Sunday links: wanting to know more

Consumer Centric Healthcare

As we think about how to modify the ACA (aka Obamacare) into something different (aka Trumpcare) I would encourage everyone involved to think about one central tenet – put the person/consumer/patient at the center of the system, not the employer, not the insurer, and not the doctor. I have written a few times about consumer centric healthcare here at AVC. I believe that patients should and will increasingly take control of their health care and that will be a good thing for costs and outcomes. Our healthcare investment strategy at USV is largely based on this premise. My partner Andy who has done a lot of the critical thinking that has informed our investments in this sector, wrote this post on his personal blog six months ago explaining how we think about this sector. Technology will have a lot to do with this. If the regulators will allow it. There are
Continue reading "Consumer Centric Healthcare"

10 Sunday Reads

My easy like Sunday morning reads: • How You Can #Resist … With Your Portfolio (Reformed Broker) • Savvy CEOs Are Learning to Manage Trump (Bloomberg View) see also Russia Fears That Trump Won’t Be Such a Great Deal After All (Bloomberg) • The America Donald Trump Is Inheriting, By The Numbers (NPR) • In Retirement, It’s Save Now or Pay… Read More The post 10 Sunday Reads appeared first on The Big Picture.

Top clicks this week on Abnormal Returns

10-Year Treasury Yield Is Bouncing Off It’s 50-Day Average, As is The Dollar

The pullback in Treasury yields (coinciding with an oversold bounce in Treasury prices) may have run its course. Chart 1 shows the 10-Year Treasury Yield ($TNX) bouncing sharply off its 50-day moving average. The two momentum indicators above Chart 1 are also supportive. The 14-day RSI (green) line is back above the 50 level. The more sensitive 14-day Slow Stochastics oscillator (top box) is rebounding from oversold territory below 20. My Saturday message also showed potential support at its November 2015 peak ranging from 2.34% to 2.30%. That may also be providing a floor beneath the TNX. [Pullbacks should find support near previous peaks as resistance turns into support]. Keep in mind also that longer-range weekly and monthly charts support a new uptrend in Treasury yields. Higher yields are pushing Treasury bond prices lower. They may also start to weigh on rate-sensitive stock groups like staples, utilities, and
Continue reading "10-Year Treasury Yield Is Bouncing Off It’s 50-Day Average, As is The Dollar"

Google Brain vs. Mortgage Risk (from ICME AI in Fintech Forum) [Flickr]

        <a href="https://www.flickr.com/people/jurvetson/">jurvetson</a> posted a photo:
Google Brain vs. Mortgage Risk (from ICME AI in Fintech Forum) Apaar Sadhwani of Google Brain opened the ICME AI Forum with a summary of their work to use simple neural networks (only 5 layers deep, 100K parameters) to outperform all of the logistic regression techniques standardly used to predict default and pre-payment risk in mortgage portfolios (Logit in red here).

The model benefited largely from ingesting local risk factors at the zip code level.

He trained the network with 70% of all mortgages over a 10 year period.

From the AI in Fintech Forum, hosted by the Stanford Institute for Computational & Mathematical Engineering ("We do big math").

Nervana after Intel — Finance Applications for Deep Learning [Flickr]

        <a href="https://www.flickr.com/people/jurvetson/">jurvetson</a> posted a photo:
Nervana after Intel —  Finance Applications for Deep Learning At this first presentation since their acquisition by Intel, Amir Khosrowshahi, co-founder of Nervana, was sweetly spunky "We provide tools for you to weaponize against each other, and hopefully make money for Intel."

He gave a good overview of deep learning applications in finance, with examples in order book substructure analysis and semantic sentiment analysis

From the AI in Fintech Forum, hosted by the Stanford Institute for Computational & Mathematical Engineering ("We do big math").

Love or Money? (in collaborative filtering) [Flickr]

        <a href="https://www.flickr.com/people/jurvetson/">jurvetson</a> posted a photo:
Love or Money? (in collaborative filtering) Gotta smile at his succinct summary: "Love is proxy for matrix vector" -- Ashish Goel of Stripe, formerly Twitter at ICME

Ashish was wondering how to personalize content on Twitter, lacking much original content, intent or demographics. To parse the social graph for attention allocations, he considered several frameworks. "Love" is short hand for undiluted attention; like "loving all of your kids equally", having more kids does not diminish the love for each. "Money" is like a finite resource to be allocated. When comparing the two, he found that "money" was 25x more useful than "love" as a framework for how to associate attention and association within the social graph.

From the AI in Fintech Forum, hosted by the Stanford Institute for Computational & Mathematical Engineering ("We do big math").

Attacking Economics is a Diversionary Tactic

Simon Wren-Lewis:
6.  ... In terms of conventional monetary and fiscal policy, academic economists got the response to the crisis right, and policymakers got it very wrong. Central banks, full of economists, relaxed monetary policy to its full extent. They created additional money, rightly ignoring those who said it would bring rapid inflation. Many economists, almost certainly a majority, supported fiscal stimulus for as long as interest rates were stuck at their lower bound, were ignored by policymakers in 2010, and have again been proved right.
7.  So given all this, why do some continue to attack economists? On the left there are heterodox economists who want nothing less than revolution, the overthrow of mainstream economics. It is the same revolution that their counterparts were saying was about to happen in the early 1970s when I learnt my first economics. They want people to believe that the bowdlerised
Continue reading "Attacking Economics is a Diversionary Tactic"

This Weak Industry Group Approaching Very Bullish Historical Period

There haven't been too many areas of the market that have performed worse than retail stocks over the past month.  While the NASDAQ 100 ($NDX) has jumped to record highs over the past month, weak retail stocks in that index like Dollar Tree (DLTR), Walgreens (WBA), O'Reilly Automotive (ORLY), Tractor Supply (TSCO) and Ross Stores (ROST) are littered among the worst performing NDX stocks.

< p class"entry-more-link">Continue reading "This Weak Industry Group Approaching Very Bullish Historical Period" »

Dealing With The Pessimist In the Room.

My wife Amy sent this HBR article – How to Handle the Pessimist on Your Team – to me. It’s almost a decade old but seems timeless. I’m an optimist. With rare exceptions (usually when I’m depressed), I can carry an optimistic view point about things (business, projects, humans, life, existence on this planet, my ability to some day go to a parallel universe) around in most of my interactions. I very much respect and value different opinions as I learn from them and from being challenged. I’m not “right” and don’t view my approach to discussions as “telling the truth”, but rather “providing data”, “telling stories”, and “helping a person / team get to a decision.” Pessimists are useful to counter balance my optimistic view point. But endless pessimism does tire me, especially when it is only used to put up objections. When the objections are part of
Continue reading "Dealing With The Pessimist In the Room."

MIB: Charley Ellis on the Index Revolution

This week, I speak with with Charley Ellis — Chair of the Yale Endowment, Vanguard Board member and founder of Greenwich Associates. This is our second conversation with the all around finance legend. Ellis explains how he accidentally began his career in the Rockefeller family office (he thought he was going to the Rockefeller foundation to… Read More The post MIB: Charley Ellis on the Index Revolution appeared first on The Big Picture.