<<inevitable>> ...
gmo.com
Just what is it that you know and the guy at Barron's know that the rest of the world does not know? And, by pouring out all that knowledge in Barron's, a lot of smart people should also now get it. With all this knowledge out in the open, why are people still paying top dollar for things that are only worth a fraction thereof? Are smart people with money that stupid?
All this economy stuff is way over my head. I am too old to really try to get a much better understanding. But all this stuff that you and the guy in Barron's spout is counter intuitive to everything that I know.
When I was way younger, I loved horses - not necessarily horse racing. The best looking horses were the thoroughbreds at the race track. I went to see them warm up and work out before the races, but I also got to see and understand the tote board.
I don't know the technical name of the tote board. That, I think is what the people who bet on horses called it. In any case, the tote board gave you up to the minute odds on the likely outcome for any horse in the race.
The odds represented the risk that horse players wanted to bet with their own money in order to win money. The odds represented all the knowledge that people had on each horse in the race. From the morning papers, you knew all their past performance including their performance in work outs in fractions of seconds of how fast they ran each eighth or quarter mile. You knew who their owners, trainers, and jockeys were and their past performance. You also knew the horses lineage - going back many generations and their ancesters past performance.
There were of course insder information: what the horses, trainers, and jockeys ate that day and what their temperatures were.
You could also judge for yourself, the shine of the horses coat as they approached the starting gate - givng you the latest indication of how the horse may be feeling just before the start of the race.
The tote board would show you at the last minute all the results of all the information that went into making up the odds.
Please explain to me how and why the financial markets are not going to act in the same way. The prices on things reflect up to the minute all the smart people crunching their numbers based on all the information available (on the up and up and on insider information).
All the little investors along with all the big hedge fund operators are feeding into their heads or supercomputers, every bit of information available. If there is a bargain somewhere, the hedge funds are going to buy it up - even for fractions of percentages.
So up against a natural tote board, why would this guy at Barron's know things that others do not?
Even if he does see something that others do not, how long will it take for the big boys to discount all that he knows? |
