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remain one of your very best investment alternatives. I believe that if you are able to stick with the magic formula strategy through good periods and bad, you will handily beat the market averages over time. In short, I believe that, even after everyone knows the magic formula, your results will continue to be not only quite satisfactory, but with a little luck, extraordinary. So, here s the deal. If you do end up using the magic formula and if it helps you earn enough money that you feel grateful for your good fortune, you might consider this. In reality, all the time and effort put into stock market investing isn t a very productive use of time. Usually, when you buy or sell shares in a publicly traded company,* you are merely buying from or selling to another shareholder. In other words, the underlying company is not involved. It receives nothing from the transaction. Many people argue that all this buying and selling activity is, nevertheless, quite useful. Through the buying and selling of shares, these people would argue, an active marketplace for the company s shares is established. Theoretically, if a company needs additional money, it can decide to sell additional shares into this marketplace. It can use the proceeds to pay bills, build factories, or expand in some other way. This is all true. Also, if Jason

An interesting engineering problem is the extent to which it s possible to integrate the technologies discussed here to provide systems that are highly resistant to all kinds of survillance and coercion. This problem has been called subversive group computing and may be thought of as the set of technologies necessary for a subversive group say, for example, a Tibetan group wishing to throw off Chinese rule. The threat model here involves not just pervasive surveillance and determined service denial attacks, but also the regular subversion of group members. One can imagine a covert superhighway that would enable group members to communicate with each other using anonymity mechanisms; distributed file stores for propaganda that would otherwise be suppressed; steganographic file systems to help group members appear innocuous if caught; and as a backstop a cell mechanism to limit the damage that could be done by a group member who is turned. Such a hypothetical system might be thought of as a generalization of the mechanisms for enabling a group of servers to withstand and recover from an integrity failure of one of their number, such as AT&T s Rampart and IBM s Proactive Security, which we discussed above in 6.2.2. There s an obvious direct interest in such techniques not just for national liberation groups and counterintelligence agencies, but also from the point of view of public policy generally, as they will set the technical limits of both privacy and surveillance. And, if recent history is any guide, they are likely to be at least as much driven by the desire to evade, or enforce, copyright as by any particular political liberation agenda. It s likely that these technologies will also find some wider criminal use, but as Whitfield Diffie puts it, If you campaign for liberty, you re likely to find yourself drinking in bad company at the wrong end of the bar.

Figure 9.9. Example of a reserved graph transformation rule. DTGS, a kind of infrared defector (made of deuterated triglycine sulfate); VDB, Video Data Base.

sensor M2T OR M4T is at logic 1 (timerRed=1 & M1S=0 & M3S=0 & M1T=0 & M3T=0 & M2S=0 & M4S=0 & (M2T=1 | M4T=1)). This means that state transition D occurs when the allocated period for the traf c lights at RED is exhausted and there are cars queuing either at road S2T or S4T and there are no cars queuing at road S1, S3, S1T, S3T, S2, and S4. In STATE2, the traf c lights on road S1 and road S3 are GREEN. STATE2 will transition to STATE3 when timerGreen is at logical 1 (the allocated period for the traf c lights at GREEN is exhausted). In STATE3, the traf c lights on road S1 and road S3 is YELLOW. STATE3 will transition to STATE4 when timerYellow is at logical 1 (the allocated period for the traf c lights at YELLOW is exhausted). In STATE4, there are four possible state transitions. State transition E occurs when timerRed is at logic 1 AND sensor M1T, M3T, M2S, M4S is at logic 0 AND either sensor M2T OR M4T is at logic 1 (timerRed=1 & (M1T=0 & M3T=0) & (M2S=0 & M4S=0) & (M2T=1 | M4T=1)). This means that state transition E occurs when the allocated period for the traf c lights at RED is exhausted and there are cars queuing either at road S2T or road S4T and there are no cars queuing at road S1T, S3T, S2, and S4. State transition F occurs when timerRed is at logic 1 AND sensor M1T, M3T, M2S, M4S, M2T, and M4T is at logic 0 AND either sensor M1S OR M3S is at logic 1 (timerRed=1 & (M1T=0 & M3T=0 & M2S=0 & M4S=0 & M2T=0 & M4T=0 & (M1S=1 | M3S=1)). This means that state transition F occurs when the allocated period for the traf c lights at RED is exhausted and there are cars queuing either at road S1 or road S3 and there are no cars queuing at road S1T, S3T, S2, S4, S2T, and S4T. State transition G occurs when timerRed is at logic 1 AND sensor M1T and M3T is at logic 0 AND either sensor M2S OR M4S is at logic 1 (timerRed=1 & (M1T=0 & M3T=0) & (M2S=1 | M4S=1)). This means that state transition G occurs when the allocated period for the traf c lights at RED is exhausted and there are cars queuing either at road S2 or road S4 and there are no cars queuing at road S1T and S3T. State transition H occurs when timerRed is at logic 1 AND either sensor M1T OR M3T is at logic 1 (timerRed=1 & (M1T=1 | M3T=1)). This means that state transition H occurs when the allocated period for the traf c lights at RED is exhausted and there are cars queuing at road S1T or road S3T. In STATE5, the traf c lights on road S1T and road S3T are GREEN. STATE5 will transition to STATE6 when timerGreen is at logical 1 (the allocated period for the traf c lights at GREEN is exhausted).