Tom at Neural Market Trends posed the question on how one would build a neural network model of the US Dollar. I added the following comment:

What if I told you that the reason why oil and commodities are high is because there is a positive re-enforcing feedback loop going on? I have been saying that it is the speculators. But what if something bigger is going on?
What if what we have is a twist on The Power of Nightmares (Video)? The documentary focused on the idea that two dissimilar, but opposite forces both get what they want without actually talking to each other. In other words you get a feedback loop that helps feed the …

There was a bit of spike in Ford, and then today the bombshell was dropped.
Ford Motor Co. today said it might not achieve its goal of profitability in 2009 for its troubled North American business unit — citing higher commodity costs and the sour U.S. economy, which is causing gas-sensitive customers to move more quickly out of large trucks and SUVs and into more fuel-efficient cars and crossovers.

Ford, its too late, you are road kill!

Folks STOP BEING IN DENIAL! Finally SOMEBODY big says it as it is!
“Index speculators’ trading strategies amount to virtual hoarding via the commodities futures markets,” Michael Masters, a former hedge fund trader, told the committee in prepared testimony.

And he goes on…
“Institutional investors are buying up essential items that exist in limited quantities for the sole purpose of reaping speculative profits,” he said.

What have I been saying? I have been saying buying commodities is akin to flipping houses! Michael Masters even goes on to say that the speculator is creating as …

I am trying to get my head around this alternative deal that Microsoft is proposing.
“In light of developments since the withdrawal of the Microsoft proposal to acquire Yahoo! Inc., Microsoft announced that it is continuing to explore and pursue its alternatives to improve and expand its online services and advertising business.  Microsoft is considering and has raised with Yahoo! an alternative that would involve a transaction with Yahoo! but not an acquisition of all of Yahoo!  Microsoft is not proposing to make a new bid to acquire all of Yahoo! …

Recently in a local financial paper it was said that some local Swiss Traders are stepping out of the soft commodities trade. Some banks have said that they have never even started that trade.
So what was the reason? Ethics…

I have been a naysayer of buying commodities because I equate it to flipping houses. When you buy a commodity where you do not plan on consuming it yourself you are adding no value and making it more difficult for those that do want to run a business. The analysts have been saying the commodity prices are the result of demand, not speculation.
I don’t believe it for a second. When the dollar became stronger did commodities drop? No. When supply surged did commodities drop? No. I don’t believe the …

Woohoo, it looks like we are buying a house. We negotiated a new deal and one that I think is pretty good. To fund the down payment I had to sell off half of our portfolio. This allowed me to take a look at how good our returns were. Remember this is since beginning of February when I said I was a bull. Net return, 18.5%, which stunned the heck out of my wife and I. She said, “wow you did really well…”
What is the moral of the story? Buying …

Yesterday I said that Yahoo will close at 25. How did Yahoo do? It closed at 24.47 but it did touch 25. Pretty close considering that most people said it would close around 30% lower.
But Yahoo’s share fall was not as steep as the 30 percent plunge anticipated by some analysts, indicating there was still an “acquisition premium” built into the stock.

I have not been blogging as much lately, because I have been completely swamped with work. These days I write oodles and oodles of software implementing financial trading strategies using Excel, and .NET. I will be posting a review of Add-In Express which has been helping me immensely. Another thing happening is that I am almost hired as a permanent on-call consultant for a major investment bank. If this materializes I will blog about it later. Why not full time? Because I don’t want to at least not yet.
Implementing dozens …