I would say that's a pretty controversial take unless you strictly mean babies. At the point a kid can walk they are certainly capable of some level of reasoning because just walking successfully prior to it becoming muscle memory requires a fair amount of reasoning and children very rapidly figure out new things both spatial and logical.
So if you believe babies do not reason, and walking humans do, then younger humans up to some age do not reason, yes?
And dogs. Looks like all animals are rational by their definition.
There's a lot of manipulation going on. Attempts to pop the bubble artificially, prematurely. There's a lot of impatience and illusion of control out there. You can bet that when a real bubble bursts, we won't be seeing articles about it on Wired in the run up.
Eugene Fama also believes the value of a Bitcoin will be zero (as do I). So he is implicitly calling Bitcoin a bubble. He does this because he understands how money works and how Bitcoin works.
Yes but his point is it's impossible to detect in realtime. Timing.
You can detect that you're in a bubble, but there's no way to know how long it will keep going before it bursts.
There is better awareness of everything bc of the internet, you are just in the disbelief phase even though markets have already peaked and insiders are heading for the exits.
Eugene Fama believes it's impossible to detect a bubble. Why do you think he's wrong?
Why do you think he is right? Lots of people detected previous bubbles. The problem is that the same people also missed or called out bubbles that never happened.
There was, at least towards the end. FED chair at the time described it as 'irrational exuberance'. Warren Buffett made an excellent speech in front of most Silicon Valley titans at the time - telling them that their wealth is about to be blown up. This isn't rocket science - do anybody sane believe that OpenAI will spend what, 1.5 Trillion $ they project ? Quite a big chunck of Oracle, Nvidia and others projections…
Warnings today are mainstream and widely understood, unlike late‑90s dot-coms where Buffett was largely ignored. Buffett explicitly says he doesn't invest in complicated businesses, finances aside. Plus, core AI players are profitable and funding capex from real earnings, valuations are concentrated in a few mega-caps, revenues are real, and financing is healthier. So while parts of AI may be overvalued, it’s structu…
"core AI players are profitable and funding capex from real earnings"
What ? Who's profitable except NVidia who is selling shovels (increasingly to itself) ?
Edit. Profitable on AI, if by profitable you mean from other sources then yes.
I do know who he is, why do you assume I don't, just so you think you can appear smart on the internet? Pretty pathetic. Gundalach has better investing success than you and Fama, you should listen to what he says instead of just assume he's wrong, that's called being intellectually dishonest.
Yeah I guess you fundamentally misunderstand the difference/significance between someone who is seeking objective peer-reviewed truth and someone who tries to seduce investors to put money into their fund for fees on the internet with wild theories and anecdotal gambling success. It's not your fault, you must be a teenager or something.
Why are you so angry buddy, are you way overinvested in tech or something? What are you even trying to argue, that it's impossible to value the market?
The impetus is that 90% of our country is in recession and the rest are soon to follow. Delinquencies are rising fast and not just in subprime. Layoffs are at levels not seen since 2008. Crypto, tech stocks and many housing markets have already peaked or are already in bear markets. The crash is here and it's inevitably going to get worse.
I’m not seeing delinquency increases or values close to .com or ‘08 on this ( https://fred.stlouisfed.org/series/DRALACBN ) or more specific series
The overall rates are increasing but contagion takes time to spread from subprime which are getting hit much harder, credit card, car and student loan in particular. They will spike when things really hit the fan, first the asset values have to deflate.
Yeah I guess you fundamentally misunderstand the difference/significance between someone who is seeking objective peer-reviewed truth and someone who tries to seduce investors to put money into their fund for fees on the internet with wild theories and anecdotal gambling success. It's not your fault, you must be a teenager or something.
Why are you so angry buddy, are you way overinvested in tech or something? What are you even trying to argue, that it's impossible to value the market?
Yeah markets are disconnected from fundamentals. Conduct causal inference with any fundamental metric on forward returns and you'll see they have almost zero predictive ability. That supports the efficient market hypothesis, as do many many other observations.
If you could simply "value the market" in some analytical way, then any simple neural network would (universally) approximate it. Instead you see the vast vast majority of machine learning quant funds fail. Here are the specific details as to why: https://www.youtube.com/watch?v=BRUlSm4gdQ4
Yes but his point is it's impossible to detect in realtime. Timing.
You can detect that you're in a bubble, but there's no way to know how long it will keep going before it bursts.
Well yes, we're in a permanent bubble with fractional reserve banking and central planning. Mises institute spends a lot of resources explaining how that works to the public, etc. That's not helpful insight though in terms of taking informed action e.g. as an investor.
Why are you so angry buddy, are you way overinvested in tech or something? What are you even trying to argue, that it's impossible to value the market?
Yeah markets are disconnected from fundamentals. Conduct causal inference with any fundamental metric on forward returns and you'll see they have almost zero predictive ability. That supports the efficient market hypothesis, as do many many other observations. If you could simply "value the market" in some analytical way, then any simple neural network would (universally) approximate it. Instead you see the vast vast…
So how was I able to make money on both crashes this year and buy the bottom in 2022, how did Burry know it was a bubble in 2008, how did Greenspan know it in the late 1990s? Humans act irrationally, they get overconfident and overreach then things pull back, boom/busts in specific industries and whole economies have happened since the beginning of history. We humans only have so many ways to value a company and us investors all look at the same ones, we have jobs though that require us to put values to these assets for our clients. This is how human emotions and psychology gets into the market. Fama might be right it's impossible to mathematically predict the exact day and time the bubble will crash, but that doesn't mean the obvious bubble we are seeing isn't a bubble.