The Opportunity Cost of Fantasy Football

I have recently been the recipient of verbal office jabs for my choice to abstain from Fantasy Football this year.  My retort?  The opportunity cost of drafting, managing, and discussing Fantasy Football does not warrant participation.  I played last year.  I enjoyed it.  I enjoyed it a little too much, spending Sunday's refreshing my phone at the local B-Dubs, telling my wife I need some obscure receiver to catch at least 4 passes for me to lock in a playoff spot - as if to include her in my predicament.  The end of the season was a welcome relief, maybe as much for me as it was for her.  No matter how many times I have vowed to not let FF take over my life, I still found myself sucked into the office banter throughout the week and a zombie - a shell of my non-football self - on Sundays.  I am STILL being sucked into the office conversations, and I'm not even playing this year!  That's power of Fantasy Football!

What is the tradeoff for that time and stress?  What am I missing out on?  Am I getting more out of participating than I would from some other activity?  What are the opportunity costs?

Beer Economics: To Brew or not to Brew . . .

We all have our "thing".  The "thing" . . . you know, the one that you, savor extraordinaire, just won't budge on.  It goes against every principle you try to uphold on a daily basis.  It's material, it's expensive, it's unnecessary, but it's sooooooo good!  Maybe it's coffee?  No, you would never frequent Starbucks each morning for a $5 Pumpkin Spice Latte with your name spelled incorrectly down the side - that would be asinine.  But there are still ways to get your fix, to feed that craving, and conquer that one weakness for a reasonable price.  Maybe when you're at the grocery store staring at that wall of Folgers and Maxwell House, maybe you can't help yourself but reach for a bag of Peet's for only $1 more per bag, or 15 cents more per pot.

Mine?  Mine is craft beer.  My dad had been brewing beer long before it was hip.  I sidestepped the Icehouse college phase.  I never "moved up" to the expensive Coors Light.  Nope, my first "bad" beer was Sam Adam's.  At that point, I was doomed.  It's a one way track.  A guy can move from Iowa to California and he'll understand what he had been missing, but you can't expect a Californian to relocate from San Diego to Des Moines and survive.  It's a step backwards, in his eyes.  After my dad's craft beer, there was no turning back. 

But craft beer exploded.  Now, a six pack of Lagunitas Little Sumpin' Extra ale will set you back $9.99, if you're lucky, and that's before taxes.  You want to buy Ballast Point Sculpin in Chicago?  How about $13 minimum?!

Utility - In Another Sense

Utility, in an economic sense, is defined in Investopedia as:

"Utility is an abstract concept rather than a concrete, observable quantity. The units to which we assign an "amount" of utility, therefore, are arbitrary, representing a relative value. Total utility is the aggregate sum of satisfaction or benefit that an individual gains from consuming a given amount of goods or services in an economy."

I became familiar with the term "utility" in this regard from Jordan Ellenberg's "How Not To Be Wrong" and it intrigued me.  Business Insider and Smithsonian give nice summaries of its use in the book here and here respectively.  The gist of it is that everything comes with a cost and you need to ask yourself what cost are you willing to pay for a level of comfort.  It is an "inconvenience factor" and Ellenberg measures it in utils.

Like Diamonds, Cycles are Forever - Premature Thoughts on a Stock Market Crash

It is a bit early to call this past week's action a "crash" or to state that the market is in the midst of a crash, but it is also always wise to plan ahead for various possible future scenarios.  From a value investor's standpoint, crash = opportunity.  The last few years since the 2009 financial crisis, may have been a bit rough for value investors.  While the rising tide of the market over the last 6 years has inevitably raised all boats, those who focus solely on a Graham-esque value strategy may have been left in the dust as growth stocks have been the been doing the heavy lifting.

Bull runs of this nature are difficult for a value investor to stomach.  He likely invested in the 2009 crash, enjoyed the gains until he sold out at what seemed a fair valuation, and subsequently watched agitatingly while the overall market continued to appreciate.  He has likely either converted to mostly cash or focused on commodities, energy, and possibly retail stocks, which have lagged behind the rest of the market sporting low P/E's and P/B's.  Energy and commodities, specifically, have been absolutely hammered this year, while the Dow finally appears to be leveling off after the 5 year bull run.  He follows all of the rules he has picked up from Graham, Buffett, and gang, yet it appears those around him blindly throwing money at in-vogue stocks like Tesla are the ones celebrating!  He has flashbacks to 1999-2001.

But bull markets must come to an end and, like diamonds, cycles are forever.  Love him or hate him (I, for one, am not a big fan), Jim Cramer makes some valid points in "Real Money" when it comes to cycles.