On Dec 17, 2008, at 4:30 AM, Julio Huato wrote:
Skidelsky wrote:
Greenspan must have believed something like
the "efficient-market hypothesis," which holds
that financial markets always price assets
correctly.
But this is *not* what the EMH holds... the EMH doesn't hold what
Skidelsky says it holds. Say X, the market price of an asset at a
point in time, is a random variable...
But where is it said that the market price is a *random*, rather than
dependent, variable? Isn't it the *deviation* of market price from
EMH "value" that is the random variable? [X=f(I) +or- r] (I standing
for available information, r for random deviation)
Shane Mage
This cosmos did none of gods or men make, but it
always was and is and shall be: an everlasting fire,
kindling in measures and going out in measures."
Herakleitos of Ephesos
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