jhulla

Housing is a taxpayer subsidized, inflation proof savings plan for the average citizen. It is also levered.

Open this chart of historical mortgage rates and click 'max': https://fred.stlouisfed.org/graph/?g=NUh

Since 1981, rates have declined and tax treatment has become more advantageous to existing owners.

With the current ZIRP/NIRP/QE regimes around the world, the leverage available to the average citizen has never been greater. That leverage has gone directly into housing.

If the leverage trends continue (see 'helicopter money'), housing (along with all other asset classes), will get further out of reach.

Out of an abundance of concern for security, I use a Chromebook running without any browser extensions for all my banking and investing activities.

I take it as a given that my Chromebook will always be more secure than my Macs and Windows machines. Less likely to have invasive malware of all types.

I currently have a Toshiba Chromebook with a gorgeous screen and good battery life. It just works.

You are correct. I removed the "are".

These days, a significant portion of the mortgage industry is built on rapidly transferring risk onto the Federal Government. Even though agency bonds are sold on the open market, after 2008, we all know those are effectively insured by the Federal Government.

This is a way to pass free money to everyday homebuyers.

Public companies socialize their profits through tax, legal, labor and regulatory compliance. According to the article, Fannie and Freddie are being hit above and beyond those. This is quite unfair to the public shareholders.

If Congress wants the public benefit, then Congress and the White House should have wiped out the public shareholders in 2008 and taken over the companies.

Freddie and Fannie were the epitome of privatize the profits and socialize the losses.

Since inception they've benefitted from lower capital and mortgage insurance costs due to their implicit government backing. In return, they've accepted substantial oversight from the government in regards to their loan acceptance standards.

The 2008 rescue and then QE where the Fed bought Agency debt by the billions made the implicit government guarantee very, very real.

When Fannie and Feddie went insolvent, Congress and the Obama administration as the rescuers had the opportunity to completely wipe out the public shareholders and take over the companies. This is what should have been done.

Instead, we now have zombie public companies whose profits are siphoned off through political agreements instead of explicit contracts open to public scrutiny.

Yeah - this is likely a place for Buffett to park some cash with sensible returns/risk for Berkshire. It is not likely to be Buffett jumping into the tech business.

My guess is that Buffett's team looked generally at the risks within Yahoo and hedged them with generous covenants on the financing.

I am surprised that Gilbert didn't get Wall St financing. I would think that analysts at the big banks could structure a deal more carefully aligned with the underlying risks.

Alphabet isn't the only big corp down after hours today.

As of now:

Microsoft - down 5%. http://www.marketwatch.com/investing/stock/msft

Visa - down 4% http://www.marketwatch.com/investing/stock/v

Starbux - down 4% http://www.marketwatch.com/investing/stock/sbux

In each case, the cause is different. But one thing is common, trailing PE ratios of all four are high compared to historical norms. High PE ratios are maintained with high growth in revenue, earnings and margins. Back off even a bit and the invisible hand smacks you in the face.

"Perfectly valued" to me means that at that moment, the price reflects the actions of everyone. It includes the actions of all buyers/sellers who choose to participate and not participate, the regulators, as well as the meddlers.

My point is a pedantic one referring to the OP using the word "overvalued". The market price is never over/under valued. It is merely the market price at that moment.

My point is simply a tautology: the price is the price. Now the price may change, someone may have their thumb on the scale, there may be shill bidders driving sentiment, etc. But at the moment you get a bid/ask spread, that is what you get.

Practically speaking, I personally don't believe the efficient market hypothesis due to the very obvious meddling by political actors, central banks, national treasuries, etc. Behavioral finance has also consistently demonstrated that humans do not react rationally in markets.

To be pedantic: the market is perfectly valued at every moment. Of course market prices will change, sometimes very quickly.

BTW, this is a great site for tracking S&P ratios: http://www.multpl.com/

IMHO, Yahoo Finance is a wildly undervalued asset. It has the deepest and highest quality data integration of any publicly available site. I use it every day.

It has also been largely ignored for better part of a decade. Three areas where Yahoo just fumbled the ball: 1) Portfolio tracking, 2) Message boards and 3) Monetization. None of these have been upgraded in years.

Portfolio tracking is an exercise in good UI & UX. Yahoo could and should have bought any number of good teams over the years that have built portfolio trackers.

Yahoo finance message boards have very low signal to noise ratio. They should have either gone the reddit model of comments or even better, Yahoo should have bought Seeking Alpha a long time ago. Alternatively, when Seeking Alpha began to grow, Yahoo should have built a competitive product. Instead Yahoo let their message boards turn into a low value destination.

Monetization - this is just comically inept. Visitors to finance sites have and care about their money. They also tend to be older. Some of the highest paid ads target these people: Credit cards, mortgages, health, travel, banking, personal loans, autos, etc.

Yahoo finance should have been the center of a massive business unit at Yahoo generating a substantial percentage of their revenue.

What went wrong?

The only solution out of this paradox with respect to carbon fuels is taxation. Unfortunately, as much as we'd like, a global carbon tax regime is not practical, nor enforceable. So we're stuck.

Spot on. Addiction causes fundamental changes in the brain. Helping addicts is a complex process well beyond fining or imprisoning them. The goal is to reverse the addiction. It doesn't happen by punishing an addict.

This is a useful paper: "Imaging the Addicted Human Brain", http://www.ncbi.nlm.nih.gov/pmc/articles/PMC2851068/

With the massive drop in oil prices, global oil consumption and carbon emissions will continue to trend upwards.

In aggregate, the American consumer is certainly not showing any concern for climate change:

Americans Revert to Buying Gas Guzzlers: http://www.cbsnews.com/news/americans-revert-to-buying-gas-g...

Both energy and China are the big risks. It'll be interesting to see how much of their foreign reserves were used up in January.

To some extent, it is easier for the Chinese to defend the on-shore yuan market (CNY) through capital controls. It is harder to defend in the off-shore yuan market (CNH). Great discussion from a few days ago here: https://news.ycombinator.com/item?id=11008872

I personally have tremendous admiration and respect for managers of the Chinese economy and I think betting against the Chinese government is just a money-losing, dumb idea.

IMHO, the big threat continues to be oil. Cheap dollar funding has pumped up global supply to well past demand. This is crushing the economies of oil-exporting nations through currency devaluation. Ruble, CAD$, Nigerian Naira, Krone, Bolivar, etc. have gotten crushed.

Developed Market banks and investors have poured a lot of money in emerging markets in the past decade. Some of that investment is going to be lost.

It is an open question whether we are working up to an event that is similar to the 1997 Asian financial crisis, 1998 Russian default, the 2012 European debt crisis, the 2008 Global financial crisis, or something milder, or something much worse.

Stop scaring the kiddos with your ghost stories. At least let them enjoy their weekend.

The problem is shrinking global liquidity. Losses in the Chinese financial system and in the global energy sector are forcing governments, central banks and sovereign wealth funds to sell assets around the world. These are some of the biggest asset managers in the world.

It is unclear to me how this will end. When the mortgage market melted down and destroyed the balance sheets of banks, the Federal Reserve liquified their illiquid assets using QE. For better or worse, QE restarted the jammed shut credit engine.

At the moment, outside of wholly energy dependent countries (Middle East, Latin America, Nigeria, etc.), there does not appear to me a 2008-like financial system shutdown.

Coming back to tech. IMHO, big tech companies with inflated multiples (as benchmarked against the FCF generating engines at GOOG and AAPL) now have a target on their backs. Unicorns that aren't cashflow positive are going to learn how to negotiate down rounds. Real estate values are sticky and will hold up longer than people think. Engineer salaries are not going to drop a whole lot. The number of people employed might.

"No upside to a high price of gasoline." This is not true.

In no particular order, and off the top of my head, the rapid disinflation in the price of oil is currently:

1. Wreaking havoc on the budgets of most oil exporting nations. 2. Destroying purchasing power through currency devaluation in Russia, Nigeria, across the Middle East and Latin America. 3. Crushing the economies of parts of Canada, Alaska, and the Dakotas. 4. Directly causing job losses in Texas. 5. Negatively impacting the Houston office markets. 6. Destroying earnings of publicly traded oil companies. 7. Reducing stock market valuations of said companies. 8. Reducing portfolio values. 9. Impacting earnings of banks that have extended credit to oil firms.

Miners produce a stream of bits by consuming CPU cycles, energy, data centers and admins. First, China is a low cost producer across many product categories. It is not surprising that bitcoin mining is also on that list.

Second, there are economies of scale to be exploited. Over time, it will become more profitable for the largest miners to increase capacity vs the smaller miners. The largest miners will get cheaper power contracts. That alone gives them an advantage that will allow them to take market share from the smaller miners.

The end result is fewer, but larger, miners doing more work.

Among the many things the federal could fund, one would be an organization that would develop a uniform legal code governing self-driving cars for adoption across federal/state/local levels. This would harmonize definitions, requirements, liability, insurance, penalties, etc. across all legal jurisdictions.

Great summary of the current state of bitcoin.

In the conclusion he states: "<i>Even if a new team was built to replace Bitcoin Core, the problem of mining power being concentrated behind the Great Firewall would remain.</i>"

Bitcoin's decentralized nature encourages power pool formation by promoting economies of scale. It is not surprising that like the production of electronics, clothing, toys, etc. the lowest cost center is in China.

I do not trust random devices that plug into my home network. All connected devices are on a 'guest' network and firewalled (openwrt) from my other machines.

When I go to a cafe with my laptop, I run it in fully firewalled mode (no incoming connections of anysort).

At home, I want my machines to be more promiscuous. With the promiscuity comes various concerns. Whether it is my 1Password safe, my health and financial records, whatever - I don't want some $30 connected device to connect to my home network and publish a port to the outside world that permits tunneling into my inside network.

Unfortunately, outside of sandboxing/firewalling, I do not have the time to implement a tracking system to see what devices doing what.

Anyone else feel more safe with connected devices at home? What do you do?

Personal experience with ACA: As of 2016, we're onto our 3rd insurer. Each prior one has dropped our local doctors, physicians groups and hospital. With each insurance change, our deductible has gone up, our premium has increased and our co-pay, co-insurance has increased.

In effect, our ACA plan has become an extremely expensive catastrophic insurance plan.

Thanks.

1) Expecting a human to be on deck within some fraction of a second in challenging times will not fly.

2) Perhaps software in cars can be independently safety tested. Just like cars are collision tested today.

3) Understand about human reaction times. My question is about making moral choices: hit a pedestrian or sacrifice the driver?

Can someone with knowledge answer questions about the current state of autonomous cars:

1) What do these cars do in ambiguous driving environments: construction zones, poorly/under relined lanes, freshly paved roads, hazards, dark/rainy roads where camera images are useless, etc.

2) How do these cars handle system failure while driving? Blown tire, engine failure, etc.

3) Is there "Moral Decision Engine" code in current generation cars? E.g. person runs out in front of an autonomous car, the car chooses to spare the person by veering off and hitting some inanimate object. I can imagine a class of accidents in traditional hands-on cars where a driver hurts himself in order to avoid harming a pedestrian. Is such moral logic hard wired into autonomous cars?

There is a key component missing from this proposal: what benefits will be cut? As written in the article: "this national basic income would replace all other benefit payments"

There are many cases where unequal benefits payments are considered politically, morally and ethically acceptable by the majority of society. E.g. the blind, the handicapped, war veterans, orphans, victims of crime, volunteers...

For example in the US, the blind may deduct expenses from their income before taxes that others may not. This is an unequal benefit that we collectively accept.

In Finland's proposal, what will happen to benefits for special cases?

Insiders can file 10b5-1 plans - committing to a sales plan in advance.

"These plans are widely used by officers and directors of public companies to sell stock according to the parameters of the affirmative defense to illegal insider trading available under Rule 10b5-1, which was adopted by the SEC in 2000."

http://corpgov.law.harvard.edu/2013/02/05/rule-10b5-1-plans-...

Part of the vetting process of tenants is simply this: will this person be thoughtful in my property. E.g. this person will not through negligence or malice destroy my walls, my plumbing, abuse the appliances, burn things in my oven. And often the most annoying: will not smoke inside the property.

You can do your due diligence with one tenant. When that tenant airbnb's the property and brings in say 50 other occupants over the course of a year, you are now in a completely different zone.

QE in Japan is another beast altogether. The Bank of Japan openly buys Japanese stock ETFs:

http://www.bloomberg.com/news/articles/2015-10-28/owning-hal...

Ponzi himself would blush in shame over this.

OK - I had to confirm the water-skis. You're not kidding:

https://www.cms.gov/medicare-coverage-database/staticpages/i...

Has Monty Python taken over the ICD?