income growth is small, and people need to pay off the debts they already have, and since credit lines have shrunk, credit wont happen. The odds of not getting credit are greater.  Thus we cant depend on the banks.

Some economists speak about the need for small business to jump-start the economy.  They have saved us before you see. But just like Joe and Jill public need to face the banks so they can buy stuff, so does Mom and Pop.  Small business need capital or money so that they can hire people for increased production; or for the new machine that will improve production or for the new hire that will work the new machine that will improve said production. Since small business has to make stuff before they sell stuff, and they first need the money to make the stuff, they need money.  And since the odds of not getting credit are higher, then small business will have to rely on increasing productivity the old way: make enough profits to buy more stuff to make more stuff.  That will take years.

Of course there are folks who can begin driving the economy.   Folks with money who don't need to to ask the banks for money.  Like the government, who’s members would loose their jobs if they provided more money for the economy increasing the unemployment cycle, and  Big Business.  If the large corporations with large cash reserves would quit sitting on their billions, and hire people, maybe they can start moving the economy again.  Large corporations need to hire to maintain their competitive edge, so they need brains for R&D, and the R&D grind. Large corporations need employees to expand the safety and reliability of their products.  For example Apple need folks to figure out why the iPhone 4 cannot be used as a “phone”;  Microsoft has to figure out how to prevent the “blue screen of death” on Windows 7 and death by Google. GE needs to make an LED light bulb that costs less than 25 bucks so that people can actually use the technology to reduce energy consumption, and BP and others need to figure out how to drill in deep water without killing the ocean, birds, and economies of the Gulf states.  And that's just to get started.

If the large conglomerates  hire more  employees, then the productivity of the company increases, which means the company will need to increase orders to small business.  Small business will make profits faster, which will enable them to have more money to hire more folks or buy the big machine that will increase their output.  They will then be able to hire folks to operate the machines that's make the stuff that they sell to the big companies.  If large companies hire more people, we get better and safer medicines, better health care, smarter applications.  Since more people have jobs they would  have more money to spend.  Joe could then consider taking the loan to improve the energy savings of his house, which will give small business more profits to hire some one to make more stuff for building homes.  Now that we have increased the workforce, and the home project is half way, Jill might say, “While were at it,  why not purchase an energy efficient fridge?  So now GE has to make more fridges, which they have to get the components from small business, who then have more money to hire more people to make more components from GE.  And since GE made profits on the refrigerators, they can now spend more money on making the LED light bulbs cheaper.  A win, win.

Then with all of the needs taken care of, people will then go out and buy stuff that they don't need, like more clothes, shoes, eat out and all that.

Big business needs to realize that they are the ones who need to be taking the risk at this economic era.  Banks are broke, small business's, don't have capital, and people don't have jobs.  Most of all, since the government is stretched holding all of these other components of the economy together, another force is needed for growth.  And since Europe is in the same economic boat as we are, and we need the oil form the Arabs, starting a war is out of the question.

Still, we may be facing a sadder reality.  The longer we wait to start moving the economy,  the longer the population of people who support retail will have to realize will really don't need to spend their money on clothes shoes and all of that junk that fills the pocket of retailers and if “trickling up” was possible, big business.  Thus the two thirds of the GDP which produce the 1% growth these days will continue to decline together with the stock market, the government and the big business that they support.

And there was Joy.

Some people feel sad.  And the opposite of that is Joy. Many things make us sad.  Achiving the balance is really what that is needed... I suppose.

Going off grid hours at a time

When Bell received the patent for the telephone, (I say patented, because many other smart fellas worked on the idea during the same era and knowing the worth of intellectual property, I will not give credit to Bell at the expense of the others... but I digress)  I am sure he had the idea that one day, communications technology would come to the point where, you don't even need a physical phone to make a phone call.  Of course he probably didn't know exactly how it would be done, but being a man of science, I sure he thought about the possibility.

Of course now that communications technology has come to the point where we need less physical lines to convey our emotions, voices, and ideas, a new question arises.  Do we always have to be available to receive the communications of others?

Saying this, I am imagining the days before the telephone, heck, before email, or Facebook, or Twitter. Wasn't it just cool to just be at peace? You wanted to say how your family was doing you wrote a letter, and waited weeks, even months for the other to get the message, and even more time to get the response.  Your significant other went off to war you worried in peace, or forgot about them until you got the next letter.  Back then, people had time; time to think, decide, feel, cry, laugh.  Since there was nothing else to be done you could read a letter twice, and replicate, dare, reconsider an emotion to to someones communication.  Disclaimer: I was not there, so I imagine it was so.

Conversely, with the speed of communication in our era, we spend a lot of our time listening to , reading, sharing and re-twitting peoples ideas, and ours too.  Industry is using the same technology to sell us more shit than we need also, mostly because we have become used to deciding instantly.  I can only wonder how life would be if we decided to unplug, to think about nothing for a while. Zero data, form our own opinions based on prolonged analysis of small data sets, moments of time at a time.

Life could be less stressful without people constantly wanting to sell us something,or  tell us and our three thousand friends  about something.  Life could be easy without the constant updates on life or the red car that drove by, or the sandwich that they were having for lunch. Should we really care about latest news in politics or crime, or entertainment? I wonder how much of our sleep time that I was probably dedicated to nerve repair, is spent on processing the daily noise.  I'm sure that a paper will be out on that some day but until the day when a expert says that too much data is bad for our brains, just like too much sugar, and too much fat, I pledge to spend significant amounts of time off grid.

So if I don't respond to your email or phone call, or Facebook status in thirty minutes to a day, no worries mate.   I'm probably off grid, and  I'm sure whatever it is can wait.


The irony here is that I using the same forum to convey my ideas... yea , but I'm no hypocrite I don't expect your immediate response, or even a response for that matter. I'm just adding more data to your REM sleep processing. Do I think that communications technology is bad?  Of course not.  But I am certain that too much of anything will surely kill us sooner.

On value and appreciation.

There are a few things in life that make an individual, speaking generally, feel happy.  In my Survey of the world around me, I have collected sufficient evidence, all be it spotty and unscientific to suggest that as humans, we all need to feel valued. Of course, value is relative, just like love, and expectations, ones value depends on a variety of factors.

Without going in to the philosophy and psychology of ones value, I can say that one important thing for as as individuals is to know our value.  It is beneficial to know or value at work, at home, and every where else.  Also we need to know also how value is rewarded in those various environments.  For example, a question I might ask is:  "Can my employer indicate my value by the salary of bonuses that she gives me?" Or, "how does my significant other show that I am of great value to him?"

In the end the way society as a whole or its actors show appreciation, gives some indication of ones value.  The bigger question in all of this is: Do I know my value, and how do I measure that for myself?

The power of a power nap, and when to use coffee.

So I am feeling sleepy and I have this report to finish before the end of the day..  Being without the utility of human heat to keep me warm at night, reduces my ability to sleep for more than four hours at a time.  As a result, when it is about two pm. my body begins to ask for a nap.  There are a few choices here.  Go to bed earlier, get a Red Bull, some coffee, or take a nap for fifteen minutes.  Or maybe that 5 hour energy drink.... 

 

So I choose a fifteen minute nap, I set the alarm on my phone for 15 mins later, and rest my head.  I had the weirdest dream.  And about two mins later I hear my phone alarming, Nap time over, and guess what feel like I drank coffee.  No calories, No chemicals, feeling refreshed.  Ready to face the rest of the day.

Seven Days

It has been seven days since I have been home alone.  And I am beginning to realize why people look for partnership.  No matter all the stuff there is to do or play with it, nothing beats having some one to boss around, or boss me around.  Or to talk to or to listen to.  We really are social animals. At least I am.