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GaltMachine

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  • The ECRI Weekly Leading Index declines to 126.3 from a revised 126.6 last week, but the annualized growth rate jumps to 4.7% from 3.8%. It's the highest level for the growth rate since June 2011. The group's future inflation gauge leaped to an 18-month high of 103.4 from 100.6. [View news story]
    bbro,

    I do agree. It does seem delusional and I have been a strong supporter of them.

    They got the slowdown right but to get the rest right it will a whole slew of major revisions to the data.

    The only thing they have going for themselves right now is that they are completely contrarian.
    Oct 5, 2012. 03:06 PM | Likes Like |Link to Comment
  • Profiting From QE3: Spotting The Mistakes [View article]
    daro,

    Let me clarify. By "joke" I mean from an inherently authoritative point of view it does not justify its position as being an expert indicator. You get the same info from a poll of polls.

    On that basis, Obama is going to win re-election. If the poll of polls changes in Romney's favor, Intrade's Obama contract will go down as well - they are coincident indicators.

    You could use Intrade as a proxy for the polls in which case it is quite accurate.

    Sorry for being so stubborn on this topic, I have a personal reason for my contempt for Intrade's so-called oracular powers :)
    Oct 5, 2012. 12:56 PM | Likes Like |Link to Comment
  • Profiting From QE3: Spotting The Mistakes [View article]
    daro,

    "but that was only on election day and it was based on exit polls"

    That is the point. If it was a rational market then there is no way in hell that it would have sold off the day of the election regardless of exit polling data. This shows it is a reflection of the current poll and not a careful evaluation and weighing of all the relevant data.

    See Jeff's points above - they make sense as well. Low-volume, easily manipulated market and it is illegal for legal US voters to have an account with them.

    Take a look at Yale's Roy Fair's presidential equation or the Electoral College equation from Bickers and Berry for an alternative viewpoint:

    http://bit.ly/PEGilz

    "CU-Boulder prof's updated forecast still gives win to Mitt Romney
    Analysis updated with more current economic data shows win for GOP"
    With the presidential election a little more than a month away, political science professors from the University of Colorado have updated their election forecast with more current economic conditions and are standing by their prediction that Mitt Romney will win.

    "The professors -- Kenneth Bickers of CU's Boulder campus and Michael Berry of CU's Denver campus -- project that Romney will earn 330 of the total 538 Electoral College votes.
    The model developed by Bickers and Berry is based on the Electoral College and, they say, it is the only one of its type to include more than one state-level measure of economic conditions. To make their predictions, the professors comb economic data from all 50 states and the District of Columbia."

    The professors claim their model has predicted every election outcome since 1980 correctly.

    Intrade doesn't predict the direction polls will go in it goes in the direction of the polls. In theory of Intrade starts to show Romney as a winner and then the polls start reflecting it then that will make your point.

    That's all I am saying.
    Oct 5, 2012. 11:55 AM | Likes Like |Link to Comment
  • Profiting From QE3: Spotting The Mistakes [View article]
    daro,

    Intrade does not include US residents so therefore it is representative of what foreign residents think of our election.

    Intrade, also had John Kerry winning the election with a 90% probability on election day 2004, obviously that was wrong. Link to a paper from Dartmouth on it:
    http://bit.ly/Wux3cI

    Intrade is an opinion poll based upon opinion polls so people gambling are just reinforcing what they see in polls - it is a circular argument.
    Oct 5, 2012. 10:28 AM | Likes Like |Link to Comment
  • Profiting From QE3: Spotting The Mistakes [View article]
    Doug,

    "Jeff Miller, in the above article, called Obama the 2 to 1 favorite to win re-election. "

    This in reference to the Intrade odds before last night's debate.

    http://bit.ly/urYy0f

    I think Intrade's a joke but Jeff's statement is entirely accurate, he just didn't happen to source it. Today's Intrade pricing shows the effects of Romney's winning the debate according to the gamblers in Europe.
    Oct 4, 2012. 05:07 PM | 1 Like Like |Link to Comment
  • The ethanol industry's latest push is off to a slow start, with many gas station owners wary about the new gasoline blend containing 15% ethanol. The industry is counting on E15 to expand its market share and is aggressively marketing the fuel, but concerns over storing the fuel and burning it in older vehicles have stalled its adoption, so stations are in "sit back and wait" mode. [View news story]
    This could be the most disastrous economic policy we have ever had. There is absolutely nothing good about burning food for energy unless you are a politician.

    Bad for car engines, bad for people, bad for the environment which is ironic since this was one of the recommended solutions to the man-made global warming fraud.
    Oct 4, 2012. 11:41 AM | 2 Likes Like |Link to Comment
  • Aug Factory Orders: -5.2% vs. consensus of -6.0%, +2.8% prior. Inventories +0.6%. Shipments -2.9%. [View news story]
    Odd when a -5.2% print is a "beat".

    I guess this must be due to that Boeing order cancellation from last month.
    Oct 4, 2012. 10:06 AM | Likes Like |Link to Comment
  • Weighing The Week Ahead: The Debate About Jobs [View article]
    Daro,

    "it is also interesting that the polls show the race tightening up including in the swing states as noted in the article"

    For conspiracists it's a validation :)
    Oct 3, 2012. 01:39 PM | Likes Like |Link to Comment
  • Weighing The Week Ahead: The Debate About Jobs [View article]
    Daro,

    Here is a link to a study of the polls for that election in detail including all of the major polls. This completely contradicts the assertion in that Bloomberg article's "poll of polls". The article below is actually a really interesting read.

    No poll can even within a smidge of the actual margin of victory of 10% so what other than the debate result could explain it?

    http://bit.ly/Pwhcp0
    THE 1980 PRE-ELECTION POLLS: A REVIEW OF DISPARATE METHODS AND RESULTS
    Warren J. Mitofsky, CBS News
    "There has been much speculation about what went
    wrong with the pre-election polls of 1980. All
    the major published polls seriously understated
    Ronald Reagan's margin of victory over Jimmy
    Carter (table i) based mostly on interviewing
    completed late in the week before election day.
    The candidate polls, on the other hand, did con-
    tinue their polling through election eve, and
    did indicate the correct magnitude of Reagan's
    victory. Charges and counter-charges have been
    raised about the so called "big bang" theory that
    Reagan surged ahead in the final two days. I John
    Stacks reported this controversy in a Time maga-
    zine article last December, as did other journal-
    ists in other articles ~. It is my contention that
    there was significant change in presidential
    preference by the public starting with the Carter/
    Reagan debate that accelerated through election
    day. "

    As far as Gallup, they are the only consistent pollster for Presidential campaigns so their validity is often seen to be higher but I leave that to you decide considering they were the 17th least accurate pollster in the 2008 election.

    I don't disagree with the premise that most debates don't matter but I certainly would not put the Carter/Reagan debate in that category.

    When a premise seems suspect as this one does, I always check the source data directly - I am a natural born skeptic an attitude which has served me well in life.
    Oct 3, 2012. 12:44 PM | Likes Like |Link to Comment
  • Profiting From QE3: Spotting The Mistakes [View article]
    Cullen Roche of Prag Cap does a great job of explaining our monetary system using the acronym Modern Monetary Realism (MMR).

    A basic tenet of MMR is that banks are NEVER reserve constrained and therefore increasing reserves will not increase their lending activities. Banks are demand constrained and will lend out whatever the market wants under current conditions.

    http://bit.ly/PvLR5K

    Understanding how our monetary system works is critical to understanding how the inflation/deflation debate is resolved.

    Having a great grasp of this methodology would have led you to hold bonds for the last few years despite all the calls for higher rates that were based upon a fundamental misunderstanding of the pricing mechanism for interest rates. Holding bonds was highly profitable during that period.

    The FED is looking to ignite animal spirits which should lead to an increase in credit demand. The key is whether banks are willing to offer less stringent standards on loans.
    Oct 3, 2012. 10:25 AM | 1 Like Like |Link to Comment
  • Weighing The Week Ahead: The Debate About Jobs [View article]
    Daro,

    That article is totally wrong on the Reagan/Carter race especially since they don't source the polls they are using. Reagan was behind by 8% before the last debate according to Gallup and then won in a landslide by 10% after the last debate.

    http://bit.ly/NcZesI

    To what other event could you attribute a 18% swing in 2 weeks times?

    I think most debates don't matter but some do depending upon the circumstances. I happen to think the current environment is one of those times where there is a lot of uncertainty, angst, and fear about the future which means people will pay attention much as they did in that 1980 debate.

    If debates don't matter, why have them?
    Oct 3, 2012. 10:10 AM | Likes Like |Link to Comment
  • Methane in two Pennsylvania water wells reportedly has a chemical fingerprint that links it to natural gas from the Marcellus Shale drilled by Cabot Oil & Gas (COG -1.9%) through fracking, evidence that such drilling can pollute drinking water. COG maintains its operations haven’t contaminated the wells, and its scientists say the gas isn’t from the Marcellus. [View news story]
    Tricky,

    I wouldn't give a s##t.

    I use my own brain to reach conclusions and from direct experience I know all of these so-called "studies" have tendentious underpinnings - left or right.

    "Antarctic Sea Ice Sets Another Record"
    http://onforb.es/RB3jX8

    Arctic ice is like icecubes in water - sea water level does not change but it certainly makes for great alarmist imagery.

    http://bit.ly/SYAmtM
    "The Antarctic ice sheet is one of the two polar ice caps of the Earth. It covers about 98% of the Antarctic continent and is the largest single mass of ice on Earth. It covers an area of almost 14 million square km and contains 30 million cubic km of ice. That is, approximately 61 percent of all fresh water on the Earth is held in the Antarctic ice sheet, an amount equivalent to 70 m of water in the world's oceans."
    Oct 2, 2012. 05:12 PM | Likes Like |Link to Comment
  • Weighing The Week Ahead: The Debate About Jobs [View article]
    Jeff,

    Thank you. You certainly have more guts and patience than just about any other writer on this blog.

    I greatly appreciate the feedback.

    If you do have the patience to respond, I have one last question.

    Would you do anything differently from a markets/investment point of view if you knew a recession was likely imminent?

    Best regards.
    Oct 2, 2012. 05:05 PM | Likes Like |Link to Comment
  • Methane in two Pennsylvania water wells reportedly has a chemical fingerprint that links it to natural gas from the Marcellus Shale drilled by Cabot Oil & Gas (COG -1.9%) through fracking, evidence that such drilling can pollute drinking water. COG maintains its operations haven’t contaminated the wells, and its scientists say the gas isn’t from the Marcellus. [View news story]
    "Hard to be an objective scientist when your salary depends on you defending the company at all costs."

    Kind of like all those scientists paid by governments worldwide to prove that man-made global warming is a fact. Let's see how quickly those grants' dollars would dry up if they said there was no global warming.
    Oct 2, 2012. 12:05 PM | 1 Like Like |Link to Comment
  • Methane in two Pennsylvania water wells reportedly has a chemical fingerprint that links it to natural gas from the Marcellus Shale drilled by Cabot Oil & Gas (COG -1.9%) through fracking, evidence that such drilling can pollute drinking water. COG maintains its operations haven’t contaminated the wells, and its scientists say the gas isn’t from the Marcellus. [View news story]
    The most interesting excerpt of the article to me was:

    "In Dimock, the EPA found that some residents had methane in their water at or more than 14 milligrams per liter -- double the Pennsylvania state safety level -- even as it issued a statement that the water was safe to drink. The U.S. doesn’t set a limit on the gas’s level, as the agency says methane doesn’t impair the smell or taste of water. It can be explosive."
    Oct 2, 2012. 12:03 PM | Likes Like |Link to Comment
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