pdmunro

You might be interested to know that in Australia where I live, the reasoning continually given by our renumeration committees for the outrageous remuneration packages given to CEO's is that if we don't pay them multi-millions then the chief executives will head off to the US. In other words this talk about CEO's going elsewhere is primarily self-serving spin. I recall from the distant past, a senior executive of a multi-national saying that the idea that the high-flyers under him needed high salaries to motivate them was pure baloney. His words were memorable: "In fact, they are so driven by the need to compete, they would work for coke bottles". And I am assuming, he was talking about empty coke bottles that they could take to the corner store for a refund. I work for a very successful not-for-profit company attached to a university. The first day on the job the CEO invited me into his office for a coffee. I recall him mentioning to me in jest, that, unfortunately, we were not-for-profit. The implication being that, if we could keep the profits, then instead of the money having to be plowed back into improving the services to our clients, he could simply pocket a few million and slip quietly into retirement. I guess he earns about 3 times my $75 000. So about $200 000. I am sure he would say that this is a fair compensation for his workload and stress.

From Warren Buffett's recent (2009 Financial Year) Letter to shareholders: "In my view a board of directors of a huge financial institution is derelict if it does not insist that its CEO bear full responsibility for risk control. If he’s incapable of handling that job, he should look for other employment. And if he fails at it – with the government thereupon required to step in with funds or guarantees – the financial consequences for him and his board should be severe. It has not been shareholders who have botched the operations of some of our country’s largest financial institutions. Yet they have borne the burden, with 90% or more of the value of their holdings wiped out in most cases of failure. Collectively, they have lost more than $500 billion in just the four largest financial fiascos of the last two years. To say these owners have been “bailed-out” is to make a mockery of the term. The CEOs and directors of the failed companies, however, have largely gone unscathed. Their fortunes may have been diminished by the disasters they oversaw, but they still live in grand style. It is the behavior of these CEOs and directors that needs to be changed: If their institutions and the country are harmed by their recklessness, they should pay a heavy price – one not reimbursable by the companies they’ve damaged nor by insurance. CEOs and, in many cases, directors have long benefitted from oversized financial carrots; some meaningful sticks now need to be part of their employment picture as well." http://www.berkshirehathaway.com/letters/2009ltr.pdf ******************************************************** My personal opinion I recently heard a TV interviewer ask President Obama if there was anything that could be done to force the top financiers to get "their snouts of the trough". My personal opinion is that this is the wrong question - it is not pointed enough. I think it should be: "What is being done to force these top financiers to get their hands out of the till?" I honestly believe they are committing robbery. Robbing both shareholders and customers. They are committing crimes and have got away with it because we have an implicit trust that there are mechanisms in place to stop people from stealing. For their part, the top financiers probably twist their undeserved remuneration packages in their own minds to be nothing more than equivalent to having "won the lottery". We go along with it, looking upon multi-million dollar paymernts with a mixture of envy (secretly hoping we might get to that level) and blind acceptance that they must be worth it. Do our minds misconstrue $20 million as some small multiple of the average worker's $50 000 pay packet? In fact the CEO is receiving 400 times the average. Are we unable to appreciate that no one can work 400 times harder than the average? Are we unable to see that this is unsustainable? That it is damaging the business? That it is robbery? And where is the financial press in all this? Why is there no examination of the role that these multi-million dollar robberies play in wrecking a financial system? *********************************************************

I remember my sister saying that her social group used to play "bingo bridge". Each player had a bingo card with either scores or bids on it and you won when you completed a line, or something like that.

"ultimately leaving themselves with only one policy tool — the epic and unfair taxpayer-financed bailouts." interesting article but saddening at the same time. I think this (above) says it all – those in charge (Fed, Congress etc) knew they could step in at any time and support in times of stress. But failed dismally (despite miles of risk analysis) to estimate the extent of the eventual stress that would unfold. Guys like Burry (if employed by banks or investment houses) would have lost their job because they failed to milk the gravy train during the days of lending excess. ************************************************************ The above is an email from my brother in response to the Burry Op-Ed piece.

Interview of Michael Lewis on "60 Minutes" http://www.cbsnews.com/video/watch/?id=629...entBody;housing (Part 1) http://www.cbsnews.com/video/watch/?id=629...entBody;housing (Part 2) http://www.cbsnews.com/stories/2010/03/12/...in6292458.shtml ("60 mins" text) Michael Burry's investment company: http://www.scioncapital.com/ (Scion) http://scioncapital.com/index__letters.html (early Scion letters) http://www.scioncapital.com/PDFs/Scion%202...20and%20FAQ.pdf (Scion Primer) ************* Excerpt from Michael Burry's Primer ************ "Credit default swap contracts on asset-backed securitizations have several features not common in other forms of swap contracts. One feature is cash settlement. Again, examining PPSI 2005-WLL1 M9 - the BBB- tranche - we see it has a size of $5,894,000. Because credit default swaps on mortgage-backed securities are cash-settle contracts, the size of the tranche does not limit the amount of credit default swaps that can be written on the tranche, nor does it impair ultimate settlement of the contract in the event of default. By cash-settle, I mean that the tranche itself need not be physically delivered to the counterparty in order to collect payment. An investor with a short view may therefore confidently buy more than $5,894,000 in credit default swap protection on this tranche. As well, these credit default swap protection contracts are pay-as-you-go. This means the owner of protection on a given tranche need not hand over the contract before full payment is received, even across trustee reporting periods. For instance, if only 50% of the PPSI 2005-WLL1 M9 tranche is written down in the first month, the owner of $10,000,000 in protection would collect $5,000,000 and would not need to forfeit the contract to do so." Source: http://www.scioncapital.com/PDFs/Scion%202...20and%20FAQ.pdf (Scion Primer) My paraphrase If I read this correctly, it's saying that if there are mortgagee defaults and subsequent writedowns occur, then 1) we don't have to wait for the whole debt instrument to be written down for our bet to pay off - if part of the debt intrument is written down, we get a payout on that part. Say, our yearly insurance premiums are 2% of a 10 million dollar tranche. The mortgage tranche might have a 30 year lifetime, but we don't expect to be paying premiums for 30 years. In fact, we expect there to be a significant number of defaults in 2 years when the variable interest rates go from, say, 6% to 12%. So if we wait 2 years, paying 2 x 2% = 4% premiums, we expect to get paid whatever the size of the writedown is. If the whole, say, $10 mill is written off, we make $9.6 mill for our $0.4 mill outlay. 2) we get money if writedowns occur, rather than getting the original property. We won't be burdened with property in a falling market - we get cold, hard cash. Now these CDS (insurance policies) were taken out with the biggest banks, (Deutsche, Merrill Lynch, ...). They weren't taken out with the lesser players like Lehman Brothers. Michael Burry wanted the institutions taking the bets to be able to pay up when the day of judgement came. Also the bets were made on tranches where bad lending decisions had been made, such as zero requirement to pay back the loan in the initial years, the interest could just accumulate. And loans were given to people with very low incomes. Defaults were guaranteed to occur. ******************************************************* Examination of CDO's in Harvard 2009 thesis: http://www.thefacultylounge.org/2010/03/th...ard-thesis.html (Faculty Lounge)) http://www.hks.harvard.edu/m-rcbg/students...CDOmeltdown.pdf (Anna Katherine Barnett-Hart's, March 2009, thesis)

an excerpt re Michel Burry from "The Big Short" http://www.vanityfair.com/business/feature...?printable=true

fascinating http://www.bloomberg.com/apps/news?pid=new...id=aUpBrUJ.pIiA

I probably have not understood correctly, but I believe it is a desirable feature for there to be no further bidding during an undo request. Thinking about it: (1) It is so long since I have asked for an undo, that I cannot remember whether the "Undo request" appears on top of a bidding box, or whether it appears alone with no bidding box present in the background; and (2) I don't know if E understood that he had to reply to the undo request before the game could proceed. Anyway, it was a fairly interesting game among "experts" before it ended in recriminations and tears!

I was kibitzing a table using the Flash client. The host (S) dealt. Bidding went P - P - P (Undo request by N). E said he had no bidding box. His comment was not understood by the other players. Eventually someone (W or N?) rejected the undo. E said he now had a bidding box and made a bid. The host (S) booted his opps (EW). I guess he misunderstood the situation and thought EW should have allowed his partner's undo request. A fellow kibitzer joined the table (permission required) as E. About a minute later, I noticed his name was still listed as a kibitzer even though he was now siting and playing at the table. I left the table shortly after. There were about 8000 on BBO at the time.

Being a recovering "know-it-all", I find I'm actually delighted to come down off my perch and learn some interpersonal skills: http://www.amazon.com/Game-Penetrating-Sec...s/dp/0060554738 http://www.amazon.com/gp/product/159726563...=cm_rdp_product

If I try to explain it in my own words, I think what happened is the following. People on low incomes were given mortgages through agencies such as Freddie Mac and Fannie May. Goldman Sachs bought "bundled mortgages" from Freddie and Fannie and onsold them to investors, advertising them as, say, AAA, returning, let us say, 10% per annum. The investors who bought these products lost a lot of their money when the people who took out the mortgages (the mortgagers) couldn't make their repayments, house prices collapsed, and the houses, if they could be sold, fetched only say 60% of their original price. At the same time, Goldman Sachs bought insurance policies (called Credit Default Swaps), against the possiblity that the mortgagers would default on their loan repayments. These CDS's operated on the "final fool" principle: they circulated through investment banks and hedge funds, with the financiers skimming off their percentages. Goldman Sachs was a major beneficiary when the sizeable CDS's it had taken out with AIG were stumped up by the US taxpayer. The "final fool" was the US taxpayer. In summary: The system of bundled mortgages, that Goldman Sachs was instrumental in setting up, collapsed, but Goldman Sachs emerged all the richer because (1) it had onsold its bundled mortgages to investors; and (2) it took out bets with AIG that the whole system would collapse, and when AIG lost the bets but couldn't pay up, the US taxpayer paid up instead. This gave Goldman Sachs a $16 billion windfall to distribute amongst its executives.

The BBC has a lot of relevant information. "According to residents in the Somali region of Puntland where most of the pirates come from, they live a lavish life. "They have money; they have power and they are getting stronger by the day," says Abdi Farah Juha who lives in the regional capital, Garowe. .... "They wed the most beautiful girls; they are building big houses; they have new cars; new guns," he says. ... BBC Somalia analyst Mohamed Mohamed says such pirate gangs are usually made up of three different types: •Ex-fishermen, who are considered the brains of the operation because they know the sea •Ex-militiamen, who are considered the muscle - having fought for various Somali clan warlords •The technical experts, who are the computer geeks and know how to operate the hi-tech equipment needed to operate as a pirate - satellite phones, GPS and military hardware. Source: http://news.bbc.co.uk/2/hi/africa/7650415.stm The pirates know the law. When they see a naval frigate coming, they dump their weapons, boarding ladder, and even satellite telephones over the side. This is what has happened with the pirates being tracked in the operations room. ... The sailors here like to say that the problem is as much on land as at sea. In other words, there will be pirates as long as there is chaos and instability in Somalia itself. Source: http://news.bbc.co.uk/2/hi/africa/8371139.stm If I recall correctly, the pirates in the Straits of Malacca were only stopped with cooperation between the countries bordering the Straits. Following that precedent, stopping the Somali pirates requires appropriate strategies involving the countries in the horn of Africa (and Yemen?). I ask: Is there a direct correlation around the world between the number of unemployed men in their 20's and the degree of instabilty and fighting that that region is experiencing? Haiti, Gaza Strip, Afghanistan, Somalia, ... all have unemployment rates of 70+ %. Imagine if one's own country was like that. Drug running, smuggling, piracy, mercenary work must grow in attraction the longer you are out of work.

best forum topic in ages ... shows me what I'm missing by not watching TV soaps ... topic should be pinned ... I must send a link to my sister: she spent a month in Spain recently - this will prompt her to tell me a few more stories ... sorry, I still cannot stop laughing ...

A couple of abbreviations, used on this forum, that caused me to pause and scratch my head: ainec "and it's not even close" ATB "Assign the blame"

Quotes from Victor Mollo's Masters and Monsters Recently posted in http://bridgejokes.blogspot.com/ Hideous Hog: Probability, playing rules, conventions and systems take the place of thinking. That is why they are so popular. Hideous Hog: (He) is so bad that he admits to mistakes before he makes them Hideous Hog: If you award Masterpoints for very good results then, logically, you should deduct them for very bad results. Papa: I don’t understand why you couldn’t see my signal, partner. Everyone knows that a singleton is the top of nothing. Papa: I am so good I can false card with a singleton. Rueful Rabbit: Do you want to play Lavinthal or Odd-Even or natural discards? T Toucan: Let’s play them all. Papa: People shouldn’t be allowed to use conventions they don’t understand. It’s not fair to the opponents. T Toucan: I know we agreed to lead A from AK. Sorry my fault. I promise to have the King next time. Rueful Rabbit: Shall we play McKenney or Lavinthal discards. ( the same… ed) Rueful Rabbit: At Grandslam, it was a little difficult to rectify the count. Charlie Chimp: I can concentrate at will on all the hands except the one I am currently playing. Rueful Rabbit: Some declarers have difficulty counting the opponent’s distribution. I have the same problem with Dummy’s distribution. T Toucan: If I work very hard at it, I may be able to achieve mediocrity. Karapet: Did I tell you about …. Corgi: Yes Karapet: I expect the worst in bridge and am rarely disappointed. Karapet: I am so unlucky that in all my life, no one has ever revoked against me. Karapet: Through constant practice, I have become an expert loser. Hideous Hog: Nature is so unfair that I have to be the dummy over ten percent of the time. What a waste of my talent. Hideous Hog: You made your Ace of trumps. What else can you possibly want? Papa: Only at Duplicate you get a bottom for using safety plays. O Owl: Better to play very badly than very good. If things go wrong you are in good company. Hideous Hog: I am so good I only need a partner who can tell one suit from another. Hideous Hog: Your bidding and card play are not on the same high level as the rest of your game. Hideous Hog: I know no one whom I would rather see in charge of the dummy. Hideous Hog: I will bid natural and you bid “Big Minor”. When you have a NT opening, you call 1C and I will bid your NT. If you have a major, bid 1D and I will bid your major. This way you will not get the stress of being declarer. Papa: I am the better side and we know it. Hideous Hog: My partner plus 12 sure tricks equals 11. Hideous Hog: I am such a fine player, no one can deny my right to be rude. Hideous Hog: It is blatant insubordination. How dare you bid NT and becomes declarer. Hideous Hog: I do not doubt your luck and I know no one who needs it more than you. Hideous Hog: Of course I always hold much better cards than you do. Being declarer is part of my system. Hideous Hog: My point count system? Extra for long suit, extra for short suit and 3 points for my superb play. Hideous Hog: The opening lead should always run up to the stronger player.

http://www.masteringbridge.com/article_oreilly.php

The following rings true with me. Comments by Ulf Andersson (Chess GM, 58 yrs old in 2009, chess professional since he turned 19) Inteviewer "What do you think would be necessary to do in order to make chess as popular a sport as, for example, football or tennis… ? Andersson I do not consider chess as a sport, what so ever. ... Why would chess be as popular like football or tennis? It is how it is! Just to realise the fact. I like sports a lot. I prefer to look at sports, rather than chess on TV, when there is chess on TV. I prefer to look a game where Barcelona, Real Madrid, Manchester or Chelsea are playing, than to look at a chess game. I would look at a chess games on the professional interest, not for fun! Source: http://susanpolgar.blogspot.com/2009_12_04_archive.html ****************** Personally, I would characterise bridge as an intellectual contest that can bring satisfaction to those who like solving puzzles in a competitive atmosphere. In comparison, sport is primarily a physical contest that can immediately engage the emotions of viewers without necessarily requiring any intellectual involvement. Viewing physical contests surely evokes a more viseral response - one involving our "reptilian brain", that part of our brain concerned with fundamental needs such as survival, dominance, preening and mating. Do we really think that the puzzle-solving part of our brain can compete with our "reptilian brain" when it comes to spectator interest and involvement?

I did a limited simulation of this type of situation some time ago: http://forums.bridgebase.com/index.php?showtopic=752&hl=

EasyBridge download link: http://www.boardgamegeek.com/file/info/13285 I don't know if it is the Easy Bridge referred to above.

Disclosure: When I started learning bridge, I just wanted to learn to a level where I didn't feel embarassed. So I am not about to tell you the steps to becoming a champion - I am simply describing some of the steps I took to achieve a level that I am happy with. Some of my stages It took me approximately 2 years to learn simple Standard American. I took classes on Monday nights and played on Wednesday nights. I think you have to play at least 2 nights a week in order to remember your bidding system. I had to give it away for 1 year while I finished writing up my PhD. I had a opportunity for about 3 years to play about 4 or 5 nights a week. Some of this was in people's homes. This occurred when I went to St Louis, Missouri to work. Those are some of happiest memories. When I returned to Australia, I was back to playing once a week for a few years. I have found that the amount of bridge I can get to play has always depended on my work commitments. Now I play nearly every night online. I am still happy to use a basic bidding system. The interest for me is in trying to work out who has what cards and bidding and playing accordingly. My preferred arena of play at the moment is the Robot Matchpoint Tournaments on BBO. I especially like checking what bidding and play earned most points on a deal, particularly those deals where I didn't do so well. All that info is available by going to http://www.bridgebase.com/myhands/index.php

http://www.bboitalia.it/info/guida_bbo_2.0.pdf (pages 39-44)

I wonder whether you could get the expert to kibitz you while you play at a table with all GIB robots. Using Skype or Google Talk, the expert could discuss your options as you bid and play.

You could direct the expert to where your hands are stored online: http://www.bridgebase.com/myhands/index.php

Have you tried Double Dummy Solver? http://www.bridge-captain.com/downloadDD.html It's free. It reads .lin files.

I like to play in Robot Matchpoint Tournaments with a Star or a Q in it. Benefits: It keeps us all honest: if you did well in that company, you know you earned your points; You can compare your bidding and play choices; and The end result is an improvement in your game By the way, I am yet to see anyone who is an Ace or a K. Do they exist?