Markets and Trading

Goodbye, Intrade

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Well, this stinks.

Intrade was the Breitbart of political prediction makers. Many bookies take political bets but Intrade, the offshoot of a sports betting shop, was the only one to specialize in politics and the only site to quote political odds in financial-market terms that speculators are comfortable with. There are alternatives to Intrade but none of them is quite as good.

Intrade’s closing doesn’t come as a complete surprise. It was long under pressure from a tacit coalition of domestic financial exchanges and gambling interests, operating indirectly through US regulatory agencies, the Justice Dept. and Congress. The untimely death a couple of years ago of Intrade’s founder and CEO may have left Intrade fatally vulnerable to political attack.

Maybe someone will eventually set up another site like Intrade in a country remote from US jurisdiction, but that is a tall order. Intrade’s closing is a big loss.

UPDATE: Possible financial irregularities. I have no idea if the insinuations of corruption at Intrade have any merit. Perhaps we will find out. Clearly, Intrade had few US friends other than its customers and quite a few other people who relied on Intrade for information unavailable elsewhere. In any event Intrade performed a valuable service and will not easily be replaced.

Social Media Bubble

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Jesse Colombo on Twitter:

A consistent theme of mine has been that the popping of the soc-media bubble will result in layoffs. Read last parag.: http://seekingalpha.com/article/781911-is-the-social-media-bubble-finally-popping …

Trading Platform Bleg

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I have been using the traditional broker/financial adviser model for trading stocks and bonds and other financial products for some time now. I don’t have a problem with it, but I am trying to be as diverse as possible so am thinking about opening my own account for trading.

I typically am an investor, not a trader. I have long time horizons and study my investments carefully before I jump in so I don’t do a ton of trading. I am interested to hear what platforms/companies you folks use.

My main things needed are ease of trade executions, and efficient tax reporting. I would also like access to things like corporate paper, muni bonds and the like but honestly have no idea if you can do any of this with simple platforms like Fidelity, Schwab and the other retail outlets.

Any information is appreciated.

Rousseau, A Golden Past, & the Academic as Luddite

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This was a comment that got out of hand. It is not a great point, but I do think that some of the academic response to well, everything is at once more complicated and simpler than sometimes posited here.

Sure, academia is turf building and this really didn’t happen until faculty moved from teaching 3-5 classes at all levels to only teaching upper level and teaching 1-2 a semester. (And we probably don’t want to get into “Studies” and “Centers”.) You don’t have time to build turf with the old loads. We certainly don’t at our jr college, where everyone but administrators teach 5, all teach mostly freshmen, and even departmental administrators (to departments of 100 in schools of 13,000 students) teach a class or two and have no secretaries. (I will say that we are an unusually hard-working or, perhaps, an unusually hard-worked campus, but we appreciate one another. We have to nor do we give “walks”: if we are in the hospital, someone covers.)

Research university faculty sometimes loses its ability to communicate with generalists, let alone freshmen. Intense publish or perish standards sometimes led to superficiality and new theories for the sake of “newness.”

I would argue, though, that Schumpeter’s theory, as I understand it, does have remarkable relevance. So does modern criticism’s alienation from the Scottish common sense guys and alignment with Rousseau: they are Luddites who fear change. The word progressive to describe such thinkers is preposterous.

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RERUN–An Academic Bubble?

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(Originally posted 5/2/2003. Nine years have passed since the original post, and I think we can safely remove the question mark from the phrase “An Academic bubble?”)

Over at Critical Mass, there’s recently been much discussion of Brooklyn College. This is the institution at which English professor Frederick Lang was removed from the classroom–evidently in large part due to his hard-nosed grading policies and his unpopular habit of writing honest comments on student papers.

The devaluation of standards in academia has been going on for a long time. Eric, a commenter at Critical Mass, reports on a conversation that took place at SUNY–Stony Brook when he was a professor there. Faculty members were discussing the math final grades:

“What should the minimum D be?”

“180 out of 420.”

“No, we’d fail too many people.”

They eventually decided on 140 out of 420. At this point, Eric asked:

“Bernie, would you trust someone who got 140 out of 420 to do your taxes?”

“Eric, that’s not the point.”

“Would you trust him to be your doctor?”

“Eric, that’s not the point.”

“Would you trust him to build a bridge for you?”

“Eric, that’s not the point.”

So what is the point?

Of course, we all know what the point really is. The point is for students to obtain a piece of paper–a diploma–which is viewed as a passport to economic success. Increasingly, the perceived value of this diploma is decoupled from any knowledge or accomplishment that it actually represents. It is valued for the circular reason that–it is valued.

This situation is reminiscent of other pieces of paper–stock certificates in certain dot.com companies. At the height of the boom, people were acquiring these certificates without much consideration of the current or potential business results of the companies they represented. (“I don’t know what it does,” said one investor of a stock, “but I know it’s moving.”) The hope was simply that a popular stock would become more popular and hence increase in price–that is, these certificates were valued because they were valued.

A bubble is not infinitely sustainable. In the market, stocks will eventually collapse if there are no earnings to support their price levels. And, in academia, degrees will not be valued indefinitely unless they represent genuine knowledge and accomplishment. The collapse may not be as immediately dramatic as a market collapse–but it seems inevitable that it will eventually happen.

8/14/2012: Glenn Reynolds recently published a book titled The Higher Education Bubble. It’s available via Kindle for $1.99, which I believe is a temporary price…I haven’t read it yet, but I’ve downloaded it, and will be reading it soon.