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Force majeure is an interesting argument. It probably doesn't apply in this case, though, because AIG became more able, not less, to honor the bonus contracts when they were effectively nationalized.

In my example there were two 2-for-1 splits, so I'm assuming the current price would be $2. Regardless, my confusion about Traderstudio's process is ebbing a little. It seems you use two data sets, one for money management and another for calculating buy and sell signals. Is my guess right?

Although AIG is winding down, it is has not filed for bankruptcy (because federal government funding prevented a bankruptcy filing). No, they did not. There is no basis for abrogating these contracts due to change in ownership. Are these contracts grounded in poor business decisions and...

I have tried before to understand the advantages of Traderstudio's method for handling stocks splits, but without success. Mind if I give it another go? For illustrative purposes, assume a stock flatlined at $8 per share beginning January 1, 2006. The board, for some odd reason, decides to...

If DeSantis satisfied the obligations in his retention agreement, he was entitled to payment regardless of whom funded it. There might be room to criticize AIG for entering into those agreements, but not for honoring them.

I'm curious about the timing of payment for his retention bonus and why he is able to keep it.

Bonuses of this magnitude could be a phenomenon most commonly found during equity and economic bubbles. Maybe this issue will self-correct as these bubbles deflate and unemployment rises.

Correct.

I agree with you, but his comments seem focused on BRK instead of a general assessment about all stocks.

Would you mind sharing your basis for this conclusion about BRK?

Is this to say a drop from 3.52 to 0 is better than from 10 to 0? Or, 50 to 0?

I believe both is true. There is a limit on the amount that is deductible and there is an AGI phaseout.

Maybe my wife and I were exception to an unknown rule, but we bought a house knowing it could go down in value. The intangible benefits, though, helped offset the risk and the house only cost $30k. Whether the same possibility of loss makes sense for someone else would be likewise...

If we agree that my house price would now be lower without benefit of subsidies, then we must also agree it would have been lower when I bought it. In such case, any increase in payment due to higher interest rates would be at least be partially offset by a decrease due to lower principal. It's...

The top 20% of earners pay 69% of federal taxes, so it's this group of taxpayers that is providing the majority of the subsidy you mention. And, it is this group that will pay a large portion of the various stimulus programs funded at the federal level.

From the late 1940's to 1997, the real price of existing housing remained essentially unchanged, and then almost doubled from 1997 to 2007. In view of those price movements, subsidized homeownership doesn't seem likely to have been a major factor for a bubble that began to inflate only 12 years...

Would you mind sharing the basis for your conclusion?

It is interesting, thank you. Now, I'll turn my tests upside to look at the flip side that you suggested.

I have not explored using a market level volatility filter. Instead, I'm tinkering with volatility filters at the stock level. Same basic idea: bypass trading any stock whose volatility is below a threshold level.

I don't want to wander too far off point, but did want to thank you for this discussion. Because of it, I finally took time to begin exploring the use of volatility filters in my strategies. The initial results are promising. It'll be interesting to see how they work out. Back on point, you...