I beg to differ. He's made a lot of money from what he understands. Around 10 times his money with coke. He might not have any technical knowledge, but he does have logical reasoning. They've been teaching that for eons, and it is NEVER useless(which is why they've been teaching that for eons.)If you think technology changes the way markets behave, then I'm afraid you're wrong. Human nature does not seem to change, and it hasn't changed since the days of the Tulip Mania some 400 years ago. What changes is the means with which they express their herd mentality. 4 centuries ago, it was going to the market in person and investing their life savings for tulip bulbs. Now, it's using one's credit card and internet broker to buy Amazon.com on margin. Successful investors throughout history have used the most basic rule of logic to become rich... sell low, buy high. Sell when everyone else is furiously buying sares priced to absurd levels, Buy when no one else dares to touch them, at the end of crashes. For the truth is that
most people buy when shares are high, and panic sell when they are low. It's human nature. If a stock has already gone up 1000% in a year, you'd feel that it will probably go up another 1000% in the following year. And vice versa. You don't need calculus or a Ph.D. in human physiology to figure out that such notions are ridiculous, just common sense. But many people, including those who hold science Ph.D.s still act on them and lose their shirts. Because it's their nature. They follow the herd into Tulips, Nifty Fifty stocks, and now Internet Stocks. And they lose out along with the rest of the herd.
If you want to play short-term gains, that's fine. Just make sure you don't get sucked in by herd mentality. |
