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"You have to wonder how the bet would have fared had we not experienced the unprecedented reaction of central banks to the crisis. I don't know if Buffett had c

"You have to wonder how the bet would have fared had we not experienced the unprecedented reaction of central banks to the crisis. I don't know if Buffett had considered that, he's a smart guy, but it didn't seem like that was what the bet was about. If the market had been allowed to take a "more natural" course perhaps the funds would have looked better." maybe you mean that over most 10 year periods you think he wouldn't have won the bet. that point is defensible. but this reads a little bit like "its not my fault an uncertain outcome happened"... well, that is how gambling works my friend.

pishpash 9y ago
That's a cop out response. The possibility of Central Bank intervention has always been part of the unknown future. Knowing that alone about the future (not the past), how does it affect your choice?
- the_cat_kittles 9y ago
  i dont know what you are saying. im saying that you cant point to "unpredicatable things" as an excuse for losing at gambling, since the entire skill of gambling is weighing risk. do you mean my response is a cop out or the original point
misnamed 9y ago
It's not like we don't have various periods to look at either - from the chart I saw it looked to me like the hedge funds lost 9 out of the 10 years. So sure, you can say 'some unusual stuff happened in there' but ... 9 out of 10 years speaks for itself.
- the_cat_kittles 9y ago
  lol i didnt even look, but yea. guess there is really no defending it. guess most of them suck at gambling. but that seems to be how these things work, a large large majority of people end up loosing when they do fantasy sports, or poker, or political futures markets, or stock picking, and the gains go to a small minority. like, even if you are better than 90% of people at one of those things, youll probably lose money.
  - misnamed 9y ago
    Exactly - the headwinds in this case are strong. Even if you're just talking about actively-managed mutual funds versus passive indexes, you're talking about overcoming the 70th percentile after fees/taxes on average. So you can't just beat half the other players, and you can't just do it one time - you have to beat more like 2/3 and do it consistently over the years to overcome drag. In studies done on this, most active managers who beat the index either (a) take on a lot more risk, and/or (b) can't do it consistently and eventually fall behind.

pishpash 9y ago

That's a cop out response. The possibility of Central Bank intervention has always been part of the unknown future. Knowing that alone about the future (not the past), how does it affect your choice?

the_cat_kittles 9y ago
i dont know what you are saying. im saying that you cant point to "unpredicatable things" as an excuse for losing at gambling, since the entire skill of gambling is weighing risk. do you mean my response is a cop out or the original point

misnamed 9y ago

It's not like we don't have various periods to look at either - from the chart I saw it looked to me like the hedge funds lost 9 out of the 10 years. So sure, you can say 'some unusual stuff happened in there' but ... 9 out of 10 years speaks for itself.

the_cat_kittles 9y ago
lol i didnt even look, but yea. guess there is really no defending it. guess most of them suck at gambling. but that seems to be how these things work, a large large majority of people end up loosing when they do fantasy sports, or poker, or political futures markets, or stock picking, and the gains go to a small minority. like, even if you are better than 90% of people at one of those things, youll probably lose money.
- misnamed 9y ago
  Exactly - the headwinds in this case are strong. Even if you're just talking about actively-managed mutual funds versus passive indexes, you're talking about overcoming the 70th percentile after fees/taxes on average. So you can't just beat half the other players, and you can't just do it one time - you have to beat more like 2/3 and do it consistently over the years to overcome drag. In studies done on this, most active managers who beat the index either (a) take on a lot more risk, and/or (b) can't do it consistently and eventually fall behind.