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If Mr. Market was perfectly rational and correct, profit would cease to exist.
by alexb_ 3y ago
If Mr. Market was perfectly rational and correct, profit would cease to exist.
- panragon 3y agoThat's not true, Capital would still accumulate returns higher than the cost of inventory plus wages, the return would just be the same 'everywhere', and you'd have a perfect market alpha for all stocks, whether it be 1, 2, 5, or 10%. Even perfectly rational markets do not establish socialism overnight. Now maybe you could argue under a Marxist lens that exploitation would be more 'visible', causing socialism to arrive out of social rebellion faster, but that's really besides the point. What would cease to exist would simply be speculation and arbitrage. Since all prices are perfect, you simply wouldn't be able to make more (or even less, for that matter) money than the return on capital everyone gets by buying and selling shares quickly.
- latency-guy2 3y agoWhy? That is a gigantic statement to make to provide no backing for.