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Politics : Foreign Affairs Discussion Group -- Ignore unavailable to you. Want to Upgrade?

To: TimF who wrote (260979)	4/8/2008 3:19:24 PM
From: neolib	Read Replies (1) \| Respond to of 281500

Even the fact that someone is over paying is really only determined by the fact that people are willing to pay less later. In other words even the point that some prices are overpayment in a bubble, is determined by what buyers voluntarily pay for in later years. If you really believe that, then bubbles can only be determined in retrospect. Complete nonsense. Further, if you really believe that you must be horrified at the Fed's attempt to stabilize the financial system, since they are attempting to prevent the very mechanism you venerate: They don't like mark to market. If you think bubbles are fine, so are busts, as long as the metric is priced by what people will happily pay. Right now the government is trying to ensure that people would pay more than they are happy with, in order to prevent a collapse. If bubbles can't be identified while happening, than neither can the reverse be identified while happening. It should all just be mark to market. There are plenty of metrics that showed we were in a housing bubble while it was happening. AFAIK, there is zero correlation between the intrinsic value of ANYTHING I buy and my state of happiness while handing over the money. If you think otherwise, experiment with drugs on your next shopping spree and see if it enhances the quality of your purchases. LOL! Oddly enough, dynamic systems can be analyzed, claims to the contrary not withstanding.