On Sat, May 17, 2008 at 12:37 AM, Andrew Lentvorski <[EMAIL PROTECTED]> wrote: > Bob La Quey wrote: >> >> Your comment "brainpower doing nothing" is complete and utter nonsense. >> Understanding how markets work, even if only for private profit, is >> profoundly important. > > The goal, however, was not "understanding how markets work." It was, in > fact, precisely the opposite. It was "manipulating the markets for profit."
And How Andy do you "manipulate without understanding?" I claim that cannot be done. One major function of understanding is to enable manipulation. I do _not_ argue the ethics of this. I do argue the logic of this. > Manipulation both diminishes our understanding and decreases the value of > markets for useful purposes. For example, all of the nice "momentum > investing" has done an excellent job of increasing volatility--not a > benefit. Part of the value of markets is liquidity so that volatility can > be managed. "Manipulation diminishes our understanding" is a nonsensical statement. It may make some limitied sense if by "your" I understand you to mean, "Andy" or the generalpublic. But if I know how to manipulate a market and you do not then I know more about the market than you do. Is what you object to the private holding of such knowledge? (Power to do so is another issue. Important certainly, but different from understanding.) Understanding "momentum" is understanding an aspect of the market. Volatility is a natural phenomena. Understanding volatilty is quite important. Knowing how to manipulate and profit from volatility is equally important. Everyone in a market wants an "unfair" advantage. If knowledge and understanding, not ignorance, is to matter at all then you can hardly argue that "They use their knowledge for unfair advantage." So would you simply have the markets pass out rewards at random to the participants? > I stand by my statement. The PhD's on Wall Street are wasted brainpower. I > might even call it parasitic--get back to me after we recover from the > meltdown. The "meltdown" which may well occur is a red herring in this context. Ignorance, which you seem to be promoting, certainly will not help to prevent a meltdown. >> Do you Andy, truly believe knowing how markets work is unimportant? > > I believe understanding them is a laudable goal. It was not the goal of > those employed there, however.te See above. I claim, you will disagree if you will, that one cannot manipulate without understanding. Our audience will decide for themselves, as after all is their right, who is correct. I suspect what you object to is not so much the fact that these PhDs might actually understand the market as that they do not share this knowledge with the larger public. I would suggest that you need to distinguish between understanding and sharing the understanding. >>> It was summed up well by a quote from the same person later in the same >>> thread: >>> >>> "Truth is orthogonal to relevance." >> >> If this is true then "truth is irrelevant." >> I do not believe that truth is irrelevant. >> I believe the quote is wrong. No "not even wrong." > > No, that does not follow. > > What this says is that truth and relevance are not necessarily related. I believe that the truth of a thing is always relevant to the thing. If what you mean is that the truth of some other thing is irrelevant than that is obvious, irrelevant and simply a silly comment. BobLQ -- KPLUG-List@kernel-panic.org http://www.kernel-panic.org/cgi-bin/mailman/listinfo/kplug-list
