4 ms·
It would make sense if the stock market was a self-organizing Ponzi scheme. Let's say I have $10 million in the stock market. I know that if I sell as the marke
by talkingtab 6y ago
It would make sense if the stock market was a self-organizing Ponzi scheme. Let's say I have $10 million in the stock market. I know that if I sell as the market is going down, I may well encourage other people to sell. The market may plunge and all of my stock will be worthless. If I buy at a crucial time - when the market has paused in the process of dropping, I may well influence the market to go up instead.
The greater my fear of a market panic, the more likely I am to try to steer the market - if there is a panic it is game over. The more I have invested in the market, the more influence I can exert. If I know other players are also pursuing the same strategy we can begin to act in unison.
This can also be explained by techno-babble, but if it is true that 10% of the population controls 86% of the stock, then anyone would be a fool not to play this way.
- esoterica 6y ago> I know that if I sell as the market is going down, I may well encourage other people to sell. The market may plunge and all of my stock will be worthless. If I buy at a crucial time - when the market has paused in the process of dropping, I may well influence the market to go up instead. That is simply not how the market works. Trying to buy when the market has "paused" is not going to trick the other market participants into thinking that the market has bottomed out and the crash is over and that everyone should start buying again. Volatility in a bear market is normal, and the stock market going up for a couple days in the middle of a crash is not going to convince anyone but the most gullible retail traders that the crash is definitively over. > but if it is true that 10% of the population controls 86% of the stock 10% of the population is 30 million people.