Thursday, December 29, 2011

The Dumbest Idea In The World

The Dumbest Idea In The World: Maximizing Shareholder Value is a much-discussed article about a much-discussed book (Peter Drucker's "The Practice of Management"). Here's a taste (I hope you'll read it all, though):
CEOs and their top managers have massive incentives to focus most of their attentions on the expectations market, rather than the real job of running the company producing real products and services.

The “real market,” Martin explains, is the world in which factories are built, products are designed and produced, real products and services are bought and sold, revenues are earned, expenses are paid, and real dollars of profit show up on the bottom line. That is the world that executives control—at least to some extent.

The expectations market is the world in which shares in companies are traded between investors—in other words, the stock market. In this market, investors assess the real market activities of a company today and, on the basis of that assessment, form expectations as to how the company is likely to perform in the future. The consensus view of all investors and potential investors as to expectations of future performance shapes the stock price of the company.

“What would lead [a CEO],” asks Martin, “to do the hard, long-term work of substantially improving real-market performance when she can choose to work on simply raising expectations instead? Even if she has a performance bonus tied to real-market metrics, the size of that bonus now typically pales in comparison with the size of her stock-based incentives. Expectations are where the money is. And of course, improving real-market performance is the hardest and slowest way to increase expectations from the existing level.”

Interesting stuff. Sometimes somebody has to state the obvious to make us really see deep changes. And this sheds light on a vexing economic mystery: why are the folks at the top of the economy so eager to suppress the middle class, when that's the worst possible move for commerce and economic growth? Harming commerce and growth ought to harm the rich. After all, a thriving middle class was the engine that enriched America's upper class in the first place.

But commerce, I suppose, is just so very last millennium. At this point it's all about the side bets: a few thousand tycoons betting against each other in an arena as untethered from the real economy as those junk mortgage derivatives they so love to swap around.

Hand me my hacky sack; I'm heading down to Wall Street....

Monday, December 26, 2011

GarageBand Sketches

Fooling around with the iPad version of GarageBand.

The title of the first one speaks for itself: "Merry Drunken GarageBand Christmas"

Merry Drunken GarageBand Christmas

Here's a tribute to some incredible blueberry pierogi I ate this summer:

Blueberry Pierogi

The Burden of a Perpetually Clean Slate

I've figured out what's been bugging me. Many thanks to niece Laura, who helped piece this together.


Meet the niece


I have, in my lifetime, walked into countless Ecuadorian joints, provoking reactions ranging from mild bewilderment to thinly-veiled hostility. Waiters take a deep breath before approaching my table in halting English, dreading the prospect of trying to accommodate the imperious clueless gringo.

But, in spite of appearances, I speak Spanish, I'm friendly, and I understand the cuisine and the culture. More than that, I actually fit in - if you'll give me a chance. I'm not just some anglo foodie who knows to order guatita; I am 1% Ecuadorian under the hood, and by the time I leave the restaurant, the waiter will be my pal and the other customers will nod amiably and ask whether I have an Ecuadorian grandparent or two (my usual reply: "¡ojal√° sea cierto!", i.e. "if only it were true!").

The problem is that whenever I enter a new Ecuadorian restaurant, I always start from scratch. Ecuadorians can't detect the cumulative approval of previous paisanos. And while it's fun to pull off this magic trick, it is, after decades, starting to get tedious. I feel as if I'm caught in a loop, and am developing an irrational expectation that all these experiences ought to afford me some tailwind.

Restaurants aside, the same issue applies in the myriad other circumstances where I must strain to overcome initial impression because I simply don't look like everything I am.

Most people avoid such issues by not meeting many new people or going to many new places. They segregate into tribes and retract into routines. They fit themselves more or less comfortably into narrow circles from which they seldom emerge.

To reject all that and maintain a thirst for adventure requires, alas, locking into a perpetual Groundhog Day loop. Unless you're skillful at making yourself seem special or at projecting a shticky image (ala Tom Wolfe's white suit), you've got no choice but to play each and every new hand without chips.

Wednesday, December 21, 2011

Mind-Boggling Distance

If you think you can come anywhere near to grasping the immensity of cosmic distances: no. You really can't.

Consider: the Voyager 1 spacecraft, launched in 1977, has been travelling really really fast. Hurtling away from the sun at 38,200 mph, it's expected to cross over into interstellar space shortly (here's the latest update from NASA). It's now just over 11 billion miles away - so distant that light takes 16 hours to travel from Earth.

A light year, as you know, is the distance light travels in a year. And traveling 38,200 mph for 35 years brings you just these puny 16 light hours. So now just try to imagine a light year (Voyager will go that far in 14,000 years). And remember that the nearest star (aside from the Sun) is over four light years away.

But the mind blower is that there are galaxies billions of light years away (here's one 13 billion light years away).

Here, FWIW, is a particularly pretty one a "mere" 10 million light years away, courtesy of the wonderful Astronomy Picture of the Day site.


Previous astronomy posts:

Good Galactic News (when galaxies collide, stars don't actually crash into each other)

The Andromeda Galaxy and You (The Andromeda Galaxy occupies much more sky real estate than the moon)

Tap Dancing on Saturn (hear the sound of the Cassini-Huygens spacecraft passing through Saturn's ring dust)

The Photopic Sky Survey (sort of like Google Maps for the Milky Way)

Tuesday, December 20, 2011

My Nonexistent Upstairs Neighbors

Here is a recording of my upstairs neighbors. The only problem is that I have no upstairs neighbors. Above me is an (empty) attic, and, above that, the roof.

I don't think it's a woodpecker. It's more of an intermittent clunking than a woodpecker's relentless hammering. It actually sounds a lot like Jacob Marley trudging around (God bless us, every one). Or could it be my old biz partner, Bob Okumura...?


My Nonexistent Upstairs Neighbors

Does anyone have a theory?

Monday, December 19, 2011

Cathy Whimsically Chooses to be Unhappy

I was driving with a very young friend named Cathy. We hit a red light, and she groaned with exasperation. "I hate red lights!" she grumbled, being at the stage where kids begin to define themselves by their turn-ons and turn-offs.

I proposed an experiment: just for laughs, let's pretend we love red lights. Red lights make us happy. Red lights are like candy. See if we can make ourselves really believe it!

And so we had riotous fun for the rest of the ride, cheering wildly for each red light we hit. Red lights became like old friends. The way a baseball fan feels when his team wins a big game, that's how we'd feel each time a light turned red. We slowed ahead of green lights, madly hoping to see red. And when we did, we'd coo with delight.

"Cathy," I said, "the only reason you hated red lights before is because at some point you just decided to. Or else you imitated someone else who decided to. But you can re-decide anything you want to! So...would you like to know the secret to a happy life?"

"Uh-huh," she nodded.

"Take everything you dislike and make it something you love. That way nothing can ever bug you or make you unhappy."

Cathy thought about it for a moment, and then narrowed her eyes and grinned slyly. "I hate lots of things!" she proclaimed brightly, completely understanding that she was being ridiculous and arbitrary. End of conversation!

And there it is, the precise hinge of human unhappiness, right there. An early ballasting choice. It's nothing more than locking into whimsical, defiant preferences as we swiftly forget how childishly arbitrary they were to begin with. We split the world into what we want more of and what we want less of, and it's all a never-ending, pointless, painful game of whack-a-mole from there on out.

Watch this:


Also see: An Adult View on Preference

Saturday, December 17, 2011

Christopher Hitchins

The recently deceased Christopher Hitchins once said "Being a writer is what I am, rather than what I do".

That being the case, I feel somewhat released from the duty to distinguish man from work, and may celebrate the writing's demise without straining too hard to regret the writer's.

Thursday, December 15, 2011

PamFax: Cheap Online Faxing

I don't own a fax machine. Or a landline phone. So faxing's a problem. I'd previously used eFax to fax online, but they stole several hundred dollars from me (I asked not to renew, they pretended not to hear, they renewed me, then promised, twice, to refund but didn't, and my credit card refused to reverse the hideously inflated charge....and this is, Google reveals, not an unusual story with them).

For the past year, I've been running to the drug store to fax, which has a certain Leave it to Beaverish charm, up to a point. Having passed that point, I signed up for Pamfax and loved it. No contract, no obligation. You just pay about 12 cents/page domestically, and international rates are reasonable. You also get a free fax number.

I convert my documents into PDFs, and send via their web interface. Easy peasy.

Note: I'm not earning any commission via that link, though PamFax does offer a scheme for that. But if I did (under guise of offering a helpful tip), then the muffin would have been refused in vain!

Time Magazine Blew It

Time magazine has once again fuzzed up it's person of the year feature by choosing not to select an actual person (remember when the wince-worthy Person of the Year was "You"?). This year, the honor went to "The Protester".


Really, a person deserved the honor: Mohamed Bouazizi, the Tunisian peddler whose self-immolation launched the Arab Spring.

I understand that Time's point was that protests on a number of fronts shaped the world this year. But why not name Bouazizi, and let Kurt Anderson, in his cover essay, explain how the spirit of protest extended across the Arab world and to our own Tea Party and Occupy Wall Street movements? The point of the "Person of the Year" is to put a human face on a global trend. So it seems inane to spotlight the trend, rather than let Bouazizi - who certainly deserves it - serve as its face?

Monday, December 12, 2011

SIGA Gets $36 Million

Note to readers bored senseless by all the SIGA talk: this will be the last such posting for a while. News has been particularly eventful, so I felt obliged to update, but this will be my last until anything dramatic happens. On the other hand, this would be a good point to buy a few dozen/hundred shares for yourself (it won't budge the stock price, so I'm not being self-serving!). There's an excellent chance this stock will septuple within a year or two or three, and having "skin in the game" will make my SIGA postings a lot more interesting for you! But only invest money you can afford to lose...

The first $36M payment is in from the government. So despite all the misinformation, the contract's on, and the company won't need to dilute the stock to remain fully operational.

Someone obviously leaked this news on Friday, hence the stock's mild drive-up. It should have been sharper, but, as I keep saying, don't expect news or "prospects" to do much at this point. Nothing great will happen until the company confirms revenue from multiple sources (and the lawsuit's resolved) a year or two or three from now. The good news is that, short of bankruptcy, it's very difficult to imagine how SIGA would fail to attract multiple revenue sources...even if the bad judicial decision stands on appeal, and even if Chimerix loosens up the primate rule and manages to get a piece of the pie for their inferior drug.

What may happen, however, is another round of propaganda and huffy political nonsense. But that's all about short term shorting, not long term reality. This is the only completely safe and effective drug for pox, including weaponized varieties. Foreign orders (Israel? EU? India? WHO?) await a step or two from FDA. And even assuming Chimerix has their hooks into that agency, eventually we'll emerge from that process, and anyone worried about terrorism will be ready to buy.

Again, it will take time (so your investment may be "dead money" for a while). And the bad guys may drop more shoes. And "stuff happens". But it's been years since I screamed "BUY!" at you. And now's the time. If smart investing means finding extremely undervalued gems poorly understood by the market (stock-hounding!), with known, surmountable downsides, then this is really as good as it gets. This should be a $10 stock right now under the most pessimistic of assessments. And it seems destined for $20 and well beyond.

You're on your own for a while re: SIGA news. If it cycles down, don't panic. If it gears up, don't exult. Give it a couple years for best results. That's my outlook until further notice!

Saturday, December 10, 2011

Rats Vs Ayn Rand

A scientific study has demonstrated that rats are more altruistic than, say, Ayn Rand.

[Revisit a golden oldie: How I Outgrew Libertarianism]

Friday, December 9, 2011

SIGA: Off the Mat!

Three pieces of blessed reassurance to report on SIGA today.

There've been times when I've wished SIGA CEO Eric Rose would spin and tout more. Or, at least some. But he's not that sort of CEO. As a discreet, low-profile, well-respected science geek, he's the sort of fellow ideally suited for patiently dealing with governmental bureaucrats and scientists. Since SIGA is funded by and sells to the government, that's essential. But his diffidence has allowed louder voices with greater chutzpah and shameless misinformation to run roughshod, with nary a peep from Rose.

Until now. Yesterday, he posted this glorious rebuttal to the insane, gut ignorant press/political assault of the past few weeks. And the fact that he's so not a spin-meister, and so devoted to steak rather than sizzle, makes it all the more powerful and persuasive. Plain facts, amply footnoted. Finally!

Also terrific was the performance of SIGA board member (and Bush administration Homeland Security advisor) Fran Townsend on Anderson Cooper's show last night. She deftly sliced through the gobs of bullshit being proffered by yet another reporter attempting to trump up a scandal from absolutely nothing. If you're a SIGA investor, don't miss it:



Also, some quieter news.

A study shows that application of ST-246, as expected, creates resistance in smallpox virus, making the drug less effective (this is true of all antivirals and antibiotics). However, the resistant varieties are much less virulent. This is really good news for three reasons:

1. ST-246 is easy to create in a lab (the patent is public), but the bad guys can't whip some up and use it to develop a super resistant strain. This makes ST-246 an extra valuable bioterror counteragent.

2. Chimerix can't (yet?) say the same about their drug

3. This opens a pathway to a safer pox vaccine to replace existing stockpiles, which have side effects and can't be used in immunocompromised patients and others (about 4% of the population overall). It's yet another use for this drug.

Finally: when SIGA receives the $40M downpayment due on their contract with BARDA, it will prove to markets that 1. the contract is good, and 2. there will be no need for a secondary offering (because they'll be flush with cash). I don't expect the price to shoot up hugely (that won't happen until multiple revenue sources are achieved and the legal cloud is removed), but it should help some.

I wrote the following paragraph at Wednesday's stock price, but it applies now, as well:

This is a good time to buy. We're at least a year or two from meteoric success, but it's a lot cheaper to buy at $1.85 [or even $2.30!] than at $3 or $4 in a few months. That said, I certainly can't promise it won't drop further. But I'm still quite confident, long term.

Thursday, December 8, 2011

The Evil Impulse Behind Christmas Warriors

I try hard to understand people with whom I disagree. When I hear something batshit crazy, I feel an irresistible compulsion to ferret out some kernel of reasonability. But I can't fathom who, exactly, the "Christmas Wars" zealots (the folks enraged by any description of a decoratively lit winter tree without specific reference to the guy they worship) are speaking to.

I do completely understand when Christians remind each other to "keep the Christ in Christmas". That makes perfect sense to me: we oughtn't be so distracted by commercialism that we forget to celebrate and reinforce what we already believe. Who could find fault with that? I feel similarly urging distracted table mates to take deeper notice of their garlic knots or tacos. Hey, people, let's not forget what we're really here for!

But the Christmas warriors aren't kindly reminding kindred spirits. They're at war. But with whom? What's the aim? Do Jews, for example, need to worship Christ on Christmas? I happen not to, but I don't perceive myself as a warrior against Christ or Christmas or really anything else (except maybe Panera). Why would my disbelief constitute a threat? Must every one of us keep Christ devoutly in mind when uttering the "C" word? Is anything less than that intolerable?

I'd imagine their reply would be that their issue isn't with non-believers, per se, but with general secularization of their holiday. As a mass culture thing, Christmas seems less religious "out there". They don't just want to worship; they want a worshipful environment. And, strangely, their freedom to worship is threatened by all the external unworshipfulness. It's like someone with a preference not to marry a gay person feeling threatened unless the external environment reflects that preference. "My household may not be gay, but the world's my larger household, and it feels increasingly gay out there...and, as I just said, my preference is for not "gay"!" Get it?

But I still don't understand who, exactly, they're fighting against. Who's responsible for this secularization, if not non-believers and other-believers? Hey, I'm one of them! So what, exactly, do I need to do differently? How am I spoiling their Christmas? I honestly don't want to!!

Setting that important question aside, the externalization of preference is disturbing in its own right. I'm missing that gene; I hardly expect anyone to listen to me, much less agree with me, much less hew to my values on a mass basis. So it's difficult for me to relate. But it goes a scary step further when difference is perceived as threat. My differing values, however mildly held (e.g. sending "holiday cards") feel like an attack on theirs.

It's one of those strange shifts of perspective I've previously noted. And I believe I have, indeed, found the kernel, but there's nothing reasonable about it. In fact, it's the root of evil throughout history: "By not reflecting me, you threaten me."

It's the dynamic that's gotten my ancestors (in terms of religion as well as overall creative contrarianism) slaughtered and spat upon for countless generations. Though the Christmas warriors make their point from a defensive posture, a close examination of their perspective reveals the true impulse behind their paranoia, and it pushes ancient buttons.

That impulse is, quite obviously, the most unchristian of impulses. So let me be the first to sincerely, reverently, wish the Christmas warriors a far more spiritual Christmas than they're demanding of you and I.

Wednesday, December 7, 2011

SIGA: The Return of the Jedi

Last time, I described a multi-pronged attack on SIGA's smallpox cure by a small group of parties. Those guys may well have a few more cards to play. But lawsuits, propaganda, and stock-shorting will only get you so far in attacking a drug our nation (and all peaceful nations) direly needs. This week, tectonic forces are finally reasserting that need, much to the relief of beleagured SIGA investors!

First, the LA Times, which had published the wildly inaccurate hatchet job (described last time) which started the recent firestorm, printed a response from the Department of Health and Human Services (which oversees the Biomedical Advanced Research and Development Authority (BARDA) - the agency that's paying us a few hundred million bucks per a signed contract, and intends to buy well over $1B more):
"The article ignores the importance of having a smallpox preparedness policy in place to provide antiviral drugs if needed. Smallpox was eradicated by 1980. Although only two labs are authorized to retain smallpox virus stocks for research, undisclosed or forgotten stocks may exist. If smallpox reappears, mass vaccination would take time. Without anti-viral drugs, mass illness or even death may take place[...].

Only two companies, Chimerix and SIGA, are developing a smallpox antiviral drug. Only SIGA can meet our time frame and regulatory requirements. We are committed to developing new smallpox drugs in the event that they are ever needed."

That's pretty clear, if absurdly understated ("death may take place"???). Then there's this big political news:
The U.S. House of Representatives on Tuesday approved legislation intended to help protect the country against acts of biological terrorism[...]

"Terrorists continue to actively seek out biological or chemical weapons to carry out horrific attacks against us," Representative Mike Rogers (R-Mich.), chairman of the House Intelligence Committee, said in a statement following the unanimous decision. "We must act to prepare for such threats that we continue to face on a daily basis more than 10 years after 9/11."

H.R. 2405 renews components of the 2006 Pandemic and All-Hazards Preparedness Act, which established the Biomedical Advanced Research and Development Authority[...]

The HHS branch manages the multibillion-dollar Project Bioshield, which was created to provide the U.S. Strategic National Stockpile with additional medical treatments for anthrax, smallpox and other agents that could be used to produce biological weapons or other unconventional threats. Rogers' bill renews the program's Special Reserve Fund, which would receive $2.8 billion from fiscal years 2014 to 2018.[...]

"I hope and pray that we never need to use such defensive measures, but they are critical to ensuring that the public stands protected," Rogers said. "We need to continue to expedite their development and strengthen the national stockpile. Quite simply, we must always prepare for the worst" (U.S. Representative Mike Rogers release, Dec. 6).

This removes the uncertainty that procurement might be cancelled due to budget slashing. Fear of tight government budgets is what recently tanked the entire biotech sector - SIGA along with it - but investors aren't sharp enough to have realized that SIGA's an exception.

Finally there's this, from Reuters:
BIOLOGICAL WEAPONS THREAT IS GROWING, U.S. WARNS

The United States called on Wednesday for closer international cooperation to prevent terrorist groups from developing or using biological weapons, a threat it said was growing.

Secretary of State Hillary Clinton said countries must strengthen their ability to detect and respond to suspicious outbreaks of infectious disease that could be caused by pathogens falling into the wrong hands.

"Unfortunately the ability of terrorists and other non-state actors to develop and use these weapons is growing. Therefore this must be a renewed focus of our efforts," she said in a speech in Geneva. "Because there are warning signs and they are too serious to ignore." She said Al Qaeda in the Arabian Peninsula had urged "brothers with degrees in microbiology or chemistry...to develop a weapon of mass destruction."

A crude but effective terrorist weapon can be made by using a small sample of widely available pathogens, inexpensive equipment and "college-level chemistry and biology," she added.

States must do a better job of reporting on measures being taken to guard against the misuse of biological weapons and scientists should exchange views on threats, Clinton said.

Consider the above in light of the statement from HHS secretary Kathleen Sebelius last April, who wrote in the NY Times that "The technology now exists for someone with the right tools and the wrong intentions to create a new smallpox virus in a laboratory."

This rebuts the "smallpox is eradicated, so this drug is unnecessary" angle, which seems too stupid to be taken seriously, but is being trumpeted by intellects as formidable as Glen Beck (here's a video of his recent rant against SIGA).

Not many people outside the drama are paying attention to any of this. To most of the market, SIGA's just another biotech company with longshot chances, when, really, they're a leading biotech company with prospects so bright as to attract a blitzkrieg of nefariousness.

And so the dots remain unconnected and SIGA still hovers at a ridiculous $2. But when the contract's fulfilled (the first payment - $40M - is due shortly), and other contracts appear, and the product pipeline's announced, lots of people will be hearing about it. So while I have no idea what's going to happen between now and then, and this is obviously not a ride for the faint of heart (and a terrible investment for money you can't afford to keep on ice for a few years), this might be a great point to buy. And then don't even look at the stock price for a year or two!

TMDTIATW: Community Food & Juice

The most delicious thing I ate this week (TMDTIATW) was brunch at Community Food & Juice (2893 Broadway, near 112th St, Manhattan, NY; 212-665-2800). Specifically, their crispy potato pancakes with Petrossian smoked salmon, caviar cream, and dressed greens - a steal at $17 (definitely click to expand this photo):

...and their butterscotch pudding, which was utterly priceless:


I tried the much-lauded brioche french toast and carrot hash, which were enjoyable, but couldn't match those potato pancakes (even though they're shredded rather than ground, which is my preference). And the butterscotch pudding was a fiendish trapdoor, plunging both me and my guest to unfathomable flavor depths. This stuff is too potent eaten straight; thank goodness for the thick layer of sublime whipped cream serving as fluffy yin embrace for the fierce butterscotchy yang. The un-billed addition of buttery nut brittle cookies were like a final fatal gunshot to the head, but in a good way.

Tuesday, December 6, 2011

Immortality

I've been watching the wonderful two-part portrait of Woody Allen on PBS' "American Masters" series.

It perplexes me that someone so evidently miserable, who lives his life in such a grim and stand-offish manner (friends who've played in his band report that he's performed with the same musicians for decades without ever uttering a word to most of them, not even "hello" or "goodbye") would be so deeply fearful of death. One would think he'd be chomping at the bit for release from this contract!

I kept remembering this line from his own "Annie Hall":
"Two elderly women are at a Catskills mountain resort, and one of them says, "Boy, the food at this place is really terrible." The other one says, "Yeah, I know; and such small portions!" Well, that's essentially how I feel about life. Full of loneliness and misery and suffering and unhappiness, and it's all over much too quickly."

While I certainly recognize the ills of the world quite keenly, I'm far less negative than he appears to be. Yet if I were run over by a bus tomorrow, it'd suit me as well as anything else. My feeling is that we're all very bit players in this cooperative theater project, our roles forgotten soon after we leave the stage. We inject what's uniquely ours to contribute and we make room for the next guy. We're verbs, not nouns. With that view, you do your very best even when no one's watching, you try to unlock the succulence in the seeming mundane, and you do what you can to help those trapped in the hell of taking it all too seriously - who've utterly lost themselves in their roles. And that's about it, really.

When it comes to existence, I can make equally good cases for it or against it. But why would I want to live forever? What purpose would it serve? I honestly don't get it. Is anyone out there really having such a great time that they couldn't bear to see it end?

There are those who bask in the living, and those who are locked into conceptualization - expectation, labeling, etc.. It's surprising that the latter, who seem less than fully alive, are most fearful of death. Those who actually enjoy are often (though certainly not always) more blasé about it all.

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