On Tue, Sep 29, 2009 at 2:26 PM, c b <[email protected]> wrote: > It is a tautology that a bubble is caused by speculators predominantly > betting on rising prices. > > ^^^^ > CB: Given your statement below, _some_ bubbles are caused by specs > predominantly betting on rising prices ?
Oh boy, lets see if I can keep this straight (:-). A tautology is a logical necessity. An empirical truism is not necessarily a tautology. The statement: "the GDP of a growing economy always increases in time" is a tautology, but "CEOs make a lot of money" is not, though they are both true. At some philosophical level, it can be argued that there is no difference between the two, but I won't go there. To start with, not *some* bubbles but *all* bubbles are caused by speculators. This statement indeed is a tautology because it follows from the definition of a bubble. > Does anything besides speculators predominantly betting on rising > prices create bubbles ? No. > It not a tautology that speculators always and everywhere create > bubbles. Whenever and wherever there is speculative money available, a > bubble is absolutely inevitable. > > ^^^^ > CB: Is the second sentence supposed to be "not absolutely inevitable " > ? Otherwise, it seems to contradict the first sentence. Should the > first sentence be " It is not true that speculators always and > everywhere create bubbles ? There is no contradiction. The second sentence is not a *logical* necessity but an *empirical* fact. It is conceivable that speculators could exist and not cause bubbles. A casino, for e.g. does not have any "bubbles". > I don't think this point has been well recognized. The consensus seems > to be that speculators *sometimes* cause bubbles when they go out of > control. Not true. > -raghu. > > ^^^^^ > CB: Are you saying all bubbles are created by speculators ? > > or Speculators never fail to create bubbles ? Yes to both. The first is a trivial observation, the second not trivial. -raghu. -- Today is National Existential Ennui Awareness Day. _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
