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But that isn't the null. The null is that these are "black swans" and unpredictable. And I also did not pick the sources randomly. I am not talking about "fring

But that isn't the null. The null is that these are "black swans" and unpredictable. And I also did not pick the sources randomly. I am not talking about "fringey characters"...I am talking about the Fed, the BoE, the Economist (both in 2004 and the 1870s). More to the point though: you can verify for yourself whether a prediction is accurate. I am not sure why people need to make sweeping generalisations: go back, check if a prediction was accurate, look at the reasons behind it...why is that so intolerable? And the null also isn't that these companies aren't fundamentally "changing the world" and so the bubble won't burst. If you actually went back and looked at history, you would see that a tiny minority of firms do survive (and are responsible for close to 100% of the positive returns for equities as an asset class). No-one has disputed this, the quantitative evidence is clear. But the quantitative evidence is also that the majority of firms go out of business. I also wouldn't use the Industrial Revolution as an argument...the exact same thing happened then. Comparatively, the innovations we are seeing now are very limited. If you think being a contrarian is fun, I would take up investing. When you are just a guy typing at a computer or some economist making predictions, maybe it is fun. When you have something on the line, it is quite different (again, that is why bubbles occur). I am not sure why this is even controversial for some people. Human nature hasn't changed in two centuries. Capital cycles haven't changed in two centuries. This doesn't need to be hard.

hash872 7y ago
Think about this way- in your 'people can call market crashes ahead of time' mental model, you need to include all the market crashes that were called incorrectly. Everyone who said it would crash in 2012, 2014, when Trump was elected, that it would crash in 2017, etc. Does that kind of make sense? In terms of the Fed/Boe/the Economist/Market Guru Person- what you're missing are all of the various calls they've made over the years that have been incorrect. You have to look at the overall track record- not just pick out the predictions they made that we know in hindsight are correct, but ignore their misses. Anyways, there will always be recessions & crashes in a market economy, so 'a guy called the crash' somewhere sometime is pretty meaningless. To be honest I'm not 100% sure what we're discussing here. > It isn't hard I mean, it [calling market crashes] is not only hard, it is literally impossible. If you have a preternatural gift for calling them, feel free to make billions in financial markets with your once in human history gift. >If you think being a contrarian is fun, I would take up investing I am in investing lol. I am invested in index funds that track the broader market, because I'm aware that neither I nor literally any human that's ever lived can time what the markets will do ahead of time. Nor do I try
- ryacko 7y ago
  https://en.wikipedia.org/wiki/Economic_indicator https://en.wikipedia.org/wiki/Economic_indicator Housing starts will predict the future of the economy. Inverted yields will predict the future of the market.
  - hash872 7y ago
    Almost by definition (if this is true, and I'm sure it's way way way more complicated than a simple rule of thumb), the market would have priced this in already. Or do you think that you're in possession of a secret, which has its own Wikipedia page, that the PhDs with supercomputers on Wall Street were unaware of? If so, congratulations, you are free to make billions in the markets by exploiting your superior knowledge which the Street cannot match. I am a little bit familiar with the inverted yield curve thing, and it is certainly much more complex- including that rules that governed the economy in the past may no longer apply
    - ryacko 7y ago
      It isn’t that complex, most of those economic indicators show the forward looking expectations of major firms. Or in other words, the future of the economy can be seen by the decisions Wall Street has already made. The real money is, as always, in insider trading on short-term purchases. Still, one could beat the stock index if one factored in economic cycles.
- johnmaguire2013 7y ago
  On this topic, I suggest the parent (hogFeast) and others who share his view read A Random Walk Down Wall Street. It's very eye-opening.

hash872 7y ago

Think about this way- in your 'people can call market crashes ahead of time' mental model, you need to include all the market crashes that were called incorrectly. Everyone who said it would crash in 2012, 2014, when Trump was elected, that it would crash in 2017, etc. Does that kind of make sense? In terms of the Fed/Boe/the Economist/Market Guru Person- what you're missing are all of the various calls they've made over the years that have been incorrect. You have to look at the overall track record- not just pick out the predictions they made that we know in hindsight are correct, but ignore their misses. Anyways, there will always be recessions & crashes in a market economy, so 'a guy called the crash' somewhere sometime is pretty meaningless. To be honest I'm not 100% sure what we're discussing here. > It isn't hard I mean, it [calling market crashes] is not only hard, it is literally impossible. If you have a preternatural gift for calling them, feel free to make billions in financial markets with your once in human history gift. >If you think being a contrarian is fun, I would take up investing I am in investing lol. I am invested in index funds that track the broader market, because I'm aware that neither I nor literally any human that's ever lived can time what the markets will do ahead of time. Nor do I try

ryacko 7y ago
https://en.wikipedia.org/wiki/Economic_indicator https://en.wikipedia.org/wiki/Economic_indicator Housing starts will predict the future of the economy. Inverted yields will predict the future of the market.
- hash872 7y ago
  Almost by definition (if this is true, and I'm sure it's way way way more complicated than a simple rule of thumb), the market would have priced this in already. Or do you think that you're in possession of a secret, which has its own Wikipedia page, that the PhDs with supercomputers on Wall Street were unaware of? If so, congratulations, you are free to make billions in the markets by exploiting your superior knowledge which the Street cannot match. I am a little bit familiar with the inverted yield curve thing, and it is certainly much more complex- including that rules that governed the economy in the past may no longer apply
  - ryacko 7y ago
    It isn’t that complex, most of those economic indicators show the forward looking expectations of major firms. Or in other words, the future of the economy can be seen by the decisions Wall Street has already made. The real money is, as always, in insider trading on short-term purchases. Still, one could beat the stock index if one factored in economic cycles.
johnmaguire2013 7y ago
On this topic, I suggest the parent (hogFeast) and others who share his view read A Random Walk Down Wall Street. It's very eye-opening.