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| | Tavakoli Structured
Finance LLC
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| | “Allow me to issue and control a nation’s money, and I care not who makes the laws.”
—Mayer Amschel Rothschild |
| | The chance of not flooding each year is 0.99,
and [1-(.99^30)]=.26, or around a 26% chance of flooding if my math is correct.
What Are the Odds of Hurricane America?
October 13, 2024
Many
people in floodplains look at FEMA’s stats and immediately misinterpret them
because FEMA uses confusing shorthand, such as “100-year flood risk.”
This
means that there is a 1/100 chance of flooding each year. If a homeowner has a
30-year mortgage, the chance of flooding during that period is higher than most
believe, around 26%. The chance of not flooding each year is 0.99 to
1-(.9930)=.26, or around a 26% chance if my math is correct. [See first sentence. I meant to write the formula above.]
Similarly,
our government conducts questionable elections and believes that the chance of
US citizens not accepting the chicanery is low. But then, what do you expect
when its agencies explain flood risk in the way that they do?
Recall
that the above Hurricane example resembles a Bernoulli process where each
combination is independent of previous outcomes.
In
contrast, our corrupt elections are not independent events. Given the
uncorrected, unacceptable irregularities in previous elections, what is the
probability of another corrupt election?
Neither
side can have confidence in the outcome because our elections are not auditable
by design. Shame on all of us for tolerating the latter. You wouldn’t run a
high school election this way.
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| | Buffett, Bogle, and Windfalls
October
8, 2024
Warren Buffett: "If
you invested in a very low-cost index fund — where you don’t put the money in
at one time, but average in over 10 years — you’ll do better than 90% of people
who start investing at the same time."
Jack
Bogle: "The
idea that a bell rings to signal when investors should get into or out of the
stock market is simply not credible. After nearly fifty years in this business,
I do not know of anybody who has done it successfully and consistently. I don't
even know anybody who knows anybody who has done it successfully and
consistently. Yet market timing appears to be increasingly embraced by mutual
fund investors and the professional managers of fund portfolios alike."
Windfall: Lump Sum or Dollar Cost Average?
Threat Vector
Via Greg Price on X: “This video was
from September 8, 2021— one day before this [terrorist] was flown to our
country.
Trump was right about everything.” |
| | Trump and the Stock Market
October 7, 2024
The ideological gulf between
Republican and Democrat candidates is enormous. After two assassination
attempts on former President Trump, anchors on CNN and MSNBC say they want to
punch Trump in the face. The anchors are confident the FBI will not be knocking
on their doors. The regime rigged the system.
I'm voting for former President Trump. To the annoyance
of many of my old friends and neighbors, I'm giving him full-throated support.
His campaign platform is close to his 2016 platform—I
hope he doesn't throw the game again. Also, I'm relieved he chose Senator J.D.
Vance as his vice-presidential running mate since Trump is an older man, and
none of us will beat time.
I've been thinking of ways to walk back my previous
comments (you know the ones). I can't come up with an answer better than J.D.
Vance's during his debate with Governor Tim Walz, so I'm stealing it (the short version is the dishonest media made
me do it. Whether or not it applies, it's a great answer)."
“Well, first of all, Margaret, 'cause I've
always been open, and sometimes, of course, I've disagreed with the president,
but I've also been extremely open about the fact that I was wrong
about Donald Trump. I was wrong, first of all, because I believed some of the
media stories that turned out to be dishonest fabrications of his record.
But most importantly, Donald Trump delivered for the American people. Rising
wages, rising take-home pay, an economy that worked for normal Americans, and a
secure southern border. A lot of things, frankly, that I didn't think you'd be
able to deliver on. And yeah, when you screw up, when you misspeak, when you
get something wrong and you change your mind, you ought to be honest with the
American people about it. It's one of the reasons, Margaret, why I've done
so many interviews is because I think it's important to actually explain to the
American people where I come down on the issues and what changed.”
The Trump Rally
On Saturday, Trump was in top form for his rally in
Butler, PA. Given Trump's rhetoric—protective tariffs, lower inflation, tax
incentives for corporations to make in America, and carbon-based energy
production—the stock market may rally the way it did in 2016 if he wins. |
| | Fifty Years in Wall Street
I’ve
been restoring Henry Clews’s Fifty Years in Wall Street (1908). I have the
original book, but the pages have yellowed, and the hinge is cracked. One can
download a PDF of the original for free—public domain—from archive.org. Among
the gems in this book is an address he gave to Yale students in 1907. If I ever
have to give such a speech to students, I’ll adapt his speech of advice to
young men starting in life.
Clews’s
story of Commodore Vanderbilt’s short squeeze was fictionalized in “Face the
Music,” the third episode of HBO’s The Gilded Age.
For
my purposes, I split the book into Part One and Part Two. I added a
table of the dates of birth, death, and age at death of the men illustrated in
the original book. I also added the dates of birth and death to each photo.
Otherwise, I couldn’t keep all the generations of Roosevelts, Vanderbilts,
Clewses, Astors, and Rothschilds straight. |
| | American Culture Is Eurocentric
Multiculturalism is a lie or rather a series of lies: the
lie that European-American culture is uniquely oppressive; the lie that culture
has been formed to preserve the dominance of heterosexual white males; and the
lie that other cultures are equal to the culture of the West. What needs to be
said is that no other cultures are equal to the culture of the West. What needs
to be said is that no other culture in the history of the world has offered the
individual as much freedom, as much opportunity to advance; no other culture
has permitted homosexuals, non-whites, and women to play ever-increasing roles
in the economy, in politics, in scholarship, in government. What needs to be
said is that American culture is Eurocentric, and it must remain Eurocentric or
collapse into nothingness. Standards of European and American origin are the
only possible standards that can hold our society together and keep a competent
nation. If the legitimacy of Eurocentric standards is denied, there is nothing
else. There are no standards from any other quarter of the globe that we can
agree upon. Islam cannot provide standards for us, nor can Africa or the Far
East. Yet a single set of standards is essential to a sense of what authority
is legitimate, what ideal must be maintained. The alternative to Eurocentrism,
then, is fragmentation and chaos.
—Robert Bork (Slouching Towards Gomorrah, 1996, P.
311) |
| |
3rd Edition
Released February 23, 2022
"Tavakoli's research work has been endorsed by, for example, the late Nobel prize winner, Merton Miller, and the "Big Short" hedge fund manager, Michael Burry."
Intelligent Commodity Investing
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| | Via Reddit: Reconstructing Burry's Research Process
Michael
Burry, Interview by the Financial Crisis Inquiry Commission, May 18, 2010.
From
FCIC staff audiotape of an interview with Michael Burry, Cornwall
Capital[between timestamps 1:36:20 and 1:38:40]:
"
... It was a dark market. I was onto WorldCom pretty early, and they went
from investment grade to bankrupt overnight ... I wondered why I didn't make
more money on this ... it hit me that's the way to short companies ... and I
noted there was a lot of these highly rated super leveraged companies where you
could buy credit default swaps ... and so I bought books ... Janet Tavakoli's
1998 book and that was the first book I read ... I didn't take all those
equations and apply them ... but I got the basics of the market from
that." |
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