Re: Securities exchanges shutdowns

2002-04-02 Thread Alex Tabarrok

Robin Hanson wrote:
 
 Alex Tabarrok wrote:
 
  Yes, in 1968 the exchange closed on Wednesday's in order to deal with
  backlog.  French and Roll (1986) find that variance of stock returns on
  days when the market is closed is much lower than on days when the
  market is open which suggests that trading itself, rather than say
  information transmission, generates variance.
 
 Couldn't we interpret this as trading *creating* information, which is then
 transmitted?

   What's the value of this created information?  In other words, what
sort of information could be created solely by trading that we would
still want incorporated into market prices?  i.e. does this trading
information help the market to achieve efficiency?  It's difficult to
come up with a story where this is true.  Markets are supposed to reveal
information that is already out there.


Alex
-- 
Dr. Alexander Tabarrok
Vice President and Director of Research
The Independent Institute
100 Swan Way
Oakland, CA, 94621-1428
Tel. 510-632-1366, FAX: 510-568-6040
Email: [EMAIL PROTECTED]



Re: Securities analysis

2002-04-02 Thread Fred Foldvary

 what's everyone's opinion here on fundamental vs. technical analysis?
 Dan

Information does not instantly get propagated to all participants in a
market, so there are profit opportunities for those who study market
patterns.  There may be changes in volume and price preceding a major trend. 
Investors Business Daily, for example, features articles on it.
It is probably not complete nonsense, but for the non-professional investor,
he best stick with Modern Portfolio Theory and not time the market.

Fred Foldvary

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Re: Silly business regulations

2002-04-02 Thread Eric D. Dixon

[EMAIL PROTECTED] forwarded:
Low-fat spat 
Mar 28th 2002 | MONTREAL  
From The Economist print edition 


Three days earlier than this Economist article, the organization I work for (U.S. Term 
Limits) coincidentally published a commentary on how the initiative  referendum 
process helped turn margarine yellow -- at least in a few key U.S. states. I've 
included it below.

Eric D. Dixon

==

http://www.termlimits.org/Press/Common_Sense/cs560.html

Yellow Margarine

U.S. Term Limits Daily Radio Commentary #560
Release Date: March 25, 2002

Over the last 100 years, the citizen initiative 
and referendum process has done great things. It 
has helped women win the right to vote, ended the 
discriminatory poll tax, and more recently, it 
brought us a number of government reforms -- one 
of my favorites being term limits.  

But let's not forget the little things, either. 
Like yellow margarine. Now, yellow margarine may 
not seem like anything special to you if you've 
never lived with margarine that's . . . well, 
colorless.

What the heck am I talking about, you ask? Back in 
the 1940s, when margarine first hit the food 
scene, the dairy producers weren't very happy 
about it. They sold butter, and for every stick of 
margarine sold, it meant one less stick of butter.  

So, what did the powerful dairy industry do to 
compete? They went to the legislature to stop 
margarine producers from coloring their product 
yellow. And legislators passed laws to do just 
that. Really. Well, if margarine wasn't yellow, 
folks just might not feel right spreading it on 
their bread. 

It was the law. Until the voters in Michigan, 
Oregon and Washington, between 1949 and 1952, 
bypassed their legislature and passed a new law, 
saying, Get real: margarine can be colored any 
color the folks who produce it think customers 
will like.

It's the initiative process that's the story here, 
not the wonders of margarine. I much prefer 
butter, myself. I also prefer the people 
intervening directly when special interests have 
hijacked common sense.

This is Common Sense. I'm Paul Jacob.

The opinions expressed in Common Sense are Paul 
Jacob's and may not necessarily represent the 
position of U.S. Term Limits or the U.S. Term 
Limits Foundation. Paul's daily commentaries are 
heard on 277 radio stations in 49 states and on 
the Internet. Subscriptions are FREE. Just call 
(800) 733-6440 or e-mail 
[EMAIL PROTECTED] today.