Friday, September 30

Dow Jones Industrial Stock Watch

AIG you look like you are ready to break out on strong volume over $62 1/2; you know once you do the sellers will disappear for a while. The path of least resistance. The future is Kaleidic and yet we seek order. Your historical and implied vols are pretty close; as your stock rises your vol should stay low or drop further. How does shorting a put vertical sound? Excellent.

Now to find a call spread to sell on another of the Dow stocks. "Market neutral" means live long and prosper.

Wednesday, September 21

The Nobel to Israel Kirzner?

The announcement for the Nobel Prize in economic science is due out in October; Peter Boettke makes the case for Israel Kirzner.

Kirzner, along with Murray Rothbard, carried on the work of Ludwig von Mises and spearheaded the revival of interest in Austrian economics that began in the early 1970's and continues to grow today. While Rothbard was more prolific and wide-ranging, Kirzner focused on economics.

His Competition and Entrepreneurship is a critique of neoclassical price theory; the "perfect competition" model built upon an equilibrium foundation, with its unrealistic assumptions about time and knowledge, and its total neglect of the process by which an equilibrium state would come to be.

Without a market process to drive prices toward that equilibrium state, there is no need for the one whose actions make that happen, the entrepreneur.

This mystery-man is noticeably absent from the neoclassical story, but he is center stage in the Austrian one, and he is not alone. Because others are on the prowl for profit opportunities also; he must compete with them and win in order to gain.

To Kirzner, "competition" means "rivalry". Every businessman knows it, but not many economists do. To them, "competition" means the state of not having to compete.

If you've ever taken a microeconomics class, you've learned about that neoclassical fraud called the "perfect competition" model; you knew from the beginning that there was something wrong with it, and in Competition and Entrepreneurship Israel Kirzner shows you what.

Friday, September 9

Watching the Money Czar

Chad Hudson ask's over at The Prudent Bear, will the Fed Pause?

Prices keep rising even as the economy seems to be slowing. Wasn't their a name for that?

The Monetary Central Planning Group of America, the Fed, meets in two weeks to humbly decide behind closed doors, how quickly they will destroy the value of the dollars we save and earn here in the land of the free.

The Fed Funds market has the probability of a quarter point rate increase at about even money.

One order of flattened yield curve, comin' up; would you like a market crash with that?

Ludwig von Mises

Ralph Raico writes about The Great Economist of the twentieth century. Those who have never heard of him should read it. It starts with a trickle.