4 ms·
Financial markets have always been casinos. I think what Bill means is that central banks have now taken a seat at the casino's table. If a whale sits down ne
by qwrusz 10y ago
Financial markets have always been casinos.
I think what Bill means is that central banks have now taken a seat at the casino's table.
If a whale sits down next to you at the casino and starts playing unorthodox strategies and betting crazy and distracting the dealer - well some old folks don't like that.
Side note: Read Bill's bio, he is a very good gambler, especially blackjack.
- lappa 10y agoBeing a very good blackjack player doesn't mean much. You can follow a relatively simple set of instructions to maximize expected value.
- qwrusz 10y agoYou are correct. Depending on one's definition of "very good" blackjack player it doesn't mean much. Casinos even allow players to bring those little instruction cards to the table while they play. I am not talking about max expected value. I am talking about exceeding max expected value. Being a "very good gambler". TL;DR I am talking about alpha. not beta. beta doesn't mean much. alpha means everything here.
- toomuchtodo 10y agoIf you're playing against someone whose pockets have unlimited depth, why would you play at the same table? How do you succeed when the rules can change like the winds shifting? That's what "old folks" don't like.
- qwrusz 10y agoWhy do people go to casinos? How does such a business even exist. People know the odds are against them and go and play anyway.
- qwrusz 10y agoThe Reuters headline and article are misleading. I was trying to help add context/some clarity based on what Bill actually said. But seeing the multiple downvotes to my comment, it appears I may have miscommunicated. I am fallible, and only have 5 years experience as a professional bond trader so it's likely others on here have more experience and I welcome the chance to learn. The headline makes it sound like markets have suddenly become a casino. That's not correct. The headline cuts off the rest of the sentence changing the meaning. The key point is markets have become a casino which are now using a Martingale-like system that is deceptively risky and intractable once started. Hence he titled the letter "Doubling Down". Link to original: https://www.janus.com/insights/bill-gross-investment-outlook https://www.janus.com/insights/bill-gross-investment-outlook Financial markets have always been a casino. Do people disagree with this? You bet money, make an educated guess about the future, if you are lucky and guess outcomes right you end up with more money. If you guess wrong you end up with less money. Win or lose you pay transaction costs (a rake, the vig, commission, spread, etc..) Bill Gross has some great Investment Outlooks over the years still worth reading. Couple favorites: "But let me admit something. There is not a Bond King or a Stock King or an Investor Sovereign alive that can claim title to a throne. All of us, even the old guys like Buffett, Soros, Fuss, yeah – me too, have cut our teeth during perhaps a most advantageous period of time, the most attractive epoch, that an investor could experience." https://www.pimco.com/insights/economic-and-market-commentary/investment-outlook/a-man-in-the-mirror https://www.pimco.com/insights/economic-and-market-commentar... https://www.pimco.com/insights/economic-and-market-commentary/investment-outlook/time-to-vote https://www.pimco.com/insights/economic-and-market-commentar... https://www.janus.com/insights/bill-gross-investment-outlook/january https://www.janus.com/insights/bill-gross-investment-outlook...