Out With The Old Year, and In WIth The New

Well, it's the last finally the day of the year. So, here's wishing you all a safe, happy, and prosperous New Year.

It's been a pretty eventful one in the Unknown Household - we had one son pass away from cancer, and had another one join the family. So, I can pretty much guarantee that 2010 will be less eventful for us than 2009 (at least I hope so).

We finished out the old year yesterday by taking the Unknown Daughter up to Boston to see the Science Museum's Harry Potter Exhibit. Total Cost:

• Three Tickets - $93
• Parking - $9
• Various Junk from the Museum Store - $35
• Overcooked and dried food from the Museum Food Court - $20
• Hearing the Unknown Daughter say (wide-eyed) "This is Fantastic" - Priceless
  

Luckily, our two nieces were home from college., They drove down the night before to baby-sit Wonder Boy for the day, so we got to go without munchkin in tow. But Boston traffic still sucked - it took us 45 minuted to go about 3 miles on Rte 93 (and this was not even rush hour traffic). Ah well, that's the price of being in a city.

Remember - there will be a lot of alcohol-impaired folks out there tonight, so be safe, and see you next year. Being old fogeys with a couple of young kids, we'll be home, warm, and in bed by 10 or so.

Yeah, we're boring. But I'm O.K. with that - I'm in touch with my inner old fogey.

As The Semester Winds Down

Since Unknown University starts (and ends) their fall semester a bit late, I'm just putting the finishing touches on my grades - two classes down and one (the smallest, luckily) to go.

It's been a tough semester - three preps (for the non academics among you, a prep is a unique class - so three preps means I taught three different classes), and one was a brand new one (Fixed Income) for me. I took it because the senior faculty who regularly teaches it took a sabbatical, and it's required of all our students. The new prep took far more time than I'd thought, so I didn't get as much research done as I'd hoped.

The winter break will be dedicated first to getting two papers completed and submitted to journals. I let things slide a bit these last few years due to the Unknown Son's illness, so I'm glad to be finally working on things that have the potential to go to decent journals - these two will likely be sent to Financial Management and Journal of Banking and Finance (two very solid journals). As for the other things I'm working on, one should go to to a solid accounting journal (JAAF), another to Journal of Futures or Journal of Derivatives, and another will be targeted to the Financial Analyst's Journal. I'm also working on a piece with a PhD student that will hopefully be finished in time to submit to the FMA annual meetings.

Somewhere in there, I'll also make some minor changes to my class (it's the same class I taught for the first time this past semester, so it's in pretty good shape). It shouldn't take more than a day or two to make the changes, since I prepped pretty thoroughly for it last time.

It's an ambitious schedule, but three of the pieces use the same data set, and a fourth is mostly done. With a bit of hard work, I should have a very productive Winter break. So, to all of my coauthors who read the blog: take heart - things will be done soon enough.

On a more somber note, please keep Mark Bertus and his family in your prayers. He's a fairly young faculty member at Auburn, with several young children. He's in the final stages of colon cancer, and is a remarkable guy. He'll leave an amazing legacy of memories to those of us who've had the privilege of knowing him. You can read the blog his wife has been maintaining to keep everyone informed about the illness here.

Mark's journey reminds me of something Steve Brown (a radio preacher) once said. It's something to the extent of "Whenever a pagan gets cancer, God allows a Christian to get cancer
so that the world will see the difference in how Christians deal with it." Depending on your beliefs, that might or might not sit all that well with you. But as you read his blog, you'll see that it definitely applies here.

To all who're reading this - Have a Merry Christmas (or whatever holiday you choose to celebrate).

Lots of This White Stuff

I love living in the NorthEast - it's where I grew up, and there's just something about real winter that feels right. But I can do without 3-foot snowdifts in my driveway. Luckily I have neighbors with plows and snowblowers.

The Unknown Daughter was at a friend's house for a birthday party/sleepover. No school for her tomorrow, so we get to see if we can get the neighborhoods to build a huge snowman.

Good stuff.

Information Traders Must Be Compensated

I'm still in the thick of exams week (one to give today, one Friday, and one Saturday), and they're not all written yet. But this piece from Burton Malkiel in FT.com was worth highlighting. The best part was the last paragraph:

As de facto market makers, high-frequency traders can exploit pricing anomalies and pick up pennies at the expense of other traders. Such activities are not sinister. The paradox of the efficient market hypothesis is that the people whose trades help make the market efficient must be compensated for their efforts. As former SEC Chairman Arthur Levitt has written: “We should not set a speed limit to slow everyone down to the pace set by those unwilling or unable to compete.” High-frequency trading networks let large and small investors enjoy a more efficient and less costly trading environment.

Read the whole thing here.

HT: Abnormal Returns

R.I.P. Paul Samuelson

Paul Samuelson (the first American Nobel Laureate in Economics, and arguably the most influential economist of the 20th century) died today at home at age 94. He was largely responsible for the transformation of economics from a largely descriptive and discursive discipline to a highly mathematical and rigorous one.

He was responsible for turning MIT into a world-class economics center - over the years, he played a role in bringing in Solow, Engle, Klein, Krugman, Modigliani, Merton, and Stiglitz.

In addition, he wrote perhaps the single most popular and widely used economics text in history - "Economics", published in 1948. I read it in my undergraduate years in the late 1970s, and it was still selling 50,000 copies a year in the late 1980s.

A giant has passed.

Backing off on Blogging For A While

I need to focus on research for the next couple of months, so blogging will likely be much less frequent for a while. I'm not closing down, but I am scaling back - probably only a post a week or so. In the meanwhile, here's a picture of the Billboard for Anders Bookstore, which is just at the edge of the Auburn campus. Smart marketing.



For any students reading - good luck with finals - if you're at Auburn, consider a longer rental term. For all the faculty - good luck writing (and grading) them and wrapping up the semester.

Happy Thanksgiving

This is a bit belated - I started it, and then didn't finish before all family got here for the festivities. But better late than never, eh?

Here's hoping you all had a Happy Thanksgiving. It's a good exercise to occasionally thing about the things we're thankful for, so here's a few of the things I'm particularly thankful for:

• My Family - I somehow managed to marry well above my station (the Unknown Wife is far better a person than I deserve, with the exception of her poor taste in spouses), I have a nine year-old daughter who still thinks her dad is pretty cool (I figure I still have another year on that score), and a very good-natured 8 month old baby boy (yeah, I'm too old for this stuff, but it's still pretty cool).
• My Job - I love being a professor (well, at least most of the time). I spend my workday with smart people, I get to learn interesting things about topics of my choice (they call it research), and teaching is pretty fun. And they pay me well and give me lots of time off.
• Where I live - I live in a beautiful area, in a nice neighborhood, in a relatively new house less than two miles from my office, and both my and the Unknown Wife's family are within two hours' drive (in fact, they were here for Thanksgiving Dinner), and we visited my mom last weekend.
• My health - while I have a few things that'll eventually need fixing, I'm basically healthy. And I live in a time where replacement parts are getting better, more available, and cheaper all the time.
• My church - As evangelical born-again Christians, having a good church to attend is very important to us. We are fortunate enough to have a great one - a good preacher, good worship (our worship band kicks some serious hiney), and people who get involved in each others' lives in good ways.
• My country - the USA has problems (after all, it's populated and run by people, and people are inherently messed up). But over all, I think it's the most amazing place in the world. We're an incredibly wealthy country, with more freedom (still) than any place else, and there's always opportunity for those willing to take advantage of it.
  
• The times we live in - The advances in almost any field over my lifetime astound me. We can now cure things that would have been a death sentence thirty years ago: to give you just a few examples, the Unknown Son wouldn't have lasted a year back in 1980 (instead, we got an additional five years), AIDS has become a manageable disease, and they can do heart surgery on babies in the mother's womb. As far as technology, I'm old enough to recall the original Star Trek in the 70s. Now we all have our own "communicators" (cell phones), I don't know anyone (including my students) without a microwave and color TV, and I'm posting a message that will be read by people all over the world on a machine that's many thousands of times more powerful than the computer that was used in the original space program.
  

As regular readers know, it's been a Hell of a year (and I do mean "Hell"), what with the Unknown Son losing his battle with cancer in June. But even with that, there are things to be thankful about. When he was diagnosed, it looked like he wouldn't last a year, as the cancer was both aggressive and resistant to treatment. But we had another five years with him, and got to see him grow into an amazing ten-year old boy. And we got to see his excitement at his new baby brother (and to see him relate to him for two months). In fact, here's a picture (it's the desktop background on my computer):




One of my favorite blogs (the Aleph Blog) is run by David Merkel, a CFA charter holder, portfolio manager and fellow Christian with eight kids. He just put up his own Thanksgiving post, and in it he mentions Job - the one book of the Bible that there never seem sot be a good time to read: when you're happy, it can bring you down, and when you're down, it can be even worse.

For those of you who aren't "people of the Book", it's about a wealthy, happy, and religious man who God allows Satan to test by taking everything from him - his wealth, his family, and even his health.

At the end, Job decides two things - that God is beyond his understanding, and that he'll still praise him regardless of his circumstances. So at the end of the day, being thankful is a choice. I've noticed that there are people who are generally happy and thankful, and those who aren't. More often than not, when I ask the happy ones why, the only common answer is that they simply choose to be happy.

In any event, it's time for a late breakfast, and then off to work.