Kind of a blah positive morning but then sellers hit the market at 1 PM precisely and sold pretty hard for the rest of the day.

Bill Miller’s Market Comments: Third Quarter 2006

In markets, competitive advantages are three: informational, analytical, or behavioral. Informational advantage is when you know something material that someone else doesn’t. It is the easiest to exploit and the hardest to find. Analytical advantages come from taking publicly available information and processing or weighting it differently from the others.

Behavioral advantages are the most interesting because they are the most durable. The field of behavioral finance is still in its infancy yet has already yielded results that can be incorporated profitably into a sound investment process. The best part is that such results are likely to be systematically exploitable and not able to be arbitraged away as they become more widely known. That is because they represent broad findings about how large groups of people are likely to behave under well-defined circumstances. Until large numbers of people are able to alter their psychology (don’t hold your breath), there is money to be made from prospect theory, support theory, cognitive psychology, and neuroscience.

Or to put it more simply, you have to learn how to buy ‘em when they ain’t.

- via Ticker Sense -

Just saw this notice at the bottom of the page at Paradise Poker.

Sportingbet plc has been advised that it is in the best interests of its stakeholders that its business is compliant with pending legislation in the United States, being the Unlawful Internet Gambling Enforcement Act. Accordingly, and with effect from 10am GMT on Friday 13th October 2006, Sportingbet will no longer accept any new deposits of funds, sports bets or wagers from any US citizen. Sportingbet’s US facing websites together with their affiliated URLs and associated companies have been sold and are no longer part of the Sportingbet Group.

Good thing they know me by our London address.

Buying kicked in at, you guessed it, 11 AM sharp and continued the rest of the day.

Pretty solid buying in the morning followed by the usual whipsaw craziness at Fed time, but buyers reappeared and took it up into the close.

Utilities, utilities, utilities! And there’s Nike … the WallStrip effect at work.

Rachel DeWoskin meets the Prada-clad ‘second wives’ aiming to get rich before they hit 30

Everyone who has ever lived in China knows the expression for “second wife”. And most people know at least one ernai personally. Ernai are a modern version of concubines, as common as colds. They are women kept in luxury apartments and goods by married lovers – mostly overseas businessmen and officials but, increasingly, by men at every level of society. The most successful kept women represent entrepreneurs of a sort, floating in a sink-or-swim economy and providing enticing models for what the new China can offer: genuine Prada stilettos, diamonds, iPods and sprawling villas. They work out in the swankiest health clubs, drive Minis, BMWs and Audis, and carry lapdogs in Gucci handbags.

The few ernai I know are all raging alcoholics (who faithfully attend their yoga classes).

- Thanks to my friend Sarah for pointing me to this article -

Weitz Funds Semi-Annual Report, Sep. 30, 2006

Wally wrote something curious in this latest letter:

We are currently short small- and mid-cap indexes because they seem expensive relative to our stocks (many of which are large-caps these days). This may seem an unlikely departure from our “bottoms-up,” one-stock-at-a-time investment approach, but we believe that selling short over-valued stocks, individually or in groups, is just another form of value investing.

I suppose that’s true in theory, but judging overvaluation is a much trickier business than judging undervaluation, no?

Selling from the get-go which continued uninterrupted all day long. Notable ETF among the new highs is Consumer Discretionary (XLY) … so much for the “suffering American consumer crushed by debt” story.

Nice solid buying into the lunch hour and then nothing more in the afternoon. Study this list closely: Wal-Mart, Google, General Motors, Continental Airlines, Sears, BellSouth, Kohl’s, etc. I’d have to say things are going pretty well back home.

Limited (LTD) still looks like a deep value stock to me when I put on my green CPA eyeshade (though accountants can be blinded by numbers).

Google Adjusts Hiring Process As Needs Grow, by Kevin Delaney

Current employees at Google were questioned on about 300 variables, including their performance on standardized tests, the age at which they first used a computer, how many foreign languages they spoke, how many patents they had and whether they had ever been published.

Given this line from the new head of HR, Laszlo Bock, one of the variables they don’t reject people for is the ability to spew bullshit [emphasis mine]:

“Everything works if you’re trying to hire 500 people a year or 1,000. But we’re hiring much larger numbers than that, and so it forces us to go back and say…what do we need to change in the way we interface with our candidates?”

Oops, I forgot, the idiots in HR talk like that everywhere you go.