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re: Dow is down over 300 Points

Posted on 11/9/12 at 7:43 am to
Posted by BennyAndTheInkJets
Middle of a layover
Member since Nov 2010
5606 posts
Posted on 11/9/12 at 7:43 am to
quote:

efficient market theory

I'm not sure what the bigger waste of time teaching in academia is, the efficient market hypothesis or the capital asset pricing model.

Both of these are absolute jokes at this point in time. Academia really needs to stop teaching finance in a static manner, correlations and relationships change all the time and models only work for a period of time. The ONLY relationships that will hold true are the inverse relationship between prices and yields, and that prices are determined by supply and demand. Everything past that can be broken at any time.
Posted by TheHiddenFlask
The Welsh red light district
Member since Jul 2008
18384 posts
Posted on 11/9/12 at 8:48 am to
quote:


I'm not sure what the bigger waste of time teaching in academia is, the efficient market hypothesis or the capital asset pricing model.

Both of these are absolute jokes at this point in time. Academia really needs to stop teaching finance in a static manner, correlations and relationships change all the time and models only work for a period of time. The ONLY relationships that will hold true are the inverse relationship between prices and yields, and that prices are determined by supply and demand. Everything past that can be broken at any time.


That law is broken all the time.

Hooray free shite from the government.

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