Thursday, February 28, 2008

Another Inverted Cup and Handle

I'm sorry, I've been very busy lately with work and preparing for what looks like life without fuBarrio, the rabid bald snaggletoothed dog.

It's starting to look VERY likely that betting my (online) life that Hillary would win the demo nom was a pretty stupid move.

If she and Bill don't pull a last second miracle, this blog will just be a bunch of commercial postings for helping some sites I work on rank a little better (hopefully). I'll be posting any and all editorial commentary on a separate site that I've registered -- and life will go on without the blind dog.


Ok...what this post is really about though is that ANOTHER inverted cup and handle setup in the dollar over the past week or so and (predictably) it failed to hold again.

I'm just hammering this post out before i eat during my lunch break, but my hope is that eventually you start to see some of this "order in disorder".

You can see, as the technical analysis Gods predict, that you see a dramatic move to the downside the second that support is broken.

(as an aside in the political prediction markets, Obama's chart formed a big right-side-up cup and handle....and burst to the upside when he beat hillary in WA state (i think it was).

Anyhow. the dollar chart is's a bit choppy to be called a "true" cup and handle...but i still think if you squint real hard you might be able to see it....the support at 75 before breaking down. If you like, refer to my earlier treatise on cups and handles, why they may be predictiive and inverted cups and handles as they relate to the dollar index.

OH....yeah...almost what to do? look for exploration and production companies (oil) gold miners (who are in production) and people who make or service people making food. a decent way to ETF into food and avoid company risk is ticker: DBA.

Sorry...lots to say, not much time.

Monday, February 18, 2008

Free Internet Marketing Advice

Well, in actuality, here's some free advice that goes beyond just Internet marketing: you get what you pay for. :)

While I'm never shy about handing out unsolicited advice -- a fun little habit that has scuttled many a job interview prematurely -- I haven't been as active about it here on fubarrio in recent months.

The reason, alas, is that it seems that the original "raison d'etre" of fubarrio, while a bit meandering, had been relegated primarily to:

  1. what's it like living in Uruguay as an expat, and
  2. trading your way into the poor house with faulty pattern recognition brought on by senility and greyed out eyes desperately in need of cataract surgery.
While I sprinkled in some "edgy" statements here and there, there really isn't much controversy left in any of my "predictions" -- with the possible exception of HRC getting the dems nod -- one of my "gut feels", poorly researched at that :)

Lately, I've been watching the markets and the happenings in the states a LOT less, and the bear case in alot of markets has been taken mainstream by reality slapping the bulls in the face.

The reason I'm not following things so close is that

a.) the turn is in hand and the trend is in place....watching the trend unfold (especially in resi real estate) is goin to be like watching a slow motion train that will take about 10 years to "play out" IMO. In fact the ramifications will be felt until the last participant in the insanity dies....maybe even afterwards if they can shake any sense into their grandkids before they leave this rock.

b.) i've been really busy with my pet project here in Uruguay -- turning this sleepy cow country into a booming offshore financial centre.

(Ok, well, admittedly, this place isn't really ready for spite of having some outrageously beneficial laws relating to bank secrecy, they also have this little problem of red tape making it an outrageously expensive and SLOW place to do business.)

In spite of that, I march on like a committed soldier to certain stress induced illness and perhaps death in trying to rework the internet marketing at my little company.

Now, I've learned a lot in the last year -- mostly about what a fool I was in regards to Internet marketing. And, if I could go back in time with 20/20 hindsight I'd probably do things a little bit differently. However, in spite of all this, it turns out that I have a lot better grasp on this whole Internet marketing thing than a lot of the people who really need this knowledge. So, I'm constantly being asked questions from friends and associates for how to "improve" what it is they are doing.

This primarily comes from companies in "startup mode" before they've realized that they already known everything :)

Ironically, these guys don't have the time money or inclination to go out and get someone who can truly help them, regardless of how desperately they need it.

So, what I'm beginning is yet ANOTHER blog, to jot down some of my findings, foibles, unsolicited advice, and war stories from the world of internet marketing.

A quick search of the term "internet marketing" will turn up a "brazillion" hits because there is big money (apparently) in selling flailing entrepreneurs internet marketing secrets, tricks, schemes, etc.

I'm not selling anything. This is purely, free internet marketing advice. Worth every penny you paid for it. :) However, I will attempt to make a solid effort to be honest and open and forthcomin with some of what I've found, what I still struggle with, and what I've burned the last year of my life dealing with so that you won't have to (hopefully).

As an aside, this sort of thing may be generically interesting to the less well-off (or younger!) fuBarrio readers who dream of expatriating themselves, but are "stuck" in financial situations where there income is not very portable.

As a Controller/CFO/CTO of startups in silly-cone valley, I had created a decidedly NON MOBILE work profile.

Trading, and later this whole internet marketing thing, were just my response to get out from under the tyranny of the hour-long commute while paying out massive amounts of my "hard earned" income in (housing) debt service, and crazy Cali-taxes to what I felt was a fascist regime.

If my "other" project can help someone get the confidence to take the plunge, or save someone from one of my fubars....all the better.

I will still attempt to articulate some thoughts on uruguay, trading, and the financial world at large through fubarrio, but I'm starting the other project as a place to point people who want to know about the place I spend the other 20 hours a day :)


p.s. as an aside about my other blog. two obvious things i'm doing wrong:

1.) never link to your new blog until you have it setup on a unique URL. i own the URL (without the blogspot stuff) but i'm too lazy to set it up right now, and

2.) think thrice before you name a site (or a product or a company) some cutesy "pun". people will constantly be mispelling your name. 'tis much better to come up with something unique never before coined and "own" that name.....what can I say, I'm a sucker for a pun.

Tuesday, February 12, 2008

Bad Year to Stop Sniffing Glue....

My arrogance *may* have finally caught up with me....

I made a drunken proclamation earlier last year that Hilary *would* be the Democratic nominee. As if that wasn't stupid enough, I staked my "life" to it, saying that I would give up blogging under the fuBarrio psuedonym if it didn't come to pass.

Ironically, I also predicted that John McCain would be the Rep Nominee to a different friend.

How the worm has turned. McCain came out of nowhere to take control and Hilary is reeling.

Now, in my defense I wasn't following the race as an expat and had never heard Obama speak. I was betting my bet on the Clintons being coniving and a little bit crazy perhaps.

After Hilary *won* New Hampshire (her first comeback so far) I heard Barack speak for the first a concession speech.

I had a feeling that my dog liver was cooked at that point. He *sounded presidential* to me....even in defeat.

A mix of MLK and a Kennedy almost.

Now, that said, my slim hopes of keeping this website alive as anything other than an empty shell of commercialism and a dead link farm lie in the sinister minds of the Clinton camp. Surely, they can drag out some photoshopped images of Obama sharing a cigar with BinLaden in a Pakastani strip club or something (?)

I know it's just talk -- and there isn't much a politico can do but make more trouble -- but the irony is this barack guy is the best chance for the US keeping up its spirits when things suck over the next few years.

I truly do hope he wins the demo ticket, for the sake of the US.

For the sake of fubarrio, i hope those scheming clintons have kept one hail mary up their sleeve for the final push.



Sunday, February 10, 2008

Ocular Penetration Restriction Act

I know CSPAN can be a little boring.

But, this propose legislation is so important I had to take the time to figure out that whole video embed thing from YouTube.

If I could take the time to wrap my nontechnical pea brain around can take the time to check out this video....The most useful piece of legislation to come down the pipe in recent memory

Sunday, February 03, 2008

SuperBowl, Sportsbetting, Odds, and the Sportsbooks

Well, this is it today....this is the "black Sunday" for the US based sportsbooks. The day when they can potentially rake in more than any other day of the year and a big sendoff to the football season, which is still the most lucrative time of the year and sport for the US based books.

I'd wager it's also a big day for worldwide sportsbooks, notwithstanding their prediliction for better on the "other" football (futbol).

Years ago, when I was more in tune with the happenings at the offshore sportsbooks, I noticed a strange phenomenon (or thought I did at least). That I was going to mention in light of the setup for this superbowl.

Before I get into that however, I need to give you some background (for the uninitiated) on how a sports book operates.

Sports books are in the business of matching betters with each other and acting as a "broker" of sorts. The return for his work in matching up bettors (or punters as the brits say) he is given the "juice" a commision of sorts, also known as the "vig" or "vigorish". I have no idea where they got the term vigorish. The vig typically amounts to 5% of the total wager and in theory is paid by the winner. But if you analyse the situation it's technically paid by both sides with a reduced expectation of return.

Well, this seems pretty easy for the sports bettor, right? All he has to do is pick the winner, and give 5% back to the bookie for taking the transaction.

Not so fast. The reason that so many people get into trouble with the bookies and end up getting kneecaps broken (in the movies at least) is that the bookie isn't a total knucklehead. He realizes that his optimum total return on dollars wagered over the long haul with minimum risk is maximized if he can find people for BOTH sides of the wager.

But how does he get both sides of a wager filled when there are some obvious favorites out there?

There are some "tricks" they use to accomplish this. Two typical ones are to pay a moneyline, or "lay odds" and the other is to create a "line". A specialist either evens the possibility of a win by adding points to a teams outcome -- or they attempt to even the betting by paying out larger dollars for "underdogs" -- or outcomes that are judged as less likely.

Laying odds, I'm not as familiar with, but you see it at where matches are a binary result. Examples of this are the craps table, prize fights, cock fights, etc.

You hear, "3 will get you 5", or some combination of risk vs. payout.

The bookie will attempt to tailor the odds so he matches the betting and gets the "vig" or "juice" from either outcome resulting in a payout that is less than what he took in.

Horse racing is similar, however the handicapping method of payout is a sophisticated "on the fly" calculation of payout vs. wagered. I have read somewhere that the "juice" at a racetrack can be as high as 18%. While this sounds very high, it is understood that games that are more expensive to organize and present and games that take longer to unfold have a higher payout ratio to the house.

That is on of the reasons, no pass in craps pays the house about 1%, and a game of keno or bingo can run 40%. Craps is very fast and bingo is very slow

Point Spread

The point spread is the other method the bookies use to even out their betting. The "line" or point spread is determined by a few different wizards that work in the larger sportsbooks....and most (if not all) the smaller books follow suit with that published line. These wizards are incredibly talented at finding the line before the bettin begins in a given week, and absent a big middle of the week injury (previously unknown to the bookies) these lines are relatively stable.

Moving the line by the bookie is problematic (although necessary sometimes) because he runs the risk (espcially if the line moves enough) or having a bettor place two bets at different times with different point spreads and winning them both. This happens when the outcome falls between the two point spread quotes and is called "getting middled" by the bookies.

(I call "getting middled" when you end up with seat "B" between two obnoxious fellow travelers on a cross country equally uncomfortable feeling.)

The online casinos have a application that feeds them the vegas lines when they are published and any changes to the moneyline.

You will hear this quoted something like, "The Seahawks are favored by 6 1/2 points". The quotes for lines tend to hand around the numbers represented multiples of 7 or 3 points (or some combo) which represents touchdowns and field goals of course.

The point spread however almost always involves a half point. Why is this?

Well, the only thing worse for the bookie than getting middled or being stupid and going into a big game with very lopsided betting -- the good bookies have arrangements to "lay off" big betting to bigger books just like insurance companies and re-insurance do -- is a "push.

A "push" is when the book declares a favorite by some number of points and that ends up being the difference in the game.

A "push" by rule means that all wagers are returned to the players and there is no VIG or JUICE to collect for the bookie. Basically he did a bunch of work for nothing. Not good.

For this reason you *rarely* see the spread an even number.

In a VERY rare case, the Rams and the Titans were in a superbowl (perhaps in the year 2000) and the initial line came out at Rams -7 meaning that the Rams were projected to win by one touchdown.

No matter how hard the book tried to move the line to either 6 1/2 or 7 1/2 they couldn't. It created a massive inbalance of betting on one side or the other.

It turns out that game...through a SERIES of spectacular plays, close calls, a photo finish, etc, the final outcome was Rams -7...they won by exactly one touchdown as predicted. amazing. The books made NOTHING on the superbowl game and the vegas casinos had to be happy with the slop over betting and extra traffic the superbowl brought in.

Do the bookies always get the line exactly right? Well, no...however, at times it is *amazing* how accurate the published point spread is....The point that I need to emphasize here is that THEY AREN'T TRYING TO PREDICT THE OUTCOME.

They are, technically, trying to predict what point spread will give them exactly even betting on both sides.

That is a fine, but very important distinction -- which brings me to thing i "noticed" some years ago -- although i have only anecdotal evidence to back me up.

It seemed that teams from large population centers would receive a larger porportion of betting...and teams from large population centers would receive a larger percentage of "homer" betting...meaning you bet on your favorite (home) team to win whether you really believe they will beat the spread or not....because you want to root for them presumably.

Cities with large populations that were really into gambling -- especially big cities from the northeast seemed to have enough "homers" betting to actually move the spread beyond what regular betting should be.

So, a game with the NY Giants and AZ Cardinals would (sometimes) seem to have an inordinate number of bettors taking the NY Giant, plus or minus whatever the line happened to be.

The result was that someone could simply bet against the giants with the line and come out ahead.

Of course, this was years ago, and I never took the time to do a deeper analysis -- and if there was an anomoly, i'm sure it was gobbled up by the big swingers who try to make a living off of sports betting.....The lines are so accurate, and the vig is high enough that there is only a small small small number of people in the world who can make a living sports betting...although many try.

So, how does that effect the superbowl line?

I would guess that the NE Patriots, bein that they are unbeaten and receiving an incredible amount of press -- their QB was on 60 minutes -- the number of bandwagon jumpers have more than likely swamped the numbers of even the "homers" from NY.

This is an unusual game from that persepctive. It's not like a regular season NY Giants, AZ Cardinals game.

So Superbowl predictions, I have none -- though underdog + points can sometimes be more fun to watch for me. I'm a sucker for an underdog.

After Superbowl predictions, I have one -- bet against the return of a "spring bounce" in US residential Real Estate usually marked as beginning the day after the SuperBowl.

Not withstanding the efforts of the Treasury, the Whitehouse and the Fed, I'm taking Recession (minus the points).

ciao for now,

Friday, February 01, 2008

Yahoo! - It's all Good!

Some credible sources were telling me after the gap down (some even before it) before Bernanke's panicked .75 basis points cut that the low had been put in on the stock indices for the quarter.

While I didn't "believe it", I was quick to lighten up on my shorts on the gap down and my short positions now are a way to cover my longs in case the SHTF. (These technicians think that we are in for a "paws" that refreshes on the bear market....then later in the year, another leg down.)

Anyhow, after seeing google disapoint I was starting to think that we could catch another wave down....then this:

MSFT agrees to buy Yahoo at a ****61% premium**** over their trading price.

Who in the H.E double toothpicks pays a 61% premium for a declining asset.

Finally, somebody overpays, stupidly, for an asset and i'm not an owner of the acquirer. Bout time I missed a bullet.

I'm quickly left to wonder what this means for the rapidly shrinking business of delivering search results.

Currently the three players are Google, Yahoo, and MSN. If #2,3 merge, then it's really a two horse race and a bunch of also rans. I'm curious whether the algoritms will merge...whether there will be a difference in the two sites' search results as their is now.

Time will tell....It'll be interesting to see what this does to the indices today given what a big weighting msft has.