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Archive for February 25th, 2009

What To Deactivate

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No. The only thing I did wrong
was to impose on IE as backup to juggling some Firefox tabs,
inviting Microsuck to go about doing the only thing it does well:
crash out a computer bad enough to blow out its settings.
What this screen really needs is a button that says
“Deactivate any Microsuck software on this equipment.”

Bumper Sticker [] - reprobate

Written by macheide

25 February 2009 at 4:38 pm

Posted in reprobate

Upstream Swim

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pottstown swim club

Search terms that recently led someone to aftermath. True, I was a charter member and lifeguard at PYC’s Beulah Land Park near Pottstown, way back when. But all my BL references are all over 30 years old, in oneirra‘s password-protected posts. If this Internet searcher was hunting down references to that particular “Pottstown swim club,” he or she would need to peek into my ancient dreams to find anything remotely relevant.

bumper sticker [] - search me

Written by macheide

25 February 2009 at 10:56 am

Posted in search me

Still No Consistent Buying

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Yesterday afternoon, Bloomberg radio spoke with an analyst who was shrugging off the day’s 200+ Dow gain as little more than temporary short covering. None of it “new money,” he claimed. What’s needed for a real turnaround, he observed, was significant new money, day after day after day, through good news and bad.

That’s the first time in the past year that I’ve come across anyone else pointing to the absence of persistent buying in the equity markets. There being no end to the commentators Bloomberg usually parades around chirping about how underpriced and “oversold” the market supposedly is.

No matter how beautiful the women are, they won’t find suitors if all the men have been killed at war.

I know, the market is not entirely about the massive permanent outflow of pension money. But with that huge shift so drastically tilting the plane the past two years (only partially counter-balanced in 2007 by Chinese money), the weaknesses created by the credit crisis could do nothing but drag the market to historic lows.

Nine months ago, with the Dow in the high 12s, I marked 13k as the ceiling for the remainder of 2008. Then consistently throughout the months since, I have never yet seen a floor (although last September, with the Dow then still over 10k, I did point down to the 5s), but have only seen the ceilings drop again and again and again.

For now, I’ll stick with this loner Bloomberg managed to dig up, against all the unsubstantiated wishful thinking for a rally. As low as stock prices might look on an unthinking chart, the price doesn’t matter when the market has no buyer who is there day in and day out. So yes, I’m still looking for us to visit the 6s and even the 5s before we’re finished with this meltdown.

Appendum – And just now I heard a numbskull on Bloomberg blame today’s retrenchment (Dow currently losing over half the ground it gained yesterday) on “profit-taking.” Profit-taking??? OK, I know that’s the standard way of saying, “We don’t really know why it’s going down today.” But in this instance, it’s just plain idiotic. The only people in this market with any so-called profits to take are either day traders who bought in just yesterday morning and are already cashing in, or long-term investors who bought over a decade ago and are finally giving up. And if that’s the alleged “profit-taking” that is moving this market today, then we’re in even worse shape than everyone already fears. Seriously, where does Bloomberg manage to find these jokers?
bumper sticker [] - calls & puts

Written by macheide

25 February 2009 at 10:10 am

Posted in calls & puts

2008’s Top Pension Story

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If net periodic pension costs for 2008 had been determined by immediately recognizing all experience (as is being currently contemplated by phase 2 of FASB’s pension accounting project), versus the deferral-and-smoothing methodologies of SFAS 87, then aggregate after-tax pension costs for 2008 would have completely wiped out all 2008 net corporate profits for U.S. pension plan sponsors.

As I’ve continuously reminded, any aftermath posts about pensions represent personal actuarial interests that are a “fave pastime,” a private hobby that is not connected with my formal work in any way whatsoever. Even so, to keep the lines as clear as possible, I’ve been password-protecting most of my posts under aftermath‘s άctuary category. But in the same spirit that I did not password-protect “Future Reading” – which three months ago anticipated this current post – so too I’ll leave this post open.

Measured on the basis of pension assets as of 12/31/2007, I now have about 40% of the 2008 details for companies within my personal data universe (S&P Composite 1500, plus certain additional companies, such as large mutual insurance companies) with fiscal years ending 12/31. (I already have in hand all data that has been filed for my data universe for companies with fiscal years ending before 12/31.) Most of the remaining data for 2008 will be filed with the SEC during the remainder of this week.

I don’t expect the remaining data to alter the conclusion stated at the beginning of this post. If pension costs were not spread in the manner required by current GAAP, then in the aggregate, pension plan sponsors would have had a net loss for 2008, with the pension plan experience more than wiping out all corporate income. Once the word on this gets out, no other 2008 pension story – not the expected return assumptions (which will face even more heated scrutiny), not the mild increase in employer contributions, not even the hundreds of billions of dollars of investment losses – will be as big.

actuary cat feed subscribe to aftermath’s άctuary category

bumper sticker [] - actuary

Written by macheide

25 February 2009 at 9:08 am

Posted in άctuary