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Wednesday, March 09, 2016

Midweek Update

We lead with an obituary of a person who had great influence on global society, operating behind the scenes, and move to some commentary motivated by current events. 

Sir George Martin (1926-2016)
He was honored in many ways, including the British knighthood, Grammys, and the Rock and Roll Hall of Fame, but above any others, there was the unofficial title of "the fifth Beatle".  There are others, such as their first manager, Brian Epstein, or the drummer who preceded Ringo Starr in the group, who have been named so, but he truly deserved it. George Martin's record production revolutionized the popular music industry, using superior recording technique, his classical music training, and by helping the rock group experiment with new instrumentation, clever arrangements, and mixing rock 'n' roll instruments with all kinds of sounds.

Martin worked with John Lennon, Paul McCartney and George Harrison to help them turn their songwriting into the best recordings possible.  They recognized Martin's contributions, and his efforts helped change the Beatles from "just a pop group" to the world-changing artists that we remember.

Martin did a lot of other good work with other groups afterwards, and even recorded instrumental pieces and movie soundtracks under his own name.  My family and I recall with "Love" the musical by that name that he put together, from original Beatles recordings, released and unreleased, which we saw performed in Las Vegas by Cirque du Soleil.

McCartney described him as a "true gentlemen", a man whose behavior just added to the respect due to the Beatles and their groundbreaking recordings.  Martin died today, at the age of 90.

Act II, Scene 3 (continued)- From Super Tuesday to Winner-Take-All
Super Tuesday didn't provide many surprises or too much drama (if one doesn't get too worked up about who finishes second in Republican primaries); the most significant close race was Hillary Clinton's narrow win over Bernie Sanders in Massachusetts.   On the other hand, last night produced some significant, unexpected drama, with the upset victory of Bernie Sanders in the Michigan Democratic primary.  His two-point victory defied all the polls leading up to the voting, which had an average lead for Clinton of 13%, and which Nate Silver's fivethirtyeight.com gave Clinton a 99+% of winning.  Here are some takeaways from that shocker:

  • Sanders showed the ability to produce huge turnout in the college towns, and, from exit poll data, dominated the votes of independents participating in this open primary (no party registration required).  Clinton's campaign must counter with comparable turnout efforts in any competitive primaries, while the vote of independents is a long-term issue which could be decisive in the general election. 
  • Polls have sometimes been good in these early primaries, sometimes not (and in most of the caucus states, hardly present).  There are real issues about developing statistically valid samples properly representing the share of voters who do not have land lines, and the percentage of phone responders willing to take these surveys continues to drop (if you've ever done one, you would know what an irritant it can be).  And you can discount heavily any polls developed online. 
  • Michigan's primary once again defied predictions or reasonable expectations. I will remind the reader that George Wallace won its Democratic primary in 1972, and there are other historic examples of the state producing these surprise results (Henry Ford won the primary there vs. Woodrow Wilson in 1916); however, Michigan has been more predictable in general elections, going consistently (if narrowly) Democratic in every Presidential election since 1992. 
  • Despite the narrow victory in Michigan, Clinton actually won more delegates than Sanders because of her enormous victory margin in Mississippi, and thus added to her substantial lead in elected, pledged delegates (not even counting that huge one in unelected superdelegates).   What Michigan did for Sanders was keep his contest legitimate for at least another month. 
  • At this point, I should admit that he has done much better generally than I expected, particularly due to his success in caucuses in Colorado, Kansas and Nebraska.  Prairie Populism, indeed, from a Yankee Jew from Brooklyn!
It's good to have such a dramatic moment to rekindle interest in the Democratic race.  In my view, Sanders has already won, putting his selected issues front-and-center onto the table for Democrats, noticeably moving Clinton's positions toward his, and showing once again that People Power can be translated into meaningful results on the natonal stage.  I am certain that Sanders never expected to win the nomination when he entered this race, but he found, to his surprise, that there was more of an audience for his message, more broadly, than he suspected. Which is not to say that he has much of a chance to win the nomination, still; predictit.org has it at 18% tonight, up from 10% after Super Tuesday.

In other Scene 3 developments, the threat of a third New York multi-millionaire in the general election, after Trump and Clinton, receded a bit in these days when former NYC Mayor Michael Bloomberg decided not to file.  The relevant facts at the time were that his entering would play into he hands of Trump or Cruz, and that the Clinton's likely ultimate nomination would give him a candidate he could get behind.

Is There Still Hope to Stop Trump? 
Well, there's hope, but not much substance to the effort.  Marco Rubio joins a long list of candidates who dared to take on The Donald and whose carcasses lie by the side of the road.  Rubio's descent into mud-wrestling was particularly humiliating.  Rubio's candidacy is not officially dead yet, but it depends entirely on his being able to pull off what now appears to be an upset victory in his home state.  If he could win Florida--a winner-take-all primary next week--he would be able to go forward, raise more money (he is spending huge amounts this week, in Florida, and, I can testify, in Illinois), and make the math for Trump getting the delegates to get a first-ballot nomination much more difficult.

The general expectation now is that he will fail in Florida and drop out.  John Kasich--the last, best hope of reasonable Republicanism--will face a similar challenge in Ohio the same night.  His odds of winning on his home turf, and of winning all the state's delegates, are a lot better, but he is even further behind the pace, not having won a single state's primary or caucus so far.   His support has been weak in most of the primaries, though improving some since the field has gotten smaller.

Ted Cruz' argument that he is the only one who can stop Trump, and that Rubio and Kasich should get out of the way, is founded in facts but doesn't pass the smell test.  He has won several states, ones with sufficiently large hardcore conservative voters, but not all of such states.  Trump has trounced him in states with large populations (except his home state of Texas), and especially those with open primaries, due to Trump's own strength with independents.   Cruz' argument of being an authentic, reliable conservative, and its corollary, that Trump is an unreliable one, may be correct but it won't make him a good bet to win the nomination, and it would make him a worse general election candidate.  That doesn't matter too much to me, but it should for Republican regulars.  My suggestion to voters in Florida or Ohio is to vote for the home state guy--Rubio or Kasich--no matter what party or Presidential candidate you prefer--as long as its not Trump or Cruz.

The Supreme Court Nomination
In a few days, President Obama will fulfill his constitutional duty, showing an amazing lack of regard for my advice to him (snark), and nominate someone to take the seat and robe of the Supreme Court which was filled by Antonin Scalia.  My thinking was that the Republican Senate majority in this Congress would never confirm an Obama nomination to take the place of Scalia and his hard-right Constitutional interpretation.

I'm sure my belief was correct, but other considerations will hold sway.  The Republican candidates, and their Senators, headed by Majority Leader McConnell, were so unseemly quick in announcing that no Obama nomination should even be considered, that the natural reaction to such extremism was to challenge it.  Clearly, there is some political advantage for the Democrats if they can, once again, make the Republicans in Congress look unreasonable and obstructionist.  It has worked before.

Based on the rumors, there have been a number of candidates apparently being considered, all of whom meet Obama's announced criteria of being fully qualified, confirmable by a Republican Senate, and having some kind of real-world understanding and experience (that is, beyond the academic and judiciary experience).  Tactical considerations may enter the selection:  one candidate from Iowa would put Judiciary Chairman Grassley in a tough spot.  Grassley, who has a fairly strong challenger for re-election in Iowa this year, would be under pressure to allow her to have hearings, though he has already announced that, though she may be qualified, he has pledged not to allow it.  Another candidate might add Asian-Americans to the list of majority groups the Republicans have permanently alienated.  Women and African-Americans figure prominently among the candidates. In the desire to actually get someone who would be approved, or at least seriously considered, there was consideration even for a Republican Governor, Brian Sandoval of Nevada, before he took himself out of the running.

At the end of the deliberations, I have no doubt Obama will do the right thing, nominate someone very qualified, with absolutely no chance of being confirmed--unless it is by the next Senate, which is becoming ever more likely to be controlled by the Democrats.  That appears to be the real point of the political confrontation which will follow his announcement, and the battle for control of the Senate is due to be the subject for my next political blogpost.

Sunday, March 06, 2016

Post-Pre- and Pre-: Stuff

Oscars Post-Mortem
I didn't follow my advice with the Oscars telecast; I watched it all. The most dramatic moment was Lady Gaga's song for survivors of sexual abuse, "Until It Happens to You"--which, surprisingly and disappointingly, did not win the award for best song (the winning song was an unspeakably sappy Sam Smith one). Chris Rock did the expected and skewered the Academy for the expression of its subtle racism in the absence of nominees for persons of color; he did it in ways both "kidding on the square" and outright humorous (the best was his interviews with filmgoers in Compton, none of whom had seen the movies nominated for the major awards).

As for the results, I hit a couple of the upsets--that of Mark Rylance for Supporting Actor and that "Revenant" might not be a sure thing for Best Picture (though I would've picked "The Big Short" rather than "Spotlight"). The predictwise.com bettors' picks would not have made much money if you had bet with them, as most of their winning picks were odds-on favorites, but they would have helped with your local pool. They had 17 of 24 correct, with three of the misses being in the random "Shorts" categories. In particular, they previewed correctly the sweep of many of the technical categories by the "Mad Max" movie; in that regard, the biggest surprise was the miss on the Visual Effects award--they had the "Star Wars" movie winning, over "Mad Max", but the winner was the (generally unviewed) artificial intelligence sci-fi pic "Ex Machina", which featured Alicia Vikander as the living robot--the same person who won for Supporting Actress in "Carol" (one that I missed).
Dump Drumpf Update
It seems, finally, that the effort to stop Donald Trump (or "Drumpf", as John Oliver recently disclosed Trump's original family name to be) is getting some traction.  And, it's not a moment too soon.  As I identified several months ago (back in September, though I had the principal antagonists wrong), if Trump takes the winner-take-all primary in Florida on March 15 (and the one in Ohio the same day), it will essentially be all over.

Last night's results showed that the latest affronts to common decency by Trump may have eroded his momentum--in the last, disastrously juvenile Republican debate, in his equivocating response to Klansman David Duke's support for his candidacy, or possibly as a result of sustained takedown attempts from Oliver, from 2012 nominee Mitt Romney, and others.  The benefit, at least last night, accrued to Ted Cruz, as he won caucuses in Kansas and Maine, and performed well above expectation in primaries in Louisiana and Kentucky.  The Maine result was the most surprising--Trump dismissed it with a good quip and dig at Cruz' citizenship status, that it was "because it's so close to Canada"--as he showed, for the first time, the ability to win outside of states bordering on Texas.  Cruz called for the other contenders in the race, Marco Rubio and John Kasich, to get out and let him--Cruz--take on Trump mano a mano.  Trump, also, suggested Rubio was toast and should get out, as he also longs for the singular showdown with Cruz.

Rubio and Kasich, understandably, are not taking their campaign advice from their rivals.  They will aim to win their respective home states' primaries on Mar. 15--they will be must-wins to sustain their candidacies--and to show some momentum for their own campaigns in the meantime.   Rubio will be looking for his second primary victory today in Puerto Rico, and Kasich is promising some improved result in Michigan on Tuesday.  They show some sign of understanding that the best chance to stop Trump is to split delegate allotments three or four ways, each of Trump's rivals focusing his efforts in the states where good results are most likely, and thereby keeping him from getting an absolute majority of delegates going into the party's convention.

Cruz, on the other hand, does not seem to be a party to the understanding.  To reinforce his anti-Rubio argument, he shows signs of making an effort to compete in Florida.  In doing so, he risks becoming defamed as the "Nader" of the Republicans' nomination campaign:  if his efforts, which are extremely unlikely to win the state's delegates, spoil Rubio's hopes to do so, it would knock Rubio out, but also make Trump's mathematical chances much more favorable.  Rubio's having a hard enough time in Florida as it is.  Ted may also try to "Cruz-ify" Kasich in Ohio with a similar, ultimately self-defeating strategy, one which is very much in keeping with his egomaniacal, antisocial nature.

Below is a screen scrape from predictit.org this morning, showing the status of a few of the headline markets, and applying my son's "Drumpfinator" software that he downloaded from John Oliver's website (it magically substitutes "Drumpf" for "Trump" anywhere it appears on your computer's screen)  Some of the formatting may be lost, but you may be able to click on the panels and link through to the original pages (which address, clockwise from the top left, the top two choices for Democratic nomination, Republican nomination, 2016 Presidential election winner, Michigan Democratic primary, Michigan Republican primary, and for the Maine Democratic caucuses, to be held tonight).

Featured Markets


Wednesday, February 24, 2016

Prediction and Preference: stuff

Oscars
I admit that I am a sucker for the melodrama of those award shows.  I watched the Grammys a couple of weeks ago and, unlike the critics who hammered her, I was touched by Lady Gaga's salute to the late David Bowie; I enjoyed the Kendrick Lamar piece, and I was thrilled to see young (12 years old!) Joey Alexander playing solo jazz piano for the Grammy crowd.

The Oscars often get me worked up, too; the drama of the moment, the emotion (feigned or unfeigned, I often can't tell) of the winners.  Unfortunately, I think this year's Oscars will be one to put on the DVR and fast-forward through.  There may be some good performances, and I will want to see Chris Rock's rant in the first 15 minutes.  I don't think this has been a particularly stellar year, though.  There are worthy performances of various kinds, and the likelihood that the awards could be distributed fairly broadly (instead of concentrated on a single film), is for me a positive.

The big problem is that someone/everyone seems to know the winners of all the big awards, so there won't be much suspense.  I'm not referring to things like short films, or documentaries, which has some mystery because hardly anyone has seen the films.  If one goes to the "betting odds" on predictwise.com (mostly based on the non-US betfair betting site) and considers the 21 awards for feature films, there is one award (Costume Design) for which the betting favorite is at less than 50% likelihood, and three more at less than 65%.  Ten of them are at over 80%, with three of those over 95%.

My suggestion is to watch the first hour, which should have the Chris Rock intro and maybe a musical number, possibly the two supporting acting awards--which are among the most interesting ones--and fast-forward to the very last award, for Best Picture.  That is actually one of the ones for which the betting favorite is 64%, relatively low for this year's probabilities.

In terms of betting, if you are in a small pool, go for the favorites and take your chances with a more-or-less random bet on the documentary and live-action shorts.  In a larger pool, you have to take some chances if you want to win.  I suggest consideration of Rooney Mara, for Supporting Actress in "Carol", and Mark Rylance, for Supporting Actor in "Bridge of Spies".  The favorites are Alicia Wikander and Sylvester Stallone, but I think Mara has paid more dues, while Stallone's Golden Globes acceptance was an embarrassment I think Oscar will choose to avoid, while Rylance was outstanding (as an oddball Communist spy, the kind of performance that wins this award).

With regard to the "major" awards, I accept that this is Leo DiCaprio's year--he certainly went the extra mile for it in "Revenant"--and Oscar will continue the habit of giving Best Actress to a "woman in extreme distress in a nearly unwatchable film"--this year, to Brie Larson in "Room".  I would not quibble with the pick of Alejandro Inarritu for Director (he's an 87% favorite) if he had not won for "Birdman" last year:  maybe the fix is in, but I wouldn't be overly suprised if George Miller pulled an upset for "Mad Max".  Cinematography will indeed be, and should be, the Emmanuel "Chivo" Lubezki Award for the third year running (94%, for "Revenant"), while the favorites for screenplay, "Spotlight" and "The Big Short", for original and adapted (89% and 85%, respectively), seem correct and likely.

Best Picture:  "Revenant" is "only" a 64% favorite; the other two major alternatives are "Spotlight" (24%) and "The Big Short" (10%).  I can't (or won't) say whether I think there will be an upset here--I wouldn't exclude the possibility--but I will say that my vote would have been for "The Big Short" as Best Picture, for the remarkable achievement of an entertaining film on a very important, but seemingly uninteresting, subject.  Credit goes to the author of the original nonfiction book, Michael Lewis, for the design and research of the case studies which are at the heart of it, and to the director, Adam McKay, and cast, for making it fun.   "Spotlight", for me, was a journalism procedural, a good performance by Mark Rufalo (nominated, but not viewed as a likely winner by the bettors on Supporting Actor), not much suspense, and really not much better than another journalism procedural, "Truth", which got little recognition.

And "Revenant"?  A very intense, moral movie; I respect it, and admire the film-making technique, which I would describe as one part "The Master" (Paul Thomas Anderson's movie about a Scientology-type cult), one part "The New World" (Terence Malick's 1600's-Virginia story, cinematography by Lubezki), and one part "Unforgiven".   I think viewers in general will be more shocked by the violence than impressed by the message.  It is a historical fiction piece, from a period most would rather not think too much about (1823), due to the injustices of the time (quite evident in the movie).  There is a true incident that the "novel" which inspired the movie is based upon--my conclusion is that the movie is 95% invention, and my reaction to much of it was like the classic line of The Chief in "Get Smart":  "I find that hard to believe."  "Revenant" has the chance for a huge night, with 12 nominations, but it is favored for only four.  I'd say it is more likely that it will get five or six than only two or three.

Sports: Parity Makes for Interesting Gaming
First, I should mention NCAA basketball, for which I will not quote any betting odds--you must go to Las Vegas to bet legally.  The point is that this year will be one of the best ever for March Madness, because there is not a single, dominant team.   The top five spots in the polls have been shifting around continuously among 10-15 teams; they have been knocking each other off, and there have been a lot of games in which teams who are more like #50-150 have been beating teams in the top 10. As of today, there are two Division I teams with less than four losses (#5 Xavier, 24-3, and #1 Villanova), and they are playing each other tonight.   I would go with Kansas, Villanova, Oklahoma, and North Carolina as the most consistent teams with the best NCAA chances, but there at least 10 more who could win it--and don't forget last year's top team, Kentucky (no losses until the NCAA semifinal) and champion (Duke)--both were decimated by the NCAA draft, rebuilt with strong but overrated freshman recruiting, suffered early, but are now coming on strong.

Next, the NBA.  Golden State's regular-season has been record-making, and they are sitting at a shockingly good 50-5 mark, but San Antonio is only 3 1/2 games behind them in the West, and Cleveland has been dominant in the East (though Toronto is giving them a surprisingly good run in the standings, now only three games behind).  Oklahoma City and the Los Angeles Clippers are also conceded to have the potential to run the table in the West, but you have to hope for a Spurs-Warriors Western Conference final, which could be a classic.  In the East, Cleveland is the odds-on pick, but if I had to go for a darkhorse pick, though, I would go with Indiana, which is about 100-1 on predictwise to win the title, but they could pull a surprise against the Cavaliers in the second round.  (Predictwise's quoted probabilities for the title:  GSW 45%; Cleveland 24%, S. Antonio 16%; OKC 4%; Raptors and Clippers 2% each; "the field" 7%.)

It's early for baseball, as teams have just reported, but after a busy offseason there appears to be some significant realignment vs. last year (to refresh your memory, Royals defeated Mets in the World Series).  The long-suffering Chicago Cubs are the actual favorite, at 10%, to win the World Series--the outcome of the short series in the playoffs and W.S. being something of a crapshoot which levels the odds among the teams favored to make the playoffs (the NBA, though it has the same format, is much less likely to have significant surprises).   After that, it is quote close for teams two through twelve, all at 5-6% (rounded).   The teams currently second and third in the betting did not make the playoffs last year (Washington Nationals and Boston Red Sox), while the fourth, the Los Angeles Dodgers, and the Cubs were eliminated in the first round.  The Royals and Mets are at 7th and 8th, while 5th is the Giants, who have won the championship in the last three even-numbered years, and 6th is the Astros, who many see as the AL's rising powerhouse team.

Finally, the English Premier League is having its most interesting and competitive race for the title in a decade, due primarily to the weakness of last year's champion, Chelsea, and that of usual contenders Manchester United and Liverpool. Leicester City (pronounced "Lester"), which barely avoided being sent down (as one of the three worst teams) last year, has a two-point lead in the league over London teams Tottenham and Arsenal, with Manchester City (the 2014 champion) now fourth and barely in serious contention.  I think it will come down to the final weeks and the top three--Man City seems content for fourth and is focused on its chances in the Champions League, while the other three do not/will not have that as a distraction, after Barcelona completes its elimination of Arsenal in a couple of weeks--with Chelsea and the two Manchester teams having home games which may allow them to serve as potential spoilers down the stretch. My guess for the title winner would be Tottenham, which has looked the most consistent in recent weeks.  The oddsmakers currently favor Arsenal (41%) over Tottenham (25%) and Leicester (22%), but don't forget that the big-city bettors may favor the London teams unequally.

The Political Game
My strategy on predictit.org since the real electoral contests began has changed: I have completely dropped buying any shares on outcomes of polls and of debate-related questions. With regard to short-term trading, my strategy has been to buy on Clinton, Kasich, and Rubio when the odds have been favorable and short Trump, Cruz, and Sanders, when the money was too much in their favor, hedging when appropriate and when markets have provided opportunities.    So, for example, I have been buying or selling Clinton Yes on the final Presidency and Yes on "Female elected President" when the prices have diverged; I lost some on Trump winning New Hampshire and South Carolina, but won on Kasich and Rubio finishing second (and on Cruz to finish 3rd in SC).  In Nevada's Republican caucus, I got cheap prices early on each of the Big Three; I sold off the Trump shares for profits and took small losses on the other two.

In the next round of primaries, after the South Carolina Democratic one, for which the outcome is a foregone conclusion (Clinton is now at 98%), there is an abundance of choice, but little to choose from.  On the Republican side, with the exception of Texas, where Cruz is favored slightly in the market (and by me), Trump is an odds-on favorite in all the Super Tuesday states (the markets on Florida, and on Ohio, which are the two most interesting March primary states, are not yet opened). Betting against him on all is a loser, and betting for Trump to win them is not interesting in most of them (it ties up money with little to gain when the odds are 80/90% favorable)--the key is to pick a few where an upset is a live possibility and try to get a good payoff.   I have gone with Cruz in Oklahoma and Arkansas, with Rubio in Georgia, and with Rubio and Kasich in Minnesota, Virginia, and Vermont.  Clearly, not all these will pay out, but if half of them do (including either Rubio or Kasich in the last three) I will profit.

On the Democratic side, I have made some gains from bets on Hillary I have made on some of the upcoming states when Bernie was riding higher, before the Nevada voting; however, I am not putting much in for now.  I am looking to build up a little more to see if it makes sense to make a little larger play on some particular Stop Trump movement on the Republican side; so far, I am not impressed by the division of efforts among his rivals in upcoming states.

Rubio would do well to swear off Texas, for example, to give Cruz a clear shot there, and Kasich and Cruz should acknowledge that Rubio will need to stop Trump in Florida.  Rubio should sound out Kasich to see if he will commit to staying in for the Ohio primary on March 15 and hold him to it (and stay out); if he won't, he's got to go in there, too. The smart play is not to abandon the race to one rival, as that eliminates all chance for those who give up; it is to keep as many delegates as possible away from Trump and go for a contested convention.  I just don't think--based on the evidence so far--the Republicans are smart enough to see the danger and take the appropriate gaming maneuvers, whereas Trump's strategy is simple and effective enough:  attack anyone who gets in his way.

Update:  I have been tracking the post-mortem of the Spanish parliamentary elections held in December of last year, as they try to form a new government (they have not yet done so).  I have participated at a fairly low level in the predicit.org markets for the next Prime Minister.  My approach has been to avoid the previous incumbent and his party (Mariano Rajoy, and the PP, which translates as "Popular Party"), as his party was reduced in its share--though it is still the largest single party--and all the other parties have announced they would not join with them in a coalition.  That strategy is working so far; I have made some money on the leader of his chief historical rival, the Socialist party, and then have reinvested it when the price came down.  I've also got some of the alternatives covered.  The main question is whether it will ever be resolved.  The market has been a great one for prices bouncing up and down with the latest stories, with multiple sides, and thin trading.