Friday, October 29, 2010

They Really Said It ! [9]

Love him, or hate him, you have to hand it to Peter Schiff on how correct he was and how well he handled all the slander and ridicule he received.

This is a compilation from 2006-2007. Some choicest statement from Peter Schiff's opponent Art Laffer
- US Economy has never been in better shape
- The monetary policy is "spectacular"

The next one have an "expert" proclaiming a return to "only" 10% annual appreciation as that's how the "normal" market works ! Another one shouts "what artificial lending standards you are talking about" and starts laughing at Peter Schiff.

Then we have the famous Ben Stein claiming that the "credit crunch is way overblown" and "subprime problem is a TINY problem". He further advises us as "buying opportunity of the lifetime" when Dow was over 13K. It dropped nearly 50% from there and even today is 15% below his lifetime buying opportunity. Peter Schiff retorts - "The party is over for US". Then everybody proclaims, "Worst is over" and only Pter Schiff says, "the worst is yet to come". Oh, and it gets even hilarious - everyone loves financial stocks - and only Peter Schiff says, "they are toxic".

The following video is just too brutally hilarious. What else can you expect when a Realtor goes against Peter Schiff ?

Click here for previous installment in this chain.

Thursday, October 28, 2010

THE Simplest Recipe for Artisan Bread

Who doesn't like eating fresh, hot from oven bread ? But most people find the entire process of baking bread very intimidating. First you have to use the right ingredients, get the proportions just exact, then knead the dough to a perfect consistency, let it rise and proof for just the right duration and then bake it at exactly for so long at an exact temperature. The amount of parameters that you have to think about make buying a digital camera seem like a child's play.

What's so special about this recipe ?
I have a very simple recipe, based on ideas from a few books and it will give you a very good artisan bread. It won't win you any prizes in bread baking competitions, but what makes it great is

1. It's very forgiving, you don't need to be super-perfect in order to get it right.
2. It uses the minimum possible ingredients, and can be very healthy if you use 100% whole wheat flour.
3. It provides ample scope for your creativity to do variations on the same theme to get very different breads. More on that later.
4. It's very flexible and can be adjusted to meet your schedule. I will cover that later, for now, let's keep things simple.
5. And it's tested. I have used it many times. I have told others about it and they have had great success with it.

The ingredients :
Generally, bread recipes call for 3 cups of flour. For the first time, use the following measures, and if you want a 3 cup bread, just double everything.

- 1 1/2 (One and one half) cup of flour. You can use bread flour, all purpose flour or 100% whole wheat flour. Whole wheat bread will be denser and heavier, as is to be expected.
- 2/3 cup water - but if you are using 100% whole wheat flour you will need 3/4 cups of water. Don't worry about the temperature of the water, just use regular water.
- 3/4 tsp table salt
- 3/4 tsp yeast (active dry or instant yeast)

Nothing else, this is as pure as bread can be (except of course breads using starters that catch air-borne yeast). Neither sugar nor fat of any kind is needed.

The first thing to note here is, the amount of water is way higher than recipes that require kneading. That's right, there is no kneading in this recipe, in fact so much water makes kneading impossible. We are relying on higher hydration to do the work for us. Apart from eliminating the kneading, high level of hydration will also give us soft, open crumb with big holes - typical of what is often called as an "artisan" bread.
In a large glass bowl (don't use plastic/metal) stir together flour, salt and yeast.

 Add all the water to it.

Using a big spoon, keep stirring the dough for a couple of minutes. You won't be able to do that with your hands. The dough will be very sticky. As you begin, it may feel too wet or too dry, but don't worry. Just work the sides of the bowl to keep the dough in one lump. All you are trying to do is to eliminate any dry spots. It won't take more than 2-3 minutes. That's it. The dough will look like a very sticky lump.

Cover it, and keep it away from sunlight for about 4 hours. Don't worry about the exact duration. The rising won't be done in less than 3 hours, and won't need more than 5 hours. Use the following photos as a guide to decide when it's time to bake.

Halfway during the rising, it will look something like this.
When the dough starts looking bubbly like this, it's ready for baking. By this time, the dough would have tripled in size, if not more.

Liberally sprinkle a cookie sheet with flour. You can use a foil to line the sheet, I prefer parchment paper.

Now, very gently pour the dough - which will look like a thick batter - on to the sheet. Just remember to not force the dough, or you will punch it down. We want to protect the air bubbles as much as possible. Tilt the bowl, and let gravity do the work for you. If you have to, just nudge it around edges. But do NOT scoop it out. Do NOT press it. Sprinkle it with flour.

Once it's on the sheet, let it be. Don't try to shape it. Our bread is very similar to ciabatta - which literally means "carpet slipper" in Italian. The only drawback of higher levels of hydration is difficulty in shaping. I would recommend that you don't try to shape it at all. Don't even score it. If you are trying out for the first time, you will almost surely punch it down while doing so. Just keep it simple, avoid the work and as a bonus, you will get a nice bread !

This may look flat - but trust me, you will get a nice oven spring once the dough is in the oven. For first few minutes, the warmth of oven and high water content will send the yeast into a frenzy and before it gives up it's life as the temperature of dough goes over 200, it would have secured you a very airy crumb.

Pre-heat the oven at 425 F. Ovens are different. But you cannot bake it below 400 and anything over 450 is too high. If you have to adjust later based on the result, be within that range.

Put the sheet in oven and bake for about 22 minutes. Again, it won't be done in 20 minutes, and over 25 minutes, it will be almost over baked. Whole wheat may take 25 minutes, but not more.

During baking, the bread will rise and spread. It won't be a super-tall loaf. It needs room to increase its size sideways, so don't bake it like a cake in a pan to give it shape - this needs to be a free standing loaf.

Once it's baked, remove it from oven and let it cool on a rack for at least 20 minutes. It's tempting to just cut it and eat it, but you have to let the steam, that's trapped inside, complete its job.

Use a sharp serrated knife and try not to squeeze the bread while cutting. Best time to cut is when you are ready to eat. This bread will stay for a couple of days, but it will start to dry out once cut - remember there is no oil to keep it soft.

This bread is perfect with an Italian menu and for many Indian dishes like "Paav-bhaji" and "Usal Paav" etc. It will be fresh, homemade, without any chemicals/preservatives and healthy. And very simple to prepare.

If you have any questions or need to make some changes or need variations, let me know.

UPDATE : See the troubleshooting guide for more help if you need any.

Wednesday, October 27, 2010


Movie Review : Changeling
Released : 2008
Director : Clint Eastwood
Genre : Drama
Starring : Angelina Jolie, John Malkovich
My Rating : 8 out of 10

Clint Eastwood has established himself as a foremost contemporary director with a distinctive style. With well developed characters, a strong focus on the story and a very deliberate pace, his movies capture our attention and never let it go. Even when the movie is over. "Changeling" is no exception.

The movie is based on a true story. In late 1920s, a single mother (played by Angelina Jolie) is living with her only son, about 10 years old. One day, her son goes missing. Most likely kidnapped. The police claim to have found him. But when the boy is returned to the mother, she claims it's not her son. Why do the police pressure her to accept the boy as her son ? That's not hard to figure out, as the movie shows how corrupt the cops were. But what happened to her real son ? And will the police accept their mistake and find the real son before it's too late ?

That's the real focus of the movie, and hence I won't divulge any further. The movie takes its time in developing the story. But remember, true stories do not have neat fiction like endings. So more than the ending, how the movie reaches there is important. The story progresses on at least 2 lines. The struggle against the corrupt police system, and the real investigation that becomes more and more disturbing as it progresses.

These 2 lines eventually merge together. Neither one is pleasant. Eastwood doesn't take any easy routes and no parent can remain unmoved by what gets discovered in the investigation. This movie is not for the faint of the heart.

Everything about this movie is top class. Great direction, great script and superb editing. John Malkovich does a perfect job in the role of a pastor supporting Angelina Jolie's fight. All other actors perform admirably, especially the alleged kidnapper (played by Jason Butler Harner) is evil personified.

Angelina Jolie received an Oscar nomination for this role, and I happen to disagree with it. She did a good enough job, but I wasn't wowed by it. A role like this offers a lot of scope to the actor to be great. Her acting was very good, but should have been great. That and the length of the movie, stops me from giving it a full 10.

This is correctly rated as R, and kids should be kept away from this movie. For serious movie buffs, this is highly recommended.

Monday, October 25, 2010

My tomato is bigger than yours

Had a nice crop of tomatoes this year. Some of them were quite big. The following is a tomato, NOT a pumpkin - it's bigger than a red delicious apple. Wish they had a tomato competition like they have for pumpkins. Maybe I should carve a tomato for this year's Halloween !

Friday, October 22, 2010

Your next crisis

This century has began with a series of crisis on the economic front. From the dot com bust to the housing bubble to financial crisis and to sovereign defaults.  I think the US Govt debt - as bad as it is now - is dwarfed by the political and economic crisis that will be brought upon us by the financial disaster waiting to happen at state levels.

This is NOT something that will happen in distant future. It's going to happen soon. See this story on Bloomberg ...(emphasis mine)
California, which has the largest U.S. public-pension fund, faces liabilities that may exceed its annual state-tax revenue fivefold within two years unless lawmakers rein in benefits, according to a study.
To keep their promises to retirees, the California Public Employees Retirement System, the biggest plan, the California State Teachers Retirement System, the second-largest, and the University of California Retirement System may have combined liabilities of more than 5.5 times the state’s annual tax revenue by fiscal 2012, according to the study released today by the Milken Institute. Levies are forecast to reach about $89 billion in the year that began July 1. 
This will not be just a financial problem for the pension funds. This will be an economic issue due to tax implications and a polarizing political issue with potential social unrest. Why ? Because every California resident - is either paying for these pensions or receiving these pensions. A neutral stance is unlikely to be available :-(

California is not the only state in this situation. And this hasn't even started catching the attention of the masses. I have no idea how this is going to play out, but I suspect, it won't be pretty.

Wednesday, October 20, 2010

The "Lara Lappa" girl

This song was played often on TV when I was growing up in India. It's from the comedy movie "Ek Thi Ladki" (released in 1949), but who really was that girl ? The tune is catchy, Lata's voice is very sweet, the lyrics are funny and the actress is cute enough to make you ignore the outdated and forced acting style. But what happened to that beautiful face ? I could never gather much information about the actress herself.

Till man invented internet, of course. I found all the information I was looking for, at UpperStall.
From being the heart throb of India (being known as the 'Lara Lappa girl' at her peak) to begging at a film function in the 1980s in Pakistan for money to marry off her sister's daughters, Meena Shorey's is the classic riches-to-rags story one often finds in the filmline, the world over.

Much more information at the link. Looks like a nice site.

Tuesday, October 19, 2010


Book Review : The Quants
Author : Scott Patterson
Released : Feb, 2010
My Rating : 3 out of 5 stars

The complete title of the book is "The Quants: How a New Breed of Math Whizzes Conquered Wall Street and Nearly Destroyed It".

The financial collapse of 2008, has generated a lot of information on many facets of Wall Street via books, news articles and TV documentaries.  This book focuses on the secretive world of "Quants", or hedge funds primarily using quantitative analysis as their investment strategy.

The people who run these funds are not in the tradition of Warren Buffet, rather they are Math wizards. They depend on their statistical analysis skills and a deep understanding of probability theory to manage huge sums of money. Their models are built on massive number crunching, rather than fundamental economic analysis.

How different it is than traditional investing philosophy ? How did these funds come to manage such huge sums of money ? Who are these people ? How did they do it ?

The book tells us, that it all started with Ed Thorpe. He literally wrote the book on winning in blackjack, "Beat the dealer". He then extended those ideas about using probability, computer modeling and statistical analysis to beat the stock market - the grandest of all casinos.

Calling Wall Street a casino, is not just a cliché. Many of these quants are very good poker players. Peter Muller has won many poker tournaments. They are obsessed with gaining a complete control over risk, not in just managing it. Understanding probabilities and positioning for various outcomes is what they excel at. In that sense, there is a lot of common mathematical ground on which strategies for both poker and trading can be built on.

This is a fascinating story to say the least. Part history, part rough biographies, and part commentary - the book presents a lot of information in a very reader-friendly style. In spite of the heavy sounding title, this book makes for a very light entertaining read - the target audience is general public like you and me.

The author, Scott Patterson is a journalist, and that style is obvious. Very readable, but often time feels very superficial. There is a lot of research done on the historical aspects, no doubt, and it's very informative. On the other hand if you are interested in finance/investing, you will most likely not encounter anything new on that aspect. I also found the order of presentation a bit distracting. It's almost chronological, but shifts back and forth between different people and the transitions are not smooth.

I can definitely recommend this book to everyone. But it left me wanting for more, and only half satisfied. Is the author blaming the quants for the financial collapse ? Of course they played a part in it and the over-reliance on models is one of the main culprits. But how much blame goes to quants ? What about the over leverage in the entire system ? And outright fraud at all levels starting from borrowers to mortgage originators and to all the steps in securitization. Not to mention the bad regulation (repeal of Glass-Steagall) and failure of Federal Reserve. This context is not mentioned at all.

If you keep that in mind, I think you would enjoy the book.
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