Are finance professors to blame for the financial crisis (Part 2)?
Titan of academic finance Gene Fama writes in his blog:
The premise of the Fox book is that our current economic problems are largely due to blind acceptance of the efficient markets hypothesis (EMH), which posits that market prices reflect all available information. The claim is that the world's investors and their advisors in the financial industry bought into this model. Because they ceased to investigate the true value of assets, we have been hit with "bubbles" in asset prices. The most recent is the rise and sharp decline in real estate prices which froze financial markets and led to the worst recession since the Great Depression of the 1930s.
The book is fun reading, but its main premise is fantasy. Most investing is done by active managers who don't believe markets are efficient. ...
I really didn't think this was the main premise of my book. I wrote 95% of the thing before the financial crisis, and I certainly didn't predict the disaster that ensued. So it would have been hard for me to set out to prove "that our current economic problems are largely due to blind acceptance of the efficient markets hypothesis." I was basically just out to recount some intellectual history that I thought was really interesting, and maybe important too.
That said, the premise of a book is in the eye of the reader, and I'm sure a lot of the people forking over good money to buy my book do so because they think I'm arguing that Fama's efficient market hypothesis is the cause of all our troubles. So I can't run too far away from that argument.
Yet ... I completely agree with Fama that most investing is done by active managers who don't believe markets are efficient. Also, investors were blowing bubbles long before Fama starting writing about "efficient markets" in the 1960s. So investor behavior during the tech stock and real estate bubbles really can't convincingly be attributed to the teachings of Fama and other finance professors.
But I don't think that's the main point that fiercer efficient-markets critics than I like George Cooper and George Soros are making. They're saying that the big problem was that regulators and central bankers drank the efficient market Kool-Aid. Adair Turner, chairman of the British Financial Services Authority, put it well in that famous interview that Prospect published back in September (subscribers only, I'm afraid; I happen to work with a subscriber):
[W]e have had a very fundamental shock to the "efficient market hypothesis" which has been in the DNA of the FSA and securities and banking regulators throughout the world. The idea that more complete markets and more liquid markets are definitionally good and the more of them we have the more stable the system will be, that was asserted with great confidence up to three years ago.
What Fama might say in response is, "Well, I never asserted that." He's probably be right. But as I wrote in my previous post on the topic, what Turner describes was the key message that emanated from academic finance and economics into the Wall Street and government-policy mainstream over the past few decades. Interestingly, some of the most interesting financial-economic research of the past decade-and-a-half has been about market failures. But the transmission of such knowledge into mainstream thinking occurs with long and variable lags—and Fama certainly wasn't one of the people out there waving their hands and saying, "Hey, watch out! Financial markets can burn you!"
I guess that's what's kind of disappointing to me about Fama's post. I'm thrilled that he's read my book, and is saying halfway nice things about it in public. In general, I'm a big Fama fan—his willingness to keep testing his theories against the evidence, and to support the work of students and younger professors whose research undermined those theories, is hugely admirable. But he and a lot of other people in academic finance just don't seem interested in directly engaging in many of the most interesting questions raised by the financial crisis. Such as: Can the financial sector get too big, and if so how can we tell? Can derivatives markets concentrate risk as well as spread it? Is financial innovation fundamentally different and more dangerous than innovation in other fields, and if so what should we do about it? Should central banks and financial regulators try to snuff out asset-price bubbles, and if so how should they go about determining when we're in bubble territory? Is Hyman Minsky right that good times inevitably breed crises?
Of course most investors don't believe in the efficient market hypothesis, and most of them would probably be better off if they did. Point taken. Now can we move on to the more interesting stuff?
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[...] Fama vs. Fox on the role of the efficient markets hypothesis in the credit crisis. (Curious Capitalist) [...]
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Mr. Fox,
It is disapointing to hear Dr.. Fama use the word "Fantasy" when referring to your book. That is disrespectful, and I respectfully submit wrong.You are right that "the premise of a book is in the eye of the reader".
In my eye you did a good job of stating the fact. Current economic theories could not explain the size and frequency of crashes. It has been a case of "well, it is the best we can do...."
My understanding is that EMH relies on Nash's theory of equilibrium. Unfortunately there is plenty of evidence of non-equilibrium behavior in the market, and the theories don't account for biology (us). We humans are "bursty" in nature. (Lazlo-Notre-Dame)
Current theory is not Full Process.I believe that Dr. Fama will come around.
Bob Klapetzky
http://www.alphaadder.blogspot.com-
2.1
In case you were checking the references, and to give proper credit it should have been:
2005 - Albert-Laszlo Barabasi Notre Dame: in
“The origin of bursts and heavy tails in human dynamics”Sorry.
bk
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Justin, I haven't read your book yet but I promise I will.
I find that a great deal of the discussion of EM theory is befuddled because the discussors don't distinguish clearly between different but related statements:
1. You can't know whether the price is right.
and
2. The price is rightor
1. Individuals are rational actors
and
2. In aggregate, individuals' actions effect the market as if they were all rational actors.Another thought:
While all (or enough) first-order information might be "in the market" to set prices "efficiently," what about the potentially more profound effects of second-order information: "I believe that you believe"? Or even more, "I believe that you *will* believe." (See "Greater Fool.")
This information obviously cannot be known, or known with any accuracy or certainty. And it is arguably far more powerful--at least in the short term--than first-order information.
And yet another thought, re: herd behavior. It's been shown that groups of individual actors, with each actor operating under very simple algorithms, can create very complex (and generally unpredictable) behavior by the whole group.
So each bird in a flock operates with rules like "if I'm on the outside of the flock (no bird on one side of me) and the bird next to me moves away, move towards that bird."
The result is the quite remarkably cohesive behavior of bird flocks.
Now, assume that our investing algorithms are based largely on our (inherently unreliable) second-order beliefs. Life gets very, very complicated...
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Mr.Roth,
I empathize with your comment " I find that a great deal of the discussion of EM theory is befuddled because the discussors don't distinguish clearly between different but related statements:
1. You can't know whether the price is right.
and
2. The price is rightor
1. Individuals are rational actors
and
2. In aggregate, individuals' actions effect the market as if they were all rational actors."People do not behave in a random manner.
Warren Buffet has been frequently quoted that he is simply trying to buy a future dollar discounted, with an eye on traditional underlying economic variables to make buy/sell decisions. He is considered the quintessential “rational optimizer”. Many people extrapolate this thought to mean that momentum “noise traders” are not trying to do the same thing. This is incorrect. A noise trader is trying to do the same thing, except his underlying economic variable is price movement. Humans with the emotional self-discipline to consistently and effectively be “rational optimizers” is rare, whereas a noise trader's barrier to entry is much less. Seeds are planted by “rational optimizers”, but bubbles and crashes are created by “noise traders”, and their market driven perception of their stored value within the market.
Their perceived priority is driven by greed or fear.
Stocks are a temporary store of value.
Stocks value is a PERCEIVED value; local, temporal and transitional based on market dynamics.
Greed drives the market up and out of control of the “rational optimizers”, and attracting ever more “noise traders”
A complex dynamic system self organizing towards criticality. At criticality, events that during “rational optimizers” time in charge would be uncorrelated, become highly correlated.
The complex dynamic system self organizing is not the market.
The market is a derivative of what is self organizing; the noise traders and their greed/fear.
So essentially you have a time period where the price is right. When rational optimizers make up the majority of the market. A time when most people won't touch it with a ten foot pole. Or a time where noise traders take over, until they panic in a hysteresis like phenomena. So there are phases. When rational optimizers are in charge, so are traditional value metrics. They are right. When the noise traders are in charge, it is the "greater fool theory". Then they are right, until they are very, very wrong.
Bob Klapetzky
http://www.alphaadder.blogspot.com
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[...] Fox, author of The Myth of the Rational Market, is in an interesting interchange with Eugene Fama, patriarch of efficient-market [...]
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There's always been a curious disconnect between the daily work of fund managers, who seem pretty capable of agreeing there are market inefficencies in the market, and the way they discuss the market in theory, where a stricter version of EMH comes into play.
I think if there's a charge about EMH, and the state of macroeconomics in general, is that there has been a growing disconnect between modeling and reality. When you build models to prove a negative, when you purposfully ignore historical bubbles that your calculations can't predict, than you've left your science open to some pretty basic attacks.
No model and theory has to be perfect. But when challenged, real science adjusts to fit reality. Economists at large seem more inclined to challenge the validity of reality itself.
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I agree with Roth. I keep bringing up the commodity bubbles of 2007-2008, and the primary cause of that was herd mentality. The winners were the people who could most accurately predict which direction the herd would move. In the case of GS and Morgan Stanley, they kept firing gun shots to stampede the herd in a particular direction.
There is a small difference between this and betting on horse races, the difference being that some bettors can influence the outcome of the race.
The problem with EMH is that every time we have bubbles and bursts, some idiots in Congress and the government will trot out an expert who will present some mathematical model designed to bewilder the audience into believing he knows what he is talking about, and to convince the audience to let the inside players keep taking most of the winnings.
I do believe that if you used a trendline to smooth out the peaks and valleys in prices, you would have rational pricing. Unfortuately, the peaks can drive a lot of players out of a market, witness all the livestock producers who left the industry in 2008. Which leads to even more concentration in the meat industry. Which is not in the best interest of the American people.
The lessons of 2008 are
- Government subsidies to companies deemed to big to fail have led to even more market concentration. The too big to fail firms got bigger.
- Concentration of economic strength can also lead to concentration of economic weakness.
-The Government can be stampeded into just about anything. Read all Paulsen's pronouncements of last September and October, and all of them helped create panic.
-Inside players will benefit from that panic.
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>randymiller: "There is a small difference between this and betting on horse races, the difference being that some bettors can influence the outcome of the race."
I'd say more like a huge difference, because *every bet* influences the outcome of the race. So there's the second-order-information effect, trying to predict what others' bets will be.
That's also true (in a different way) in parimutuel betting, because every bet affects the odds. But a bettor can largely avoid that by betting at the last minute--relying only on what is then ex-post, first-order information.
And I love this btw:
"In the case of GS and Morgan Stanley, they kept firing gun shots to stampede the herd in a particular direction."
Steve
http://asymptosis.com -
8
All above some well thought out comments. I can't help but comment constructively (i hope) regarding every bet influencing the outcome of the race.
Again, it is dependent on what "phase" the market is in. It is analagous to water. At room temperature there is not a lot of correlation in the individual participants. Put your hand in and what affect/effect will you have? Virtually nill in relation to the system.
Different scenario. Water again. H20, but right at the freezing point, but it is still liquid. "Critical", and a high degree of correlation within the latices and matrices. Touch it and it is a block of ice instantaneously. They just don't roll over like a wave, it all turns. Amazing.
So, to be picky, respectfully, no, I don't agree "every" bet influences the outcome. It depends on what phase the market is in. Thanks for bringing that point up.
Bob Klapetzky
http://www.alphaadder.blogspot.com -
9
Roth,
I hope you are not being sarcastic about GS and Morgan Stanley firing shots to stampede the herd.
I followed that bubble closely in 2008, and there seemed to be a lot of correlation between GS and MS making a prediction of shortage, and the market going up dramatically.
I visualize a purchasing agent for an oil refiner going into his boss's office believing there would not be a shortage and wanting to wait out the market. And the boss says "Do you really think you are smarter than the guys at GS and Morgan? We need the supply in October, so pay the price."
Remember, these are real people who worry about losing their jobs. The safe bet is to follow GS and Morgan's herding direction. Certainly the CYA bet.
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>I hope you are not being sarcastic about GS and Morgan Stanley firing shots to stampede the herd.
No, not even a little bit. I loved it because it was so apt.
Steve
http://asymptosis.com
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not an expert at all in EMH, but is it not hypocritical to state that you believe in EMH (asset prices reflect all information) and that in general, most active investing is done by those who do not believe in EMH, thereby changing asset prices based upon something other than all relevant information?
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Suffice it to say that Benjamin Graham, the undisputed father of security analysis, had this to say about the original claims of the efficient market hypothesis “I share the skepticism expressed by the "efficient market" theoreticians as to the ability of all but very superior security analysts to do a good job of individual stock selection. But this is far from saying that I think that individual stocks reflect in general and under most conditions the "fair value" of each issue. On the contrary, my present emphasis on the tendency of most stocks to fluctuate widely and often wildly in price over the years should show my conviction that stock prices are often out of line with their fair or intrinsic values... The stock exchanges appear to me chiefly as a John Bunyon type of Vanity Fair, or a Falstaffian joke, that frequently degenerates into a madhouse -- a tale of sound and fury, signifying nothing." It is the contrary point of view that individual stock prices are close approximations of their intrinsic or “correct” values most of the time that is the choking point for many insofar as market efficiency and/or rationality is concerned.
Investors are simply awash in a sea of ambiguity when it comes to determining the risk-adjusted discounted present value of a perpetual claim on all future income a corporation will generate during its lifetime. Keynes understood this when he observed that “the market will be subject to waves of optimistic and pessimistic sentiment, which are unreasoning and yet in a sense legitimate where no solid basis exists for a reasonable calculation… Investment based on genuine long-term expectation is so difficult today as to be scarcely practicable.” Paul Samuelson understood it when he wrote “I doubt that the devil himself knows what is the equilibrium price-earnings ratio on stocks. Fifteen to 1, as Secretary Douglas Dillon once rashly averred? Twenty five to 1? Or 14 to 1, as the tape enunciates now that high interest rates imply high P/E ratios on bond investments. No one knows.” And, of course, Graham understood it as well when he wrote the words that have already been cited.
Of course a market in which stocks are correctly priced virtually all of the time will not be an easy market to beat. And innumerable studies have shown that is the case for institutional investors with billions of dollars of in-depth research behind them. Since such a result is a logical consequence of a market in which stocks are correctly priced most of the time, this has lent credence to the efficient market hypothesis in the minds of many. These developments, in turn, may have lent policy makers and regulators to believe that if investors can correctly price a perpetual claim (share of stock) for its chronically uncertain and risk laden prospects then surely they should be able to do so for packages of mortgage securities. In effect, such a perspective (about the outlook of regulators toward market efficiency) is the one that Paul Krugman (among others) takes in his review of “The Myth of the Rational Market.”
Meanwhile, stock investors instinctively know the type of valuation problems they, and others around them, confront. Faced with the reality of such chronic uncertainty they behave accordingly and act under the sway of hope, fear, greed and ignorance to a far greater extent than they follow the precepts of rational-economic-man that Harry Markowitz (the father of modern portfolio theory) set forth as follows: “The theory of rational behavior is usually presented as a study of the principals upon which a rational man would act. This rational man...makes no errors in arithmetic, or logic, in attempting to achieve his clearly defined objectives...Every action is perfectly thought out; every risk is perfectly calculated.”
Fox's book, in many respects, seems to embrace behavioral finance and its denial that the market is driven by rational economic players such as the ones that populate modern portfolio theory (Markowitz), the capital asset pricing model (Sharpe) and the efficient market hypothesis (Fama). The other leg of the assault on market efficiency is simply that individual stock, and overall market, prices are far too volatile to reflect proper adjustments to changes in the underlying fundamentals for a stock's short, intermediate and/or long term prospects. Thus, as the late Yale economist and Nobel laureate James Tobin observed in 1984, “Keynes classic description of equity markets as casinos where assessments of long-term investment prospects are overwhelmed by frantic short term guesses about what average opinion will think average opinion will think -- and so on, to the nth degree -- rings as true today as when he wrote it.”
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I think active traders have a schizophrenic attitude towards the efficient markets hypothesis. Obviously they fundamentally don't accept it, yet they assume it is valid when designing hedging strategies or justifying their compensation schemes. It was switched off and on. The belief that comovements of CDS prices revealed the (assumed to be constant) correlation of latent variables which determined defaults (the Gaussian copula) was critical to the crisis. That belief relied on the EMH.
see this for more
http://angrybear.blogspot.com/2009/02/schizofinance.htmlThe idea "that more complete markets and more liquid markets are definitionally good and the more of them we have the more stable the system will be," would be wrong even if all agents had rational expectations, that is even if the efficients market hypothesis were correct.
General equilibrium theory describes the consequences of "complete markets." The concept of "more complete" has no place in general equilibrium theory. In particular, it is possible that adding new assets to an economy with incomplete markets will make everyone worse off.
The idea complete markets are the best so "more complete" markets are better has the same status as the claim 2+2=5. It has been proven to be false. In particular, generically, if markets are incomplete it is possible to make everyone better off by restricting pairs of agents rational mutually beneficial transactions.
The insights from general equilibrium theory which influence policy makers are all based on the assumption that markets are complete -- that means for any possible state of the universe, there is an asset or portfolio which pays a positive amount in that state and no other.
The fact is that advocates of laissez faire decided general equilibrium theory should be taken seriously exactly so long as it yielded implications they liked. When later developments in the field yielded pretty much the opposite, it was decided that it was esoteric math of no practical interest.
here is more on the topic.
http://angrybear.blogspot.com/2009/02/general-equilibrium-theory-by-popular.html
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Mr. Waldmann,
Wonderful post. Went and checked out Angry Bear. Wow. Really dense, useful, and a lot of hmmm moments. I subscribed immediately. Never done that before. I look forward to receiving updates.
You bring out a great point, that hits home with me. I was a financial advisor in Florida. I was at Merrill Lynch, and I did my own research, although I could not say that. I found the quant Richard Bernstein(and his team) to be fantastic, but obviously the herd didn't listen. My clients went through 01 just fine. I was actually firing clients that wouldn't listen. In 2004 I presented research that I started on twenty years earlier while a teenage intern in the Astrophysics division at Los Alamos National Laboratory, that morphed as I ended up in the financial field.
I presented internally to the chain of command, my own personal research, that spoke to " (assumed to be constant) correlation of latent variables". Further I had the audacity to write there are pre-cursors prior to every sig-sigma crash.
The response was underwhelming at the local level, and never made it out of the district. (Komansky was CEO when I first got there, and it was very different than under O-Neal at the time -little did we know. I believe if Doug Hornburger and Harold Corrigan had still been in Palm Beach that it would have been different. Thanks for hiring me guys.)
On one hand they didn't understand it, and didn't work with me, but out of fairness, they offered and followed through on sponsoring me for the SEC Registered Research Analyst exams. Which meant NY, and I didn't want to be away from my kids in florida at the time. So I left Merrill, gave up all my licenses, and started to publish results from my work on http://www.alphaadder.blogspot.com. No fanfare, just putting things in black and white with date and time stamps. Time showed me to right.
I invite you and your team, to take a look. I am open to constructive criticism and comments. I am trading options on volatility for myself, and I am brainstorming about what to do with the blog site.
Thanking you in advance,
Bob Klapetzky
http://www.alphaadder.blogspot.com -
14
During the 1950s and early 60s sociologist gave up their attempt to overlay rational models [statistical modeling] on human behavior, made peace with the psychologists, and started to build a legitimate understanding of how society is constructed and changes.
Economists have only recently started this project, perhaps because of their disgust with those liberal sociologist and psychologist, or perhaps because of their ability to get large salaries from Wall Street.
I look forward to seeing the fruit of their labor in a couple of decades. Meanwhile, I get great amusement watching economist defend EMH a theory so easily demonstrated false as to be done by my 7 year old. Rational actors indeed.........
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All good posts. Now get those thoughts into the mainstream. Every time some TV pundit or politician talks about free rational markets, challenge him. Go out of your way to challenge him. Or her.
When Bank spokesmodel Erin Burnett on CNBC parrots the mainstream talking points, challenge her. When John Boehner parrots those same talking points, challenge him. We have limited time to move a nation to reality. I hate to pick on Erin, because there was a time when she showed a lot of common sense. Maria I have no hope for.
Remember that there are people out there who make a lot of money based on volatile markets, and they want to trot out rational market theory to justify their positions and profits.
Also, remember that many of the talking heads you see on TV socialize with Wall Street people. They are required to disclose any financial interestst they might have in the subject they are discussing. Maybe they should also say, " I need to disclose that I regularly socialize with people who work at Chase, Goldman, etc."
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@strawmn, @robertwaldmann and @randymiller all make a really important point—and articulate it better than I have: There are lots of traders/investors who think the market is inefficient enough for them to make money, but generally understand its behavior (and justify their paychecks) in the context of the EMH. My friend (and Fama's former student) Cliff Asness totally fits this profile.
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I should add that everybody's been making great points—this is a really brilliant comment thread—but this one in particular seems kinda crucial -
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[...] Eugene Fama defends the efficient market hypothesis, sort of – The Curious Capitalist – ... "I guess that's what's kind of disappointing to me about Fama's post. I'm thrilled that he's read my book, and is saying halfway nice things about it in public. In general, I'm a big Fama fan—his willingness to keep testing his theories against the evidence, and to support the work of students and younger professors whose research undermined those theories, is hugely admirable. But he and a lot of other people in academic finance just don't seem interested in directly engaging in many of the most interesting questions raised by the financial crisis. Such as: Can the financial sector get too big, and if so how can we tell? Can derivatives markets concentrate risk as well as spread it? Is financial innovation fundamentally different and more dangerous than innovation in other fields, and if so what should we do about it? Should central banks and financial regulators try to snuff out asset-price bubbles, and if so how should they go about determining when we're in bubble territory?…" (tags: financial-crisis pedagogy cultural-norms economics models-and-modes) [...]
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[...] Fama vs. Fox on the role of the efficient markets hypothesis in the credit crisis. (Curious Capitalist) [...]
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Agreed. Great thread.
My last two cents.
The professors aren't to blame. The Professors product that they are judged on in the short term is "paper". What and how much you have produced.
EMH does well most of the time. It falls out of bed when there is a big crash. Statistical physics, is just now getting a better grip on phase transitions. It is a dirty messy subject, difficult to "produce" results. It had not been a smart topic to tackle if you are looking to keep or grow your position. The advent of cheaper computing power has changed that. We are starting to reap the benefits.
Just about when I was about to bring in Glass-Steagal what shows up on Bloomberg: " Lawmakers were wrong to repeal the Depression-era Glass- Steagall Act in 1999, Reed said. At the time, he supported overturn of the law, which required the separation of institutions that engaged in traditional customer banking services from those involved in capital markets.
“We learn from our mistakes,” said Reed, who wrote an Oct. 21 letter to the editor of the New York Times endorsing a division of banking activities. “When you're running a company, you do what you think is right for the stockholders. Right now I'm looking at this as a citizen.”.
You guys remember the scary ads in the WSJ when Japan was doing well showing the big Sumo wrestlers visually depicting Japanese banks, and little sumo wrestlers depicting us. The massive holdings they reported, and still report, even after massive write downs.
People do not change. Beware when anybody says you should place a wager that we have.
Bob Klapetzky
http://www.alphaadder.blogspot.com -
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Mr. Fox,
I have read your book and while I enjoyed it, I must second the original comment (#3) by Steve Roth. In the book you make a distinction early on between the EMH and the *Rational* Markets Hypotheses. As the book progresses you become less and less clear about this important distinction. As the discussion here illustrates, this distinction needs to be preserved, as most of the comments are in fact directed at the RMH, not the EMH.
Your book is a fun if slightly wonkish bit of popular history, but it is likely to leave the reader who comes to it already lacking in some formal background in finance and economics rather confused about the RMH/EMH distinction. That's not a great failing of your otherwise excellent book; it's just an almost unavoidable pitfall of any popular treatment of a complex technical subject.
Even most MBAs still receive mostly comforting fairy tales, such as Porter's Five Forces and the SLM-CAPM, which research academics have not believed for at least a decade. Consequently, the size of the informed potential audience for books such as yours is relatively tiny to begin with and most do not read popular treatments of topics that they know. As you have the forum of this column in which to expand on your book, it would be a service to the community at large if you spent some time clarifying the points raised by Mr. Roth, explaining clearly how each related to EMH/RMH, the distinction between the two and their separate implications.
-ysb
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Mr. Fox,
Please e-mail me from http://www.alphaadder.blogspot.com. I just read the whole blog post from Dr. Fama, and it is ripe for the pickens. You had a lot to choose from!
I have a challenge for Dr. Fama.
I'll be back later, gotta run. Salsa dancing night.
Thanking you in advance,
Bob Klapetzky -
22
Once upon, there is a company now a wholly owned subsidiary of UBS called the Prediction Company which was one of the first automated trading system that found patterns through chaos. It was so good that unbeknownst to the inventors that gold price's were fixed then by NM Rothschild and the machine detected that anomaly. I think the EMH is false because of the prevalence of market makers, and huge institutional investors that can sway the market in their favor. When the market goes bad put in a put option, or better yet when they really tank phantom trade since only market makers have the ability to “fly under the radar,” as if there really is a radar for them!
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Just had to add this link which the book on "The Predictors" Thomas Bass is a Wired writer.
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Dr. Fama I respectfully disagree with your statement:
" EMH is a solid view of the world for almost all practical purposes" contained in your blog.
I believe otherwise, and have set up a challenge to shed some light on this position.
It is at http://www.emhfantasy.blogspot.com
Sir, there comes a time in the natural ebb and flow of the market, when people need it most, that EMH falls short, and I will show you where. In time, and within the chalenge.
Most sincerely, and very respectfully,
Bob Klapetzky
http://www.alphaadder.blogspot.com
http://www.emhfantasy.blogspot.com -
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[...] says Justin Fox, author of The Myth of the Rational Market, policymakers believed in efficient markets, and the academics who constructed the hypothesis didn't disabuse [...]
- foxjust About to walk to LA Public Library for this http://bit.ly/7LgRu6 Am told only a nobody walks in LA - 1 day ago
- foxjust just took first ride on LA metro. Totally disorienting not to have car to park here - 2 days ago
- foxjust Thanks to Bama fans for reminding us we needed to buy TP! (Turns out we're fine on detergent). Oh, and nice game #ironbowl - 1 week ago
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