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Does Market Timing Work?

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Re: Does Market Timing Work?

#281

Post by munksbeer »

grogers wrote: post #154
Devasta wrote: post #136

Earlier quoted context omitted.

1 - People should be able to retire. 2 - Their retirement should be financed by 401ks and the like. 3 - Stock Markets can go down as well as up. You can't have all three, so the government will always ensure that the stock market goes up long term.

With the excessive debt (which is not slowing down) the government is planting the seeds for high inflation in the long term. This historically has been very bad for equities (in real terms).

Bad for equities, in real terms, over what time frame? Things tend to revert to the mean.

Re: Does Market Timing Work?

#282

Post by galaxyLogic »

bumby wrote: post #230
galaxyLogic wrote: post #218

Earlier quoted context omitted.

It is not clear exactly how, but kind of makes common sense. Productivity is about producing the same things faster. If AI can do part of our work for us it means we can accomplish more with the time saved.

Or, fewer and fewer people are needed for approximately the same amount of production. This may lead to a further bifurcated society. I do think that a service-oriented economy has many, many more nooks and crannies to hide non-productive jobs, though, and that could perpetuate the “bullshit job economy” hypothesis.

Fewer people are needed to perform a specific job as we do it today. But there will always be room to improve the products and services we produce and to make them cheaper.

Consider the steam-locomotive. It was a great invention but we didn't stop there now we have bullet-trains and hyperloops.

There is also plenty of room at the bottom as famously noted by Feynman I think. We can make products smaller to make them easier to carry around. New cheaper price points create new demand and new markets.

Also as economies improve, people will have fewer children, because they don't need them to take care of themselves at old age. So it's not like we will have too many people having nothing to do.

On the contrary I think AI can be the great equalizer: Rather than having fewer people who know how to do things, we will have more people who are able to do things with the help of AI.

The technology by itself will not produce a great society however. We need democracy to accomplish that. As people will have more free time they will have time to study and more and more people will demand democracy because they will understand it's the only way to avoid wars.

Re: Does Market Timing Work?

#283

Post by vik0 »

envsubst wrote: post #112
vik0 wrote: post #68

Ever since I read The Black Swan by Nassim Nicholas Taleb and Thinking, Fast and Slow by Daniel Kahneman, I can't take anything related to the stock market seriously (among other things as well, but this post is related to the stock market, so that's why I'm focusing on it.) There's very little skill involved, which isn't to say there is no skill involved whatsoever - but at the end of the day it really is just luck…

Nassim Taleb made his money trading markets.

Yes, I am aware of that

In the Black Swan he talks about his endeavor with the stock market and how lucky he got by chance, and not by using some pseudo scientific formulas and whatnot to "predict" how his stocks would do. He also gave some pretty good advice when it comes to the stock market

The whole book is just awesome, I'd recommend giving it a read

Re: Does Market Timing Work?

#284

Post by envsubst »

vik0 wrote: post #283
envsubst wrote: post #112

Earlier quoted context omitted.

Nassim Taleb made his money trading markets.

Yes, I am aware of that In the Black Swan he talks about his endeavor with the stock market and how lucky he got by chance, and not by using some pseudo scientific formulas and whatnot to "predict" how his stocks would do. He also gave some pretty good advice when it comes to the stock market The whole book is just awesome, I'd recommend giving it a read

I have read it.

- He isn't a stock trader, he is a bond trader. The kind of bets you need to make to be succesful are different.

- "how lucky he got by chance" - He doesn't say this. He talks about how we can even better model uncertainties.

Re: Does Market Timing Work?

#285

Post by AnthonyMouse »

bumby wrote: post #279
AnthonyMouse wrote: post #272

Earlier quoted context omitted.

> It becomes cost efficient to truck construction workers (even if it's not great for the workers). This gives me a different idea and I wonder if it's worthwhile. There are industrial robots that e.g. mass produce cars. Suppose you make one to mass produce housing, but instead of putting it in the factory you put it on the truck. Put it on the construction site. It takes a pile of lumber, cuts it to length and turns…

I’ve worked on those robots that mass produce cars. The idea that you can ship them from site to site doesn’t really work. They require a lot of support infrastructure. The use a lot of large parts (dies in the case of cars) that are heavy and must be constantly swapped out. They require a lot of constant tuning that would likely be made worse when subjected to the vibrations of transit. They require whole specialize…

Those sound like things that are actually specific to cars, which operate on metal with tight tolerances because it e.g. has to hold compression in a cylinder.

Houses are made out of wood and tolerances are measured in centimeters if not inches.

Re: Does Market Timing Work?

#286

Post by pjlegato »

bumby wrote: post #239
pjlegato wrote: post #188

Earlier quoted context omitted.

This is a common and fundamentally incorrect misconception about Social Security. Many subsequent policy debates are then misinformed. Your money is not ever saved for you. Your retirement is NOT funded by your own past taxes. Your retirement is funded by those younger people who are then working and paying taxes. You can see the details at https://en.wikipedia.org/wiki/Social_Security_Trust_Fund Payments to retirees…

Isn’t the implication that solvency can be maintained by increasing the age of claimants? It doesn’t have to be a drastic step function, it could be slowly phased in.

That would be theoretically possible, yes; but all proposals along those lines so far have been met with staunch and bipartisan political opposition. Attempting to alter the retirement age seems to be political toxic waste.

Re: Does Market Timing Work?

#287

Post by bumby »

AnthonyMouse wrote: post #285
bumby wrote: post #279

Earlier quoted context omitted.

I’ve worked on those robots that mass produce cars. The idea that you can ship them from site to site doesn’t really work. They require a lot of support infrastructure. The use a lot of large parts (dies in the case of cars) that are heavy and must be constantly swapped out. They require a lot of constant tuning that would likely be made worse when subjected to the vibrations of transit. They require whole specialize…

Those sound like things that are actually specific to cars, which operate on metal with tight tolerances because it e.g. has to hold compression in a cylinder. Houses are made out of wood and tolerances are measured in centimeters if not inches.

This sounds like conjecture from someone who hasn’t worked in construction or automation. I’ve worked in both. Problems generally seem much simpler when we don’t have much experience with the nuances and details of execution. Some tolerances are forgiving (like framing, which can be corrected by a finish carpenter) and other systems are much more difficult. Both take some level of AGI to problem solve that comes in the form of a human. That's why there are "design" drawings and "as-built" drawings that (in my experience, at least) never match.

I'm not saying its impossible, but I think the marginal costs are too high to replace what we already have. In addition, society has been moving towards individualization since the 1980s. We aren't in the Henry Ford days where people are ok with "any color of car as long as its black." People want individualization when it comes to their homes as well, and that lack of standardization makes automation more difficult than building a modern Levittown with robots.

Re: Does Market Timing Work?

#288

Post by vik0 »

envsubst wrote: post #284
vik0 wrote: post #283

Earlier quoted context omitted.

Yes, I am aware of that In the Black Swan he talks about his endeavor with the stock market and how lucky he got by chance, and not by using some pseudo scientific formulas and whatnot to "predict" how his stocks would do. He also gave some pretty good advice when it comes to the stock market The whole book is just awesome, I'd recommend giving it a read

I have read it. - He isn't a stock trader, he is a bond trader. The kind of bets you need to make to be succesful are different. - "how lucky he got by chance" - He doesn't say this. He talks about how we can even better model uncertainties.

My apologies, you are correct on the first point.

>He talks about how we can even better model uncertainties.

Where does he say this? What chapter? Thanks in advance.

edit: were you alluding to his barbel strategy?

Re: Does Market Timing Work?

#289

Post by yterdy »

bumby wrote: post #237
yterdy wrote: post #202

Earlier quoted context omitted.

No, they shouldn't. SS is meant to prevent destitution, not enable luxury. Wealthy Americans owe the working and consumption classes whose sacrifices make their riches possible; there is no such obligation to ensure those elite earners get back even what they paid into that particular channel, at the expense of people who are much less well off, when they have other resources to draw from. You might not think that's…

Devils advocate: by subsidizing the “consumption class” you enable more consumption. I get that’s how our current economy works but there are probably a lot of negative externalities associated with increasing consumption.

That's fine. Sure, there are downsides that increase as consumption increases, meaning that overconsumption (however that's defined) is undesirable. However, consumption enables cultural expression that otherwise would be economically untenable. Art, design, music, etc. benefit from economic incentives to overproduce beyond subsistence. That people go above and beyond in their productive capacity in order to enable creators to create freely and contribute to the corpus of human expression is something that should be recognized as the sacrifice for the collective soul that it is.

Re: Does Market Timing Work?

#290

Post by bumby »

yterdy wrote: post #289
bumby wrote: post #237

Earlier quoted context omitted.

Devils advocate: by subsidizing the “consumption class” you enable more consumption. I get that’s how our current economy works but there are probably a lot of negative externalities associated with increasing consumption.

That's fine. Sure, there are downsides that increase as consumption increases, meaning that overconsumption (however that's defined) is undesirable. However, consumption enables cultural expression that otherwise would be economically untenable. Art, design, music, etc. benefit from economic incentives to overproduce beyond subsistence. That people go above and beyond in their productive capacity in order to enable c…

That's a good point, and I'm in favor of those 'cultural expressions'. But I think we're fooling ourselves if we think somebody is buying a gas-guzzling SUV, or the next iPhone, so they will have the ability to write the next great American novel. I'd venture that most consumption is a status game.

I think my larger point is we have to zoom out for a systems level analysis. We shouldn't assume that the production is de-coupled from the consumption, and production can come with a host of negative externalities. I'm not convinced that wonton consumption (especially for the sake of itself) is a net positive, given human nature's tendency to be insatiable with regard to consumption.

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