yes, there is market inefficiency due to risk aversion. Black swans exist. D2
From: [email protected] To: [email protected] Subject: RE: [Vo]:MFMP on a possible independent report of DGT's Hyperion Date: Sat, 27 Jul 2013 13:09:49 -0500 >From "Blaze": ... > In terms of my credentials though, which might be more >interesting, I spent about the> last 8 years or so on Intrade making buckets >of money on making big bets on highly> improbable events like this which came >true. The opportunities for profit there were> incredible. Some examples, I >made money on Obama on McCain winning their> primaries by making early bets >(admittedly though I had hedged a bit, but was over> all long on them). >"Buckets of money." you say. It's obvious to me that it takes a large and >well-integrated skill set to make "buckets of money" betting on improbable >events. (On a related note, one of my mutual funds is a "contra" fund. It >often seems to do better than the average fund.) On a related topic, earlier >in my life I tried my hand in the commodity markets. I suspect trading >commodities shares many similarities with the kind of skill set you have >acquired. In a sense, the commodities you bet on are futures. It's anyone's >guess whether the types of futures you buy into will ripen or go sour when it >comes time to cash in. As for me and my commodity trading adventures, I'll >grant you that it was a fun and exciting time for me... while it lasted. >Eventually, I lost all the money I had set aside for this adventure. I'm sure >I lost it all due to my own lack of having acquired a sufficient collection of >skill sets, and the fact that I didn't possess an appropriate psychological >propensity for immediate "trading", and finally not having timely data in >which to make proper assessments on whether to bury or short the commodity. I >did manage to eventually rationalize my financial losses as having acquired >some valuable experiences in the art of trading futures. It’s not for the >faint of heart! Of course, while I paid my tuition fees I flunked the course. >On cannot pass at everything they dabble in. ;-) In the aftermath I eventually >learned that many professional commodity traders manage to stay in business >because there's a constant influx of newbies (just like me) who come in with >the goal of making money. What typically happens, however, is that the vast >majority of these newbies end up transferring bulk of their bank accounts into >the accounts of the professionals. An irony that did not escape me was the >fact that the only way the professionals tend to stay in business is to >constantly sell to naive newbies a manufactured hope that there is money to be >made in trading futures. In fact, that's how all forms of professional >gambling manage to survive. Granted, an extremely small percentage of brand >new "newbie" traders actually DO end up become good at the skill, but as >someone was known to have sed: A sucker is born every minute. In the end I >think the biggest [moral] lesson I learned completing this particular course >was to ask myself, what kind of a contribution was I actually making to the >world? The more I thought about it, not very much. I then asked myself, what >if I had become successful? What would I have then been able to put my grave >stone? STEVEN VINCENT JOHNSON1952 - 2031 HIs contribution to the world was >thathe made a lot of money extracting it from the wallets of otherswho were >also trying to make a lot of moneyattempting to do the same thing to him.* * >*RIP Just as in the fine art of betting, commodity trading works by profiting >from the losses of others. Inculcating this realization did not set well with >me. In a sense I actually became relieved of the fact that I had lost money. >It meant that I had not profited from the financial losses of others. I >realize this was a rationalization on my part. Nevertheless, my own "losses" >left me with a clearer conscience. Based on my own memories I will grant you >that it probably IS a rush to realize how smart one must be in order to take >money (willing so) from others, and to be able to do it in a perfectly legal >way! The fact is that a capitalistic economy needs transactional activity of >this sort in order for the markets to remain dynamic and liquid. So... in a >sense, THATS, the "service" traders and betters are contributing to the >system. Hey! It's just money. ...hopefully, YOUR, money, and not mine. Nothing >personal! For some inexplicable reason, I don’t think I personally would feel >comfortable advertising the acquisition of such a skill set on my gravestone. >But by all means, have fun with your "buckets of money." Regards,Steven >Vincent >Johnsonsvjart.OrionWorks.comwww.zazzle.com/orionworkstech.groups.yahoo.com/group/newvortex/ >
