Pseudo Random News and Comment

You may have noticed many of the links are now on Twitter. I’m not thrilled with the change but with the demise of Google Reader it’s easier to put most of the short comment links there.

Transplant experts challenge assumption, describe pathway that leads to organ rejection  It’s about time. It’s been pretty obvious something is missing from current treatments, and what do you know? It’s those damn dendritic cells again.

Predicting risky sexual behavior Scripts get the blame in large part. Makes sense. Everyone knows you go wild in college, as well as drink and do drugs, so it’s no surprise it’s rampant there.

Overspending Has Become a Modern Form of Mating Deception’ The modern potlatch, signaling what you really don’t have and are then committed to trying to maintain. Not high odds of long-term success.

The Killer Robot War Is Coming   Coming up with legal restraints. I’m not sure that property rights aren’t the right approach, as long as they’re strictly enforced – which they rarely are. But if one set of laws can’t be adequately enforced there’s no reason to assume another set will fare any better, particularly when they are aimed at the law enforcers.

Is Google a rat? The curious timing of the Mt Gox bitcoin exchange shutdown and the Gmailing money announcement has me wondering. There’s no way in hell the bank ratted on itself since they have a long history of laundering billions for drug dealers and others. There’s also the question of why ICE is handling FINCEN in the first place, but mission expansion and empire building always seem to be job #1 at homeland security.

Pseudo Random News and Comment

Why Is It So Hard to Keep the IRS Out of Politics? A: Because it’s so damn politically useful. I especially love this bit: “If I were Obama, I’d ask Eric Holder to appoint a special prosecutor…” Eric Holder. Ummm……

Is Psychiatry Dishonest?  Are its lips moving? Good piece on the emperor’s new clothes.

Let’s Cut Through the Bitcoin Hype: A Hacker-Entrepreneur’s Take The best thing I’ve read about bitcoin recently, maybe ever.

Our Algorithms Can Predict Future Disasters — Now What?  Knowledge is power, but also questions and confusion. Too many false alarms will quickly be ignored.

Living close to major road may impair kidney function. At least in stroke patients.

How to quickly spot signs of a stroke. Maybe. I had a hemorrhagic stroke and had none of these signs.

Did FBI Counterterrorism Agent Reveal That Feds Now Record All Phone Calls?  Of course! An obvious attempt to prove we’re getting our money’s worth with the million acres of server farms. They can’t fill up that much hardware with only employee porn stashes.

Exercise-related changes in estrogen metabolism may lower breast cancer risk. Get up, stand up, stand up for your breasts. If that gets used in a PSA I want some money.

Secular Bull or Bear? Excellent summary. Secular bears are no stranger to new highs, which makes diagnosis difficult. But if it was obvious which, it would have already happened.

Investment Risk Re-imagined Excellent rethinking of risk.

Study links diet with daytime sleepiness and alertness in healthy adults.  Fat puts you to sleep. Carbs do the opposite, Protein does neither.

Antibiotics could cure 40% of chronic back pain patients I had to check the calendar to make sure it wasn’t April 1st. It’s not. Backaches could be contagious.

Rewarding Behavior

I think it’s a general rule that over time people tend to do what they are rewarded to do, often despite finding the behavior initially repulsive. Rewards will find their own justification. So what is being rewarded today? Here’s one answer, from a Zero Hedge post to which I’ve added some snazzy interpretive graphics:

What does this say for the future of society?

Ignorance Can Be Bliss

There is an absolute limit to how much profit can be extracted from a market in any particular period of time. You will never make as much profit in the markets as hindsight and imagination can lead you to believe. Back-tested, theoretical profits will be devoured by a nearly limitless number of factors. The biggest profit eaters are shown below:Losses from slippage, not following the plan, commissions and fees, taxes, and the relative merits of different investing styles have been covered endlessly in the financial press. But the biggest factor is largely ignored. NASAYAYA: Not As Smart As You Assume You Are. Welcome to the future! The place where everything is out of sample and all that is certain or assumed goes to die a grisly death. You think you know X. You’re certain about Y. You think 10 years of intraday data is a representative sample of something other than those 10 years. The market will react the way it “should”. You feel your past results are mostly the result of skill. Whatever it is, the more you think you know, the greater the odds that you don’t know shit. Understanding comes with a curious byproduct: The more you know, the more you know you don’t know. Thus, true insight can only come with a generous side order of humble pie.

I’ve become increasingly convinced that trading nirvana is reached when you accept your near absolute ignorance in the markets. As dangerous as the inherently uncertain future is, it’s a known unknown. The unknown unknown, and even more dangerous, is what your preconceptions are blinding you to right now.

Ben Bernanke once said he was unable to imagine a set of circumstances that would convince him he was wrong about the economy. Burdened by that level of certainty he has no real choices or flexibility left. In his world he can’t be proven wrong and if you’re right, why change?

That’s the exact opposite of where you want to be in the markets. When you accept the completeness of your ignorance you’re free to listen to the market and go with the flow. Whatever theories, beliefs, preferences and biases you have lose their power to blind you because you know they’re all crap, and any help they may provide can only be temporary.

So take a seat. It’s time to start the meeting…Hi, my name is Mortalitysucks and I’m an ignoramus.

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Next time: Knowing enough to know you don’t know much of anything isn’t the end. The next rung on the ladder of enlightenment is answering whether it’s even possible to know anything. In other words, is there really such a thing as market-beating skill? How should the answer alter your approach?

Pseudo Random News and Comment

Four Basic Traits of Successful Investors I think #5 should be they’re boring.

Porn, rape, and a ‘natural experiment’  Read ‘em and weep anti-porn zealots. Leaves unaddressed what Dad’s sock drawer is doing to stay relevant when free porn is readily available elsewhere.

How to spot liars in official interviews Police interviews that is. When interviewing actual officials the old fallback of “when their lips are moving” is far more accurate than the 68% this increased cognitive load method identified.

Money Buys Happiness and You Can Never Have Too Much, New Research Says  Really the study highlights the difficulties of studying happiness, since this is measuring satisfaction rather than happiness. It’s possible to be quite satisfied with how things have turned out but not happy. I think generally satisfaction is based more on objective measures of outcomes. Happiness really doesn’t care…

Meet Mr. Money Mustache, the man who retired at 30 (via Crossingwallstreet) Naturally, I’m 9 for 9 on his tips.

Does Working From Home Work? As I’ve long suspected, if you read between the lines it’s better for the employer than the employee. Anyone have that Yahoo’s email?

Study Finds Women Most Aroused By Men With Intermediate Level of Beardedness. Most disturbing – because I didn’t find it first. This explains my unconscious avoidance of shaving more than once a week.

But I think this one tops the last one: Antibiotic Protects Men from Being Too Trusting of Attractive Women  A new meaning to “using protection.”  Normally used to treat acne, this means they made themselves more attractive to the attractive women but then didn’t trust them. Life can be so cruel.

Sperm cell release can be triggered by tightening the grip around the delivery organ  Pretty much says it all.

Why Still So Few Use Condoms. Because they suck. But Bill Gates is going to lend a hand.

Baby knows best: Fetuses emit hormone crucial to preventing preeclampsia  So manipulative they can’t even wait until they’re born to start working you.

Are Doctors Diagnosing Too Many Kids with ADHD?  “Data suggest, however, that a bright dividing line does not exist.” Exactly, any cutoff imposed on the distribution is arbitrary, and imposes drastic changes in how everyone will treat them.

Seven simple lifestyle steps may decrease risk of blood clots  Boils down to taking good care of yourself, which doesn’t make it easier.

Wall Street Is A Rentier Rip-Off: Index Funds Beat 99.6% Of Managers Over Ten Years  Even worse than I thought.

Pseudo Random News and Comment

Gene controls three different diseases  Just the sort of pathological cheapness on the part of nature that will make genetic cures for disease difficult. Multiple uses needn’t be all good or all bad. Fixing one thing may often break something else.

Build Your Own Neutra Home!  They still look modern a generation later.

What Martial Arts Have to Do With Atheism  Interesting interview with Sam Harris.

Sexually explicit material affects behavior in young people less than thought I always wonder how you find a control group of males who haven’t watched porn. In this study 88% said they had. 88% of the other 12% were lying. So the lack of statistical difference isn’t surprising.

Autism risk spotted at birth in abnormal placentas  This raises an interesting question of who is doing what to whom.

Pleasure and pain: the effect of (almost) having an orgasm on genital and nongenital sensitivity. I’m going to go way out on a limb and guess that subjects who perform in these conditions may not quite represent the norm, thought the results seem reasonable.

Thought Prenda Was Dead? No, It’s Up To Its Old Tricks… And More  Amazingly limitless depravity.

The Gold Medal Gold Model, Tarnished?  A fundamental model for gold. For the patient it seems to be holding up quite well.

Why Sleep Deprivation Eases Depression  Glial cells strike again.

Judge says giving up your password may be a violation of 5th Amendment. Forcing you to divulge evidence against yourself “may” be a violation of the 5th Amendment. Ya think? Totally gutless.

Calm Down … You Are Much More Likely to Be Killed By Boring, Mundane Things than Terrorism  I love numbers about relative risks. “You are 8 times more likely to be killed by a police officer than a terrorist.”

Pseudo Random News and Comment

Consciousness After Death: Strange Tales From the Frontiers of Resuscitation Medicine  I think he’s let a desire to believe something outrun the science to support it. He also seems to assume consciousness resides only in the brain rather than being an emergent property of a complex system involving the entire body as well as the brain.

The Most Stressful Places to Live  The least stressful state is, of course, Hawaii.

I’m on the drug that killed Paul Erdős  Smart drugs are coming to a workplace near you, and some day they may even do what is hoped. Keep in mind you can’t turn a donkey into a racehorse, and more isn’t always better.

Two days of staging as effective as four for high-altitude climbs  The short-term adaptations are quite rapid so there’s no point in diddling around any longer.

After Boston: Don’t Get Fooled Again by the ‘War on Terror’ Hawks  Nice dissection and prophylaxis.

Low-dose aspirin stymies proliferation of two breast cancer lines, study finds  More benefits from lowly, old aspirin.

Flu shots boosted by exercise  In moderation – prolonged intensive exercise is an immunosuppressant.

IRS Says It Will Change Its Policy On Looking At Emails Without A Warrant… At Some Point  Never assume you have any privacy. Perhaps at the end of a long trail, under a waterfall, whispering into the ear of someone is safe, but only perhaps, only if you’re not already under surveillance, and only for a very limited period of time.

My answer to John Hussman  Good example of the importance of knowing your time frame and goals. In 1995 when I first had the epiphany that we would be repeating the market action of the 1970′s on a grander scale I had intended to trade the swings like a madman. Instead, my time frame changed and I’ve mostly done nothing. Either way can be right (and it’s possible to do both at the same time).

An example:  Broadening the Window – Aligning Indicators with Correct Holding Periods

Virus kills melanoma in animal model, spares normal cells  Edging just a little closer to the immortality virus.

Decision making in scientific peer review unravelled with mathematical modelling  With all the fraud going on, is there any doubt this bit of reverse engineering will be abused?

Random Thoughts on Apple  Nice summary. The biggest risk to me is a very large percent of revenue is from the latest products so it wouldn’t take more than a couple bad quarters for Apple to lose a significant chunk of their revenue….and Samsung Galaxy is doing quite well in China.