His famous theory, from the dawn of modern economics, the "Invisible Hand" is EXACTLY what all this economic thinking is ABOUT.
Invisible hand != efficient market theory.
They are two entirely separate concepts.
---
In economics, the invisible hand, also known as the invisible hand of the market, the term economists use to describe the self-regulating nature of the marketplace,[1] is a metaphor first coined by the economist Adam Smith in The Theory of Moral Sentiments. For Smith, the invisible hand was created by the conjunction of the forces of self-interest, competition, and supply and demand, which he noted as being capable of allocating resources in society.
en.wikipedia.org
In finance, the efficient-market hypothesis (EMH) asserts that financial markets are "informationally efficient", or that prices on traded assets (e.g., stocks, bonds, or property) already reflect all known information, and instantly change to reflect new information. Therefore, according to theory, it is impossible to consistently outperform the market by using any information that the market already knows, except through luck. Information or news in the EMH is defined as anything that may affect prices that is unknowable in the present and thus appears randomly in the future...
...The efficient-market hypothesis was developed by Professor Eugene Fama at the University of Chicago Booth School of Business as an academic concept of study through his published Ph.D. thesis in the early 1960s at the same school.
en.wikipedia.org |
