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> “Market can stay stupid longer than you can stay insolvent.” -> Yeah, that is called cope. You had me at the start but lost me here. That’s not speculation,

• whimsicalism 3y ago
  Right, but what they are supposed to be modeling is the market, so if they went broke doing so they failed at doing that. [0] > Some big shorters of the 2008 crisis almost went broke waiting for the market to catch up. At what point are you a successful predictor of the 2008 crisis vs. a guy who just shorted the economy in 2006? [0]: https://www.econlib.org/archives/2015/08/recessions_ofte.html https://www.econlib.org/archives/2015/08/recessions_ofte.htm...
  • ben_w 3y ago
    The adage exists as a reminder that human behaviour can make people run off a metaphorical cliff, and, just like a cartoon character, keep going horizontally until they look down. But never discount the possibly of spherical cows in a vacuum.
  • sudosysgen 3y ago
    Modelling the market is not the same as allocating capital efficiently. The former requires predicting stupid and irrational investors acting as mob.
  • majormajor 3y ago
    " Right, but what they are supposed to be modeling is the market, so if they went broke doing so they failed at doing that. [0]" soo now we've moved from "take advantage of investors being stupid by trading against it inidivudally" to "accomplish a FAR HARDER task by modeling the whole market". Cool cool, moving goalposts for days. Calling certain investors stupid is hardly contradicting the idea that the market as a whole will sort itself out in the end.