Dec
7
Thoughts, from Victor Niederhoffer
December 7, 2009 |
The snare and delusion about executive pay at the banks is right out of Uncle Remus. Don't throw me in the briar patch. Are the banks really afraid that their stars will be lured away by others who are unfettered? Every thinking person knows the reason all these big bonuses are paid is because of the contribution to profits. But the contributions to profits are directly tied, nay 100% correlated, with the amount of capital that can be contributed to positions, and the amount of risk absorbed. The amount of capital that can be deployed is so much increased by all the programs that one can't begin to count them including the guarantee of debt, the injections, and the buying of troubled assets, and the direct buying. The recipients of the funds are very much afraid, like Br'er Rabbit, that they might have to keep those profits in the company itself rather than pay them out to those who might be "poached" in the briar patch. Who is the naive party in the Uncle Remus story and the market story that believes all these stories, and pays 100 cents on the dollar to forestall these terrible outcomes?
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This is one of the reasons why the public sector cannot work in the private sector. They do not understand the culture, the esprit de corps. Much akin to when GE bought Kidder Peabody and they were clueless as to the mindset a trader lives by. Most of the politicians and Congressmen have never held real jobs their whole lives.
Please forgive the implication that any parties are naive as I have no reason to believe that and the more I age, like Captain Aubrey, the greater the number of gaps in my understanding that I find. I left out the increase in capital from the payment of interest on reserves of the Br'er banks. And I certainly left out the implicit reductions in uncertainty from the opportunity to play a daily squash game or bike ride with the Interior.
Vic,
So long for you to suddenly find the true religion. I staked my position, many months ago, and received from your followers a tongue lashing. I dared the unthinkable; I challenged you. The response was interesting, and though harsh, believe me I’ve taken worse. Yes, the vehemence of the response was startling.
It was the same that assured me in my position.
What’s next Victor? What rocks your boat?
You’ve a beautiful son. Raise him well.
lon
A wannabe speculator (from India) after reading the round number theory and tweaking it to his own needs is puzzled to find:
that for 39 consecutive times since 5th May 2008, Nifty has an inordinate tendency not invade 5200 (at the close) anytime in the next five trading days, once it closes in between 5000 and 5200
There are five more (7th Dec -11th Dec 2009, where Nifty closed above 5000 but below 5200) in the sidelines eagerly waiting….
Side note - this wannabe recently wrote a book on Nifty, by heavily borrowing ideas from books written by Chair's former employees.
I want to know whether my personal goal can be fulfilled
Copy and paste of the references page
—
References
***See foot note
Day trading with Short Term Price Patterns and Opening Range Breakout By Toby Crabel
etc
Trading Secrets of the Inner Circle (Paperback)
Andrew Goodwin
etc
—
**foot note - I’ve deliberately not mentioned either his name or referred to his books, in this whole book. I will mention about this modern day polymath after reaching my personal goal, which is to get a personally signed copy of his book/s. Clue- both of his books have the word speculation in the title
—
Another side note, As I come from India , where we have this tradition of Gurudakshina ( refers to the tradition of repaying one's teacher or guru after a period of study or the completion of formal education).
My Gurudakshina will be to send the print version ( available in Feb 2010) or pre-print version through Fedex to Chair. In this regard I want to know Chair's snail mailing address. Of-course it is stupidity on my part to expect that Chair will be finding it is interesting to read , as I already mentioned the ideas/ramblings in the book are heavily borrowed from books by Toby Crabel & Andrew Goodwin