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To: Jacob Snyder who wrote (13683)	12/19/1997 7:02:00 PM
From: Iceberg	Respond to of 70976

> When you do this to rats with an electric shock, and eventually they don't respond, it's called habituation. I guess the same process works with investors and downgrades. Jacob, Interesting analogy comparing rats to humans, and electric shocks to the stock market. My understanding is that the stock market, generally speaking, shocks humans randomly and nonsensically. What happens to rats when repeatedly exposed to random, nonsensical shocks? Is it habituation? Or does it drive them crazy? Maybe it depends upon the frequency and intensity of the shocks. There may be a more defined pattern to downgrade announcements than for the market action in general, so habituation is certainly a possibility in that regard. Are you aware of any studies comparing rat behavior to human behavior relative to downgrades, or to any other aspect of the stock market? It seems to me a possibility that rats might exhibit even more rational behavior than humans under experimental simulated market conditions. At least from my observations of human behavior and the stock market, I wouldn't rule out the possibility at all. <g> Thanks, Ice

To: Jacob Snyder who wrote (13683)	12/19/1997 7:51:00 PM
From: Paul V.	Respond to of 70976

Jacob, >When you do this to rats with an electric shock, and eventually they don't respond, it's called habituation. I guess the same process works with investors and downgrades.< Stimulus, response, we never get away from Pavlov. Are you comparing investors to rats emotionally?:) I agree, we as investors, need to be in tune with our emotion and try, try, try, to control our Greed and fear emotions. To try to keep my own emotions at a minimal level I use the statistical analyis and consider the views of Big Buck, Kumar, Tito, Gottfried, Lester e, Ricardo, Cary, you and others on this thread. Emotion control is, in my opinion, one of the most difficult items in investing. Just my opinion. PaulV.