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I agree with the thrust of your comment, but to nitpick: > Books have been written around timing markets and it's generally accepted that it cannot be done rel
by dsacco 9y ago
I agree with the thrust of your comment, but to nitpick:
> Books have been written around timing markets and it's generally accepted that it cannot be done reliably. To get out before a crash then buy cheap would require you to predict three different moments accurately: when to get in, when to get out, and then when to buy on the "cheap". Timing even one reliably requires luck or clairvoyance.
This doesn’t strike me as true, unless you’re describing the subset of academic economists who agree with EMH in some form. In particular, the first sentence on its own appears to be evidently untrue; it’s clear that there are many parties, including economists and financiers, who attempt to time the market and generally forecast macroeconomic shifts.
- headmelted 9y agoI completely agree that it's the role of many parties to attempt to forecast the market, but I'm skeptical of how many (even those whose job it is to do so day-to-day) really believe that it can be done reliably. CNBC is probably a good example of this. When you don't predict anything specific, you can never be wrong. (Clairvoyance was not meant seriously, I should have made that clear!)
- executive 9y agohttps://www.youtube.com/watch?v=V9EbPxTm5_s https://www.youtube.com/watch?v=V9EbPxTm5_s
- toyg 9y agoI think parent and you just disagree on the amount of reliability these attempts actually have. Of course everyone tries to time the market, but the amount of evidence for anyone being able to do it reliably over and over is not that great. Professionals can guarantee a certain level of educated guessing, but a lot of the most skilled moneymakers on the planet still lost their shirt in 2008.
- dhimes 9y agoAttempting and succeeding are two different things. Right before the last real-estate crash I attended a seminar with an economist who spoke at length why there would not be a crash and in the coming spring there was going to be a real estate boom. Quoted lots of economic stuff to back it up (indicators and such- I don't remember but he was definitely convinced). The field of economics seems to have a ways to go before it can be used reliably to predict things.
- pault 9y agoIt occurs to me that economics today is roughly at the same level of development medicine was circa 1500CE.
- meebs 9y agoThe difference being there is an advantage to keeping economics knowledge shady & unknowable. Information asymmetry is one way those with wealth can maintain or grow their wealth. I do not subscribe to conspiracy theories, but I do think enough independent selfish actors will result in a "conspiracy theory"-like outcome.
- noddy1 9y agoCompletely agree. It is further warped by the fact that although the anti-interventionalists are probably right, the interventionalists are the ones who do all the consulting and take all the jobs and give all the advice - because they are .. interventionalists. And who wants to pay a consultant to tell them "don't do anything, and there's nothing you can do."