Daily Speculations

The Web Site of Victor Niederhoffer & Laurel Kenner

Dedicated to the scientific method, free markets, deflating ballyhoo, creating value, and laughter;  a forum for us to use our meager abilities to make the world of specinvestments a better place.

 

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6/27/04
Laurel Kenner: Yanks 8, Mets 0; Outlook From the Diamond

I sat in the front row at Yankee Stadium for Game #2 of the Subway Series in the playoffs, courtesy of Mr. E, and had the exhilarating pleasure of witnessing the beautiful grand slam homer by the Yank's Hideki Matsui in the eighth. This came after three home runs by the Yankees in the early innings.

"Definitely a batter's game," I told Vic. "Four homers in just this game, and several players had more than 12 already this season. Also notable from a Spec point of view was the complete absence of hubristic gestures, first pumping and so on."

"The first is bearish and the second bullish," Vic said.

"Just so. Perhaps the balance tips to the bullish side as the pitchers showed a great ability to walk the heavy hitters, keeping most innings scoreless. But the rules do seem to favor the batters."

As the 20 readers of our worst-selling March 2003 book Practical Speculation know, we devoted a chapter to testing the market implications of the shifting balance between offense and defense in baseball. We usually like to stick to daily and 100-year forecasts, but we found a bit of predictive value in changes that favor one side or the other over a period of several years. Think Babe Ruth in the Roaring Twenties and Barry Bonds in the '90s vs. the emphasis on singles and infield defense in less ebullient times.

And then there are times when everything lines up for a good game. Like June 27, 2004.