Mars Phoenix Lander – beating the odds

I’ve just finished watching the successful landing of NASA and JPL’s Phoenix lander on Mars. Previous success rate for landing on Mars was less than 50%. Not great odds by any stretch. Interesting that not only is the Phoenix lander made extensively out of the technology of the failed previous attempt (Mars Polar Lander) but the result of several review boards, and the Phoenix project team’s own review of […]

Confidence and capital – Nationwide has neither

Nationwide Airlines is on the ground. A series of business and operational problems met the global economy of skyrocketing avgas prices and left them insolvent by R172m (assets of R46m less liabilities of R218m). They’ve also left friends of mine stranded in South Africa after a trip from Ireland for another friend’s wedding (congratulations Kay and […]

Optimism and flawed decision making

Behavioural finance is no longer a “new idea”. It has entered mainstream finance education through CFA, Business Schools, even actuarial exams (ST5 for UK and South African actuaries). Some of the biggest lessons revolve around how bad we as a species are at making decisions in the face of uncertainty. Emotional biases, overconfidence, loss aversion, […]

Sharing the light

Florida is experiencing its very own fun and games with nuclear power station shutdown, blackouts and unhappy Dwarves and Princesses.  Ok, so apparently the Dwarves and Princesses were mostly unaffected. Without wishing the hardship on  the Floridians, I’m pleased to hear the news in that it shows that systemic risk in electricity grids is a global operational risk and not […]

Nick & Jerome

Jérôme Kerviel, a 31 year-old banker at Soc Gen is blamed for losses of €4.9 billion incurred through rogue trades spanning over a period of some months. The story has a remarkable similarity to Nick Leeson, the Original Rogue Trader who is blamed for the demise of Barings Bank in 1995. Unfortunately for Soc Gen, […]

National consequences of not understanding uncertainty

Business Report has an interesting article where Eskom recommends shelving new infrastructure projects due to lack of electricity until at least 2013. A few important quotes form the piece: Bongani Nqwababa, Eskom’s finance director, said yesterday that the parastatal had advised the government that it wanted South Africa marketed only from 2013 for both local […]

Directors’ Dealings – Information, Noise and the role of Randomness

I was reading an article about the directors of Imperial and Steinhoff purchasing shares in their respective companies. Steinhoff directors made the news when the CEO originally used Single Stock Futures to gear his exposure to a significant position in the company. (This position has since been converted into a direct position with about the […]

Standard Bank, halting trade and Satrix FINI

I was reading the recent news about ICBC’s large investment in Standard Bank and had a thought. If Standard Bank’s shares are suspended from trading, why not plunge into Satrix Fini? If you really wanted to get fancy, you could probably find SSFs on most of the other large players within the Satrix Fini (a […]