>>>Some paragraphs are NOT new
As I have never read a Greenspan speech before, probably makes no difference to distinguish (for me). Expect it means the matching bolded last paragraph. My knowledge of Economics is nil. So, grain of salt in order.
Aside from the technicals I don't follow (which I cheerfully elide, rather than trip over) the argument seems linear, lucid, non-discursive (in the sense of obscuring essence - deliberately or otherwise). Also in the spirit of curiosity, not fear. In that sense it doesn't seem exactly talking down the market.
It sounds like the dodge of re-pricing options has been addressed. Don't understand that, but not so necessary.
other incomprehensibles...
The value ascribed to any asset is a discounted value of future expected returns, even if no market participant consciously makes that calculation
Who/what makes this calculation - institution/individual/analytical tool? when? how? The term discounted value is a puzzle.
Even our most sophisticated analytic techniques have difficulty dealing with the interactions among time preference, risk aversion, and uncertainty and with the implications of these interactions for the risk premiums that are embedded in asset prices
Yikes
Nonetheless, certain stable magnitudes are inferable from the process of discounting of future claims and values and the rate of time preference underlying interest rates, like so many other aspects of human nature, has not materially changed over the generations
Those(presumably)analytical terms (which i don't understand)
time-preference, risk premiums, discounting of future claims and values..etc
coupled with---aspects of human nature?
Not exactly all. Am hoping to check an Annual Report & see how spending which is capitalized vs expensed affects reported earnings.
Annual reports, for the most part, i find not very user-friendly!
Otherwise, hope you've gone fishing & if you can suggest a book that might help ... I began charting by reading books (like Iris) & using websites. I think Motley has a lot on Valuation, but find their tone very irritating. Like those books for idiots - even if I am an idiot!
Dorothy |
