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hobbesmaster posted:accepted models for options pricing is really what opened that up futures and options on commodities still have a pretty valuable purpose in a few areas farming depends heavily on futures for their crops because the damage to a farm by the price coming in too low (wiping the farm out and putting it into bankruptcy) is much bigger than the gain to the farm by the price coming in high, so they benefit by transferring that risk elsewhere companies that rely on oil (for example, airlines) can similarly have a real need to hedge their exposure to oil prices, either through futures or options on oil. companies that produce oil may have a similar need to hedge since a drop in oil prices can easily send them into bankruptcy since the business model of an oil company is "borrow a lot of money and hope the oil wells can pay it off" and that collapses hard if the price collapses (there's been a ton of bankruptcies in this sector in the past few years) but for a random person trading them, futures and options are no better than going to vegas and putting the money on the roulette table; you've got a negative expected return (because the house takes a cut, and every dollar you earn is a dollar someone else lost)
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May 10, 2019 17:16
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qirex posted:oh here's a fun one: now bankrupt startup munchery, the one that was running a fleet of rental refrigerator trucks 24/7 outside their soma warehouse, is in proceedings and the ceo is still paying himself a salary and wants a 250 grand "success fee" for finding someone to buy the leftover flaming wreckage for $5 million. And who ends up holding the bag? the small businesses who bought into their plan that guy will probably get sued by the unsecured creditor's committee that said, there's a giant problem of executives of bankrupt companies getting themselves paid handsomely in bankruptcy because they're "so important" that you "need to keep them". congress specifically banned retention bonuses, so now they just propose to give themselves success fees for how well the bankruptcy goes instead. and a lot of the time people don't object too much because those executives control the company in bankruptcy and the company has a ton of power in bankruptcy and you don't want to piss off the company unless you have to, and going after the exec's wallet is the best way to piss the company off. potentially more so than suing the executive, cause the exec has D&O insurance. the only time i've seen those "success fee" bonuses actually disallowed was when the company was so loving dumb they actually titled it a retention bonus, forcing the judge (who would have been happy to approve it otherwise) to tell them come on, you've hosed this up too badly to get it, congress specifically disallowed these. why do the law firms running the bankruptcy allow the companies pay those bonuses? well, who do you think hired the law firm running the bankruptcy? evilweasel fucked around with this message at 18:09 on May 10, 2019 |
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May 10, 2019 18:06
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Jabor posted:puts are relatively safe, since your maximum loss is whatever you spent buying the option. shorting has unlimited downside - if you're shorting an overhyped tech stock and don't have an unlimited bankroll, you're basically gambling that nobody in the world is going to be a big enough idiot to massively buy into it, which is a real bad bet. puts are relatively safe - but they're still relatively safe in the sense that the money you laid down on red is "relatively safe", it's still a bet with negative expected return. it's just one without the possibility of infinite negative return  qirex posted:I worked on a product with support for options for like a year, including designing interfaces for setting them up, and I admit I still don't completely understand them the price of an option depends on how far the price is from the current price (obviously, an option to buy uber stock at $45 is worth more than one to buy at $55), how "volitile" the price is which basically means how much the stock price moves (if the stock price swings wildly, an option is worth more because it's more likely to swing to 'in the money', if the stock price is usually very steady the option is worth less), and how long the term of the option is (if you can exercise the option anytime in the next five years, it's worth more than if you can exercise it anytime in the next year, because it's more likely it will be in the money at some point) how you go from those inputs to the price is complicated math, but the inputs themselves aren't really. for something like uber you'd probably pay quite a lot for a put option because people would assume the volatility is going to be very high evilweasel fucked around with this message at 18:16 on May 10, 2019 |
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May 10, 2019 18:07
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Munkeymon posted:plus you can generally unload puts for only a partial loss if they're going too far out of the money i mean yeah, but that partial loss is going to be like 95% or more and the market for those options may be illiquid enough you're getting only a fraction of even that small amount its "worth". don't trade futures or options, unless you'd be going to vegas with that money instead, and even then vegas will give you a free drink while you gamble and the casino is probably more effectively regulated
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May 10, 2019 18:21
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Broken Machine posted:that is a big part of it; up to the 70s or so finance was much simpler and more ethical. then quantitative finance became a thing and ethics went out the door the biggest change is that investment banks used to be partnerships; i.e. the people running them had their money on the line too. so if the client, or the bank, took a big hit they too were out a lot of money. it didn't make sense to run huge future risks because you'd still be on the hook for them years later. now they've all shifted to a model where none of the people running this poo poo actually have any money on the line and their goal is to funnel as much money out as possible. if you run huge risks that pay out this year and get paid millions, then they go to poo poo next year, well lol all your millions are in your bank account, see you later suckers. if you were sensible this year such that you didn't make as much but won't lose a ton next year you maybe got a small bonus or more likely, you got fired and another guy like the one who got paid millions got hired.
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May 10, 2019 18:27
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Broken Machine posted:there's essentially only goldman sachs left in their bracket of investment banking, other than perhaps chase. somewhere around two thirds of all dollars in the us pass through four banks at some point yeah whoops that model didn't work out too well for merrill lynch, lehman brothers, or bear stearns goldman grabbed the only lifejacket and lifeboat in the cdo collapse and laughed as it watched the rest drown still though, now you see a ton of hedge funds which are basically set up in the same way; you pay the people running it a percentage of assets under management, and a cut of the profits...but they're not taking a cut of the losses.
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May 10, 2019 18:33
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lancemantis posted:being a retail investor as a Normal Person has and always will be nothing more than gambling; at best a more socially acceptable form of gambling the stock market has a positive expected return and to the extent it's gambling it's the good form of gambling: the kind where the odds are in your favor that said things like stock picking, trying to time the market, etc, that's all just lowering your expected return yep. low-cost index funds are the only way to go.
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May 10, 2019 19:42
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Munkeymon posted:Pepper defeats Apple https://www.scotusblog.com/case-files/cases/apple-v-pepper/ well that was unexpected i would not have expected kavanaugh to cast the deciding vote not to gut antitrust laws even further through nonsense loopholes apparently the rest of the liberal wing was shocked as well, and that's probably why they let him write the decision, so he'd stay put like, this line from the decision: quote:Second, in addition to deviating from statutory text and precedent, Apple’s proposed rule is not persuasive economically or legally. Apple’s effort to transform Illinois Brick from a direct-purchaser rule to a “who sets the price” rule would draw an arbitrary and unprincipled line among retailers based on retailers’ financial arrangements with their manufacturers or suppliers. arbitrary and unprincipled lines are basically like catnip to conservative judges the other four had to have been going "that's the point! that's the point!" when they got to this part evilweasel fucked around with this message at 16:25 on May 13, 2019 |
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May 13, 2019 16:18
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duz posted:it was about if they are allowed to sue apple or not, they still have to actually win the trial back at the state level and not have it overturned by scotus sure, but apple losing this case would be disastrous and the 9th circuit and (for some unexpected reason) the supreme court have just refused to give them a lifeline so apple's got to be super nervous now because their litigation strategy was probably premised on the supreme court overturning any attempts to enforce antitrust laws, just like they've been doing for ages. this has to be especially worrying to apple because their behavior here is, pretty much, the definition of monopolistic
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May 13, 2019 16:27
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iospace posted:Yeah, but it's a blow to arbitration laws so I'll take it. this case wasn't about arbitration. this was about apple trying to use a technicality to evade antitrust laws entirely. basically, the law right now is that only the person who buys from the monopolist (or alleged monopolist) can sue. to take the original case: if the manufacturer of concrete bricks has a monopoly and/or has engaged in price fixing with other manufacturers, the cost of that gets passed through the contractor (who buys the bricks) to the ultimate owner of buildings being made (who got charged more, directly or indirectly, by the contractor due to brick prices being high). but the person who commissioned the building can't sue the brick manufacturers directly - only the contractor is allowed to sue. this is a sort of technical argument that you can justify by saying that antitrust gets too confusing if anyone below can sue, but has real problems because the monopolist may be able to successfully threaten the intermediary with being put out of business if they complain, and the intermediary may not care if they can pass the costs along. so apple wanted to use that exception but there's a problem: users buy the apps from Apple. under that rule, plainly you can sue apple: apple fixed app prices, you bought from apple, you get to sue apple. so apple tried to come up with bullshit technical arguments to further restrict antitrust laws, basically saying "well, someone else set the price, so you should ignore that you bought from us and require the developers to sue instead, those devs we can put out of business at a whim if we want" and for some completely unexpected reason (perhaps he was drunk) kavanaugh did not leap at the chance to come up with a new bullshit technicality to exempt large corporations from antitrust law. like, this is basically my view of every conservative decision interpreting laws that they'd rather not apply yet somehow kavanaugh found this a valid reason to reject it: quote:Apple’s line-drawing does not make a lot of sense, other than as a way to gerrymander Apple out of this and similar lawsuits. like this is a deeply shocking decision to come out of kavanaugh, it is basically dripping with contempt for the idea of gerrymandering your way out of applying a law you don't want to apply, it's like what i would write about most of the decisions by him and his compatriots  apple may have just forgotten to put the right arbitration clause in their contract early enough, i haven't followed the case beyond reading the decision, but nothing in the decision is about arbitration. the word doesn't come up at all, if apple has an argument that the claim is barred by an arbitration clause they can still make that (and i would expect the supreme court to uphold it)
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May 13, 2019 16:39
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Luigi Thirty posted:Uber down another $4 today tbf holding $5b of uber stock is not as good as it sounds given that it pays no dividends and never will, so you've got to actually find $5b worth of suckers before the bottom drops out if you ever want to have ActualMoney
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May 13, 2019 16:42
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flakeloaf posted:i thought the point was to leverage that $5bn in wealth to buy actual poo poo with someone else's money if you do that then you're actually doubling down on the stock; it takes a smaller stock drop to wipe you out than actually going to zero, because if the stock goes below a certain point you have to repay the loan in full immediately elon musk is in a precarious financial position due to doing exactly that with tesla stock - if it drops below a certain point (iirc it's rumored to be ~230) poo poo goes south because he faces a margin call and if it's not met whoops the bank owns his stock and he already blew all the money he borrowed on stupid poo poo
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May 13, 2019 16:50
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Shaggar posted:the dissent makes more sense in that developers are more directly harmed by the anti-competitive nature of the app store, mainly the 30% commission and its effect on pricing. the consumer is then harmed as a result, but who gets a cut of damages first? the consumer gets any damages they prove affected them. so lets say that absent the 30% commission, the devs would retain all that extra money: the consumers will get nothing in damages. if absent the 30% commission, devs would drop their prices dollar for dollar so their income stays the same, consumers get all the money. if the court is convinced that it's somewhere in the middle - say, for every dollar apple doesn't get devs would drop their price $0.50, then consumers get half of the damages. it's just a question of proof and both sides will try to persuade the judge/jury about how much of the damages consumers actually suffered. any antitrust lawsuit will need to wrestle with that issue; if you required devs to sue instead they'd have to prove their damages as distinct from consumers as well. it's not a valid reason to ban a lawsuit because you can't avoid dealing with that question.
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May 13, 2019 16:54
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Jabor posted:worth noting that a bunch of amicus briefs were basically saying "actually, we think that the end consumer should be able to sue the monopolist even if they're only seeing a cost increase that's being passed along by an intermediary, this stuff isn't confusing any more with the record-keeping and processing technology available today". saying that it can be enforced in this case lets them punt those arguments and keep the existing status quo in place more generally, and also likely avoids having legislators say "hey this is stupid, if this is really the way you're interpreting the law we're gonna change it". there is zero point zero chance that congress is passing any new antitrust laws anytime soon, unless there's a wipeout of the republican party of historic proportions in 2020, well beyond the wildest dreams of any democrat who has looked at the senate map and if they did, then the supreme court could just find new bullshit ways to draw technicalities to gut the law until that majority was lost
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May 13, 2019 16:55
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infernal machines posted:tek bubel and all, but holy loving poo poo. you know this, i know this, business loving insider knows it and is willing to print it, and yet somehow people are still investing in this ridiculous cash inferno everyone keeps thinking that the network effect is huge in taxis and uber can jack up prices eventually once it has self-driving cars people do not seem to think "hmm, what would it cost to build a taxi app for self-driving cars to compete with uber? a few million bucks? maybe if you wanted to go way overboard, a hundred million to build the app, nine hundred million for advertisements, ten billion to burn on your own self-driving cars, plus let's throw in twenty billion of losses as you scale up and compete with uber, giving you a new-uber for...half of the price of current uber? hmmmmmmmmmmmmmm...." the losses you need to run if you want to, say, just target NYC first and expand from there are a lot lower of course.
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May 13, 2019 18:31
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Farmer Crack-rear end posted:theoretically it shouldn't be shocking that people are investing in a company currently losing money. it's that they're investing money in a company that doesn't know how to (or simply fundamentally cannot) stop losing money. there is no good reason that, if we wave a magic wand and create fully safe autonomous self-driving cars, that uber is worth $70b considering in that world its useful assets come down to (a) an app and (b) a large install base of that app already the market for "app-directed dispach of automatic car taxis" would have minimal barriers to entry. if uber tries to finally use its monopoly pricing power someone will just start their own app that can compete at a fraction of the price because they won't have burned ten digits of cash on what is essentially just brand equity
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May 13, 2019 18:34
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you can even replicate the uber scam by letting people purchase their own self-driving taxi cars and adding them to the app, getting Pure Profit that doesn't take into account depreciation costs, offloading all of that risk onto other people tesla's already planning on doing that of course (but their self-driving tech is the least likely to work, of course)
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May 13, 2019 18:36
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BMan posted:Ah, but what if Uber creates the self-driving cars and all its competitors fail to do so? What then tbf i forgot about that. you could, theoretically, argue that if their self-driving car project was advanced enough that could be a very valuable piece of tech since there will probably be quite the barrier to entry in that market (and you will need very deep pockets to run the liability risk) that it could support a high valuation. but in that case every dollar that's been spent subsidizing the uber taxi app is utterly wasted
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May 13, 2019 18:42
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infernal machines posted:even their blue-sky robotaxi bullshit makes absolutely no sense in terms of profitability because there is absolutely zero point zero percent chance that the cost per mile to operate and maintain a fleet of $100k+ robocars is going to be less than they're currently paying some dipshit to use his own nissan stanza. like, even if they got what they want, they will lose more money doing that than they do now and there's no way they haven't figured that out yet. it's not clear to me that, aside from recouping the r&d cost, that a theoretical self-driving car is all that much more expensive than a regular car. they're that expensive now because lidar is expensive as balls but the cost of that is already coming down dramatically and will definitely be a lot lower when production at scale is as big as you'd get if self-driving cars worked.
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May 13, 2019 18:44
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Fuzzy Mammal posted:they'll be expensive because the insurance premiums will be high because they'll get in lots of accidents because the software is bad, i bet that's true. liability insurance cost will be a thing yeah because the manufacturer of the car is de facto an insurer for anyone the car hits under general products liability law, and so that cost will be an up-front cost included in the price but will eliminate or virtually eliminate the need for driver insurance. but that means for a company that plans to own and operate its own robotaxis your overall cost probably goes down, though your startup costs are higher infernal machines posted:also there's no such thing as brand loyalty and all your assets are 1099s who will happily jump to whoever will pay them an extra cent per mile in this situation their drivers are all obsolete and you've fired them all. but yeah not even customers are exactly loyal to uber anymore, they're too sleezy for people to like them as a brand as opposed to just being the default
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May 13, 2019 18:50
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Shame Boy posted:don't worry, they're also buying laws in lots of different states and jurisdictions to make it hard for other people to do business, like any good large corp there's a bit of a tension between relying on friendly legislators and regulators to block out your competition and having dealt with those legislators and regulators for years by firing jets of piping hot piss directly into their faces, especially when they will have just fired a lot of local workers
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May 13, 2019 18:53
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lancemantis posted:i don't see how you could take equity en lieu of cash compensation in todays startup land early on in a startup they just don't have cash. you need to pay people in lotto tickets, and VCs want you paying people in those lotto tickets. the length of time an IPO takes is actually an issue in retaining people because employees start getting restless about not getting a chance to cash in because eventually they want to buy things with their paper wealth.
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May 13, 2019 19:21
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infernal machines posted:lmao. that's gonna be just loving amazing for insurance and also liability. you'll find that the fine print of the fifty page long contract that you signed by signing up to the app required that you maintain commercial car liability insurance (which you didn't, because you have no idea that exists) and your insurer denied coverage and you're on the hook and are uninsured the company probably has a secondary insurer that covers it in the first instance...and then sues you
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May 13, 2019 19:22
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i'm remembering that article from a couple months ago where the bay area association of Realtors™ was blasting ropes about the idea that there would be 10,000 new millionaires in sf this year because of the IPOs and that the average house price might go up to to $3 million. so, watching uber crater like this and imagining how those Realtors™ feel is giving me a huge schadenboner [/quote] just because last year's options are underwater doesn't mean all the equity comp from the nine years before it are. the ipo will make a lot of new millionaires just as soon as the trading restrictions run out, even if the price stays low.
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May 13, 2019 20:00
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lancemantis posted:i don't know, i feel like the bubble isn't going to pop anytime soon because many powerful people don't want to address the massive inequality driving it in the first place there is a reasonable possibility that we enter a global trade war and recession as a result that, as a side effect, pops this current bubble
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May 13, 2019 20:08
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iospace posted:He also has argued that the more older brothers a man has, the likelyhood of him being gay increases. i thought that was statistically true, just that there was no accepted causal explanation. it's just like a "look at this odd statistical correlation we found"
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May 14, 2019 16:55
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El_Elegante posted:only if p=.05, your twenty potential coorelations are randomly distributed and not correlated with each other this article seems to be targeting a different misconception: that because a study did not show a statistically significant difference, the study affirmatively showed there was no difference.
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May 14, 2019 17:08
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El_Elegante posted:I’m glad you decided what a whole nature article was about in less than five minutes it wasn't hard. in part, i relied on the well understood idea of putting a summary of the article's conclusions at the beginning. the claim you responded to was p-hacking, a well known problem that creates spurious correlations that are likely due to random chance. you fight p-hacking by requiring people to then test their specific conclusion in a seperate study before declaring it statistically significant. the nature article is about a much more nuanced issue but boils down to what i said; people misinterpreting that a difference found was "not statistically significant" as an affirmative result that there was no difference, as opposed to a finding that there is insufficient certainty that the difference found is not due merely to random chance, such that people should not rely on that study alone.
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May 14, 2019 17:19
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hobbesmaster posted:"following orders" actually works if you're a grunt. the nuremberg defense required you to believe that generals in germany had as much agency as an army private which is laughable so it of course failed. it does not, as the death camp guards who were prosecuted demonstrates
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May 14, 2019 18:22
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Rex-Goliath posted:speaking of: do we know when the blood gates open as the employees begin offloading their shares? usually this dip doesn’t occur until the proles are finally allowed to play i think there's usually a six month lockup but i'm not sure if that applies to employees
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May 14, 2019 18:51
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a few DRUNK BONERS posted:you don't get how positing that testosterone levels affect sexuality could be used to hurt queer people? if you're motivated to hurt marginalized people then you're gonna find a way there is literally no theory about the root cause of sexuality that you can't find some way to use as a justification to hurt people
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May 14, 2019 20:19
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Notorious b.s.d. posted:if your house is gutted by fire after a seismic event, will regular homeowners cover that? the practical answer is no, if two things contributed (one covered, one not) regular homeowners insurance will say it was the non-covered one. this happened with the "storm surge" claims from katrina. you'll need to fight them to prove that it was a covered loss.
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May 17, 2019 16:44
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also, five years ago the answer would have been "eh congress will step in with disaster aid" but lol at the idea that if republicans have any say there will be a single dollar going to a liberal area in a liberal state no matter what disaster strikes
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May 17, 2019 16:46
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H.P. Hovercraft posted:remember how mad people got about the federal government subsidizing flood insurance when these stories started coming out there is a serious argument that the structure of flood insurance incentivizes rebuilding in flood zones, which is the problematic part. obviously you shouldn't use the flood insurance to push people out who can't afford to leave - but once a house is wrecked and you hand the family a check, if the area is sufficiently likely to flood you probably want them to take that check and build a house in a non-flood zone rather than in the flood zone again. that issue, of course, got mixed up in the idea of pushing poor people out right now and all sorts of other bad ideas
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May 17, 2019 16:52
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BangersInMyKnickers posted:also that the payouts disproportionally benefit rich assholes who keep building in high risk areas willfully yeah there's a whole lot of rich people's vacation beach houses we're all going to be subsidizing due to global warming which is not a super use of tax dollars
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May 17, 2019 16:57
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my bitter bi rival posted:i guess. whatever. sure. why dont you just go back to loving new york already new york is better in basically every respect than san francisco except the weather in the dead of winter
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May 20, 2019 21:17
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The_Franz posted:walking down the street in new york during the summer is akin to someone pulling a filthy blowdryer packed with trash from a landfill and blowing it right in your face the garbage might be a little less dense in sf because due to zoning laws it basically holds a medium size town's worth of people rather than being an actual city which is why nobody can afford to live there
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May 20, 2019 22:01
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graph posted:"""""""""""""""software glitch""""""""""""""" there obviously was a glitch though the money-laundering software was supposed to be better obfuscated
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May 22, 2019 18:22
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graph posted:i have been in meetings with programmers and executive level clients where the executives demand the programmers code in functions to steal "im going to need that request in writing, via e-mail. you know, so i completely understand it and we're all on the same page about exactly what you're asking for."
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May 22, 2019 18:27
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Trabisnikof posted:26m on "r&d" and 50m marketing and 20m on "administration" gets you there real quick i see constant fiiver ads on subways and poo poo and yeah paying yourselves giant salaries out of dumb investor money is a big cost
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May 22, 2019 21:24
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