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Have you read any of the books that I listed?

Russ


Gee, have you read my last message? Like the part where I suggested that you drop the confrontational tone and try to be civil?

I expressed a willingness to forgive the obnoxiousness of your previous message to me, and to make friends. But I guess you find it more important to bolster your self-confidence by demonstrating a suffocating pedantry, rather than just getting along.

Too bad.

I already know what you think. Evidently you have no idea what I think. So, I'll follow your example and provide some lists. Let me know when you've finished your homework, and maybe it will be easier for us to communicate. These lists are not exhaustive, they're just for starters.

Reading:
JP Sartre, Being and Nothingness
K Kesey, The Electric Kool-Aid Acid Test
D Brown, Bury My Heart at Wounded Knee
R May, Love and Will
S Sontag, Against Interpretation
J Kerouac, On The Road
C Castaneda, Don Juan

Viewing:
Any 5 films by the Coen Brothers
Any 5 films by Federico Fellini
Any 5 films by Martin Scorsese
Any 5 films by Stanley Kubrick
Any 5 films by Tim Burton
Any 5 films by Werner Herzog

Listening:
All nine Beethoven symphonies, twice
Brahms 2nd Piano Concerto
Vaughan Williams, Variations on a Theme by Thomas Tallis
Debussy, La Mer
Barber, Adagio
Hindemith, Symphonic Metamorphosis on Themes of Carl Maria von Weber
Copland, Rodeo; also, Fanfare for the Common Man
Miles Davis, Birth of the Cool
The Beatles, Revolver
Django Reinhart, anything you can find on disk
Bela Fleck and Edgar Meyer, Music for Two

You should of course also see at least three plays each by Shakespeare, Arthur Miller, Clifford Odets, Ben Hecht, Tom Stoppard, and David Mamet.

Somewhere along the line, get a look at La Jetee by Seurat. Just stare at it for about four hours. Then do the same thing with Guernica by Picasso, with the Pieta by Michaelangelo, and anything by Calder.

All that should keep you busy for a while. But there's one last step.

Find a local pub near MIT, Stanford, Caltech, or some such place. Pick whatever type of alcoholic beverage you prefer -- even if you do not normally drink -- and drink far more than you ought to. Do not get drink enough to get sick. But drink enough to make the room spin.

Then grab a grad student from among the patrons, and attempt to discuss the inevitable failure of String Theory as a way of uniting relativity and quantum physics. Feel free to pick either side of that opinion, the point is to attempt to debate it while extremely inebriated.

(Make sure you have a designated driver on hand, of course.)

By the way, I have not exactly done that last step personally. But I've done much more foolish things, so I'm actually going easy on you in this case.

Now, this whole message might seem to be terribly off-topic. But my goal is to promulgate one simple notion.

And that is, that the so-called "Efficient Market" is not at its heart a bunch of numbers printed on pieces of paper. At its heart, that market is comprised of millions of HUMAN BEINGS. Each of them has a heart and soul, thoughts and feelings. The literature and artworks listed above are ways that some folks have tried to express themselves, while also achieving resonance with other people who willingly experience those expressions on a repeated basis.

Resonance among individuals. An audience in a theater. It is a "mass market" of consumers of drama (or music or whatever). It is not dissimilar from a distributed "mass" of people who collectively invest money in various ways. The sum total of those actions can be summarized by mathematicians in a handful of figures, but that is not where those actions ORIGINATE.

So I kinda think that a person who believes he can understand people by looking at the end result of their actions, in a limited sphere such as finance, does not really get it. If the market were ever "efficient" then how could it also be "irrational" or "exuberant?" I mean, really.

Some of the same people who put money into index funds may also go skydiving or bungee-jumping on weekends. They may fear risk with something as meaningless as money, while taking extreme risk with the most precious possession of all, i.e. life itself. Is this sensible?

No, but it's human. If people can get worried or happy, then a person who knows people may be able to anticipate when that worry, or that happiness, will be translated into investment behavior. And there are a lot of people making money by that precise method. If it were not true, it would not be possible for pump-and-dump scams to work. But they do.

So it does not matter if you refuse to admit how well I rebutted your point in my last message. People like Warren Buffett do, indeed, "time" the market. You'd rather try to drag the discussion back to some books and theories, rather than just look at the real-life actions of a real-life person, who demonstrates an ability to make money that is not tied to following the crowd and waiting endlessly for results.

I ain't Buffett by a long shot, but I do know a lot about him. And I know he did not become a billionaire by owning index funds, or by buying high and selling low. This is common sense -- something that a person with far less education than you or I can figure out. So I think you're trying to make it harder than it is, for the sake of showing off a bunch of rather pointless erudition. But hey, I could be wrong. ;-)
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