Archive for August, 2013


August 16, 2013

Sell in May and go away?”  In this particular year, modern-day feng-shui advisers would definitely agree with the old-money WASPs who coined this 19th or 20th century Wall Street investment adage.

“The Snake is a powerful fire element: snake fire could bring social unrest, revolution, bombs, bullets, explosions. The Snake will combine with the Tiger and the Monkey to create a strong fire configuration of “Fire Penalty.”  The most dangerous months are the months of Tiger [February] and Monkey [August].”

“Monkey is in penalty with the Snake during year of the Snake.  If you are speculating in the stock market be very careful in May [Snake month], August [Monkey month] and November [Pig month] 2013. From 7th August to 7th September [the Monkey month] in the year of Snake is a full penalty month. Think twice before taking action.”

hand puppet casts shadow of Snake on Big Board

hand puppet casts shadow of Snake on Big Board

So even in the absence of any other economic indicators, Snake Year August would be a risky time to have investments in China.  And don’t blame the Pleiades, either:

Chinese stock prices swung wildly Friday after a brief trading frenzy blamed on a brokerage’s computer error.  Trading volume soared to 54 percent above Thursday’s level, with 1.5 billion shares changing hands. The main market index spiked up 6.5 percent before falling to end the day down 0.6 percent.  Everbright Securities Ltd., China’s fifth-largest brokerage, said later it suffered an unspecified problem with a computerized trading system, sending 7 billion incorrect purchase orders for shares.

In late morning trading, the benchmark Shanghai Composite Index spiked by around 100 points, or 5 percent, within two minutes, with turnover totaling 7.8 billion yuan ( 1.27 billion U.S. dollars). Bank and oil shares, including the Industrial and Commercial Bank of China and PetroChina, rose near the daily limit of 10 percent. In a statement sent to the Shanghai Stock Exchange, Everbright said that its investment strategy department encountered a problem in its arbitrage system while operating with its own funds during morning trading. Mei Jian, secretary of Everbright’s board of directors, said the company’s arbitrage system will not be used again until the company finds out how it failed.  “The company’s other systems are functioning normally, ” Mei said.


“We are probing the case and have seen some developments. But it will take more time to come to a correct and complete conclusion,” Mei said.

Offhand, Lunghu can think of two interesting possibilities:

  1. Everbright’s IT development team attempted to ‘cut some corners’ in building its arbitrage trading system.  Unfortunately, they used bits of code or algorithms ‘sourced’ from a Goldman Sachs or Merrill Lynch honeypot server.  Gotcha!  Fire Penalty.
  2. Perhaps certain red-blooded, patriotic, North American computer specialists from the Chesapeake Bay region (maybe even contract employees) decided to send a subtle message to any members of the CCP Central Committee who might happen to be the actual owner-operators of Everbright Securities Co. Ltd.  There’s always a way in, and usually a way back out.  Has anybody really forgotten what happened to U.S. markets in the Snake month of a recent Tiger year? Or last year’s August adventure at Knight Capital Group?

Until the next Ed Snowden steps forward, we Americans won’t ever know whether either of these scenarios actually occurred. But the Chinese will. Now, is that fair?


Update 18 Aug 2013:

The China Securities Regulatory Commission said Sunday that its investigators concluded Friday’s buying frenzy [resulted from] design flaws in Everbright’s computer systems that should have limited orders and prices.

So … looks like Option One is still a good bet, and Option Two can’t be completely ruled out: it might constitute a subset of Option One.  (Part of the ‘trusted partner’ program, you know?)




Tee 42

August 12, 2013

From Oak Hills to Oak Bluffs, Dufners and duffers have been trudging up the fairways and tiptoeing across the greens.  When the pros and their imitators weren’t playing a few rounds of golf, some business somehow got done:

A memorandum signed by President Obama on Monday … [authorized] Director of National Intelligence James Clapper to empanel outside experts to review U.S. surveillance technologies, particularly how the government can maintain the public trust.  The memo was released as Obama vacationed on Martha’s Vineyard.


The Review Group on Intelligence and Communications Technologies will examine the technical and policy issues that arise from rapid advances in global telecommunications. The group will assess whether U.S. data collection “optimally protects our national security and advances our foreign policy while appropriately accounting for other policy considerations, such as the risk of unauthorized disclosure and our need to maintain the public trust,” the statement said.

Neither the White House nor Clapper released details on the size or composition of the panel.

If there are any vacancies on the RGICT, you’re in luck: Lunghu’s temporarily available for this crucial public service assignment!  After Labor Day, that is …  Right now he’s on vacation.  And even though Lunghu is more of a Vineyard Haven kinda guy rather than an Oak Bluffer, both the President and he agree that it’s best to stay far, far away from Gay Head.  Even though the Menemsha Inn serves GREAT seafood.

Be seeing you!


To Forgive is Ovine

August 7, 2013

Breaking news update from the U.S. Department of Signs and Portents:  those of you seeking indications of the imminent End-of-Days need look no further than Washington DC.  In our nation’s capital, the separation of sheep and goats has already begun.

More than 100 goats will be [herded into] Washington’s historic Congressional Cemetery to help clean up the landmark.  The goats will graze 24 hours a day for six days to eliminate vines, poison ivy and weeds.

The Congressional Cemetery was founded in the early 1800s and covers 35 acres on Capitol Hill. Thousands of [bodies] are buried at the cemetery, including former senators and House members. The cemetery says the use of goats will eliminate the need for harmful herbicides and will keep invasive species from killing large trees, while also ‘fertilizing the ground.’


Somehow it’s not at all surprising that goats would cluster around the shades of dead Congressmen.  After all, when living, both species have a reputation for being capricious, lustful, gluttonous and proficient at ‘fertilizing the ground.’

So, if God’s goats are herded into Washington, where will the sheep be gathered?  Just hope it’s where you are!

Fun facts

Little wonder that separating sheep and goats is the prerogative of the Almighty: the process can be trickier than it might seem.

  • “The goat is a member of the family Bovidae and is closely related to the sheep –both are in the goat-antelope subfamily Caprinae. Some breeds of sheep and goats look similar, but they can usually be told apart because goat tails are short and usually point up, whereas sheep tails hang down and are usually longer and bigger.”
  • “Goats are quite particular in what they actually consume, preferring to browse on the tips of woody shrubs and trees, as well as the occasional broad-leaved plant. However, it can fairly be said that their plant diet is extremely varied, and includes some species which are otherwise toxic.  Goats prefer to browse on vines, such as kudzu, on shrubbery and on weeds, preferring them to grasses.”
  • “Goats are one of the oldest domesticated species, and have been used for their milk, meat, hair, and skins over much of the world. The wild bezoar of the Zagros are the likely origin of almost all domestic goats today.  The earliest remnants of domesticated goats –dating to 10,000 years ago– are found in Ganj Dareh in Iran.”


Dacha and Cover

August 2, 2013

Lunghu has just this to say about l’affaire Snowden:

In the intell business …

  • It’s not what you know;
  • It’s not who you know;
  • It’s not even what-you-know-about-who-you-know.
  • Instead, it’s all about what your adversaries (including ‘allies’) think you know.  Or fear you might know.

By that metric/yardstick, Snowden’s measured dribble of Powerpoint leaks should be assessed as an outstandingly successful information operation.

“If you can’t understand this without an explanation, you wouldn’t understand it with an explanation.”

Edward Snowden: patriot-disguised-as-traitor … and unknown soldier?