Mmm....Cheese

The CSA is back in session - real vegetables - what an improvement over the grocery. So we're making a lot of Kale soup. Trader Joe's spicy Jalapeno chicken sausages make a nice substitute for Chorizo. My recipe is something like:

• Sauté an onion, some carrot, celery, and maybe garlic on low heat.
• Throw in the chopped up sausage, brown it a little.
• Throw in the Kale, mix it around a bit.
• Cover with broth, throw in a few chunks of potatoes.
• Leave it on low and forget about it for a few hours due to a chain of phone calls from work.

We had leftover Parmesan rinds and threw them in the soup - it tasted good, so I'll call that a success.

We also just did a blind taste test between aged Parmigiano-Reggiano, younger Parmigiano-Reggiano, and Grana Pedano. The real parm was noticeably better - I liked the older, Lori liked the younger, but the Grana was not a real substitute. (It's also not much cheaper - only about $3/lb less.)

Why My Wife Is Brilliant (part 372)

SaltineMatzah Toffees. Salt 4 pieces of Matzah with sea salt. Melt 1 cup of butter with 1 cup brown sugar, boil 3 minutes, pour on top. Bake for five minutes at 400, then sprinkle on semi-sweet chocolate chips. Let them melt, spread them, let it cool (if you can) and nom.

Congress Has Never Used Shark

Shark is a performance profiling tool that I use heavily at work. In a nutshell: Shark tells you what part of your program takes the most time to run, so that when you spend time making your program faster, you make the parts that matter run faster.

To construct a trivial example, imagine that my recipe program spends 99% of its time drawing beautiful 3-d recipe cards, and 1% of its time drawing the menu bar. If I want it to be faster, I have to make the cards faster, not the menu bar. If I make the cards twice as fast, the program is twice as fast. But...if I make the menu bar twice as fast, you'll never notice, because I've only affected 1% of the total problem.

Put another way: it pays to go after the whale, not the minnows.

Consistently going after whales is what has made X-Plane fast over the years.

So it drives me nuts when Congress goes after minnows.

Here are a few lists of potential spending cuts...we'll see how much of this actually happens. There are even some cuts that save more than $1 billion - that is, cuts that almost matter.

• $1.1B - Office of Science.
• $1.7B - GSA Federal Buildings Fund
• $1.6B - EPA
• $1.4B - DOE Loan Guarnatee Authority
• $2B - Job Training Programs
• $1.3B - Community Health Centers
• $1B - NIH
• $1B - High Speed Rail

(And we have some minnows: $6m for the NEA, $6m for the NEH, $7.3m for the Smithsonian, $2.3M for Juvenile Justice...if ever we optimized the menubar.)

But the real problem here is the total failure to 'Shark'. A few big ticket items seem to have strangely escaped the list.

• $663.8B - the US defense budget last year, after suplementals.
• $446B for Medicare

I'm pretty okay with the 'less government' idea...but I'm not okay with the 'less government except for the stuff I like' idea, and either way if you're going cut, make cuts that matter.

(Why is Social Security not on this list? Social Security takes in a lot of payroll tax, and could be made solvent by relatively small changes in benefits, the payroll tax cutoff, and retirement age. Heck, Social Security was doing fine before Wall Street cratered the economy. Compare this to Medicare, which has jumped 13% in cost in two years.)

Glengoyne 17

Keeping with the "notepad of food and drink" theme, I figure I'll take note of the Scotch I finish...a bottle lasts a long time (despite X-Plane 9), so better to write it down.

People write some crazy stuff about Scotch - it's like wine tasting. "The nose had notes of hickory, burlap, and an old bicycle. Very good." I haven't taken a tasting class, so consider what follows to be totally uninformed.

Glengoyne 17 smells of caramel or honey - you'd think it smells good even if you don't like Scotch. It's fairly mellow; you can drink it neat and it doesn't burn at all. After drinking smokier whiskeys, it almost seems a little bit muted. Perhaps a good Scotch for drinkers who aren't quite prepared for more "challenging" whiskey.

Salt Fish Fried Rice

It was pointed out to me (by my mother) that I never update this blog anymore...a major release will do that to you. But...I need to write cooking notes down somewhere.

Salt fish fried rice is...freaking awesome. It's also an acquired taste. An epic discovery: Top Cafe is just down the street from Apple (should you be out there on business), open late, and does a mean salt fish fried rice.

Salt fish fried rice is one of those dishes that, like a gin and tonic, walks a fine line between culinary bliss and disaster. The salty fish should add a bit of tang to the whole dish and should come out and bite you when you get a piece, but it shouldn't be so overpowering that you can't taste anything afterward.

I have made the recipe twice for myself and I'm getting closer, but have been held up by the principle ingredient: haam yu (咸鱼). The first time I made the recipe I used Portuguese salt cod. To put it bluntly, that's the wrong kind of fish. The results are quite edible, but the salt cod has no tang because it hasn't been fermented.

The second time I went to my local Chinese grocery and did my best to explain what I wanted. Unfortunately they were all out of salt fish and sent me home with...well, I'm not really sure what it was. It was a piece of carp labeled "Grandma's food products" in Chinese. I'm not sure what was done to it. It was a lot closer than the salt cod, but didn't have adequately awesome killing power.

The recipe I made is this one, and it seems to work pretty well; the results were close enough for me to know what I was going for and to know that I was only off by the type of fish.

Salt fish (咸鱼 - literally "salty fish") is xian yu in Mandarin and haam yu in Cantonese, unless Lori is punking me. One of the problems with Googling such ingredients is that there appear to be Chinese pop stars and kung fu masters with the same name. I suggest that we rename Justin Beber to Justin Hamburger in retaliation.

If You Can't Stand Up, You've Probably Been Fouled

I've been reading the official rules of Ultimate; I realized I didn't really understand the criteria for fouls. And now that I've read them, it's clear that a lot of casual and semi-serious players don't understand them either.

Here's a big distinction that gets lost in recreational play: a general foul vs. a receiving foul. To put it simply:

• If you can't keep playing because you got hit, it's a general foul.
• If you would have caught the disc, but you didn't because you got hit, it's a receiving foul.

The difference matters because the standard for each is different, and the penalties are different too.

Receiving Fouls

First the receiving foul. You're running for the disk, and before you can catch it, your defender crashes into you and knocks you down. That's a receiving foul; you would have caught the disk, but he hit you so you couldn't. If that's the case (and he doesn't contest the foul) you get the disk where you got hit.

Receiving fouls are the ones that people know about, and thus a lot of offensive players think they will get the disk every time they get hit. But here's the rub: in order for the foul to be a receiving foul, it has to happen before you could have made a play on the disk. So if some big guy jumps over me, grabs the disk, and on the way down knocks me over, it's not a receiving foul because at the time of the foul, I had no play on the disk. (This ignores dangerous play, which is a different story.)

The continuation rule also applies; with the continuation rule if there is any violation by the other team, but it doesn't affect the play, and there is a turn, the turn stands. So if your defender checks you, but the throw was just terrible and hits the ground immediately, it's not a receiving foul, and play wasn't affected because the disk was turfed no matter what.

So the moral of the story for receiving fouls: you're only going to get the disk where you got hit if you got hit while you still had a chance to catch the disk. If the disk was not catchable at the time of the hit, too bad. (Delightfully, the defender who hit you can contest that you had a play on the disk; contested receiver fouls go back to the thrower.)

General Fouls

There are a bunch of ways you can get hit and not have it be a receiver foul. But that contact might still be a general foul. If the contact "affects continued play", it is a general foul even if the criteria above for a receiver foul aren't met.

Here's an example that actually happened to our team this weekend: a large man on the other team knocked down a (poorly thrown) huck by our team. After he knocked the huck down, he subsequently crashed into one of our women and knocked her over. Our woman's defender (who was now on offense because of the turn) promptly bolted down field to participate in a score without a defender, while our woman sat on the ground trying to figure out what the hell hit her.

This is a perfect case of a general foul that isn't a receiving foul. The collision happened after the other team grabbed the disk, so our woman's ability to receive the disk was not impaired by the hit; she had no chance of getting the disk at that point under any circumstances. But the hit definitely affected continued play: she was unable to play defense because she had been run over!

This is a general foul, and she can call foul. The key here: while she would not receive the disk (it's not a receiving foul), play would stop! This stoppage of play is critical for allowing fouled players to readjust after being knocked over. Without the stoppage of play, an effective way to play defense would be: hit your opponent away from the disk (no receiving foul), then run deep while they're down. General fouls make this impossible.

So: if you can't stand up, you've probably been fouled. It may not be a receiving foul, and you don't get the disk, but it's still a general foul, and play stops, everyone freezes.

Asset Allocation for Fun and Profit

In my previous post I suggested that commodities speculation was a poor idea and not a good use of retirement funds. But the fact that I think it's a lousy idea doesn't explain why a brokerage like Fidelity would suggest such a strategy. To understand why commodities are being promoted as an "asset class" (and Fidelity is neither the only nor the first brokerage to start pedaling commodities as an asset class) you have to look at what half a century of efficient market theory has done to investing.

Modern Portfolio Theory

To understand anything a brokerage ever does, you have to understand at least the basics of Modern Portfolio Theory. Here's the short version, it's not very complicated.

• Markets are efficient - you can't beat them because they already "know" everything you do. So picking stocks isn't going to get you a better retirement fund. You might as well buy an index of all stocks and keep the fees low.
• If two separate markets have low covariance (that is, they go to hell at different times) that's the only free lunch you'll ever see. By investing in both, you can limit how far down your portfolio tanks. If stocks and bonds go to hell at different times, then at any one time maybe only some of your money is hosed.
• Combine these and you realize something strange: the important question is what types of things you invest in (the "asset class") and in what ratio. The important thing is not the details. In other words, your ratio of stocks to bonds matters a lot, but which stocks you buy doesn't.

MPT dominates the "buy" side of investing (e.g. the institutions that manage people's retirement money) in a huge way. "Lifecycle" funds are just funds that adjust the ratio of stocks vs. bonds as you get older, based on MPT.

Go Off the Cliff With the Herd

There's another boot-print from quantitative finance on the face of investment management. Since the market is "efficient", it's not the place of your investment adviser to try to beat the market. And MPT provides cover for this. If I am in my 30s and my adviser suggests that I should be 70% in stocks, and then the stock market loses half of its value, that's not negligence, incompetence, or a breach of fiduciary duty. MPT says that I have to be heavily in stocks for my risk-return profile. And that investment adviser has a certain amount of cover: pretty much every other investment adviser has suggested the same thing, so "no one could have known".

Unfortunately, MPT strikes me as a difficult approach to long-term investing. MPT "works" based on the historical long term (or sort-of-long-term) relationships between asset classes. But because everyone now uses MPT, the "good ideas" that MPT suggests may not be so good any more since those ideas move markets.

(Put another way: if everyone piles into stocks, the return on stocks isn't going to be very good. But MPT says we should pile into stocks because past returns were good. We saw the bull market of the 80s, we piled in, and in the process we guarantee that we won't have a bull market like that again.)

Look, Fees!

Now here's the problem with MPT from the perspective of a brokerage: it makes it really hard to make any money. If I manage your money, I make my return based on a fee (usually a percent of assets under management for a mutual fund or ETF). But the actual asset classes that I can manage keep moving toward lower fee structures. For example, Van Guard's total market return stock index fund (TMI - this is the ETF I use quite frequently) has an expense ratio of 0.07%. And now (finally) you can get bond index funds with low expense ratios too. BND, another Van Guard ETF has an expense ratio of 0.12%. (This is a huge improvement over the 0.5% you'd pay on bond mutual funds; with only a few percentage of return a 0.5% fee was a huge chunk out of returns.)

Fidelity seems to now be charging me $8 to buy/sell ETFs. So let's review: Fidelity takes $8 to make my purchase every now and then, and Van Guard gets between 0.12% and 0.07& in fees. How does anyone make any money off of this?

To make matters worse, Fidelity can't (and no one else can) credibly come to me and say "you should pay more for this proprietary product" - some magic 'beat the market fund' or the advice to 'stay out of stocks'. MPT says that they can't beat the market and they shouldn't be messing with my asset allocation. So no way to add value there. (Heck, if they did come up with a product that went against MPT and it tanked, they'd probably get sued.)

And now we have enough pieces to understand my cynical view of commodities investing. Currently "buy side" money management companies have only two asset classes to sell (stocks and bonds) and the margins on those products have gotten very, very low. But if they can invent a new "asset class", investors would nearly have a mandate to buy it (due to MPT) and while the market is fresh and new, there's still a hope of raking in fees.

A quick screen of commodities ETFs shows expense ratios from 0.3 to over 1%. And ETFs are usually the cheapest investment vehicle available to retail investors.

In summary: it has become to save for retirement very cheaply. Commodities investing isn't necessarily a good idea, but because it's a new market it's still profitable. Investment advisers have to make the case that commodities are an "asset class" in order to justify selling commodities funds to investors.

In all of this discussion I have not mentioned gold. That is going to have to be the last (and separate) part of this rant. Buying oil, coal, grain, or copper - that's commodities speculation. But buying gold is something very different, and in my opinion, even more loopy.