Born in 2010 – What’s a newspaper?

This downturn has really had its fair share of victims in the business world. The financial industry, the auto makers, it looks like technology has suffered, but the online media formats continue to grow. This brings us to look at one media industry which might simply never come back; the newspaper industry.

Today I write as the Chicago Sun-Times files for bankruptcy with a Delaware court. Just recently the The Seattle Post-Intelligencer stopped it daily print edition citing the paper failed to find buyer for The Hearst Corporation Owners. Minneapolis’ Star Tribune also filed late last October for chapter 11 bankruptcy as the paper’s new owners, New York-based Avista Capital Partners, had an outstanding 350 million debt they purchased the paper with a few years before.

Just as any industry has reorganized in the past we can list the real suffers of these situations are the journalists and union employees. I am not saying the investors of the paper don’t take a hit as well, but we know if you are living off of investments you are better off than those on a shoestring. Along to the fact most employees of large papers are enrolled in pension, or at least 401K programs that invest in the very same company they work for. All together the situation we are in does not insulate anybody from the effects of cash evaporation.

newspaper-chart-inflation-adjusted

There are a few people with a ideas about how to solve the dilemma. Senator Benjamin Cardin, D-Md has proposed an idea to allow local and less distributed papers operate as non-profit or tax-exempt entities siting the ad revenue is simply not enough to be taxed. The idea is good, but the question is whether it will be enough to save a single paper. The conglomerates would not be included in the legislation.

picture-2

Today’s victim holds with it an interesting perspective as this stone simply continues to roll faster and faster. The market doesn’t seem to care about these papers failing, not that it ever did, but we are seeing a nice rise of over 100pts in the DOW as these writers dust off their resumes. Papers like the New York Times are increasing buy-ins from investors, as Carlos Slim bought a 6.4% stake in the company in a ploy to keep operations moving forward.

So, do people actually think there is future for these papers to sell print in a world so engulfed by rich media web applications and readership of younger generations lower than any other demographic. Last time I personally wasted money on a print paper was years ago. This is not to say the content was not valuable or entertaining, yet could I not have simply printed the crossword from homem, sat and occupied my morning coffee.

picture-3

This chart is not unique as in all the companies are suffering. There is a drive to try and figure what models will work for online media to develop revenue, as the print advertising slowly drys up. One possible solution would be to offer free advertising in print pages with the purchase of contract spots online. And models like the Financial Times who charge for specific content seem to be less apt to suffer, although this model doesn’t seem to hold in general news situations. The other aspect to charging for specific content is that after one person buys the article it gets mashed and redistributed throughout the web. I consistently see article by the FT republished in user blogs, at the violation of copyright.

My favorite solution is to provide all content on line and use the revenue saved by printing to help those without access to high speed internet get up to speed. This would save paper, help energize online income generation ideas, and set the stage for a technological media generation. After-all if the Millenials don’t buy it, its dead in 30 years.

Stay hedged, stay happy,

Margin of Safety

The Last Geotagging Thing.

Hooray the end is here, or should I say bummer dude. My final of the 16 things has come to close and I could be more grateful for the experience of exploring all of these thing the web to offer. A few of the thing seemed to get redundent, but overall I learned more with each thing. If I get the scholarship, whew whoo! But if nothing else comes of it I still learned something. My last post about the 16 Things is about Geotagging a fun way to show the world where you have been and what you liked to do once you were there.

You can see my photostream for a trip my wife and took about two years ago to the west coast here :

My Geotags

This was probably one of the easiest things to do on Flickr. Simply go the map page under the organize tab and have at it. I liked the search which brought my into the California coastline for posting my photos. It seems cool to be able show those people who never leave their house how much you actually have gotten out into the world.

There are other Geotagging services out in the world, but I care not to explore them at this time. I am going to look into dropping a AJAX version of Google Maps on this blog, so when after I finish the heavy coding I will be able to do some geotagging right on 7thstreetcapital.com

I have use geotagging personally for the completion of my 16 things, but I will inevitably be using for the business adventures in the future. For example I can see a web conference with a variety of faces, or I can see an investment opportunity in a remote destination being published so others will be able to exactly understand the region their investment will take place in. Let me indulge further: Some place along the Ecuadorian Coastline could a wonderful investment, but some of the towns have the same name and others are not on any Google map. In this case we could travel to the region and take photos of secluded beaches posting the to Flickr of my personal Geotagging applet for people to see. We could seel real estate or commercial adventures this way.

Geocache in a similar term and I invite you look at the home page explaining the habit here:

Geocaching.com

This is one of those activities which brings out an eclectic bunch of folks. I can see this for a group of friends looking to spice up a road trip. The idea of simply bringing this electronic wonderland into the natural world is becoming more popular all the time. Time, who has the time? I would think a good gang of Geocachers would need a fair amount of resources to get any of these containers, so if you have the time get to it.

To anyone who has come to this blog looking for financial or trading information over the last eleven weeks I congratulate you. For, the 16 Things project has dominated the writing lately, but as with all bull and bear markets this to shall pass. Shall pass, it does tonight with this final blog about the 16 Things. If you are a web mover and shaker I challenge you to explore the 16 Thing page for a lesson in what some call the Web 2.0, and I despise the name Web 2.0, so I will call it WebGI = Web Generation Innovation. That what this all about right, creativity. To finish all the colorful making tips will be back in short order, and thank you 16 Things for making the web a better by teaching us to think better.

Stay hedged, stay happy,

Margin of Safety

Let’s talk about it!

Podcasting is an all to familiar topic for myself. I love the Podcast. I am a very auditory learner by nature and resulting in thousands of dollars of classroom education there is the evidence. The listening of public radio and personal dialog incorporates nearly 80% of my listening. I subscribe to a variety of different podcasts ranging from stock trading to design ideas to left wing political gibberish. I have recorded a few screen casts and will do much more of this in the future. Sorry for you I have not completed anything worth sharing to this point, but when the day comes you will be the first to know.

Specificlly I subscribe to the following podcasts on Itunes for free.

  • APM: Marketplace
  • APM: Sound Opinions
  • CNBC’s Fast Money
  • The Street’s Real Story
  • The Ric Edelmen Show
  • PRI: Design for the real world
  • InformedTrades.net

There is a directory just brought to my attention great for learning called the Educational Podcast Network. I am excited to dig further into the libraries to see what kind of educational resources I can conger up. If there one thing I love more than all else about the web is how easy it is learn about stuff you like, ummm…. for FREE!!!

Walt Whitman…what? Would Walt Whitman podcast? Probably. Doesn’t everybody have an obligation to podcast at least once before they die. I can only imagine the crazy kind of shows Whitman would have about sex and freedom. Walt Whitman would be the Howard Stern of Podcasting and incredibly popular. He might also have a strong views about the Wars in the world and political unrest.

New Podcast coming soon.

Stay hedged, stay happy,

Margin of Safety

Your own secretary

We use calculators for many things in this world. Finding the interest on the mortgage, taking a run and adding up the calories, and just like the old days…adding. They are useful little contraptions that free up much time similarly to the lessons one has learned on the 16 things travels we have been taking over the last eleven weeks.

This post is about two assignment calculators designed for timing and collecting information on the a project or single assignment. After you enter your dates of the work and the type of assignment the calculator spits out a time-line where illustrating the work flow recommended to complete each task of the project. One calculator I examined was a product of the University of Minnesota and the second is a research calculator. Follow the links and look for yourself to see how they work.

U of M

Research Calculator

Most of the work we complete at the Art Institute, where I attend school, is less researched based, so the first calculator seems most obvious. After reviewing the output as a non-university student the “Research Calculator” seems to fit my researched based activities in the financial markets much to my delight. The layout is less university-isk and the ideas it lays are less hand-holding. The appeal is a more adult way of looking at a project versus explaining every little task.

The RPC would help with setting up a classroom in two ways; both as a student and as an instructor there is value. Instructors would run an assignment into the machine and then use the time-line as a grading tool to evaluate progress. From a students perspective the general idea is laid out to complete a thesis for a masters program or any other research project. I will use one in the next project I get from an unruly instructor.

Just as educational uses have been mentioned there are business practices in thought as well. The best businesses seem to be always funding their R&D departments, and a well organized research project would take place. For example: a business team needs to develop a financial forecast for a company it thinks the market is underpricing, a housing development company needs to analyze the market in a new city before deciding to put a shovel in the ground, or a web development firm has a new idea for a twitter based search engine. Imagine your exploratory research on any project following the regiment of one of these tools; success would inevitably be closer and easier than you may think.

Stay hedged, stay happy,

Margin of Safety

Thirteen is productive and you cannot stop it

Productivity has become such an over used phrase in the current web climate. The possibilities of endless collaboration and cataloging as grown to place of near confusion. But the purpose of these thousands and millions of tools are to really make our lives simple. In the 16 things I have written about where we have traveled through specific production and creative tools that make this web environment a place as natural as the earth we come from. The ability to tweet and re-tweet every little thing we come across is pure nature. The following prompts are attempts at collaboration tools that a number of well-to-do developers have put into our lives. Some like Stikkit are no longer functional and others like Backpack seem to be valuable tools.

To start my first place to admire was the site called Backpack. I loved the customizable aspects of being able to add pictures, power points and calendar tools.

tools – Backpack is fully customizable originally I thought that to be a great thing, but then I looked at a site called Scrybe and found their tools allowed for the average business person to select travels from the web, like the tagging power of delicious, and import them into a fully formatted newspaper layout. This would be wonderful addition to a research project.

Online calendars are probably one of easiest and most readily available collaborations tools on the web. I think because they been test since the early email days. They seem to be best for project work if the entire team adds events like wiki blog. It becomes very easy for the entire team to see what is happening when, and how the deadlines will fit in their schedule.

These online sites all seemed to have blackboard or post-it note of some kind. The post-it tool is over rated on all of these production suites. The MAC OS has a nice sticky program built into the applications which incorporates spell check, hyperlinking, and color coordination. As these cloud computing programs start to become more and more strapped to advertise new ideas things like post-its or other white board technologies will seem less advantageous.

Backpack offers a nice video advertising the features about the program. I did sign up for the free trial for they want a credit card from the get go. How crazy, somebody wants me to pay for something! Here is point of difference for all you product placement advertisers: TAKE MY CREDIT CARD after the free trial. If your product rocks I will pay for it; gladly!

Other production tools I have experience with and suited my needs were Google Sites, and Adobe Connect Now. Google sites is free and any person with a gmail or other registered email can register for free. It provides a blog and a page sharing application. This works great for low income college students and quick project with materials in the creative suite. Adobe Connect Now is a live Adobe Air platform any person can sign-up for free. Nothing to download so check it out here Acrobat After you sign up send me an email/comment and we can collaborate and share desktops, docs, and ideas.

Of course my favorite productivity tool is twitter and I love to see what other productivity idea you have going on. Follow Me HERE!

Stay hedged, stay happy,

Margin of Safety

#12 del.icio.us

Delicious is one of the most important tools we can incorporate into our lives. This thing makes marking your territory on the web easier than a dog wandering the yard. Last year I had the misfortune of loosing my hard drive on my MAC. Oh well, I back-up often and only lost a few weeks of financial information. The most cumbersome part was opening my bookmarks to find nothing….Ahhhh! Delicious now gives us the opportunity to store bookmarks off the local drive on a host server and publicly as well.

Check it out at del.icio.us

This tool can is really what makes the web a personal playground for us as people. In our ultra-consumer and ever-changing days we pass information left and right every second. Tools like this will help a research project become sharable for those interested and important site easy to find. Another example is an Art History catalog assignment I finished working on. If I would have been using delicious I would not have needed to carry my laptop from to school to home and back to school every day. I could have accessed my bookmark from the cloud computing site and reduced the strain on my back.

Delicious is now part of my web routine. I tag every site I find interesting along with posting the links into my twitter page. I am sure when I get into another team project I will find the application useful in sharing with others. The site could be used to track political candidates internet interests. It can be used to incorporated people with similar habits into your network. As with most of the social and recording aspects on the web this makes it easier to find people who are doing the same things you are.

Stay hedged, stay happy,

Margin of Safety

#11th Thing

Hey yall, getting closer to the finish line.

Today’s 16 things blog post is all about the possibility of photo sharing in tools the web has to offer. The few programs I have sequenced into my work flow today . The purpose is to find business applications for the video and picture view programs. The elements are seem very similar to online applications for Power Point.

This first experience I came across is an application called Slide Share . The platform is comparable in design to the YouTube look and feel. The best part I can conger in my imagination is how valuable this would be in a business setting where it is uncertain how set up presentation equipment. It is like power point on the go. Anywhere you could get online the possibility to share long photo logs or instructions is simple as logging in.

The next site I took under my wing to example is a place called Social Software Showcase . The particular video linking in this paragraph is a video providing information about Twitter. I am having a hard time thinking these sites are much different than the communication tools we have already featured in earlier. For example youTube the biggest video sharing application.

Any screencast can be placed into the site and made private or public depending on your needs. I almost think because there is so much content on YouTube non-business related most people have forgotten it could be used for that. These tools are not hard to use when you have an application for them.

Each of the tools featured above are open sourced based and free with an account and user name. I would think in a future project for a classroom the possibility for Slide Share has a place and I might even try to embed a plug-in on my blog with some of the charts i have seen in my trading days, but the future for now I will leave these applications to the web for others.

Web sharing is the fantastic part of the new world we have embarked into. Millions of applications spring into the market everyday much like those I featured here today. The market has become so saturated is seems like there is no home base for anything. For each project there is a tool which will be near perfect for the tasks at hand. The hard part is searching threw all those pages on Google just trying to find the perfect one.

Stay Hedged, stay happy,

Margin of Safety

We have a choice as humans

2008 is a year business, economics, and finance classes will study for the next one hundred years. The following exposition is a perception on why unethical organizations will become publicized as the downturn continues, and then a long-term perspective on how we got here is described. Finally, two very different pictures are provided as speculations for our country and race as whole.

The current downtrend and its ability to reveal unethical behaviors

When the music is playing in the financial markets it is crucial for institutions to get up and dance. The products making up global markets are diverse as the economies they come from. The constant deregulation over the last fifty years, especially in the previous twenty-five, has lead to incredible wealth for the developed world, and our profit based business world has become the path of least resistance for nearly all humans to acquire wealth. Sadly a few bad apples has turned into an entire bunch of bad apples.

Ethics was a strong selling point for many in a generation that fathered the baby boomers. As the largest population (baby boomers) of our country’s history grew the rational to justify unethical behavior became a priority over fair and balanced business practices. Organizations have been free to manipulate people, labor laws, and accounting practices to assure those with most cruel rigor will always come out ahead. Annual profit and stock price take a precedence over all other aspects of business, because the leverage a company has in the world is derived from it’s perception from the eclectic crowd on Wall Street.

Just as they rose the tidal pools of prosperity are receding and those whom swim naked must face an angry crowd. The reinforcing behavior of regulatory agency will grow as the public demands justice for their lost dollars, and the public in general will ask more questions before trusting any person in the industry with dollars earned with sweat. This invariably reveals more wrong doers everyday. It is not that Wall Street has any less unethical people; they simply don’t have the resources to continue their raid on the innocent.

How we got to this place

The 2008 stock market crash did not simply show up out of nowhere. The roots have stretched farther than most American would probably care to think about. The market crash of 1907 and even earlier booms such as the Indian Trading fiasco in the 18th century. Even the south sea bubble in England has shown what happens when large populous places enormous sums of money into a machine like a stock market. Human model of this behavior is even evident in the crusades, which plague millions to the rise of the middle ages.

This particular crash can be modeled as the housing crash of 2007, but the bubble we are experiencing started in 1978. There is no specific starting point, but the deregulation campaigns, along with global military spending, in the 80s were the real gas for the fire, which has been burning since August of 2007. Special interests pushed Washington’s leaders to abandon utilitarian ethics for an ego-centric approach easily sold to populations of low income Americans. The dream of financial freedom was pushed in Americas face as the engineers of the system slowly took more for their own ledger.

Once the business leaders of the country were able to secure a deregulated ticket they were able to reduce the incomes the government collected slowly pulling social programs out of functionality. This led to a high rate of competition mentality, for it is most honored under extreme capitalism, and sets ethics and responsibility in an unwanted light. Between unethical leverage rules in the Long Term Capital Management crash of 1997, the tech bubble in 2000, and the now the housing crisis of 2008 the environment we have come accept a rapid boom and bust economy thriving on news and immediate results. We have stooped to crisis management as a nation instead of stable empire engineering. The end of this era is the end of the belief that the equilibrium of the markets will sustain if we leave them to the free market.

Two possible futures

It should not be taken the market and credit imposition leads to a strong argument against everything we call tradition here in the United States of America, for markets have created wealth the world over never before seen in our history. More people are with safe drinking water today than fifty years ago and the energy grid connects over one billion people instantly. Simply the rules of ethics will need to come back for our race to move forward. Our profit for scarcity demand curves need to be responsibly redrawn.

In one instant of the future we can listen those who preach the free market mentality, or who I like to think of as the market fundamentalists. The way of the past, which allows for large populations to be left without basic human needs, or results in people growing crops responsible for destroying human ambitions. The very rich will pass their wealth to their youth and the aristocracy will grow to levels not seen since the Middle Ages. The business communities of the world will enjoy private jets, clean water, top-notch schools, and fine real estate while 90% percent of the world’s population tries to get by another day with less than yesterday. Governments will cease to control budgets, justice, and inflations will kill any attempt to make one’s life better. The despair between those who have and those who have not will grow to dangerous levels. Fighting will break out or unknown diseases will cripple massive amounts of people as the world darkens with billions of people fighting in religious wars with their countrymen.

The other option is to do something different. The house of cards will need to be rebuilt with bricks. The governments of the world need to enforce the rules of white-collar crime as they due to murderers on the most dangerous streets. Life sentences will need to be handed out to those who intentionally destroy or use people for personal gain. The free market must still price assets, but assets need to be visible far into the depth of companies. It is fairly evident when the boardroom windows go black trouble is brewing. Taxation should be weighted heavily on those with the most and placed into education of our youth. The utilitarian benefits of the estate tax must be instated to ensure opportunity for all upon birth, not only for those born unto riches. Technology needs to be rewarded as quarterly profits are now. Royalty programs costing little to individuals, but benefiting innovation, must take the place of our profit over scarcity supply and demand. Government’s role should be to remove money from the systems exponentials grow and place dollars back into the money system when recessions loom.

Accounting practices and profit-based economies may never be totally revamped. They’re too many people who thrive on the uncertainty of the boom and bust rational. We as a society, although aiming for rational, are irrational in nature and quest for experience, so as in the coming years we will see more and more accounting frauds publicized, and white collar crimes exposed the pain in the economy we feel now will come back in the future after we have forgotten how we got to this place today. It is simply human nature.

This paper I wrote for an accounting class in response to the Enron documentary “The Smartest Guys in the Room”

Stay hedged, stay happy,

Margin of Safety

Play with picture tools until the market goes up

Big huge labs is a great way to change and manipulate your photos. In the following examples:

Image hosted @ bighugelabs.com

View slideshow

In these two examples my requirement is to reflect on the way mash-ups are productive and offensive to copyright laws.

1) Productivity is simply a way doing something faster, cheaper, and better than it has been done before. In design we mash up our previous experience to create new visual stimuli and in finance we take lessons from the past to create a better return in the future.

One of my favorite collegiate instructors always states, “you should not be reinventing the wheel”. It takes too much time to start from scratch.

These photo or creative mash up tools can allow for professional designers to gain inspiration on what is possible with ad campaigns or photo blogs. Some of the tools like puzzle could be purchased for a friend so they have something to do on cold winter nights in the upper Midwest.

2) The copyright problem has been a funny thing for a generation of people raised on free music (the millennials). Creativity is a liquid thing and we are creators by nature. I am not advocating that any person should go out and steal, but I do think people unrealistically hang on to their creations as if they are the last Picasso.

In reality most people’s personal art sucks. It needs to be mashed up and taken away to a seemingly unrecognizable state. Whether we need laws to dictate what we can and cannot use for creative license is something I am afraid to answer, for I argue with the question on a daily basis. We artists need to be heard. As investors we want to show off our portfolios when they win and hide when we lose. I want a basket of free photos, but I might be angry if IBM took one of my photos and made money with it after mashing, but I would say the same things as any other idea I have missed:

I wish had though of that.

Stay hedged, stay happy,

Margin of safety

Rolling up, Rolling Down

Well with all of this side project going on here on Margin of Safety it seems like I have missed a bit of why this blig came to pass in the first place. THE MARKETS!

Today I want to touch briefly on something I have been reading about for a while and had not needed to try until today. Rolling up, or in some cases rolling down, is the process of hedging a losing option position buy covering your current short position and selling another position further from expiration.

The example: I have sold a strangle in ($XYZ) as a 40 put and 50 call one until expiration. This will allow me to take in maximum premium if the security stays between the 40 and 50 strikes. If the security really starts to move I have a couple of hedging options.

1) I could simply buy back one side of the strangle and take a loss letting the other option(s), which would be out of the money, expire worthless taking income.

2) I can purchase a hedge buy buying the security to cover the call: if the security is rising, or selling the security if it is dropping into the money on the put.

3) Another option we have is to roll the position forward. This is not my favorite tactics but it allows one to keep the same P&L ratios by extending the time on the trade. It needs to be noted the cost incurred in margin for the additional time needs to be calculated.

My brokerage makes it very easy to place this trade:
picture-16

Now the security is trading at 55 and the positions would look something like this. The put(s) on the lower half of the trade are out of the money and gaining value into the near March expiration. The Call(s) are now set at 55 and set to expire in April or May depending on the security or price.

The cost of this transition is minimal compared to the other hedging options. The new position may actually bring in a credit for the position, or a debit will be minimal. If you decide to act in this manner you still have risk in the position, unlike if you close one side of the spread, so the strangle writer will need to keep a close eye on how the security will continue to move.

This can really bring in some nice income if you are willing to wait and tie up the capital. I typically analyze my trades against a CD from a bank. If you can make more than 4% on this strangle trade you are in a better position than anything riskless.

Stay hedged, stay happy,

Margin of Safety