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Strategies & Market Trends : Anthony @ Equity Investigations, Dear Anthony,
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To: MaryinRed who wrote (29491)4/12/1999 4:43:00 PM
From: TripleT  Read Replies (1) of 122087
 
LOSS OF CONTROL

Years ago, there was a pop psychology book called Psycho-Cybernetics. The author used the analogy of the mind being like a "operational amplifier" in that positive or negative feedback determined how the mind functioned. The market today seems to me to behave like these amplifiers.

I was a technician then and worked on OP-AMPS or feed-back amplifiers. They were used to drive a mechanical drive train. When the feedback was too strong, they would over-drive the system and the gear train would set there and swing back and forth trying to find the tracking point. The gear-trains could literally destroy themselves if the feedback on the OP-AMPS was too high. Today the market is functioning like these amplifiers. The market is going well because of the hype, speed, and the exuberance that abounds. My opinion is that the feedback is too high. If and when the market OP-AMP gets out of whack, watch out. On the internet, exuberance can turn to fear quickly and panic could set in.

Under the old system, the brokers functioned like a shock absorber and dampened the market. Thanks to the internet and on-line trading, the dampening has been removed and anything is possible, which may make us a fortune but can be a source of much grief, if unchecked.

TTT
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