Measure it...  

And you will game it. Thanks to this app, I check the wind like an 18th century sea captain before driving anywhere. It can mess with mileage ± 2-6 mpg. on an Equinox.

When I start postponing trips, we'll know I've gone over the edge.

I think there's something here...  

Just not sure what it means for agriculture.

 

One thing for sure - NASS is sooo yesterday on this idea.

HAL trades commodities...  

Consider this unsettling sentence from a recent research paper on algorithmic (algo) trading:

As we have seen, HFT algos can easily detect when there is a human in the trading room, and take advantage.  [More]

The astonishing takeover of all kinds of trading by "black boxes"should be a warning note for farmers who think their markets will not be affected. Quite literally, algo trading changes everything about any public exchange.

A third of all European Union and United States stock trades in 2006 were driven by automatic programs, or algorithms, according to Boston-based financial services industry research and consulting firm Aite Group.^[4] As of 2009, HFT firms account for 73% of all US equity trading volume.^[5] [More]

While the focus of black box trading has been speed which allows High Frequency Trading [HFT], it seems that is now reaching the point of diminishing returns, although it has upped volume magnificently. as for the big benefit - lower costs per trade - that may have bottomed out.

The advantages of the nation’s increasingly high-speed stock market are under the microscope after a number of recent trading malfunctions underscored the risks and instability that have come with the rapid changes. This month, one of Wall Street’s most important trading firms, Knight Capital, lost $440 million in 45 minutes after installing faulty software designed to keep up with an evolving market.

As the battle to introduce more sophisticated technology continues, raising the specter of more problems like Knight’s, the diminishing returns flowing back to investors are making even longtime proponents of innovation question whether the competition to make the market faster and more efficient is now doing more harm than good.

“They’ve reached the point where the competition is measured in microseconds and there are essentially no benefits to the public at that level,” said Lawrence E. Harris, the former chief economist at the Securities and Exchange Commission, and now a professor at the University of Southern California.

High-speed trading firms have thrived in the computerized markets and now account for more than half of all stock trading, up from 26 percent in 2006, according to the Tabb Group, a financial markets research firm. But even many of them acknowledge that they are engaged in an arms race that is delivering diminishing returns.

Manoj Narang, the founder of Tradeworx, said that the competition had become “a tax” on computerized trading firms like his. Mr. Narang says he thinks that his competitors are dedicating fewer resources to the race as they see there is little more to be gained. [More]

 While reversing this trend doesn't seem to be possible, more than few knowledgeable observers are wondering if we aren't stacking dynamite for a major market demolition.

First, let’s be clear about what these charts are showing. HFT is maybe a bit misnamed, since what we’re seeing here is two separate eras. From 2000 to 2006, trading got faster and cheaper. From 2007 to date, trading itself hasn’t actually risen much, or got faster. the huge spikes are in quotes, rather than trades, and it’s not uncommon for certain stocks to see more than a million quotes over the course of a single day, even when they are only traded a couple of dozen times.
You know the track cycling at the Olympics, where the beginning of the race is entirely tactical, and the trick is not to go fast but to actually position yourself behind the other person? HFT is a bit like that: the algorithms are constantly putting up quotes and then pulling them down again, in the knowledge that there’s very little chance they will be hit and traded on. The quotes aren’t genuine attempts to trade: instead, they’re an attempt to distract the rest of the market while the algo quietly trades elsewhere.
As such, the vast number of quotes in the market is not a genuine sign of liquidity, since there really isn’t money to back them all up. Instead, it’s just noise. But don’t take my word for it. Here’s Larry Tabb, the CEO of Tabb Group, and a man who knows vastly more about HFT than just about anybody else:

Given the events of the past six months, the SEC should think hard about the market structure it has created, and do its utmost to rein it in. While the SEC can’t stop computers from getting faster, there is no reason it can’t reduce price and venue fragmentation, which should slow the market down, reduce message traffic and lower technology burdens.
Until we can safely manage complex and massive message streams in microseconds, fragmentation is making one of the greatest financial markets of all time about as stable as a McLaren with its RPMs buried in the red.

HFT causes stock-market instability, and stock-market instability is a major systemic risk. No one’s benefitting from the fact that the entire market could blow up at any second. So why isn’t anybody putting a stop to it? [More]

But what about our tiny (relatively) commodity markets? Can't we buy a few puts or calls and live to tell the story?

The big increase in HFT-related trades has been well documented (though exchanges have been reluctant to break out the rising share of HFT trades for fear of inflaming demands for a clampdown). It has contributed to a surge in the number of trades in NYMEX crude from under 1 million in 2005 to almost 42 million in 2011, and in CBOT corn from 133,000 to 10.7 million, as well as a reduction in average trade size.

It is a truism to say that correlation is not the same as causation. But nothing worthwhile in social science has ever been proved conclusively to this standard. Bicchetti and Maystre do present some convincing arguments for a possible link, though, including the presence of statistical arbitrage programmes operating across multiple markets, and invite further work to establish its extent and the mechanisms.

The authors touch on an even more sensitive area when they speculate about whether HFT programmes import non-fundamental influences onto specific commodity prices.

The paper points out "(conventional explanations) fail to explain how economic fundamentals or the risk appetite of financial investors changed quickly. Indeed, news frequencies or human investors reaction is certainly not as high as 1-second."

Later the authors go on to argue "the strong correlations between different commodities and the S&P 500 at very high frequency are really unlikely to reflect economic fundamentals since these indicators do not vary at such speed."

In other words, HFT traders translate volatility from one commodity or financial market to another at timescales from seconds to minutes by arbitraging them very rapidly.

In a more serious charge, the authors suggest a lot of HFT programmes have feedback characteristics that tend to be self-reinforcing. "Although individually rational, the overall effect of trend following strategies may destabilise markets". Bicchetti and Maystre cite the "flash crashes" in equities (May 2010) and oil (May 2011) as examples of destabilisation.

The potential combination of HFT enforcing tighter correlations, and perhaps also propagating volatility within individual markets through herding behaviour, leads the authors to conclude that "as commodity markets become financialised, they are more prone to external destabilising effects". [More]

The warning here is clear. Our markets can bumble along in what we consider to be a normal market only to be be overwhelmed by spillover from who-know-what financial exchange and Very Big Money. This will happen between breaths.

My takeaway from this research is this. I want Cargill or Ingredion* between me and HAL. And any banker who funds a commodity trading account is asking for trouble. After all, they can tell I'm merely human.

*Yes - the first major grain buyer with "greedy" in the middle of their name! What committee okayed that one?

Better and better...  

After Herculean effort, my ISP guy (a young farmer/engineer neighbor) has fired up a REAL Internet connection.  I use picpitstop.com to measure speed and I've been hitting 13+ Meg (down) and nearly 1M up.

However, something screwy is going on with my Mac and Airport router.  I have to restart several times, swap cords, reconfigure, sacrifice a chicken, and I still don't know what happens. I have to get that squared away and write the Christmas letter today.


I'll try to post some stuff before I drop off for no good reason.


(I'll bet I need a new 27" iMac, don't you?)

#%^&**$@!...  

My e-mail account was hacked a few hours ago (password stolen) and a stream of messages sent from my account. To all affected, sorry. I think I have stopped the flood.

To be fair, Macs are very virus-proof, but passwords are my own responsibility.

Better mice...  

Note how fast it returns to the start after mapping.

Update: the embedding isn't working. Click here.

Sorry

Ya gotta believe this kind of software will be what we turn on at the entrance to a field soon.

Password sense...  

Of all the places to find a better password system, xkcd was not my first thought:

 [Click to embiggen]

Roll your own here.

Toy Alert #35...

They finally made a Verizon-native iPad 2, and I saved my pennies up (which are a bad idea, BTW).

Here is the verdict after two weeks: simply amazing!

This is the best on-tractor computing device available. It's large enough to read and the touch-keyboard is much easier to use than a phone. The backlighting is great for all light conditions, and by loading the free Kindle app, I was able to give away my rather beat-up Kindle.

I can see my working spreadsheets and maps, via Dropbox, although the translating them back and forth between Excel and Numbers isn't worth it for me right now. (There is no iPad version of Office)

The camera functions are great. Here's what my days looked like this week (although too few of them).



Uploading or emailing video/pics is a two-touch process. It also "skypes" well with (Facetime) with two cameras.  Good battery life as well.

I'm still climbing the learning curve which has been pretty easy, except for Blogger.  One reason I haven't been posting is there is not good app for doing so for the iPad.  I expect the Google guys will have something soon, but I can't really post easily yet.

Still, this is the mobile computing device that dovetails with auto-steer to make cab-computing work, IMHO.  Best of all it's relatively cheap.

This is the device that will replace notebooks and make phones just phones again.

I recommend the magnetic cover, and maybe a heavier one for rough use.

What were they talking about...

Around 1900?  Google has launched a real "time suck" - an app that shows how often a word was used in the gazillion books they have scanned.  So after fooling around see what came up when I tried the words "farm subsidies" and "biotech":

[Click to embiggen]

[Try your own words here]

So what did biotech mean back then or is something else going on here?

Slow scrolling?...

A reader asks:

I enjoy reading your blog, we must have a similar sense of humor.  However, since you changed backgrounds a couple weeks ago scrolling down to read the page has become exceptionally slow.  Your page is the only place I experience this.  I know I should use this as an excuse to upgrade computers, but this one still does everything else acceptably.  Maybe I'm the only one having this problem?  Anyway I thought you would want to know.  Keep up the good work.

Is anyone else having this problem?  If so, please leave a comment below. I'd hate for this loyal reader to have to upgrade to a new computer with a 1 TB drive, 24" screen, wireless keyboard/mouse, 2 GB RAM, fast graphics, etc...

[Update: I have deleted the background image - any help?]

My life (short version)...

[More]

What he said - Episode 12...

Stumbled over this - loved it.



Truth be told, I think it's a little early be assigning moral value to a phenomenon we barely can describe, let alone predict.  For my part, since I'm at the age where memory itself is a fading memory, Google has been an enormous crutch.

I don't begrudge folks new knees - what's wrong with an artificial memory enhancer?

[via boingboing]

Confused about upgrading to Windows 7?


Join the club.

[The comments really help.  Not.]

Dept. of "Oh, c'mon!"...

So I get a new MacBook this spring to get a bigger screen, and I find out my VGA - DVI adapter for the old MacBook doesn't work.  For some reason that escapes me.

So I wander into Best Buy to get the proper adapter.

Thirty. Two. Dollars.

Apple just can't resist taking occasional cheap shots.

Except everything is forgettable...

For me these days.

How to improve your pathetic passwords. (They are too!)

Start with an original but memorable phrase. For this exercise, let's use these two sentences: I like to eat bagels at the airport and My first Cadillac was a real lemon so I bought a Toyota. The phrase can have something to do with your life or it can be a random collection of words—just make sure it's something you can remember. That's the key: Because a mnemonic is easy to remember, you don't have to write it down anywhere. (If you can't remember it without writing it down, it's not a good mnemonic.) This reduces the chance that someone will guess it if he gets into your computer or your e-mail. What's more, a relatively simple mnemonic can be turned into a fanatically difficult password.

Which brings us to Step 2: Turn your phrase into an acronym. Be sure to use some numbers and symbols and capital letters, too. I like to eat bagels at the airport becomes Ilteb@ta, and My first Cadillac was a real lemon so I bought a Toyota is M1stCwarlsIbaT. [More]

Of course, I'm hoping the wrong way on this one.

Microsoft tries again...

And maybe misses again.

We loaded the Windows 7 Release Candidate on three systems (two desktops and a laptop) and then ran our WorldBench 6 suite. Afterward we compared the results with the WorldBench 6 numbers from the same three systems running Windows Vista. Each PC was slightly faster when running Windows 7, but in no case was the overall improvement greater than 5 percent, our threshold for when a performance change is noticeable to the average user. [More]

According to friends still using Vista, it is better than when I dropped out of the Window pain [heh].   But this is not promising for MS.

I can just see the commercials.

You look human to me...

But how can I really tell?  Well, the squiggly letters on the comment box are how we currently do it.  Its called CAPTCHA.

But the challenge is increasing.

Herein lies the key to leaving squiggly letters behind. As Alan Turing laid out in the 1950 paper that postulated his test, the goal is to determine whether a computer can behave like a human, not perform tasks that a human can. The reason CAPTCHAs have a term limit is that they measure ability, not behavior. The history of computing shows us that machines will eventually learn how to perform all manner of tasks—like identifying words, for instance—that we currently assume only humans can solve.
How might it be possible to measure behavior rather than ability? The other day, I was writing a note to company using the online form they provided for media requests, doing the usual amount of typing, backspacing, and retyping as I tried to phrase my note in a way that would make them respond quickly. It occurred to me that the random, circuitous way that people interact with Web pages—the scrolling and highlighting and typing and retyping—would be very difficult for a bot to mimic. A system that could capture the way humans interact with forms algorithmically could eventually relieve humans of the need to prove anything altogether.

Any solution that could replace CAPTCHAs en masse would have to be free, work across a wide variety of platforms, and be easy for the average blogger or Web admin to install. One of the reasons that CAPTCHAs have spread like kudzu, I suspect, is that they're so easy to implement—in some cases, as simple as checking a box on a site that helps you set up an input form. The more a bot-fighting algorithm can insinuate itself behind the scenes, the better. In the meantime, we'll all have to keep debating the eternal question: Is that a W, or is it a V and an I attached at the hip? [More]

Of course, we may discover with more sophisticated "humanity" tests there really are aliens among us.

Speaking of which, have you noticed now everyone is carrying a cell phone that takes pictures the number of UFO reports has plummeted?

Computerized hand-written notes...

Clearly an oxymoron for our times. Has your handwriting deteriorated to a semi-legible signature on credit card stations?  For that matter, are they still teaching penmanship at all?

I'm always embarrassed by my thank-you notes (and it gives me too easy an excuse not to do them). 

Well, this could be the answer: create your own handwriting font.

[Full instructions and website]

You'll need access to a scanner.  And it's free!

I'll let you know how mine works out.


[via mefi]

Gadget alert...

How cool is this?

You’d have to be a jaded gizmophile indeed not to be impressed the first time you turn on this tiny, shiny black box. In the center of the short end, there’s a very bright light-emitting-diode lamp. Inside, there’s a miniaturized Texas Instruments digital-light-processing (D.L.P.) chip, similar in principle to the ones that drive some full-size HDTV sets. Together, they produce an astonishingly bright, clear, vivid video or still image. That’s right -- from a projector you’ve pulled from your jeans pocket.
There are no footnotes for that jeans-pocket statement, either (like, “not including enormous power brick”), because the Pico can run on battery power. Each charge lasts for about 90 minutes -- longer if you use the lower brightness setting or when you’re playing video without sound. You can recharge the projector either from its power cord or from a computer’s USB jack. A spare battery comes with the projector, and so does a little drawstring carrying bag.

A pocket-size, self-contained projector changes all the rules. An iPod and a Pico -- that’s the entire setup. Now, for the first time, a tent wall can become a movie screen when you’re out camping. (So much for roughing it.) [More]

The neat part about technology like this is even the makers may not fully appreciate how it will be used. Smaller, lighter, cheaper can trigger all kinds of imagination when placed  in  the hands of users.

One unfortunate outcome could be ubiquitous PowerPoint presentations for groups of 1-2 on topics so trivial as to need no more than two bullets.  Conversation may never be the same.

[More info]

[Another review]

At least I made one...

Good decision in 2008:  I ran as fast as I could from Windows Vista.

Microsoft (NSDQ: MSFT) in the past week announced yet another life extension for its supposedly retired Windows XP operating system, a sign that, despite almost two years on the market, Windows Vista is a no-go for most businesses. Only 10% of 700 business executives recently surveyed by the Information Technology Industry Council and Sunbelt Software said their companies are using Windows Vista in the enterprise. [More]

Now a year into my affair with Apple iMacs, I am pleased by the reliability and performance. Although upgrades can be challenging for satellite users like me, and while some have their own unique hangups, our Macs have been nearly bulletproof.

I have navigated the re-learning process and as a result, am faintly startled by how unintuitive Windows now seems to me. The two major programs I use (QuickBooks and Office) have been updated for the Mac this year to their enormous benefit.

I just remembered - I did have a failure of the motherboard, and for once I had bought the extended warranty.  The repair was close, fast and effective.  And I paid for the Applecare immediately.

All in all, a happy camper.