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Throughout this thread, commenters are assuming that circuit breakers are helpful and useful. Yet no evidence in favor of that assumption is presented in the WS
by jvm 11y ago
Throughout this thread, commenters are assuming that circuit breakers are helpful and useful. Yet no evidence in favor of that assumption is presented in the WSJ article. The CNN article quotes someone named "Dennis Dick" claiming they are useful without providing evidence.
Under economic theory, interference in markets prevents them from correcting prices and is therefore never a good thing. Certainly Milton Friedman [1] thought they were harmful rather than helpful.
Is anybody interested in sharing positive evidence that they are helpful? Helpful is presumably defined to mean they help prices stay as accurate as possible.
[1] https://books.google.com/books?id=5NQvv_Z-zKcC&pg=PA151&lpg=PA151&dq=milton+friedman+on+circuit+breakers&source=bl&ots=4aqiH3-Hq4&sig=jpXqaDLdflv76iDbD73rZ4eBSUQ&hl=en&sa=X&ved=0CB8Q6AEwAGoVChMI8NrdzNDExwIVRZ6ACh1F9QGX#v=onepage&q=milton%20friedman%20on%20circuit%20breakers&f=false https://books.google.com/books?id=5NQvv_Z-zKcC&pg=PA151&lpg=...
- confluence 11y ago> Certainly Milton Friedman [1] thought they were harmful rather than helpful. Ah yes, Milton Friedman, the man who was right about everything. Also never? Good god man, so what about market manipulation? > Under economic theory, interference in markets prevents them from correcting prices and is therefore never a good thing. Well if the market knew what it was fucking doing then it wouldn't need to correct prices now then would it? But the market does not know what it is doing, and when it shits itself, we have to come in and stop the world from imploding in a negative feedback loop.
- stouset 11y agoYour definition is inherently skewed. After all, what is an "accurate" price other than what the market is trading? Furthermore, why is an accurate price the overall goal? Perhaps other goals are more worthy, and would come at the expense of accuracy.