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What happens when you trust the markets

April 23, 2013 - Harry Eagar
You know all those people who say you cannot do better than allow the market to do as it lists? In particular, that it is impossible to sit down and think about something and then act on your conclusions and have your act turn out better than if you just let the invisible hand take care of it?

Well, balderdash. Here's today's evidence, from Business Insider:

"Of course the story was false, though it remained uncorrected for several minutes. Eventually an AP employee tweeted that the company's account had been compromised.

"But in that time, the stock market briefly tanked.

"The Dow had been up over 100, but it then lost 150 points."

How much is 150 points off the Dow worth?

Tuesday's event was transitory, because it proved easy to show and tell that the market was reacting to a delusion. The market always reacts to delusions, and sometimes those delusions persist for years and years.

 
 

Article Comments

(1)

OneAikea

Apr-25-13 3:49 PM

Playing the stock market it seems is a legal form of gambling and allowed. Yet gambling in Hawaii of any sort is illegal. If the stock market was a sure thing, then everyone would be rich and therefore the numbers would change from 99% rich to 1% poor. 1% who believe that gambling is sinful.

Gambling is Gambling.

 
 

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