Sunday, October 2, 2011

Modern Finance created both the Universal Banking nodel And commoditized investing using MPT

Both have been proven to be flawed and are now inefficient and outdated models.

Large Financial Institutions make a huge bet automating this Theory whichis now worthless.

Limited to variable annunities and Target account to Plug this need - WRONG AGAIN

Tuesday, September 27, 2011

This is A very different mind set and skill set ie Financial Times article on Admitting mistakes

AlphaMatrix Wealth Management is The combunation of Goal Based Planning with Modular Portfolio Construction and Management to provide a more robust and reliable process....

Move beyond the world of buy and hold commoditized Todays investors are looking for more - Modular portfolio Rap....

Sunday, June 26, 2011

Wall Street for Main Street

Don't Get Tricked into Playing the Others Guys Game.....

Monday, May 30, 2011

Investing is A Game.......

And it's Played From The Buy Side.........

That is Why the Business Has Been moving to a New Model.......

Theory and Practice:

The Simple truth when you follow the Money

It that the Systme No longer Exists to Finance The Private Sector But To Milk It....

Nobody says it has to be Perfect but the Net Effect is so Far off the Charts that it has clearly morphed into Something Else...A Vacuum Cleaner.....And It's Stated Purpose no more than a front for this pathological Activity

A World Class Financial System this is What made this Country Great - Our Competitive Advantage - Our Leadership Position - This Is no longer The cace it has been lost we are now "average" no worse  but no Better. This Competive Advantage has been lost......

Beyond the World of Packaged Goods and Structured Products.....Built by GM

Thursday, May 19, 2011

New Times Times 05/19/2011

Paris - The French finance minister, Christine Lagarde, was on a panel at the World Economic Forum in Davos this January when her usual smile turned into a frown. Next to her, Robert E> Diamond Jr., Chief executive of Barclays and one of the most powerful bankers in the World, Thanked regulators and finance ministers for their role in Shaping a better environment after the financial crisis.
   Ms. Lagarde looked him in the eye, "The best way for the banking sector to say thank you would be to actually have, you know, good financing of the economy, sensible compensation systems in place and reinforcement of their capital, " she replied, to a burst of applause.

Therein lies the problem...That wish list is so far from their business model it sounds revolutionary...

Thursday, May 5, 2011

Wall Street - The greatest sales and trading Machine the World has ever Known.....

Unfortunately Like Dorothy and Toto found out ....that's really all that going on There.....The rest is up to You...

Saturday, April 9, 2011

Do The Math......

The issue at the heart of all the explanations of boom-bust cycles is the unpredictability of the future. This is what makes finance different - and more unstable - than other economic activities. The primary purpose of any financial system is to link decisions made today with events many years or even decades ahead. Savers, investors, and businesses must resolve here and now how much to save or spend, whether to build new factories and which technologies to back, but all these decisions depend on views about the future - and those views, in most cases, can be based only on gut instincts, hope, and fears.

In non financial businesses, market prices may move more or less rationally in response to measurable changes in supply and demand, but in financial markets, prices respond mainly to subjective expectations about events in a distant future that is often unknowable, even in a probabilistic sense. Modern economists sometimes pretend to overcome this problem by assuming that financiers make decisions by calculating future probabilities in the same way that normal business, operating in the present, count current profits and losses. But substituting probability distributions for observable facts does not solve the problem of uncertainty. It merely covers up the true problem, like a con man playing the three-card trick. Calculating probabilities may work well enough in the insurance business or in everyday banking, but in many events, probability cannot be assessed. Recent events have offered Spectacular examples.

What was the probability that two planes would hit the New York twin towers within an hour? What was the probability that the Soviet Union would dissolve without a shot being fired? What was the probability that the US government would suddenly withdraw its backing for a systemically vital financial institution that everyone "knew" was "too important to fail"?

Business life consists largely of similarly incalculable, but more banal, questions about the future that simply cannot be answered, even in a probabilistic sense. What is the probability that someone in the next hundred years will invent a soft drink more popular than Coca-Cola? This probability must surely rate at almost 100 percent, yet that would also have been true in 1910. There is no rational way of making such an assessment.
It is unclear if Thomas J. Watson, the chairman of IBM in the early 1950's ever made his widely quoted remark that "there will be a worldwide market for maybe five computers." But what is certain is that even as late as 1980, no one would have put any significant probability on computer sales exceeding car sales by a factor of ten to one.

     The role of inherent unpredictability in finance means that the most important prices set in financial markets - interest rates, exchange rates, stock market values, and property values - will almost never correctly reflect conditions in the economy of today and may not create the right investment and saving incentives to keep the economy in equilibrium. Most of the time, the errors tend to cancel each other out or correct themselves quickly through normal market competition. But every so often financial markets go haywire, succumbing to the alternating excesses of greed and fear that create boom-bust cycles. Does this mean that financial cycles are pathological and immoral? The alteration of greed and fear certainly causes losses and economic disruptions in the short term, as well as suffering among innocent bystanders who have no involvement in finance, but in a larger historical perspective, financial cycles can be seen to play a crucial part in the evolution of the capitalist system.

      Greed and fear, after all, are not unnatural or dysfunctional conditions. Natural selection has hard-wired these emotions into the human brain for good reasons. The great insight of Adam Smith was that greed, euphemistically described as self-interest, is the creative force that constantly drives humanity to improve the material world. Greed is what gives impetus to the arrow of progress - and this is true not only of economics. In Chinese philosophy the creative principle of yang is associated with aggression and acquisition. In Politics, Machiavelli described the accumulation of  worldly "glory" as the motivation principle that drives leaders to undertake "great enterprises" and do "great things" on behalf of their fellow citizens and not just themselves. But greed, whether for material possessions or for political glory, must be kept in check. Hence, the evolutionary value of fear. Fear also known as prudence, caution, or the Chinese yin, is just as important as ambition and greed for human success.

     This is why the ring of repetitive financial cycles is needed as a countervailing mechanism to control the arrow of progress. In fact, the interplay between the arrow and the ring may be necessary for the capitalist system to evolve and improve itself, just as the balance between the greed for profits and the fear of bankruptcy is needed for business and industries to adapt and improve.

Sunday, April 3, 2011

Once You Have Moved Beyond GTD Products and Fixed Maturity/ Income Investing - You have Entered a New Realm

Anything beyond Guaranteed Returns and Principal is the Domain of Another Realm.

Banking 2.0 - Evolving from a commodity based Mentality

When a commodity based mentality is transferred to more complex products and services, bureaucrats can wind up creating more costs than they save.

Friday, April 1, 2011

The MARKET is BETA - Excess Returns are Alpha....

Why pay Alpha Management fees for Beta Management... Money has been Flushed Confusing One with the Other

Once we go Alpha the Relationship Changes.......You and We are now part of the performance/result

Your Role in the Process is defined....

Sunday, March 27, 2011

Thursday, February 10, 2011

"I'm shocked, shocked to find that gambling is going on here".

Yes Virginia, Poker is being Played, Strategy is part of the game.

The Game is played From The Buy Side - the Hunter vs the Hunted

If you're are not playing the game from the buy side you are being played from the sell side - It's that simple.

Thursday, February 3, 2011

MW/AlphaMatrix PortfolioManagement

A Flexible Strategy to Capture Alpha in an Evolutionary Phase

The Retail Distribution Model is Decades behind the times - That is an established fact

This is an Evolutionry Phase you need to get up to speed Fast if you are going to participate

We separated these two Models for A Purpose - they are separate and distinctive worlds

Bot independent and dependent upon each other Like Men & Women.

Wall street - A colossal failure in serving this need

the front end is driven by the back end - instead of the back end being driven by the front end

It's too late you have the wrong personal

Wednesday, February 2, 2011

Wall Street 4 Main Street

What we have here is A FAILURE To COMMUNICATE

Current models don't model the real world

Both in economics and finance

They model and "explain" historical DATA like a back fitting trading Strategy and create a false sense of confidence - they are not useless but they do not predict the future.

Friday, January 28, 2011