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Author Topic: Sea Ice or Land Ice. Which is the Bigger Threat?  (Read 5916 times)

gerontocrat

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Re: Sea Ice or Land Ice. Which is the Bigger Threat?
« Reply #50 on: August 04, 2019, 09:46:46 PM »
C'mon. There is never going to be a craze for real estate scheduled to go under water.
"Para a Causa do Povo a Luta Continua!"
"And that's all I'm going to say about that". Forrest Gump
"Damn, I wanted to see what happened next" (Epitaph)

dnem

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Re: Sea Ice or Land Ice. Which is the Bigger Threat?
« Reply #51 on: August 05, 2019, 03:34:18 PM »
Rich, the opposite!  Coastal real estate already supports irrational valuations. My point is that markets could not be less "cold and rational". They are the sum of collective human behavior and can be highly non-linear and emotional. Sure, underwriters might pull the plug on mortgage/insurance, but if normal humans get spooked, there could be a run for the exists.

dnem

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Re: Sea Ice or Land Ice. Which is the Bigger Threat?
« Reply #52 on: August 05, 2019, 03:38:45 PM »
Fun fact: The 'Tulip Mania' is a myth.

Link >> https://www.barrons.com/articles/the-real-story-of-the-dutch-tulip-bubble-is-even-more-fascinating-than-the-myth-youve-heard-51557666037

And btw, so are many economic narratives. Homo Economicus, a myth. Trickle-down, a very very stupid myth.

Did you read your article?  It was an irrational bubble and crash.  The article is about some of the subtleties in how the story is remembered and told.

blumenkraft

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Re: Sea Ice or Land Ice. Which is the Bigger Threat?
« Reply #53 on: August 05, 2019, 05:58:34 PM »
Quote
how the story is remembered and told.

That is the point. It is told and remembered ridiculously exaggerated.
Refugees welcome

dnem

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Re: Sea Ice or Land Ice. Which is the Bigger Threat?
« Reply #54 on: August 06, 2019, 01:22:06 AM »
Ok, fine.  How about the 2004 dot.com bust?  Were the absurd valuations of companies that never made a profit and had no viable business model effected by human emotions or were they the result of "cold and rational markets"??  My only point was that markets move on emotions and are hardly rational.  Markets overshoot and collapse.  Maybe you don't think the Tulip Mania is the best example of that, but it was an overshoot and collapse. Sheesh!

petm

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Re: Sea Ice or Land Ice. Which is the Bigger Threat?
« Reply #55 on: August 06, 2019, 01:54:53 AM »
The stock market is something akin to a pyramid scheme. You better believe that when the next crash comes, which is likely to be large and soon, the big players will get out with few losses. I often hear the same people who say "there's no free lunch" also make statements indicating that, in fact, they believe the stock market is a free lunch. Dnem is right -- markets are mostly based on 'sentiment', i.e., emotion. Once the panic hits, look out!

Klondike Kat

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Re: Sea Ice or Land Ice. Which is the Bigger Threat?
« Reply #56 on: August 06, 2019, 02:54:30 PM »
The stock market is something akin to a pyramid scheme. You better believe that when the next crash comes, which is likely to be large and soon, the big players will get out with few losses. I often hear the same people who say "there's no free lunch" also make statements indicating that, in fact, they believe the stock market is a free lunch. Dnem is right -- markets are mostly based on 'sentiment', i.e., emotion. Once the panic hits, look out!

This is not correct.  While emotions can cause short-term gyrations, the longer term is based on performance.  Apple did not become the first company to have a stock market evaluation in excess of $1 trillion based on sentiment.  Tesla might be based on sentiment.  Sentiment can only carry a company's stock so far.  Eventually, they have to produce.  You may be referring to future expectations, which is loosely based on sentiment.  Investors tend to look 3-6 months out when making decisions.  Many factors come into play, most of which are company metrics.  Additionally, the investors try to gauge global or consumer patterns that may weigh on the market.  This is where sentiment enters the fray. 

Small investors tend to be herd investors; meaning that they follow the fold.  They are the ones likely to panic when the market falls.  We have had three instances of "panic" selling in the past year, last December, late May, and yesterday.  In the previous two, the market rebounded to new heights.  Today, the market is opening higher.  We shall see what happens.  The pyramid reference is completely false.  Those at the bottom make money also.  If you have some special insight into the timing and magnitude of the next crash, please enlighten us.  We could all benefit from such important knowledge.

dnem

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Re: Sea Ice or Land Ice. Which is the Bigger Threat?
« Reply #57 on: August 06, 2019, 03:06:20 PM »
Historically, you are of course correct, KK. As the economy has gone through several doublings over the past century, market valuations have tracked that.  The sentiment driven booms and busts along the way are noise in that very clear signal. If you think the global economy can double again without destroying the biosphere, well, good on ya.  Invest away. (Sorry, OT).