2008-12-15

Going Long on going short


Very interesting article in Barron's this weekend from two of my colleagues at CS. Last week was the first time the VIX stayed under 60 for all five trading sessions, but investors should not be lulled into complacency. Messrs. Tom and Davitt submit that it can go a lot higher.

Like many folks I believe stocks are cheap and have been buying them selectively -- but often with a "buy-write" derivative hedge. I wrote the Nov 40 calls on HNZ and was proved spectacularly prescient when the stock closed at 38.75 on expiration (never mind that I had to sell anyway for liquidity!). Long term investors should consider writing more calls, but remember that what you consider a steep premium may seem like peanuts in a few weeks. I'm going to short half my position with covered calls, and be prepared to short more if the VIX spikes in line with the article's perspective.

2008-12-06

Durham hipster singularity


They were thick as thieves last night, what with the Fullsteam investor party leading to the official opening of Pinhook. This view is from the balcony of the Baldwin Lofts, where the occasion was the lighting of the Lucky Strike tower.

2008-11-07

Durham Co. LP meetup and victory lap


Now that the elections are over, the Durham County LP will resume meeting on Tuesday evenings at The Federal. Come one, come all -- we have loads to celebrate, from the shattering of the 2% vote threshold to the defeat of the prepared meals tax. MrCheap is buying beer starting at 6:30pm.

Federal is smoker-friendly at the front bar, but we'll be in the back. You can shoot your mouth off all you want, but leave your shotguns at the door; the skeet outing will have to wait until the end of hunting season. (See the Facebook group for the Duke University Shooting Team if you need more details.)

2008-10-22

Buyology (book review review)


I think it was Oscar Wilde who said "I never read books, because the reviews are so much better" (though I've been unable to find this quote -- first one to cite it gets a free KDD bumpersticker).  This definitely holds true with most nonfiction these days -- I can't remember the last nonfiction I read in its entirety, though when it comes to fiction I can hardly wait to get my hands on the latest Updike sequel.  Thus I get most of my nonfiction reading in nice five minute snippets from my daily newspaper or reason.com.  Today I'm introducing a new feature, the book review review.

The WSJ had a review today of "buyology", and while I always applaud obscure Lionel Trilling references, I think Andrew Stark is reaching a bit by saying that neuromarketing fosters 'a culture of "inauthenticity": It disrupts identity itself by bypassing the conscious mind and targeting aspects of the self over which none of us has control'.  The applications of neuromarketing are temporal at best; while you may have an urge to pinch the cheeks of the Mini Cooper's face, surely at some point your right brain reminds you that you never fit your kids into the back seat.

I'm reminded of the swanky advertisements for downtown Raleigh highrise living as so ably parodied by Blazer Manpurse.  Many will see in this ad a younger, hipper version of themselves, sipping ten dollar appletinis poolside among the creative class (or maybe just another toned empty nester).  The reality is that you will bitch about not having a decent grocery store and having no one besides trustafarians to talk to (I found this out firsthand when I lived in Williamsburg, Brooklyn).

Word on the street is that "North at West" is being discounted given the housing collapse, despite their well-produced YouTube ad (the bikini-clad avatar is a nice touch).  If you find this a bit much you might enjoy the one for HUE, which I liked better.

2008-10-17

the housing crisis is a demographic crisis

I was just getting my morning shot of Bubblevision when Josh Rosner told Joe Kernan that the real problem in home prices is that the traditional postwar level of home ownership (estimated at 60%) has ballooned to 70%, and that given the baby bust there's simply no way out of this mess (other than to raze homes).

This is shrewd analysis.  On the one hand, you could see a scenario where the boomers keep these second homes and their underwater mortgages through thick and thin, passing them on to their kids for use as weekend getaways.  One hopes the general level of prosperity will rise enough so that having a second home will be as commonplace here as it is in the English landed gentry (who would prefer to jet off to Ibiza, but will settle for Sussex or the Lake District).  Given the government's apparent preference to guarantee the unlimited appreciation of asset prices, this is a likely scenario.

But what about The Angry Renter?  I know that homeownership is all well and good, but couldn't you make the case that a nation of renters makes for a more fluid economy, where labor is free to pack up and move according to economic conditions?

What Durham needs is a state income tax deduction for rental payments, similar to what they have in Massachusetts.  This is the true progressive position.

2008-10-14

DDs: businesses that can't spell

I don't go to Wayne's because I love the little warren of shops south of NCCU, the prices are great, the service is good, or it's close to my commuting route (although all of these things are true).

I go there because the "Laundramat" sign makes me chuckle everytime I stop in. Won't see that in Cary.

2008-10-02

DDs: bagpipe guy


Treo_092408_002
Originally uploaded by dcrollins
Have you seen this guy outside the DSA? He's usually on Duke St. just north of Corporation. Awesome.

2008-09-26

Durham Differentiators - Sean Haugh


IMG00004
Originally uploaded by dcrollins
First in a series, profiling those who keep Durham different. Sean is running for NC House 30.

2008-09-25

mark-to-market

I'm trying to stay above the fray in the financial markets, because (1) this is where I make my living; and (2) this site is supposed to be about Durham, and I've already commented on some of my other sites. But this article is worth reading.

I'm not going to join the chorus of analysts blaming mark-to-market for the current problems, because like Mark and Erin of CNBC's "SquawkBox" I believe that we wouldn't be in this mess if only we had adopted MMM earlier (as in, way before the fed opened the discount window, or for that matter before the runup in real estate, or before my employer even invented the securitization of mortgage backed securities).

But that doesn't mean I don't agree with Blodget & Co. Buffet IS right on the money, and this is part of why I went long on GS Monday afternoon. I was burned on the Lehman failure, when I thought Paulson had finally grown a pair.

In related news, I encourage everyone to support the unionworkers in their protest to Stop the Bailout!

2008-09-23

about the name



Several people have commented that it's too much like the "Keep Austin Weird" campaign of the mid-90s...especially my wife, who went to law school in Austin.

I'm OK with this, but I'm also open to suggestions if anyone has a better slogan. Having lived in Texas myself, I'm all too familiar with how the KAW campaign became corrupted by all manner of people: "evil" corporations trying to make a buck, do-gooding yuppies who wanted upscale boutiques on Guadeloupe, hippie weirdos who found it fashionable to hate Wal-Mart, etc. KAW is what you make of it.

KeepDurhamDifferent is intended to be a rallying cry for the independent-minded people and businesses that make this city great. We don't want to be another Cary (bland suburban), Raleigh (vanilla sprawl), or Chapel Hill (unaffordable elitism). It's what you make of it, whether as a merchant on Ninth St., a resident of Trinity Park, or a Duke student slumming it in the Dirty D Town.

In case you're wondering, the second choice for the name of this site was DurhamRenowned, which I actually like better but doesn't sound pithy enough on a bumper sticker. For more discussion of Durham slogans, see the post at Gary's site.

about the site

I started this site when my campaign for state senator began to attract interest from the liberal and progressive coalitions in Durham, especially the Green Party. These interests are traditionally represented by the People's Alliance, but when they met recently with our state representatives there was a lot of bitching and moaning about how Durham's needs are outvoted by the rural and Republican coalition in the General Assembly.

To which I say, "Well, Duh." North Carolina is not that partisan relative to other states, but when the Democrats and Republicans square off there is often little room for compromise. We need a third way to advance the progressive agenda, in the spirit of Bill Clinton and the New Democrats. Call it conservative Democrat, liberal Republican, Libertarian....I don't care, as long as we get the job done. Durham needs mass transit and should not be held back by the lack of reform at the state level.

Constitution Day

I started this site on Constitution Day. As a card-carrying member of the ACLU, I think it's appropriate to take a few moments to consider the strengths and weaknesses of the Constitution and the Articles of Confederation that preceded it. Yesterday's Wall Street Journal featured a great profile of one of the dissenters, Luther Martin.

Durham's progressives would do well to remember that the Constitution was passed only with the inclusion of the Bill of Rights. Reflecting on the arguments of Martin and the constitutional opponents, it's easy to see that the federalists laid the groundwork for the concentration of government power at the national level. One of the guiding principles of this site is that the citizens of Durham know best what is good for them; we need effective leadership from our state representatives to allow reforms that are not necessarily endorsed by our sister cities in the Old North State. I'm not going to parrot the libertarian line that "Small government is better", but I think it's accurate to say that "local government is better".

2008-09-17

Welcome!

A new vision for Durham, supporting the progressive agenda. Durham, love thyself!