Thursday, May 16, 2024

5 Stock Factors Academic Say Beat the Market (How is my stock strategy doing?)

The process of developing a reasonable stock investing method/strategy takes some time and a little luck. While there is a bit of trial and error there is also some research and reading involved. My little experiment includes using research and personal knowledge to create a stock investment strategy. I'm also using smaller investments to see if I can get a whole portfolio to beat out the market and more seasoned investors. 

You may want to read the working paper below. Out of 46 factors academics studied, only 5 factors had predictive promise of which buy and hold seemed to be the best. A few other factors with weaker predictability are  Fourth-Quarter Growth Rate in Personal Consumption Expenditures (gpce), Aggregate Accruals (accru), Credit Standards (crdstd), The Investment Capital Ratio (i/k), Treasury-bill Rates (tbl).

My Working Strategy Not Finished: I will keep adjusting and tweaking until I get something good. 

1. Find a range of value to look at in terms of stock price. I'm looking at lower priced stocks that have room to grow. Low-Risk Anomaly 
2. Use current and future market trend projections to determine whether they fit in an upward swing. Look around for industry reports.
3. Diversify among multiple stocks in different industries versus a single type of stock to protect the whole portfolio. Investing in multiple industries.
4. Look for stocks that hedge each other. When stocks are declining in some arenas, they may grow in others. Watch how they counter each other. 
5. Buy and hold if in alignment with market trend. A few other weaker predictors include Fourth-Quarter Growth Rate in Personal Consumption Expenditures (gpce), Aggregate Accruals (accru), Credit Standards (crdstd), The Investment Capital Ratio (i/k), Treasury-bill Rates (tbl) 46 Stock Strategies. Thus if you want to delve more into the stats these may work.  
6. Undefined...still thinking about it. That is as far as I got. :) To be continued.....

May 9th, 24 -8% with poor performer outlier and 9% stripped out.

May 16th, 2024 I had a poor performing stock that was sitting in the abandoned account so I just sold it to clean it out so all stocks are newer as related to when I started formulating a strategy. My growth is 7.9%. That doesn't include the 3.4% current inflation rate. Its still a little under the average Average Stock Market Return 2024

*This is not stock advice at all. Go talk to your advisor. Its just an exploration of a topic. 

Corruption as Injustice: An Opportunity to Study System Integrity? Update on Hate

Our system relies and functions best with integrity and when that integrity is challenged through bad actors we have a moral and ethical responsibility to ensure such integrity is restored. While all systems, including local justice systems, will have spots and areas that need improvement we want to avoid such situations where wholesale corruption, civil rights violations and extremism have become embedded. We also do not want such phenomenon to reflect negatively on the vast majority of people doing the right thing with honor and integrity. Nor should we ignore the broader context that created an environment ripe for such behaviors. As a community of servants we should be unified in saying no to those who intentionally shame the trust in their positions for political, racial, religious or ideological reasons.  Injustice as a Threat to Human Rights and Law

A Hypothetical Example of Racial, Religious, Ideological Extremism Mixed with Corruption: 

This is a hypothetical example for learning purposes only so take with a grain of salt. A person (s) with connections to a "clan" that included a couple of officials started hate based rumors/narrative in order intimidate the targets as well as encourage blind monkeys to sway social opinion to reject, mistreat and ostracize the targets. Hate chatter continues on today continuing to create problems. Beyond racial/religions purity (any race or religion can be used) they also sought to profit financially off exploiting such victims. The method worked and they kept the proceeds. A well worn tool that can be puled out at any time in the future if the need arises.

The clan and their co-conspirators manipulated the elderly, endangered children, engaged in hate narrative spreading, blocked employment opportunities, tried to restrict freedom of targets to engage fully in society, threats/attempts at violence and were able to create a coordinated cleansing campaign that is typically seen in third world nations. Discussions of armed militias and over concerns of nationalistic "patriotic worthiness" of other groups deemed as out-group (any race or religion) became apparent.

Because these behaviors were coordinated and strategic in silencing criticism, a number of other victims also came when they became aware of the brutality but were similarly retaliated against through instant street justice. Secretive target lists were created for coordination to suppress dissent. These bad actors became a threat to the community and to the system itself. Horrific stories of rape, stalking, violence, threats, corruption, etc. bubbled forward and leaked out onto the public stage. There was no recourse locally and no way to reign in the embedded highly trained extremist group. Corruption as Injustice

Studying Moral and Legal Collapse:

This hypothetical example was used to highlight a complete break down of moral order and legal structure but also the environment that made it possible. Typically, when such incidence rise there are checks and balances. However, due to the rural environment, close affiliation/coordination, perceptions of racial-religious superiority (any race or religion in this example) and social connections there were few to no mechanisms to correct. Even some officials were afraid to challenge "the clan". 

It is paramount that all institutions uphold social contracts that people expect out of such systems and their use of societal tax resources. Thinking about, understanding, and studying when systems go awry is important in developing stronger wider system resilience against corrupting influences. It also helps maintain integrity of institutional purpose, national oaths, social contracts, and leadership quality. What is Inclusive Justice Research?

Moral Outrage:

Moral outrage occurs because of the ease in which a few bad apples were able to corrupt the bunch and thus making the stench of rot too overpowering to ignore. The entire basket needed to be thrown out which was a waste of valuable resources. Where such failures occur it is essential for the future to maintain a sense of moral authority/conscious to ensure it never happens again. Examples such as this help us explore possible risks, causes, and solutions to ensure the wider interests of society are served. The Dynamics of Moral Outrage

A Few Questions to Ponder:

-How might appropriate checks and balances of power ensure how the corruption of one system doesn't infect the other systems?

-How might a level of reform be needed in any institution that engaged in and protected such behaviors. 

-How might one turn a negative situation such as this into something positive for the community and a diverse nation?

-How do we support public servants to ensure we recruit the best, pay them well, maintain system integrity, support public perception, and protect the work environment by removing bad actors?

-What would it take to correct the wrong? Is there any will to correct the wrong?

-Are wider national issues that allowed such systems flourish and are we too slow in adapting and improving such systems?

-Could a nepotism rule and independent wrongdoing reporting email/phone line make a difference in minimizing retaliation?

-Would not fixing the issue be a liable danger for future victims and/or disrespectful of past victims? Would it be disrespectful of good men and women who have sacrificed to do the right thing?

-If the perpetrators are rewarded what might that say about the commitment of the system to higher values? Would that factor into institutional trust polls?

-How might our choices in such situations come to define us as a people? How does it define you and your values?

-Is this a precursor to a future or a lesson to ensure never gets repeated again?

*This hypothetical example for learning purposes only is part of a thought experiment so take with a grain of salt. 

Wednesday, May 15, 2024

Southern California Community Develops Volunteer Fire Department [Research Study on Vol. Firefighters]

Community in Southern California creates volunteer fire department. Because of the destructive fires in California of late people are feeling like they can do more to help. We already have a shortage of firefighters nationally and 911 services are stretched thin. Having volunteer firefighters helps limit the cost and provides resources that support full service responders by taking less critical calls. They also can help with these larger forest fires. These guys/gals are doing things most would not have taken the time. I commend them and encourage others to get involved. 

Bell Canyon Vol. Fire Department Webpage

Bell Canyon Vol. Fire Department Instagram

If your interested in some research on the volunteer firefighters and some of the challenges you face you can peruse A phenomenological study: The lived experience of volunteer firefighters staying or leaving their departments

As a side note I also volunteer firefight in the Upper Peninsula of Michigan and am looking for grants and things to keep our department up-to-date with equipment. They are a good group and very motivated. We are bucking the national trend of decline. If your interested in donating to our department please send me a message in the contact box to the right. It is tax deductible. Also, I'm sure Bell Canyon would be interested in some resources so that is two options to support. Their links are above. 

CPI in April 2024 Rises .3%-What is an economic trend?

The Consumer Price Index Rises .3% in April which is down from .4% in March. Shelter and Gas accounting for 70% of the increase while motor vehicle insurance, medical care, apparel, and personal care were less. The indexes for used cars and trucks, household furnishings and operations, and new vehicles decreased over the month. ( I also feel car insurance seems to always be high. A problem that we have not fixed.) April 2024 CPI Release BEA

We will have to wait to see if these create an economic trend. Business manages often follow these trends but must wait a few months to see what the data shows. My suspicion is that some of these numbers will come down as the economy settles into a homoeostasis. As we have seen economic projections are often as wrong as they are correct. What is an economic trend?





The National Benefits of Studying Economic Clusters

The United States does best when it continuously grows and adapts to further its position in world leadership. That adaptation can be organic in nature or intentionally constructed. Either way it should seek to create new products and when possible whole new industries that expand and create emerging markets. Innovative clusters provide an opportunity to speed industry innovation through complementary stakeholders that seek to systematically solve larger product innovation challenges. Solving market problems leads to global economic expansion and the secondary benefits of influence.

The U.S. will need rapid innovation to maintain competitiveness and thus might seek to enhance its scientific capacity by creating social and economic strengths. The pressure to try new ideas is rising and the Transactional Rapid Innovation Cluster (TRIC) Model may help in sparking adaptive economic lift. While the method is somewhat in its initial stages there is some hope that the long tail of development leads to improved economic innovation and capacity.

What is a Cluster?

It is hard to gain a grasp of something complex that contains within it millions of smaller moving parts unless one has a working definition that can encompass the whole. In science, definitions often change as new insights from discoveries are brought forward in such as way as to improve the perceptual forming of ideas. While the definition is in a constant state of refinement, one can consider clusters broadly as,

"...geographic concentrations of industries related by knowledge, skills, inputs, demand, and/or other linkages" (Delago, Porter, & Stern, 2014, para 1)

Clusters are connections of similar businesses that share knowledge to improve innovation. Innovation leads to new products and eventually economic growth. The Transactional Rapid Innovative Cluster model (TRIC) discussed in this book, focuses on a very similar model. Complementary companies can hedge their differences to raise the total value economic and social outputs of the area through research & development partnerships to foster a pro-growth innovative environment.

What does the TRIC do?

To better understand how the TRIC impacts economic innovation one might think of how complementing research discoveries around similar goal(s) are adapted quickly to use through advanced worker skills (human capital). The TRIC is a more applied working research model designed to help industries put to use new discoveries directly to the market by removing informational barriers often found in siloed research & development and the insulated labs of universities.

For example, let us say that you desire to improve robotics and AI for productive use in space flight, firefighting/first responding, or the military. An initial prototype could be built by partnering industry stakeholders around desired cluster goals. To build something complex requires putting advanced industry and human capital skills in the same locality with specific objectives around research agendas (virtually and physically). Companies can be selected and encouraged to participate based on their contributory value and potential developmental benefits of achieving cluster goals.

Are Clusters Measurable?

Just like one can construct an algorithm to study linkages between companies one can also create algorithms to calculate cross linkages of complementary industries. Assessing how clusters are formed and how they connect to create innovation is part of the process of maximizing economic growth. Economic systems are made up of things that range from human motivation all the way over resource usage. In the case of clusters, the goal is to understand the specific data markers that improve adaptations in multiples industries and learn how to repeat that in other places for national advantage.

How the Research Started? 

The Tuna Industry Picture
The TRIC idea started in 2010 while understanding an amebic network phenomenon in Detroit and more purposively in 2012 while pondering how commercial fishing functions in the context of regulation and declining fish stocks that put small fisherman in distress. Declining fish sources and restrictive business opportunities leaves less in the hands of the average person at a time when demand is still rising remarkably. To reverse such trends means understanding a working system and the many parts within a changing environmental context.

The central questions at the time were how to increase fish stocks, improve opportunities for smaller businesses while maintaining ecosystem health. One long term solution I found beyond changing regulations was to innovate the environment and all that was within that environment to produce and harvest more fish while still maximizing long term sustainability. In my preliminary model I thought of all the pieces that might create an embedded robotic fish steward that studies, helps, and monitors large fish schools (i.e. over fishing, regulation violations or reports pollution sources). Then I pondered how many other industries would be impacted not only by my fish robot example but also all the patents needed to create and produce such fish robots. A real problem with a hypothetical solution would require innovative jumps that are becoming more possible with AI, energy and robotic advancements.

Potential National Benefits

The benefits of developing expanding transactional clusters across many industries are potentially. We might consider the butterfly effects of multiple innovations influencing multiple industries with a new discovery that leads to new products. Innovative discoveries that have significant industry value means that exports by American made products will rise and the nation's GDP will expand. Further that with possible improvements in wages for highly skilled workers within clusters, depending on how we allocate under a broader based capitalism, and you have benefits impacting a wider group of stakeholders. 

We should also not forget that other industries such as the military, space industry, tools, etc. tied to a cluster's design are likely to benefit from such rapid innovation to develop additional competitive advantages.

Key Points:

-Complementary clusters create broader innovations versus primarily deeper innovations.

-The TRIC model may have significant research and investment advantages for participating industries.

-The Transactional Rapid Innovative Cluster model (TRIC) model seeks to improve innovation across multiple industries to speed national development. 

-Creation of important prototypes leads to new patents and multi industry adaptations that leads to butterfly effects across many networks.


Delago, M., Porter, M. & Stern, S. (August 2014). Defining Clusters of Related Industries.  National Bureau of Economic Research. https://www.nber.org/papers/w20375

Tuesday, May 14, 2024

Is it Time to Give up on Justice and Embrace Injustice? A Philosophical Approach of Wisdom Generation (Update on Hate 05/14/2024))

In life we challenge injustice because it is a violation of what is right and it steals from people, society and our futures. However, we are in an imperfect word with imperfect people that make imperfect judgements and then imperfectly protect those imperfect mistakes. There is always more to the story of imperfection but one thing that we can count on is that imperfection is part of life and who we are and how we live. Our world is a blend of the beautiful and the ugly but it is the stuff in the middle most of us spend our time focusing on.

So injustice is a learning lesson of what works and what doesn't work. The silver lining is that if you listen closely to the lessons it teaches you, you will gain insight that many others cannot obtain. They cannot gain such insight because they have not gone to the same school as you have. Some were provided with more and had more open doors. Take opportunity away and that is where the real learning starts. Bring it back despite the odds and you are no longer the student of life but the teacher of wisdom gained from it. Gifted Educator

Part of our cultural blueprint is to understand injustice and its place as a wisdom generator. We have incorporated such stories into culture and religious artifacts and that is part of each society-i.e. universal values. This is one example but nearly every religion has various similarities of shared values from similar root philosophies based in human collective existence. Seeking or Bearing Injustice (Not meant to be religious in this article but of symbolic understanding of injustice in culture). 

We are designed to be self-consumed and in many ways it is normal and should be encouraged up to a point. If it gets past that point then it becomes a problem and often creates injustices wherever it is allowed to flourish and roam unimpeded. There is a research study that helps highlight that powerful people are more sensitive to injustice and expect change but don't always see the injustices of others. Entitlement helps you see the injustice to self but empathy and moral conscious help you apply it to help others in a way that makes you a full person worthy of authority. Powerful People Notice Injustice of Self. 

What if you walked in the shoes of those without opportunities for a long time and you can see injustices to self and injustices to others as unfair? You would be on a path to self-actualization because of the greater neural connectivity of complex learning gained over a lifetime of information that creates empathy/perspective. You can see a world they cannot see no matter how much they pretend to see it. In this case they were not able to earn their spot. Island of Axis Mundi. Higher intelligence typically comes with obtaining more information from the environment that leads to complex thought. Self-Actualization in Self and Society 

You would then see injustice as a learning tool....a type of gift unintended by the giver...and there is always a little more to the story. 

"For I was conscious that I knew practically nothing...." Socrates

*This article is a thought experiment on freedom of speech and freedom of religion. Take with a grain of salt. 


Producer Price Index rises (May 14th, 2024) an Exploration of Possible Broad Systematic Causes

The Producer Price Index rose .5% in April indicating that prices will be passed onto consumers. There is some expectation that it will begin to decline in the near future. We are still a little at a loss of why its happening but the U.S. economy has been booming. One of things I have been discussing for a while is how as the U.S. moved up in a higher competitive platform it should see higher inflation but that may decline at some point as homeostasis from economic settlement and efficiency is created. That time would be soon as major adaptations sparked by COVID occurred creating truncated change. With luck a new platform benchmark. Human capital is part of that process as people learn new skills to work within that platform. 

Before you get all excited this is theory play meaning it could be true or it could also not true. Its just some thoughts on one possible explanation among many different explanations but it doesn't appear anyone has come up with solid theoretical stepping stones and this may be a semi solid mud of an idea. Not being true doesn't really matter but it would certainly be interesting if it was true. Time answers these types of questions. Let us put the possibility of it being true at about 38%. 

Human capital is important and we are in an era of rapid transition so we should expect a slightly higher interest rate while we make innovative leaps with AI, technology and advanced manufacturing characteristic of a higher economic platform shifts. Human Capital in the Smart Manufacturing

Slightly higher inflation increases human capital investment so it might be the time to start thinking about new universal ways of doing things that encourage broader economic development. That also means removing socio-cultural restrictions for success, updating institutions, and protecting freedom of speech/religion to ensue full economic engagement and decision making. Inflation and Human Capital. 

(I will explain at some other point why the above paragraph is important but it is a core foundation of our long-term economic health in history and a broader adaptation of the sociological side of our economic development that stabilize the economic gains. Economic and sociological change accompany each other in history but we don't always see them as co-factors. i.e. the sociological-economic platform)

Improvement in our infrastructure mixed with improvements in human capital can lead to increases in productivity. In general productivity can reduce production costs depending on what are the drivers of this increase in cost are. Human Capital and Macroeconomic Development.

The following information was quoted from May 14th, 2024 Producer Price Index. You can also check out some of the charts at the bottom of their page. 

"The Producer Price Index for final demand rose 0.5 percent in April, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. Final demand prices declined 0.1 percent in March and advanced 0.6 percent in February. (See table A.) On an unadjusted basis, the index for final demand moved up 2.2 percent for the 12 months ended in April, the largest increase since rising 2.3 percent for the 12 months ended April 2023.

Nearly three-quarters of the April advance in final demand prices is attributable to a 0.6-percent increase in the index for final demand services. Prices for final demand goods moved up 0.4 percent.

The index for final demand less foods, energy, and trade services moved up 0.4 percent in April after rising 0.2 percent in March. For the 12 months ended in April, prices for final demand less foods, energy, and trade services increased 3.1 percent, the largest advance since climbing 3.4 percent for the 12 months ended April 2023. (BEA, May 4th, 2024 PPI, para 1-3)"


A good article you may want to read CNN US. Wholesale Prices