Gemstar Intl (GMST) Message Board

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Technology Stocks : Gemstar Intl (GMST)

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To: Lucrative who wrote (735)	11/8/1999 4:52:00 PM
From: Seeker of Truth	Read Replies (1) of 6516

Galileo was chained, Darwin was attacked, Newton was ignored but somehow science was born. The essence of science is not to believe anything without proof. A proof of the value of technical analysis would be like this. We get out a chart of values progressing in time. We cover up the later half, just showing the first half and ask the "technical analyst" to predict. This experiment has been done many times with large samples and the bottom line is that TA has no predictive value. Then why is it so popular? People don't understand statistics. "Uncle Louis smoked and lived to 91 so I can smoke also. I'll be fine." "Analyst A is no good but look at technical analyst B's prediction of HoT Rod Inc. He said the chart was very favorable and sure enough it tripled!!!" Anecdotes swamp the science. Wishful thinking obliterates objectivity. Many Ph.D. theses in economics have been written which presented data that rule out TA as a useful predictive tool. But TA gurus will make a living as long as people love their dreams more than they love science. I don't know whether GMST is a buy or a sell here but you certainly can't prove that by TA. I usually say JMHO, but not this time.

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