Not quite. The extra seats only provide additional revenue when the flights would have otherwise been full. From the article, the average flight is only 80% full, which means those six extra seats aren't providing any additional revenue.
To determine the actual revenue increase from those six extra seats, we would have to know how frequently flights have less than 6 empty seats.
While these numbers will never be perfect, per se, RITA[1] shows that in 2011, Southwest's loadfactor was 80.8% while in 2012, loadfactor was 80.4%. So, the flights remained around 80% full on average.
I took this into account in my calculation and assumed roughly 4.8 more seats were filled on average per flight, not a full 6.
I think the key question then is why it was that 4.8 more seats were filled on average per flight. If we had data the showed that the distribution of plane occupancy were the same year over year save for a few occasions where last year the plane had been at capacity but this year those extra 6 seats had been put to use then the conclusion could be valid. However with the data I've seen so far it seems spurious to conclude that the extra 4.8 filled seats were caused by the extra 6 physical seats.
What is the revenue impact of expanding capacity? The solution is not obvious, but the author's approximation is more accuare than you suggest. You obviously can't solve this without a stochastic ticket demand model, but 4.8 is much closer to the right answer than 0.
Also if the airline wants to maintain an 80% capacity, having an extra x% of seats means they add to revenue if they can maintain that occupancy percentage. In this case we don't even need to factor in 100% occupancy, which if anything would help the numbers as I'm sure last seats on a fully booked flight aren't cheap.
They target around 100% full. That being said, having more seats allows them to adjust their pricing model so that they have more seats to attempt to maximize revenue.
Depending on the demand structure of routes, those 6 seats may have wildly different values and could potentially be worth more than the average ticket price, on average for the airline.
Since this is counter-intuitive, I'll explain why briefly:
Airlines attempt to price discriminate by selling low priced tickets to leisure travelers and high priced tickets to business customers.
The problem airlines face is that business travelers book at the last minute.
Since business travelers book at the last minute, they need to estimate the number of business travelers who will be flying.
If the average leisure passenger ticket sells for $100, and the average business ticket sells for $500, just having 1 extra seat can add 5 leisure tickets worth of revenue assuming they sell the same number of leisure tickets.
Realistically, their model will readjust the optimal pricing changes overtime to capture the most value. Because the additional seats give the model more flexibility, I would not be surprised if the additional seats added more than an average of 80% of 6 seats multiplied by the average ticket price.
Since not all seats are sold for an equal price, the extra seats may have indeed increased revenue potential by allowing for more "premium location" seats on the plane.
There are a lot of factors and it would be silly to think that the airline didn't take more than we can come up with into account in their decision.
The article states that reducing leg room from 32 to 31 inches allowed for one additional seat row. Which means that there were already no less than 32 rows on those planes. Six seats per row give 192 passengers. RITA numbers clearly show that the load factor have never exceeded 90% since 2010. That means that at least 10% of seats were empty, that is, 19 seats. There is no sense of adding another 6 seats just to have them empty. If there were a demand for six seats, the people demanding them would just have occupied those of 19 free ones.
Adding another row only makes sense if the plane is full and there's additional demand for seats. We should have looked at the load factor distribution, not only at it's mean value. Most attentively we should have looked at the standard deviation of the load factor around it's mean, but RITA didn't provide such an information.
There are a number of factors in play. But without knowing how the priced seats, and the number of capacity flights, this could just as easily be normal growth as it could be the impact of extra seats.
Not that I'm saying you are wrong, just that it's not the only explanation of the known facts.
The extra seats are only utilized when the plane is beyond the capacity of the old configuration. You'd need to know how often this event occurs in order to produce a meaningful number.
Until you can separate cause from effect, you have no way of knowing if the change in loading was due to reconfiguration of the seats, or other policy changes that occurred around the same time.
You also need to calculate the extra fuel costs for the additional weight of the empty seats. If most of the time those seats are empty, they need to be utilized enough to justify their extra expense.
Plane seats are over-committed on an informed guess of how many people will cancel, with enough slack built in as to mostly prevent the embarrassing case "I bought a ticket and there's no seat on the plane". So six extra seats may well equal seven extra tickets allocated for sale each time.
Of course the bastards should still be tortured for reducing the leg room.
People don't like booking the last seat on a jam-packed flight. If given the preference, they'll find a flight with some room (this applies in other cases where people decide whether or not to be in a crowd). So I wouldn't be surprised at all to hear that Southwest's 80% capacity remained constant before and after the six additional seats were added.
EDIT: Here's a related article where church seating on pews versus individual chairs is discussed - and airplane seats are even mentioned: http://www.alban.org/conversation.aspx?id=2380
Be careful. Anxiety is a common side effect only at the beginning of SSRI treatment. Once serotonin receptors down-regulate to accommodate the new levels of extra-cellular serotonin, steady-state is reached and the anxiety usually abates.
Unfortunately, this causes many patients to abandon treatment before the the therapeutic value is apparent. This is one of the biggest obstacles in treating depression.
Of course, there are always exceptions. However, most of the time you will find that those who complain about SSRIs inducing anxiety did not actually wait long enough for the effects to become apparent.
Also, your suggestion that Prozac is one of the more mild SSRIs is completely backwards. Prozac is one of the earliest SSRIs and has a rather broad spectrum of receptor affinities. Newer SSRIs are more selective and have better side-effect profiles. Escitalopram is the gold standard here.
I guess we must agree to disagree that its only a side effect in the beginning. My clinicians experience and mine (personal and experiences I've heard in Group Therapy) differ, though I'm happily on another anti-depressant that works for me. For what its worth, Prozac's effects were negligible for me. I still recommend it as a first treatment for those with symptoms.
The same goes for my statement that Prozac is one of the more mild anti-depressants in terms in side effects. Its often the first prescribed, specifically for the reason that its effects (side and primary) are more mild, thus a safer place to baseline to start from.
He said that Prozac is one of the milder anti-depressants (not milder SSRIs). That's true. Prozac is coarse compared to the later SSRIs but not compared to the other categories of antidepressants (MAOI, tricyclic).
Fluoxetine treatment is often associated with an increase in BDNF (Brain-derived neurotrophic factor), a protein which encourages the development of new synapses in the brain areas responsible for higher-order thinking and other functions. At first glance this sounds great, as the Scientific American authors concluded. However, other researches, such as those in the study I linked above, hypothesize that this increase in BDNF and neuronal growth may actually be due to neuronal insult from fluoxetine. In other words, the increase in plasticity and new cell growth might be a healing response from the brain following damage caused by fluoxetine.
Furthermore, fluoxetine is an older SSRI with effects and receptor affinities that extend beyond the serotonin system. When using fluoxetine for research, caution must be taken to separate the effects on the serotonin system from the effects of other functions of fluoxetine. Without further study, we can't know if these effects apply to all SSRIs, or just fluoxetine.
I should also note: All of this is great for future R&D of next-generation anti-depressants, but it should not be used by anyone when determining a treatment path. Despite the study I linked above, to my knowledge we haven't seen any deleterious effects on memory or cognition due to SSRI treatment in the general population. The bottom line is that we don't know why or how SSRIs work (despite what the drug company marketing department wants you to believe), but they are effective for many people. And combined with therapy, the rate of remission improves even more.
"Previously, researches have found that fluoxetine (Prozac) actually suppresses neuronal growth in vitro"
Neurogenesis is only one type of plasticity, and it doesn't sound like the type they're talking about in this article. (Albeit I didn't read the study.)
While they didn't measure neurogenesis directly in the study, they did measure BDNF (Brain-derived neurotrophic factor) which can induce neuron growth[1]. Essentially they took two groups of mice: regular mice, and mice whose BDNF levels are believed to not respond to Prozac (Flx). They found that in regular mice, Prozac plus retraining reduced anxiety. In those mice in which Prozac doesn't increase BDNF, the Prozac effect went away.[2]
I know it's hard to read the actual study all the time, but sometimes it helps. :)
[2]Because mice heterozygous for the BDNF null allele (BDNF+/−) are insensitive to Flx treatment in behavioral models of depression and anxiety (3, 26), we tested whether BDNF+/− mice (C57Bl/6J background) responded differentially to Flx in the fear-conditioning paradigm. Flx again prevented fear renewal in the wild-type mice, but in BDNF+/− littermates trained to fully extinguish the fear response, the Flx effect was absent as indicated by elevated levels of freezing 1 week after extinction (Fig. 4B and fig. S7). To test whether BDNF was acting predominately in the amygdala, we used doxycycline-regulatable lentiviral infection to overexpress BDNF locally in the BLA from the end of extinction onward (figs. S8 and S9). BDNF-overexpressing mice did not show fear renewal, whereas control mice did (Fig. 4C).
This man is described as an "independent market trader" in the attached article. His twitter profile ( http://twitter.com/#!/alessiorastani ) describes him as a "Keynote speaker" and a "Mentor and dedicated to helping others succeed". That doesn't exactly inspire much confidence. In fact, it is pretty obvious that he has set out to make a name for himself through this controversy.
Furthermore, he has obviously bet heavily on a near-term market crash. He's now financially and emotionally invested in a market crash, so of course he will be confident that it's going to happen. And if his doomsday video circulates the internet and makes a dent, however tiny, in investor sentiment then he has also effectively pushed the market (in a very tiny way) toward his goal.
Take a look at one of his recent tweets: "I've been waiting for this stock market crash for 3 years. #finance #economy"
The world economy is in trouble, no doubt, but let's remain reasonable and rational here. Spend enough time around financial types, and you can always find a doomsayer like this man in any sort of economy.
This guy is an independent trader because no one would hire him. He's misguided in his understanding of the markets. Goldman Sachs is an investment bank. When he says "anyone can make money from a crash", he's right: any INDEPENDENT investor/fund. Such as a hedge fund or himself, an "independent trader". These people are referred to as the "buy side". However, Goldman Sachs, as well as all the other banks he probably thinks "rules the world" is on the sell-side. The sell-side provides "prime" brokerage services to the buy-side clients -- that is they connect buyers and sellers via the exchanges. In fact, with the upcoming Volker rule, no investment banks will be allowed to engage in proprietary trading (trading for profit with the firms money), which is what the buy-side does.
Investment banks might actually lose money in recessions because they might take illiquid, toxic assets onto their books to service demand (point and case: the mortgage crisis). And securities is only a part of the investment bank business model. Advisory services, largely driven by M&A and IPO volume, provide a decent chunk of profits for banks. Capital markets dry up during recessions, which will completely stifle M&A and IPO activity and therefore revenue on that side of the bank.
This guy is full of shit. When asked what to invest in when the market goes down, his best advice is bonds and "hedging strategies". Bonds do indeed rise in value during bear markets, however hedging has almost nothing to do with profit or loss. Hedging is risk management: covering your ass in case of an unexpected move. For example, if I expect a downward market turn, as per his advice, I might buy up treasuries. But, to "hedge" the possibility that the market moves UPWARDS instead, I might buy an index tracking the Dow, which will increase in value as the market moves up. In this case, hedging is actually DECREASING my profits in the case of a downward movement in the markets. There are much more intuitive ways to play a downward market.
The basic thing is that while there are ways to play down-markets, down-markets and up-markets are not mirror image and are not simply "different ways to make money".
An up-market inherently creates - maybe-not-money - but the appearance of money, the availability of money, "liquidity". An healthy up-market inspires healthy production and makes the liquidity it generates really correspond to people having more wealth on average. An unhealthy up-market naturally involves mis-allocated resources and its liquidity thus becomes illusory and so it is followed by a down-market. A down-market eats liquidity and decreases production meaning the decreased-money people have really corresponds the people also having less stuff, on average. So given the downer that is a down market, profiting become harder on average. Some do great but the average person should assume that the law of averages to applies to them...
For any interested in Burry's story, pick up Michael Lewis's The Big Short. Great (if somewhat miscontrued) tale of the housing crisis, ripe with corrupt financiers and the "smartest men in the room".
Burry's lightbulb concerning the crumbling housing market was a product of a staggering amount of research on mortgages, contra to the research (mostly by rating agencies) already published. No average Joe is going to foresee a bubble about to explode.
I was thinking something more conventional. For example, contrary to what many may believe, history actually IS a good predictor of future. As an investor, I am not only limited to investing in individual companies -- I can also bet on entire markets/sectors (for example, Burry bet against the housing market). Also recall that the markets are cyclical (that is, recessions follow booms and vice versa).
With that in mind, I could, for instance, have a sector-based model hinging upon the business cycle. Certain sectors, historically, have tended to outperform during different segments of the cycle, and with well-timed bets I can always make money just by recognizing what state of the business cycle we are in.
For example, currently we are in a (if somewhat shaky) "recovery" phase. During recovery, financials and tech companies tend to outperform. I might use ETFs (IXG and IXN) to go long on these markets. I might even enhance my bet and short Consumer Staples, which are expected to underperform during recovery.
However, any kind of shorting strategy involves not just an expectation that the market will go down some time in the future but instead requires that you say exactly when.
Especially, if the stock that you are short begins rises, you may be forced to buy back the stock you've sold - the traditional "short squeeze".
http://wiki.fool.com/Short_squeeze
Basically, playing to a down market is inherently harder than playing to an up market. It can be done but it is harder. Just another way the video is full-of-shit as many folks have mentioned.
This is an extremely valid point. If you look at the stories that are posted daily on Yahoo! Finance, nearly all of them are market predictions by people with a vested interest in their predictions (beyond simply trying to be correct).
I think this is still lost on most consumers; most people think stock analysts are the same as economists, and that's completely wrong. A good economist will tell you that they can't predict the stock market, but they can tell you what the economy will do. That's enough to let you know that the direction of the economy and the stock market are not directly linked.
>> A good economist ...can tell you what the economy will do.
I was sipping a venti mocha when I read this and I laughed so hard there's mocha all over my keyboard. There are people here, actual paid economists, who are doubling up in laughter at your assertion.
That's funny, because I have some actual paid economists who work for me and they are scarily accurate. But I could throttle back and say 'they know what the economy will LIKELY do'.
I still think you are transposing economists and analysts.
Just out of curiosity, did any of your economists predict the US recession back in 2007, or the US housing crisis? From what I recall, almost none did.
Actually, many did. Economists were telling us that the economy was shaky all through the 00's. Economists told us in 2006 that the market problems from Wall Street would spread into housing.
Again, there is a difference between stock analysts and economists. Economists are looking at numbers, trends and history more like a computer scientist. Economists are even often specialized into various regions of the country.
A stock analyst is going off of timing and trends more than data. If you've ever traded stocks heavily, you learn quickly that traders throw away yesterday...'that money's gone'. Having worked to make companies profitable, it's unsettling to realize that the stock market is full of people who know how stocks work but have no idea how business works.
I think I've posted this before but in one past company we moved millions of dollars of product around before we did our annual inventory just so our numbers would match what Wall Street expected. We actually needed much more on hand than the stock market wanted just to do business, but they wouldn't have any idea about that.
I've always found that economists for the most part have been extremely unreliable in forecasting things like recessions. (Also stock analysts are useless too) Case in point, an article from 2007, pre-recession:
I remember that article. It had two glaring ommissions:
1. Economists were not aware that there would be a major terrorist attack six months later
2. Economists did predict the recession that occurred in March 2001 due to the Bush administration's desire to weaken the dollar. When polled, a few economists were polled if there would be a double dip recession and 95% said no- a fact that changed six months later.
I'm enjoying this discussion heavily, particularly your contributions to it which are great. Just a minor (but important) nitpick -
> A stock analyst is going off of timing and trends more than data.
Not necessarily. You can broadly divide analysis into two camps - "technical analysis" [1] which is what you're describing, and "fundamental analysis" [2] which is looking more at intrinsic value, numbers, assets, things like that.
Warren Buffett, for instance, does plenty of stock analysis and he's not a technical trader at all. He repeatedly says he doesn't try to time the market. [3]
The first book I read on trading - Technical Analysis of the Financial Markets [4] - was from a technical analysis perspective, and I lost money trying to implement it.
Then I read about value investing and started trying to apply those principles - only buying fundamentally sound stocks trading at a favorable price earnings ratio, either in fundamentally defensible businesses or with lots of solid assets on their books, and buying with a big margin of safety.
I haven't had a losing trade since then, though in fairness my sample size is small and I don't sell unless the price of a stock I bought gets over what I consider reasonable. I'm currently holding Microsoft and HP which are down, but both I think are way undervalued (Microsoft is extremely stable, has some upside in the way of a strong research division, and could potentially translate a hit like the Kinect into alternate input devices. HP is being treated as toxic despite owning some nice high margin businesses that most people don't think about when they think of HP, as well as a huge patent portfolio and some good assets... yeah, their management sucks lately, but who cares if a company is trading below its liquidation value? anyways, do your own research, check the financials, etc, etc)
Anyways. Not all traders are technical traders. Fundamental analysis is also analysis, and probably easier to implement to be consistently successful. The top book on that is "The Intelligent Investor" [5] by Ben Graham, which Warren Buffets calls the best book on finance ever written (I agree).
[3] “If you’re an investor, you’re looking on what the asset is going to do, if you’re a speculator, you’re commonly focusing on what the price of the object is going to do, and that’s not our game.” (1997 Berkshire Hathaway Annual Meeting)
I've come to almost the exact opposite conclusion. I went from fundamental trading to almost completely technical/algorithmic trading.
After the 87 crash, the 2001 crash and the 2008 crash, I'm a firm believer that we will experience crashes every 7-10 years, because the financial markets are fundamentally unstable, and keeping your money in the stock market for long term will only lose you money.
I believe the only way to be in the stock market is to realize that it is a game, that the dominant players all believe it is a game, and you have to know how to play by their rules. In this case, it means that you have to follow the technicals in order to understand the ebbs and flows of the market, and know how to trade, not invest. I believe that given the nature of the markets these days, it's more of a market of probabilities, and short-term momentum rather than fundamentals.
I still think there is room for "investing", but it is high risk to hold things in the market these days.
Buy stock of fundamentally solid companies that pay dividends when their stock price is low.
Sell if their stock price gets overinflated, otherwise just hold and collect dividends.
Don't buy stocks that are trading at stupid prices. Don't even buy stocks that are trading at reasonable prices. Only buy stocks that are trading at a steep discount to their reasonably projected future cashflow + asset value + large margin of safety.
...win?
I mean, you kind of can't lose if you do that. Sure, sell if your stocks get overheated. Or just collect dividends forever if it's a great company that's consistently underpriced. Avoid stocks that are priced high relative to earnings/assets, and even avoid reasonably priced stocks. Kind of a no lose proposition that way, no?
1) Dividend might get cut. All the banks had their dividends drastically cut, and their stock prices kept dropping. I'm talking pre-crisis, EVERYONE was saying that the financials were screaming buys. When a stock's dividend yield is too rich relative to its stock price, and it can't get its stock price to appreciate, many companies will tend to just cut the dividend outright.
2) Just because a stock is low doesn't mean it won't go lower, especially if the prospects for growth keep dropping. Look at CSCO. People bought in at 21 thinking it was a good value investment. Now they are trapped longs, waiting to get out at break even. The same goes for MSFT and HP at this point. These are called value traps, because your money gets trapped while you wait for a pop.
The worst case scenario, which happened in 2008 to many, many stocks and which I believe will continue happening, is that you buy a "value" stock, the we get a recession or another crash, the stock price halves, and then the dividend gets cut or eliminated altogether. Then you're left holding a crappy stock for months or years.
The point is that your strategy is not fool-proof. I believe there are probably plenty of companies where it might work, but there are also plenty of companies in-this-day-and-age where you could get massively whacked following this strategy. And history in the last 3-5 years shows that it doesn't work that well.
I did it with WaMu and lost a boatload. Watching cashflows, etc, etc is fine during a healthy environment, but right now, we have no clues as to the underpinnings of many, many companies, because you really need to understand how to interpret financial statements better than a casual observer. Look at Groupon... would you have been able to tell that their cashflows were positive only because they collected their moneys quickly, but paid their merchants slowly? That takes significant amount of experience to understand this. Probably for most of us here that isn't in the industry, it would have looked great.
> EVERYONE was saying that the financials were screaming buys.
Investing on fundamentals means giving not a damn what everyone is saying or thinking. It's just about the numbers. Actually, if EVERYONE is really thinking something is a great buy, it's probably not.
> Look at CSCO. People bought in at 21 thinking it was a good value investment.
Nothing at 21 is ever a value investment. That's still looking for growth. Just because a whole industry is insane doesn't mean a less insane number is good. As a very rough and flexible guideline, I won't spend too much time looking at something with price/earnings above 12. There's just too many solid companies priced below that with solid businesses and assets.
> The worst case scenario, which happened in 2008 to many, many stocks and which I believe will continue happening, is that you buy a "value" stock, the we get a recession or another crash, the stock price halves, and then the dividend gets cut or eliminated altogether. Then you're left holding a crappy stock for months or years.
That's a good point, yeah. I'm comfortable holding forever with my buys, and when "forever" comes around these things correct, but you've got potential opportunity cost in there.
The problem with a strategy of only buying stocks when they're clearly undervalued is that it's generally extremely rare for companies to actually trade at an obviously undervalued level. Generally, when their price is depressed below the level you'd expect based on their dividends and/or earnings, it's because there's some other black cloud hanging over their future earnings potential.
It's great in theory, but in practice it's not realistic to believe you can reliability know what a company's "reasonably projected future cashflow" really is. Even if they're in the most reliable business in the world, if someone comes up with a lower-cost alternative next year, all those future cash flows go poof.
Conversely, it's damn hard to tell when some stocks are overpriced. I remember folks saying in 2007/2009 that Apple was wildly overpriced at about $90. I heard the same things about Amazon over the past few years.
I love your response. This is the kind of thoughtful reply I greatly respect, and yes, when I said 'economists' vs. 'analysts', I really wanted to just make a point between how detailed an economist can be and the difference between such and a stock trader.
Your response is one of the reasons I have to force myself to stay away from Hacker News; I have too much to do but there are some great conversations on here.
> Your response is one of the reasons I have to force myself to stay away from Hacker News; I have too much to do but there are some great conversations on here.
This might shock you, but 2-3 years this was the only kind of conversation we ever had on HN with any regularity. It was pretty cool back then.
Anyways, I appreciate the kind words and the discussion as well - drop a line if I can ever lend a hand with anything.
You might want to follow Brad DeLong's blog. Krugman also talked about housing bubbles (http://delong.typepad.com/sdj/2006/01/paul_krugman_on.html) back in 2006. He wrote a column that said so explicitly, arguing that "part of the rise in housing values since 2000 [has been] justified given the fall in interest rates, but at this point the overall market value of housing has lost touch with economic reality. And there's a nasty correction ahead."
My memory of the blogosphere is that people knew housing was overvalued and a lot of people were taking equity out of their homes by remortgaging them at high valuations. But I do not remember discussion of how much fraud there was in originating and repackaging housing loans, and no-one was talking about how these were getting securitized and distributed.
It didn't take an economist or soothsayer to call these things. A war economy with a massive run-up in property prices that were clearly irrational is a formula for disaster.
Hell, the financial crisis had a early warning alarm. Bear Sterns imploded in the Spring... was the subsequent collapse of Lehman and the crisis really a big surprise?
No, plenty did. From the more famous Nouriel Roubini, Nassim Taleb, and Peter Schiff, to lesser known money managers like Mike Shedlock and Karl Denninger, there were many. Just because the market-cheerleading media hardly covered them doesn't mean no one saw the housing crisis coming.
I said economists, not money managers. Of the group you mentioned, only Roubini and Taleb are economists. Taleb did not predict a recession. He made money off the financial crash of 2008, which is entirely different.
Of course there will be people who say there is a crash. That's what makes a market. But economists don't predict market crashes, they predict recessions. And very few economists predicted a recession, which is what I said.
I don't recall economists saying it (I didn't listen) but every trivial housing metric said we'd been overpriced since the 90s. I saw people buy condos they couldn't pay for with rent in twenty-five years, if ever - if all went well. The rule is that 10-12 years gross rent is the highest reasonable purchase price.
Any economist who didn't call the bubble, and painful end of it, wasn't trying.
It will get worse. Our economy is debt all the way down.
As economics, as a field, becomes more powerful, the economy becomes more stable. I think this is probably a positive indicator for the value of economics.
This recession is severe, but it has nothing on the recessions of the past. Let's not throw out this knowledge; it was won by the accumulated experience of economic hardship unimaginable to modern Americans.
I have a hard time believing there are any "actual paid economists... doubling up in laughter" in your vicinity. Something about the attitude of your post.
People entering the workforce forty years ago could reasonably guess when they'd retire and what they'd be doing at the time. I know very few people who think they'll have the same job five years from now. It seems very likely that the argument that the economy is getting more stable is false.
Here's why: underlying predictability probably increases volatily. People love to lever up when they're certain; "Private Equity" as an asset class refers to both VC deals and leveraged buyouts because in both cases, they fine-tune their leverage to get the same (high) volatility. Increased certainty makes bankers more willing to lend, and speculative buyers are always willing to borrow.
In my experience, speculative borrowers and the marginal banker overestimate decreases in volatility. Thus, a more superficially predictable economy will lever up fast enough to more than counteract that (sort of like the theory that airbags increase traffic fatalities because drivers overestimate how safe they are and thus take extra risks).
For economic volatility to actually dampen, you'd need economists to come up with better predictions that sound really stupid, so bankers and speculators would disregard them.
This is inaccurate, or misleading at best. "It has nothing on the recessions of the past" is only true if you're looking at the pre-WW2 period. Compared to recessions since then, this is the most severe and long-lasting. There has been no recession since the Great Depression where unemployment has stayed as high as it is for so long.
Economists spoke of a Great Moderation that had occurred thanks to their ideological theorizing, but that is just an unfunny punchline to a joke now.
It's plainly obvious that I'm thinking of the entire economic history of the United States.
If you think this recession is bad, look at recessions before modern economic theory came about. That's what I'm trying to get at.
It makes absolutely no sense to throw out sound, proven macroeconomic theory because of a regulatory experiment gone wrong. I'd say it was that macroeconomic knowledge that prevented that mess from being a total disaster. And now people want to throw that economic knowledge out in favor of ridiculous shit like the gold standard, or MORE deregulation, or on the left twisted ineffective versions of laborism, or whatever. Bleh.
Economists do not necessarily have a great track record with predicting the future state of the economy. From a study by Denrel and Fang:
'Economists who had a better record at calling extreme events had a worse record in general. “The analyst with the largest number as well as the highest proportion of accurate and extreme forecasts,” they wrote, “had, by far, the worst forecasting record.' [1]
Actually, only a dishonest economist would say, "they can tell you what the economy will do." NO ONE knows what the economy will do. People make educated guesses, some better than others, but for every economist that tells you one thing, you can find another that will tell you the exact opposite.
I think a more accurate statement is that a 'good' economist can tell you what the economy MIGHT do, based on what it has done in similar circumstances in the past.
Economics is the study, and explanation, of the way things work - from a historical perspective.
Wouldn't someone employed by realtors be one of those vested interest parties, who can't make a rational prediction, because they'd loose their job if they did?
I agree with the fact that most people who make these comments have a bias. While these bias must be disclosed they are often not done so until the end of the video or article that they've written. It should be required that a person disclose any potential biases at the beginning of their argument so that the audience has a clear understanding of what motivates them.
It's strange seeing a doomer post here. When HN starts colliding with ZH, things must be glum. Is this bizarro day? Typically I come here for the start-up-optimism, technology-will-save-the-world, how-i-made-twelve-million-dollars-from-a-weekend-project posts. . .
This is exactly a "how-i-made-twelve-million-dollars-from-a-weekend-project". Winter is coming, buy shorts. Too bad Groupon didn't IPO shorting that stock would be gold in this market.
Goldman Sachs haven't Canute-like powers, they simply have better tide tables. So anyone claiming they "rule the world" should be viewed skeptically.
That said, we've had several decades of large and various constituencies "financially and emotionally invested" in the government absorption of risk (via Freddie / Fannie, Greenspan Put & Too Big Too Fail), and in the excess stimulation of demand via deficit spending.
The linkages between fiscal policy preferences and political ideologies, of all stripes, really shouldn't be that hard to figure out. I mean, it really shouldn't be that hard to think about what, say, a Paul Krugman believes to be ideal long-term policy, and what that might imply for his forecasted outcomes of various short-term initiatives. Or for your standard issue right-wing think tank circa fall 2003.
By all means, let's inspect this yo-yo's motives and their influence on his opinions. But if we're symmetric about it, we'll overturn a lot of rocks far larger than needed to hide this wannabe.
Big banks do rule the world! Not for the reasons he implied though. Take a look at Goldman's alumni list for example. So many people in power positions. And there's all the money big businesses put into politics. It's not charity! You don't think the ability to lobby effectively counts for anything?
That's the great part about the market, you don't need to have these debates, you think he's wrong? Take a position against him and in a few months time you'll have dollars instead of upvotes if you're right.
The other wonderful thing about the market is that it doesn't care whether you have favorable odds if you only take one bet. Lucidity in a debate is much more likely to produce upvotes than 55% odds on a single speculation about the market is to produce dollars.
(As Keynes said, "Markets can remain irrational a lot longer than you or I can remain solvent.")
I heard recently that market naysayers had 'predicted twenty of the last two recessions'. I think that about sums up this activity whether or not the predictions are made by interested (read: untrustworthy) men.
You absolutely need to remove the TechCrunch and KillerStartups logos if indeed they have not reviewed you. It's highly misleading to your users and an abuse of their brand.
In addition, the testimonials each have New York Times icon logos next to them. This doesn't add credibility; it's obvious the New York Times didn't write those reviews.
maybe you are wrong about Techcrunch and Killerstartup not reviewing me, maybe you just miss the reviews...well, as for the testimonials, for me, it's indeed obvious that the New York times didn't write them as well, as it is for you, so I don't get why "it's misleading", could you please elaborate?
Check Techcrunck UK , and look for GmbhNews: Old Brand.
Check Killerstartup, and look for GmbhNews: Old Brand
Check the press section, you will find some of those infos. Thanks for your great feedbck, I'll create new facvicon, I wasn't aware that those favicons are exclusively NYT favicons (it's a suggestion of the designer)
Could you link to the reviews from your site? Preferably directly from the "As Featured In" banners. That way there's absolutely no question. No doubt. Credibility can be proven without requiring a search or investigative discussions on HN.
Other than that, my #1 piece of feedback is that after pressing the large red button on the homepage, the user is expecting to see his or her mobilized site. Instead, the user sees a message saying: "Thank you very much for trying us. Your submission will be reviewed, and should be added shortly if accepted..."
I recommend checking out dudamobile.com for a good example of this flow.
Second, asking the user to solve a captcha right after pressing the large red button is not a good experience. I recommend including the captcha as part of the form, or not including it at all.
Interesting to see that they've revived it as an iOS tablet-only product. It does make sense that the tablet crowd would have higher disposable income than the general internet population. Given the emerging popularity of eBooks on tablet-style devices, catalogs are the logical next step.
For the same reason you don't negotiate with terrorists: If Apple pays up without a fight, then patent trolls everywhere will begin suing iOS devs with hopes of being acquired by Apple.
Warning: Don't enter your own twitter handle unless you want it permanently added to their archive.
I entered my own twitter handle to see what (if anything) would come up. Instead, I was greeted with a message that my handle was not yet in their database, but it would now be added to their list because I entered it. Great.
Meta-warning: Don't rely on your ability to keep a low profile to keep you out of trouble. Having your name on this list shouldn't bother you at all. These are some of the nicest people that have ever spied on you.
Right...people should just start to assume that anything they ever post on the Internet will be publicly findable for the rest of the Internet's existence.
15 years ago, you could've written a local newspaper column espousing the most radical of views and felt relatively comfortable that once you moved to a different state that no future employer would ever associate those words to your name. Not anymore. Hell, that's even true for people hundreds of years ago, now that Google has digitized old newspaper collections.
Same with photos. Posting a photo devoid of any caption or metadata may seem anonymous now...but five years from now, there will probably be the search capacity for anyone to efficiently and accurately search by facial-features and stumble across that random photo.
There's already services that mirror twitter feeds and scrape blogs, reposting them for any number of reasons, even just for filling a spam blog. So, this undetweetable just makes such exposure more explicit.
Unless you want to use Google+ or Facebook. Although, maybe we'll see a resurgence of real name pseudonyms. Now I just need to think of a name as cool as Mark Twain...
It depends on 1) the IR attenuation of the filter and 2) the sensitivity of the camera element to IR.
IR filters can only attenuate incoming IR so much while still allowing nearby red wavelengths through. And any filter will have a non-flat response through the visible wavelengths, slightly distorting the color response of your photos.
A properly coded IR signal from the transmitting 'disabler' device could still be picked up by the iPhone even if it was severely attenuated. At ~30fps, you can quickly get 100+ samples to cross-correlate with to search for the encoded 'disable' signal.
My gut feeling is that Apple patented this technology because it was low-hanging fruit. They saw they could roll it into a legitimate patent and prevent others from claiming it down the road. Still, I think it's worthwhile to send a quick letter to the powers that be to let them know we all disprove. If it does get implemented, the popularity of jailbreaking will move up another notch.
A properly coded IR signal from the transmitting 'disabler' device could still be picked up by the iPhone even if it was severely attenuated.
How about IR filter + 555 timer connected to an IR LED near the camera lens. Filter down the unwanted IR signal, then wash it away with a flood of intermittent IR of your own.
At ~30fps, you can quickly get 100+ samples to cross-correlate with to search for the encoded 'disable' signal.
Can you explain how that works? I don't have a deep grasp of CCDs, so I don't understand how a signal like this could be encoded within a single 1/30 second frame. I thought that all pixels were captured simultaneously, is that not the case?
Tread very, very lightly if you plan on going this route.
Be absolutely sure that your e-mails have real content in them (i.e. this is progress we've made, we just closed X deal, etc.) that can be easily digested. The goal shouldn't be to make contact and then explain yourself. The goal is to generate interest, which will lead to the contact.
Also, if this technique catches on and hordes of desperate entrepreneurs everywhere start spamming every VC and investor they can find, it's all over. The HN crowd, of all people, should know just how easy it is to create a filter to immediately trash messages from a specific address. This is why it's important to have excellent content in your very first e-mail.
To determine the actual revenue increase from those six extra seats, we would have to know how frequently flights have less than 6 empty seats.