December 2005 Archives

Domestic Spying?

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Iranian embassy in Sweden seems to be actively looking for holocaust deniers in Sweden. What is going on?

The Iranian-blog “Friairanvanner” (Free friends of Iran)

has discovered that one of their visitors, who is a known employee of the Iranian embassy in Sweden, was using the Swedish search engine to search for “holocaust denier in sweden. The person found the Mark Steyn article

that the friends of Iran blog was reprinting.

Ambassy IP adress (

What is Iran doing? Is this a central directive? Are they attempting to find holocaust denier to help them in propaganda? This would hardly be surprising, given the “liberties” Iranian espionage in Europe take. Maybe there is a innocent explanation, but what?

Worth keeping an eye on.

Selling Potential


Looking for a four bedroom house can be tough in the DC. You have to pay more than you think reasonable -- even for a potential third bedroom in an allegedly four bedroom home.


Shaped Charge and a Restart

The sudden end of the Wal-Mart blog has taken a very big toll on me, and I have had little desire to blog at all. But I'll be returning to T&B shortly.

But in the meantime, I present you with an example of how to get others to believe you've validated your model: A visual side-by-side comparison of a model of a shaped charge with the detonation of the real thing:



If you think you've had a bad day at the office, how about the person responsible for this(via Mahalanobis):

The trouble began Thursday morning, when Mizuho Securities tried to sell 610,000 shares at 1 yen (less than a penny) apiece in a job recruiting firm called J-Com Co., which was having its public debut on the exchange. It had actually intended to sell 1 share at 610,000 yen ($5,041). Worse still, the number of shares in Mizuho's order was 41 times that J-Com's true outstanding amount, but the Tokyo Stock Exchange processed the order anyway. Mizuho says it tried to cancel the order three times, but the exchange said it doesn't cancel transactions even if they are executed on erroneous orders. By the end of the day, Mizuho Securities -- a division of the nation's second-largest bank, Mizuho Financial Group, Inc. -- had lost at least 27 billion yen.
I once worked on a trading desk and quite frankly kind of sucked at it since I had more than an average amount of errors, but never anything more than a few thousand dollars. My redeeming ability was being able to go out and get order flow.

In other market news, the New Economist points to an economist article which mentions that researchers are begining to look at order flow to model currency movements. From the Economist:

The mythical auctioneer is notably absent from the models they construct. In his place stand the big currency dealers, who act as marketmakers, willing to buy or sell any amount of currency at their quoted prices. The marketmaker will take orders from a mix of clients—from American multinationals repatriating profits, to Asian central banks manipulating their currency—whose beliefs are as diverse as their motives.

These orders represent opinions, backed by money. As such, they convey useful information about what clients believe and how strongly they believe it. The marketmaker is privy to all of these opinions as they accumulate on its order books, while its clients know only their own. It is like a poker game in which only the dealer is allowed to see what each player throws into the pot.

This is exactly right and it is one of the ways traders make their money. It is how I have made money in the past, by simply guaging order flow. I often have disagreements in class because of my views as a trader. Theoretically, a lot of what is discussed sounds nice, but my experience gives me a different intuition as to what is happening. An example would be much of discussion over currency crisis. Some people say it's contagion other say there is some general disequilibrium that needs to be addressed and so forth. As a trader, I simply look at it from a perspective that if country x has problems I look for countries similar to x to go after. In a way its the same thing as contagion, but without the theoretical baggage.


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