It's remarkable that they created jobs that resemble the intentionally pointless tasks of the workhouse or the satirical versions of Keynesian economics. And use it for private gain.
Is it all that clear that they created a significant number of new jobs? More drivers for driving the metal around? But if there were *more* such drivers they'd also be able to send it out, too.
I don't know. It's hard to read articles in a bar.
A regular bar, not a 1,500 pound bar of aluminum.
This is what happpens when everything is run "like a business", which means like a hedge fund. Can you make money by declaring bankruptcy and reincorporating every two hours? That's what you do. Can you make money by buying date palm plantations and threatening to set fire to them? That's what you do. Can you make money by buying a small college somewhere, removing most of the students and faculty, and using the accreditation as accreditation for your worthless online college? That's what you do. You have to find all available legal loopholes and imagine ways they could be exploited to pervert their original purpose.
So does anyone understand how exactly they're making money? It seems like the journalist couldn't quite figure it out and/or no one would tell him. (Yglesias posted this same question, but I didn't see any coherent answer anywhere.)
4: The physical bar part of my local bar is lined with 80% of the world's copper.
6: Isn't it in the third paragraph quoted? The longer they just keep the metal around, the more rent is charged for it, which is a storage cost, which increases the price of the aluminum that is sold (by, presumably, an amount greater than the increase in rent charged).
6: It's not totally clear to me either, but the basic idea seems to be that spot prices for aluminum are set by the LME using some sort of formula, and one component of the formula is based on (average?) wait times for aluminum to be delivered from warehouses to customers. Goldman appears to be gaming this system by shuffling the aluminum around its own warehouses and charging extra rent for the additional storage time this involves. This increases its own profits through the higher rents, and also increases the price for everyone through the effect on the spot price formula. Since most of the owners of the aluminum in Goldman's warehouses appear to be speculators, they seem to be willing to pay the higher rents in exchange for the likely higher profits they'll get when they eventually do sell it at the artificially high price. Since the LME was until recently owned by a consortium of warehouse owners and is (still?) funded by a percentage of their rents, it benefits from this arrangement too and has no incentive to change it except the complaints from aluminum buyers.
At least, that's my interpretation.
I'm pretty sure they're doing something more than just getting increased rent from storing things for longer. That's just too little money, they must be exploiting the increased price of aluminum in some other way too, right?
9 makes more sense than 8, if (as seems to be the case) Goldman isn't the owner of the aluminum itself.
I mean, if you knew that the price of aluminum was going to increase a bunch over the next couple of years you should be able to use that inside knowledge to make big bucks (not just the little bucks of the increased rents, though that's nice too).
That's just too little money, they must be exploiting the increased price of aluminum in some other way too, right?
They're probably using it some way in their own commodities trading too, I guess.
I mean, we're talking about five billion dollars that went from consumers to somewhere, and it seems implausible to me that we're talking about five billion dollars in increased rent costs or that Goldman knew that there was going to be 5 billion dollars going somewhere and didn't find a way to make that somewhere be they're own accounts.
I mean, we're talking about five billion dollars that went from consumers to somewhere, and it seems implausible to me that we're talking about five billion dollars in increased rent costs
The cost to consumers doesn't have to be the increased rent cost, though, if the spot price for all aluminum is affected by average storage costs.
I thought this:
After a sustained lobbying effort, the Securities and Exchange Commission late last year approved a plan that will allow JPMorgan Chase, Goldman and BlackRock to buy up to 80 percent of the copper available on the market.
implied that the banks did actually own the aluminum, and were just doing a work-around around the rule that tries to keep your from stockpiling and driving up the price.
16: The aluminum situation seems to be different from that copper scheme, though. There's even a quote toward the end of the article from a Goldman spokesman emphasizing that warehouse owners aren't allowed to own aluminum.
I don't think it makes sense without loads of speculation.
If the average storage cost of a unit of aluminum is X per month and storage lasts 1 month on average, Goldman controls 25% of the storage business, and it doubles its storage time, then average storage costs only go up to X*.75 + 2X*.25 = 1.25X, and while this gets incorporated into the price, the costs of storage to Goldman go up to 2X per unit, so this doesn't make them a profit.
On the other hand, if they bought the option to sell metric fucktonnes of aluminum at a lower price, back when the rest of the market assumed prices would include only X per unit of storage costs, they could be cleaning up right now, and keep doing so into the future by randomly moving storage time up and down.
Excuse me, buy fucktonnes at a lower price.
the costs of storage to Goldman go up to 2X per unit
Do they, though? It doesn't seem at all clear to me that Goldman's own costs go up nearly as much as the costs to the owners of the aluminum. And the latter seem to be what get incorporated into the spot price.
A quick calculation says: 1.5 million tons stored times .48 dollars per tonne per day is roughly 260 million dollars a year. Whereas at the old levels they were only making 10 million a year. So just the rents are pretty significant. On the other hand even over a few years that's still no 5 billion.
Plus the article has quotes like "So financial institutions that engage in commodities trading have a huge advantage because their ownership of physical assets gives them insight in physical flows of commodities." which sure seems to be implying that they're using the information about the price of aluminum going up somehow.
(The 48 cents per tonne per day number comes from the LME's webpage. Also I think the storage time doesn't actually matter as every day they're charging for all the stuff they're holding so all that matters is how much they have not how long they're keeping it for.)
Good point, market concentration probably allows them to pass on costs to some extent. But I think there's much more potential profit in combining concentration with speculation.
I'm not sure how to estimate their increased costs for the extra storage space, but you have to figure that buying empty warehouses and hiring forklift drivers in Detroit isn't too expensive. Still it's going to definitely cut into that quarter of a billion per year figure.
the costs of storage to Goldman go up to 2X per unit
Goldman is the one charging rent for storage.
Oh, someone over at MY points out that they offer "incentives of up to $230 a ton." Probably that's the high end, but if they're paying $100 per ton and keeping that ton for a year and a half then over a year an a half then they're spending 1.5 million times 100 = 150 million dollars. So over a year they'd be spending 100 million dollars in incentives. So that really suggests it's the speculation and not the rent itself.
Probably pwned, but since lawsuits about this stuff is my business, here's how it works.
Step 1: take a long position on aluminum futures, basically betting that the price will go up.
Step 2: buy a bunch of warehouses in Detroit and fill them with aluminum, refusing to deliver to customers who need the metal. Thie restriction on available supplies will drive up the price, as the beer companies have to buy on the open market when they can't get the stuff from the warehouse.
Step 3: profit.
This is a short squeeze, the most basic stock or commodity price manipulation. The revenue on storage fees is just gravy. Also, the biggest victims are investors who were short on aluminum futures. Many of them get advice from their brokers at Goldman Sachs.
21.2: Right, the article doesn't give any concrete examples of GS profiting from information gained by owning these warehouses, but it has lots of quotes from industry analysts suggesting strongly that they're doing something like that. Presumably this is why they got into the business in the first place, and the rent is just an extra bit of profit on top of their trading advantages. The overall cost to consumers, though, seems to mainly be driven by the effects of the storage costs on the spot price formula.
Thanks for the great succinct description in 27. There are two things I'm confused about though. First, why couldn't the journalist get anyone to say that GS had a long position in aluminum futures? Second, according to the article the LME bans the warehouse owners from owning aluminum, wouldn't that also stop them from using their futures contracts? Or do they just avoid that by using shell companies? Or do they sell the futures contracts rather than actually using them?
That was me, sorry.
Goldman is nvolved in a bunch of lawsuits about substantially the same scheme in loan derivatives.
The times article doesn't explain the part about the long position because their source doesn't have that information.
That was me, sorry.
Goldman is nvolved in a bunch of lawsuits about substantially the same scheme in loan derivatives.
The times article doesn't explain the part about the long position because their source doesn't have that information.
That was me, sorry.
Goldman is nvolved in a bunch of lawsuits about substantially the same scheme in loan derivatives.
The times article doesn't explain the part about the long position because their source doesn't have that information.
Thie restriction on available supplies will drive up the price, as the beer companies have to buy on the open market when they can't get the stuff from the warehouse.
Apparently exacerbated in this case by the additional increase in spot prices from the premium LME adds based on storage costs, which Goldman is also manipulating.
The times article doesn't explain the part about the long position because their source doesn't have that information.
Presumably because they appear to have relied mostly on information from people at the warehouse end rather than the trading end.
Right, the article seems to be strongly implying that it's the premium added that matters more than the increased storage costs, which makes sense because the former is proportional to the total amount of storage that they have, while the latter is proportional to the amount they're taking off the market each day by using more storage space.
So basically they're paying people for the right to store their aluminum for longer in order to increase the spot price of aluminum via a formula the LME uses to calculate premiums. Although this manipulation probably loses them a little money (since the rent profits are cancelled out by increased storage costs and the incentives paid), nonetheless they make a killing via their aluminum futures contracts. Since speculators in aluminum also profit when the price of aluminum goes up, there are enough people who are happy to be paid to store their aluminum longer while the price goes up, so the warehouse still has willing clients.
Presumably this scheme only works for a set amount of time (the length of the original futures contracts) so soon they'll just sell off the storage company?
Yeah, pretty much. To me the most elegant aspect is that by storing aluminum thatbothers own, and stalling on delivery,, they can reduce supply without having to buy the aluminum.
It is easy to liquidate long positions at a profit without taking delivery, especially for a market maker like Goldman.
Unimaginative, can you email me at the linked address to discuss this more? I have a professional involvement.
So is this basically a modernized way of cornering* the market?
(I've only read the first four paragraphs and then some number of comments.)
*Not controlling the whole market, but enough to affect the price in a way you can predict consistently enough to make a profit.
It feels different to me from cornering, in that they're affecting the price without buying any of the commodity.
40: Pretty much, yeah. (I was wondering what your take on this would be.)
I'm hoping at some point dsquared will show up and explain why GS is actually doing something good here.
And yet my plan to bet $50 million that prices will go up at the local Uni-Mart, and pay $50,000 a day to get employees at all the other local convenience stores to stage a sit-down strike with huge padlocks and chains on the doors, remains on the drawing board.
I feel like Marx would give a grudging admiration that these people have figured out how to turn M --> M' without any sort of production or sale of commodities entering the picture. It really is the most advanced stage of capitalism.
27. How does this differ from the classic tactic of cornering a commodity?
This reminds me of a meeting I sat in a couple of years ago with the risk management people of a fairly sophisticated company that consumes industrial quantities of a certain raw material. They had (correctly) come around to view financial hedging as insufficient risk protection, and realized that they needed to think more about physical security of supply. We told them, "Yes, you're right to think that. But you're still thinking about the problem too narrowly. The most serious risk of supply interruption lies not in the availability of the raw material itself, but in the logistical choke points along the supply chain. The sources of supply are abundant and diversified. It's the specialized, capacity-constrained transport, handling and storage assets in the middle you need to worry about."
They ignored us and hired a competitor who flattered their impulse to go buy up a bunch of raw material sources. Dumbasses.
We skipped the tight contango
turning cartwheels across the floor
It seems this scrutiny is coming just as this particular warehouse loophole is getting tighter or closing. (Although per the link in 49, it seems there will still likely be reasons for aluminum inventory financing--things I should understand but don't really for $200/ton, Alex.)
JPMorgan Chase and Goldman Sachs are seeking to sell their metal warehousing units just three years after their controversial entry to the industry, even as a proposed rule change by the London Metal Exchange is likely to reduce the attractiveness of the business....
The proposal, which is open to consultation until September, marks a step forward in the LME's effort to address the warehousing situation following its acquisition by Hong Kong Exchanges & Clearing in December. Before that, the LME was owned by banks and brokers, with JPMorgan and Goldman as the two largest shareholders.
Even setting aside the contango shenanigans, I'm impressed by how crappy these warehouses are. The same companies that are collocating supercomputers in exchanges to get nano-second advantages in trade execution can't even be arsed to computerise the inventory in their warehouses.
52: A business plan that consists of goosing the market, getting rich, and then moving on to something else when regulators catch on is not harmonious with capital investment.
Is this sort of thing likely to have any impact at all on prices to consumers, or does it come down to one set of financial companies extracting rents from another?
That is, is there an actual reason to care, if I'm not professionally concerned with the industry?
It's financial companies extracting rents from manufacturing companies, not each other.
54. As Cryptic ned suggests in 5, if prices are set by investment banks playing financial or regulatory Calvinball with physical goods, then that's a bad public outcome.
In 48, is posting as Kevin Rudd now that he's no longer an ex-executive conventional? Shouldn't you go for Hawkie or that National party guy that was there for 10 days?
In 38 once you have a way to influence the price presumably you can go long and short as you choose, ie after the initial long you can go short just by stopping buggering around with warehouses, but without actually selling them. Until the LME calls shenanigans.
55: No, it says the manufacturers are passing the rents on to us. (First paragraph: "costs consumers billions of dollars", and that's just in the US.)
(First paragraph: "costs consumers billions of dollars", and that's just in the US.)
That's US consumers as a whole, not individual consumers.
Unlike LIBOR where all the manipulators plausibly could have cancelled each other out from the average joe's point of view, there's not really any way that cornering the market on something can be cancelled out by some GS competitor shorting the price of aluminum choosing to do the opposite (super-efficient maglev trains in warehouses, using teleportation to get the metal to those who need it, etc).
54/61 exemplify the ideology behind the rise of the word "consumer" in the policy context. (Screw what it adds up to, if I can't feel it hurting me personally it must not matter.)
63: I'm willing to be re-educated on this point. But, say, the price of aluminum is a component of the cost of a can of Coke. However, the price of a can of Coke is determined (at the very simplest conceivable level of Econ 101 analysis) by what consumers will pay for it, rather than being determined by the cost of its components. It seems unlikely to me that a small change in the price of aluminum is going to have any effect at all on what consumers pay. And the same effect for any other commodity.
I can see the profits from this scam coming out of the pockets of investors in Coke. But I'm not really seeing it having an effect on anyone other than the owners of manufacturing companies.
What am I missing?
I have no idea what I intended to convey by the last sentence of that first paragraph. Disregard, unless it makes sense to you.
(And I'm not arguing exactly that no one should care. But financial shenanigans seem to me to generally fall into one of two categories: rich people screwing each other, and rich people screwing the rest of us, and until I understand this better, it looks like more of a category 1 than a category 2 story.)
I hadn't heard about this scandal before, but it's less a new frontier in villainy than a nice little example of good old fashioned nineteenth century style market manipulation. The only part I don't understand is why, e.g., Alcoa or some other interested party who really knows the market hasn't raised holy hell about this already -- unlike in some areas of finance, there should be real world players who understand exactly as well what's going on as do the folks at GS.
64, 65 -- first, prices of things like coke cans are indeed affected by supply, not just demand. Second, think of it as billions of dollars being hoovered out of the real economy where it could be used to create productive things that improve people's lives, and into a few extra ten million dollars of padding for GS's partners' kids life trusts, which is basically what this is.
(And I'm not arguing exactly that no one should care. But financial shenanigans seem to me to generally fall into one of two categories: rich people screwing each other, and rich people screwing the rest of us, and until I understand this better, it looks like more of a category 1 than a category 2 story.)
But within category 1, there's finance industry people screwing other finance industry people, and then there's finance industry people screwing rich people in the real economy. Even if the price of a can of soda/beer hasn't actually gone up, presumably Pepsico and Oskar Blues Brewery are making less profits on it. Further siphoning of money into the nonsensical casino world.
Price manipulation of aluminum affects how much municipalities pay to recycle, and in principle affects how much mining gets done.
There are environmental and social costs. Asking only about the personal impact of a distributed risk rather than thinking systematically is IMO an error. Analogy ban, but one woman personally isn't getting hurt when the old guy asks her to bring him coffee.
The underlying problem is opaque and shortsighted manipulation of the physical world, one more failure of markets to intelligently allocate long-term capital.
64: Well, classically, the price is a combination of what people are willing to pay and what it costs to produce. In a perfectly competitive model, higher costs of materials push the supply curve to the left, meaning the new equilibrium is less consumption at a higher price, which is to say consumer surplus shrinks. So that impacts the price even in Econ 101 fairyland.
In a less competitive model, where consumption is sticky for all sorts of real-world reasons, consumers may simply keep paying the higher amount. (And their ability to substitute other goods is limited due to this being common to all aluminum products.)
I don't get how the aluminum is effectively held hostage. Why does the owner not have control over when it is shipped? The whole scheme seems to depend on the owner just accepting that they are getting screwed.
72: That's where the cash incentives come in (see 26). They're actually paying manufacturers to wait longer for the metal.
73: That's the point in the story where the whole thing starts sounding like Milo Minderbinder.
The story is confusingly written. If this is plain old market manipulation the whole trucks and warehouses thing is really tangential. The main point is hanging on to the Al for a long time, not shuffling it around.
meaning the new equilibrium is less consumption at a higher price
Right. And it isn't just products with no social utility like cola. Beer, both cans and kegs, is being affected.
75: I think the WSJ wrote that story two years ago, the LME increased shipping requirements, and that led to where we are now.
This scam seems simple enough for even Congress to understand. Is there any defense for this activity? (Even a laughably tranparently false defense would probably be good enough, but I'm having trouble thinking of any at all.)
I'm also having a very hard time understanding how this could not be illegal, at least if we're correctly understanding the activity. Maybe the reporter didn't have any direct proof of illegal activity (such as trading on the manipulated spot prices), but if that's what's really going on... it's hard to see how this doesn't end up very badly for Goldman Sachs. (Unless they've successfully captured their regulators.)
Good catch, 77.
it's hard to see how this doesn't end up very badly for Goldman Sachs. (Unless they've successfully captured their regulators.)
:-D
The main point is hanging on to the Al for a long time, not shuffling it around.
Yes, but the shuffling it around is required as an end-run around the regulations that prevent them from just hanging on to it.
trading on the manipulated spot prices
I do hope someone does the followup story confirming that this is what's going on. Because without it the story makes no sense at all.
This piece at FTAlphaville seems to explain the scam in a lot more detail, although I had to look up a lot of jargon. Contango, anyone?
My strong guess is successful regulatory capture. From a quick skim, it looks like the SEC (or maybe CFTC) had some rulings specifically allowing for commodity hoarding, and the moving between warehouses trick may be within the technical rules of the London Metals Exchange. Probably was justified to regulators at the time with some deep bs about deepening liquidity and efficiency in the market and improving spot prices. Of course it may still be illegal for other reasons. But yes, it would be nice to learn about exactly what's really going on, though it will almost certainly take litigation and not just journalism to do so.
It may not seem like much, but $5 billion in profits over a three year period is pretty huge.
They're actually paying manufacturers to wait longer for the metal.
I thought they were paying the owners of the metal to keep it in their warehouses.
Yeah, reading 82, it sounds like 83 is right. Whoever said that thing about the real scam being what's legal (Mark Twain?) gets it right once again.
85: Oops, right. But that still answers 72.
77: Yes, this has been known for some time. The initial change was from 1,500 tons to 3,000 tons a day by the LME (so it is their "regulation"). But everybody's sense was that just upped the size of the shuffle, not led to more metal release. And a key point is the last sentence in the quote in 50: Before that, the LME was owned by banks and brokers, with JPMorgan and Goldman as the two largest shareholders. (plus the LME took a small % from the warehouses). The potentially biggest change has been the acquisition of the LME by a new outfit (who I'm sure have their own schemes for increased monetization). I think this is more of a rich people screwing rich people thing and rather small fish for GS* etc (a few hundred $M). The $5B smells bullshitty to me--a small part from the warehouse tricks and probably more to the whole contango inventory financing thing in general (which I admit I have not been able to wade through completely).
*That said, deep information can be valuable in any number of ways, especially to folks with deep pockets. And part of this is that the banks have much deeper pockets than anyone else, even the metals and consuming companies.
||
Q: Can I write a formula that would calculate four random numbers adding up to a fixed total, with no component tending to be bigger than any of the others?
|>
the banks have much deeper pockets than anyone else
Also per this article on contango in commodities in general:
The gap between the contango and the actual cost of carry stems from a number of imperfections in physical and financial markets:
(1) Contango compensates stockholders for the interest cost associated with buying and carrying inventories. But the actual cost of finance varies widely. In the current environment, high-rated issuers, banks with access to official liquidity, and other institutions long of cash face a much cheaper cost of funding than other participants. They have natural advantages funding and owning raw materials. They can transform their privileged position in the financial markets into a privileged position in commodities.
Q: Can I write a formula that would calculate four random numbers adding up to a fixed total, with no component tending to be bigger than any of the others?
I'm sure it would be a snap in Prolog, or Kanren.
Actually I wonder if either of those can do randomness well. Kanren probably.
91: Excel, although I can probably translate generic formulas into it.
The article in 82 is very helpful if very jargony, basically confirms 88 and 90, and also explains who is getting screwed. Basically, retail investors (surprise!) in bank-arranged commodity funds, and real-world manufacturers who need aluminum to make things. Meanwhile bankers and large holders of aluminum profit, but especially the bankers. It's a nice illustration, if we needed another one, of financialization gone wrong and basically doing the opposite of what it was promised to do in making markets actually work for society.
Maybe the reporter didn't have any direct proof of illegal activity (such as trading on the manipulated spot prices)
Could this be why the article doesn't cover manipulation? They were lawyered into not straying far from the shipping and storage shenanigans.
First, generate four random numbers from 0 to 1 using RAND. Then a cell with a constant that is your fixed total and a cell where you add the four numbers. Use those two cells to figure out what you need to multiply your four original numbers by to get the total you want.
I remember hearing about GS going into aluminum storage years ago, and thinking, along with a bunch of other paranoids, that it could only be for purposes of manipulation. Lo, and behold. It's tempting to conclude that GS is fundamentally a parasitic organization.
The story is confusingly written. If this is plain old market manipulation the whole trucks and warehouses thing is really tangential. The main point is hanging on to the Al for a long time, not shuffling it around.
Yes, although based on the numbers in the article I don't entirely get why Metro (GS) has to do the shuffling to end-run the regulation. They have the scale that actually shipping 3,000 tons daily doesn't seem like it would be an issue.
92. Distributed how, uniform, normal, something else? If uniform, take four random numbers between zero and one, then normalize the sum of each set of four. Normally distributed is trickier, I think that you can only draw three there. There should be a way to do that and impose the same distribution on all components, but that distribution wouldn't really be normal.
101: I think that's a per-warehouse limit.
"with no component tending to be bigger than any of the others"
This is an interesting and tricky requirement. So you want a set of random numbers that all add up to X but none of which is individually bigger than X/2? Because 97 wouldn't produce that.
104: I took "tending to be bigger" to mean that when you repeated the process, there wouldn't be a pattern such that one of the four random numbers tended to be bigger. That is, that each of the four numbers had to have the same chance of being the biggest or the smallest.
104: "Tending" gives a weaker restriction that's met by 97.
102: I think what you're describing is a choosing only values from a N dimensional normal distribution that lie on a specific N-1 dimensional hyperplane (are we allowed to use this word?). This just becomes a N-1 normal distribution.
105 is right. And thanks, lw; the distribution isn't relevant to me, but I'm glad my dreary spreadsheeting has led to a question of some interest.
107. Yes, you're right, Box-Muller gives independent normal components while amplitude is also normally distributed. Been a while.
101: From the New York Times article, it sounds like GS's angle is not price arbitrage, but providing aluminum storage services to other financial institutions that want to do the trade. GS gets to charge more rent if they drag their feet, so they're doing so - and possible the owners of the aluminum are happy not to sell anyway.
I was imagining "with no component tending to be bigger than any of the others" to be a much more complicated requriement.
Hmm, 110 seems like an inadequate explanation.
Probably the business is to help, for a fee, firms doing the contango arbitrage trade, store aluminum without violating any regulations. So they don't actually want to ship it. But they're subject to some regulation that says certain institutions can't just sit on aluminum, they have to ship it. Thus the shuffling.
Apparently in Prolog one could just do:
| ?- consult(user).
compiling user for byte code...
minivet(S,Result) :- repeat, random(0, S, A), random(0, S, B), random(0, S, C), random(0, S, D), S is A + B + C + D, Result = [A,B,C,D].
user compiled, 2 lines read - 1339 bytes written, 27799 ms
yes
{1}
| ?- minivet(10, R).
R = [3,1,0,6] ? ;
R = [0,3,7,0] ? ;
R = [7,2,0,1] ? ;
R = [4,0,5,1] ?
(4 ms) yes
{1}
110 is indeed partially correct, but it's still a scam -- the piece linked in 82 explains why and how.
Or, more precisely, it's both arbitrage, market manipulation, and providing storage for aluminum to parties that are happy to pay GS to provide aluminum storage.
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Does anyone have any recs for a good intro to STATA book? Getting Started with STATA for Mac is starting to drive me crazy.
As is the Econometrics one.
|>
I don't have a Stata book, but this site is very helpful.
119: Thanks. I've got Stata version 13, but I'm sure that the basic commands have been around for a while.
It's not clear to me what I should be starting with--do files and logs or playing around with scatter plot graphs.
The menu version that the book starts with is so much more complicated than using the command prompt.
The new versions rarely change anything that somebody just beginning would use. I like the command prompt and do files, but maybe that's because I'm mostly using SAS.
I thought we were supposed to unhelpfully tell her to use R, like the cool kids do.
Anyway, here's my email if you have a question or something. It's going to take a while to get your bearings, but the commands are fairly simple as far as these things go. I find the log annoying so I just cut and paste directly from the output window into notepad or Excel or whatever.
Nature wants papers to be submitted in Microsoft Word format and figures as JPEGs? What the hell?
You hate to see that kind of thing at this level of play.
I think everything we submit is a Word. I don't know about the figures.
I'm disappointed that no one seems to be interested in improving the Prolog solution to Minivet's question.
Since Nature gets so many submissions they like the initial submissions to be pretty small file sizes. If your paper has a chance of getting accepted, eventually you'll be uploading tiff files or other high-quality images.
As for the file format, you can certainly send a PDF.
123: I'm doing work for a friend of mine who is an economist who is just doing me a favor so that I can get a copy of STATA and teach it to myself.
He is a big fan of log files.
PDF is the only thing I can send, I think.
Which, of course, is a much larger file size than the source.
If he was really a friend, he'd have you use R.
122: Advocating freedom is never unhelpful, trapnel.
Nature wants papers to be submitted in Microsoft Word format and figures as JPEGs? What the hell? / You hate to see that kind of thing at this level of play.
Apparently, PLoS of all places uses Word '97-'03 format in their production workflow. (You can submit a PDF for review, and use any plain text for production, but apparently Word is what they use behind the scenes). Sad!
Which, of course, is a much larger file size than the source.
Isn't it the case these days that since Word uses what's basically just a compressed xml file, .docx files are actually pretty small? (I had even thought they were smaller than plain text, but a quick cut-and-paste of the Project Gutenberg version of 'Die Verwandlung' into Word resulted in a 229k file, as compared to 142k for the txt.
And yes I know you were talking about PDFs versus LaTeX sources. That's not what I wanted to talk about, though!
I'm actually kind of resentful about this improvement to Word, because I like hating on Word, and "bloated file size" was one of my favorite arguments for why it sucked.
I guess so. I was under the impression that their XML format was kind of insane, with weird extraneous tags all over the place.
Trying to turn my 30-page draft paper into a 1500-word Nature submission, which in all likelihood will be rejected outright, is turning out to be one of those supposedly career-advancing things I'll never do again.
"It really does sit on a Hellmouth". Thanks, heebie. I definitely haven't already watched that multiple times or anything.
Dead thread, but thinking about the general activity in the OP, let's say for the sake of argument that there is a socially/economically useful function to be played by some level of hedging and/or a modest amount of commodity stockpiling during periods of cyclical reduction in demand. Given the inherent complexity, is there any "honest" broker* that could accomplish this or is it irretrievably moral hazard all the way down?
*I guess that is what the LME was theoretically designed to be.
I think the dichotomy between "people who use LaTeX" (mathematicians, physicists, and philosophers for some reason?) and "people who don't know what it is" (anyone else) is an underrated dichotomy.
I started using LaTeX [philosopher] partly to get away from the iniquities of Word, partly so I could handle references and footnotes better, partly because I found the output just looked better, and partly so I could put in logical notation. There's also something just _right_ about editing in a text editor and not being distracted by, or futzing with, formatting.
Aside from here, I don't know anybody who uses LaTeX.
It really does seem to exist only on the internet. Like presentation programs other than Powerpoint, or people who spend all day insulting people for believing in God.
Sides of boobs being on view, that is.
138: Probably moral hazard all the way down.
LaTeX also replaces Powerpoint.
There's also something just _right_ about editing in a text editor and not being distracted by, or futzing with, formatting.
You could just draft in Notepad. I probably use Notepad nearly as often as I use Word, mostly because I edit my Stata do files in notepad.
I find word just horribly clunky and unintuitive. I end up wasting tons of time on formatting and it gets in the way of the flow of writing. I end up having to use it (and Open Office) semi-regularly, but damn if it isn't just plain badly done all round. LaTeX can be a monstrous pain in the ass (especially when you're new to it) but at least the PITA comes after the writing is mostly done and you can worry about formatting exclusively.
I think the dichotomy between "people who use LaTeX" (mathematicians, physicists, and philosophers for some reason?)
Also, if we let one representative count for an entire discipline, linguists, sociologists, and english litterateurs.
Like presentation programs other than Powerpoint
But I almost never see Powerpoint. Usually Keynote, sometimes LaTeX (the latter more often from Europeans, especially Germans).
I collaborate with multiple Germans who make slides in Powerpoint and write papers in Word.
Well, two Germans are probably running the show and the other ones have to copy what their bosses do.
There's also something just _right_ about editing in a text editor and not being distracted by, or futzing with, formatting.
I confess that for me it is quite the opposite.
138: In principle, if futures price got far enough above the spot price, then selling futures, buying aluminum, and storing it somewhere would be a simple enough - and possibly socially beneficial - arbitrage play.
The tricky part is that although it's a money-maker, you can only do it so much given leverage regulations. That's where the tricky business comes in.
The problem is that the institutions that are well equipped to do the tricky business also face regulations specifically against executing this kind of trade - so they have to play an elaborate game of pretend, that ends up annoying regular buyers of aluminum.
Alphaville Biblesplains commodity warehousing
you can only do it so much given leverage regulations.
Isn't that the thinking that nearly killed the economy? There's not much profit in this, so we'll borrow enough that we can make money.
155 seems about right.
There is some risk involved for whoever actually owns the stockpiles, though - if they have a lot of aluminum that hasn't already been offset with futures contracts, then they are accepting downside risk if the price of aluminum falls permanently, and selling it slowly won't help. There are financing costs, so every day you hold onto unsold aluminum that doesn't appreciate, you're losing money.
156: Yes, it is. A pure arbitrage trade seems pretty low-risk as long as nothing unexpected happens to the stockpile (which I suppose could be insured), but that sort of thing adds up anyway.
The FT registration form's list of positions is bizarre.
I just go with missionary on those type of things.
155 directs me to something asking me to sign in via my (nonexistent) affiliation with Har/vard Busi/ness Scho/ol.
The FT registration form's list of positions is bizarre.
I said that my position was "other C-level", IIRC, and that my industry was "student".
160: If you'd only apply yourself.
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Can't tell whether 163 is directed to Moby or ajay.
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