The idiot wrote:
The idiot wrote:
Cool, it's a bet! I'll come looking to collect this time next year. :-)
One month further along, the index continues upward, making the chances of seeing 1500 by end November next year just that much more minuscule.
No, it actually makes it more likely:
https://northmantrader.com/2019/12/19/party-like-its-1999/Ghost of Igloi wrote:
You ran out of original material years ago.
Oh, the irony!
?
Igy, with respect I suggest that your understanding of probability and statistics may be missing some fundamental concepts. The time remaining (now 11 months down from 12 when I first offered the bet) is a key determinant of the probability., given the way the wager was framed (originally over the next 12 months). I’m willing to up the odds in your favour, staking $2000 of my imaginary dollars against $50 of yours. That’s doubling down and then doubling down again.
Of course your entire dignity is still up against all of mine... :-)
Shake on it?
The idiot,
Sure. My bet has nothing to do with statistics. That is where you will be wrong, time frame not enforced. It is an asset bubble. Like piling grains of sand into a pyramid form, the last grain leads to collapse. Of course your bet is enhanced by the time to the last speculative grain, however valuations are at the upper end of the last 120 years.
“A speculative bubble is a social epidemic whose contagion is mediated by price movements. News of price increase enriches the early investors, creating word-of-mouth stories about their successes, which stir envy and interest. The excitement then lures more and more people into the market, which causes prices to increase further, attracting yet more people and fueling 'new era' stories, and so on, in successive feedback loops as the bubble grows.”
—Robert Schiller, 2012
Igy
Ghost of Igloi wrote:
The idiot,
Sure. My bet has nothing to do with statistics. That is where you will be wrong, time frame not enforced. It is an asset bubble. Like piling grains of sand into a pyramid form, the last grain leads to collapse. Of course your bet is enhanced by the time to the last speculative grain, however valuations are at the upper end of the last 120 years.
“A speculative bubble is a social epidemic whose contagion is mediated by price movements. News of price increase enriches the early investors, creating word-of-mouth stories about their successes, which stir envy and interest. The excitement then lures more and more people into the market, which causes prices to increase further, attracting yet more people and fueling 'new era' stories, and so on, in successive feedback loops as the bubble grows.”
—Robert Schiller, 2012
Igy
Everybody knows the market will collapse. You’re preaching to the choir.
The question is when? Everything else is just hot air.
Ghost of Igloi wrote:The idiot,
Sure. My bet has nothing to do with statistics. That is where you will be wrong, ....
Igy
Igy,
Predictions are hard, especially about the future...
You’ve made a clear prediction (index below 1100 by the end of next year) and I have challenged you on it with a specific counterclaim (no way it’s below 1500 by end November 2020), with a wager you’ve accepted. For sure one of us will be wrong and owe the other his/her dignity and some imaginary cash. Time will tell, and I can’t wait! ;-)
The idiot,
You may have an interest in this:
http://math.stanford.edu/~ryzhik/bubbles-final.pdf
Also, Didier Sornette in “Why Markets Crash,” uses a model similar to that used in predicting earthquakes. It is a build-up of pressure leading to collapse.
Igy
Bjork wrote:
Ghost of Igloi wrote:
The idiot,
Sure. My bet has nothing to do with statistics. That is where you will be wrong, time frame not enforced. It is an asset bubble. Like piling grains of sand into a pyramid form, the last grain leads to collapse. Of course your bet is enhanced by the time to the last speculative grain, however valuations are at the upper end of the last 120 years.
“A speculative bubble is a social epidemic whose contagion is mediated by price movements. News of price increase enriches the early investors, creating word-of-mouth stories about their successes, which stir envy and interest. The excitement then lures more and more people into the market, which causes prices to increase further, attracting yet more people and fueling 'new era' stories, and so on, in successive feedback loops as the bubble grows.”
—Robert Schiller, 2012
Igy
Everybody knows the market will collapse. You’re preaching to the choir.
The question is when? Everything else is just hot air.
You like others miss the point that timing does not matter. If the bubble expands further it only makes the reversion to mean greater. How else do you explain people paying more for a unit of earnings? It’s speculation, of course it ends, and to the detriment of investors.
The idiot wrote:
Ghost of Igloi wrote:The idiot,
Sure. My bet has nothing to do with statistics. That is where you will be wrong, ....
Igy
Igy,
Predictions are hard, especially about the future...
You’ve made a clear prediction (index below 1100 by the end of next year) and I have challenged you on it with a specific counterclaim (no way it’s below 1500 by end November 2020), with a wager you’ve accepted. For sure one of us will be wrong and owe the other his/her dignity and some imaginary cash. Time will tell, and I can’t wait! ;-)
The idiot,
You like others, try to pin me to a time, and I just throw out a date. It is a guess, but in my view a lot more accurate than your statistics.
Igy
Igy, thanks for the book recommendation I’ve just downloaded it onto my ipad and will put it next in the pile. Currently reading The Book of Why by Judea Pearl, which is also pertinent to this topic as it examines causality in scientific reasoning. Complex, chaotic systems are a core interest of mine, including earthquakes and other natural processes. Predicting the next “big one” is no easier than predicting the next market crash. They are both sure things, but their timing is unknown and highly uncertain. Hence my easy willingness to pose the bet.
Igy if you read back the tape, on page 1780 I think, I didn’t pin you to a time, you offered one and I made a wager around your words. Tick tock... ?
Ghost of Igloi wrote:
You like others miss the point that timing does not matter.
Of course it does. Don’t be stupid.
Maserati wrote:
Yep, markets up again nicely today.
Hey Racket I bought the Tesla options, already looking good.
Ridiculous times?
Heh, heh. So funny this came up today, I just so happened to nibble on a few shares of Tesla this morning, but got bumped out on a stop loss just slightly below my purchase price. No biggie, lost some lunch money only. Can't see buying at these levels without a quick exit strategy, Did the same for Shopify a couple of days ago broke even on that trade and now it's several points lower.
Big picture, though, glad i haven't sold the bulk of my portfolio as this bull just keeps chugging along.
The idiot,
Sure, Thought you would enjoy.
Well certainly the market is a chaotic system currently. Central banks can be blamed for that. You take their QE away and it collapses. Why? Central bank are buying bonds to control supply/demand. Without it interest rates float higher and the bubble pops. Of course once the market understands the debt can never be repaid interest rates move higher anyway. So this bubble does not have the expiration date you expect. It will just be the reverse of what you see today. In a very painful global rebalancing.
Here is the current Schiller CAPE 10. agip quotes the high CAPE 10 over the past 25 years as justification that the market is not expensive.
https://www.multpl.com/shiller-pe
Igy
The idiot wrote:
Igy if you read back the tape, on page 1780 I think, I didn’t pin you to a time, you offered one and I made a wager around your words. Tick tock... ?
The idiot,
OK, others do. Bet is fine. I am in.
Igy
L’Oncle wrote:
Ghost of Igloi wrote:
You like others miss the point that timing does not matter.
Of course it does. Don’t be stupid.
Talking about investors as a class. How else at a market high you get a 20 year index return of 5%? Investors far less.
The idiot wrote:
Ghost of Igloi wrote:The Idiot,
I would contend that your beliefs, which mirrors investors as a whole, in fact supports and makes my assertion more likely. Market history supports my view more than yours. Of course there are proponents who truly believe the regime has changed and the past is no guide for the future. I guess that makes a market.
Igy
Yep, that's exactly right, that' what makes a market. I'll look forward to checking in a year to see whether the SP500 is at 1100 or closer to 3700. Anywhere below 1500 and I will give you a virtual $1000 and all my dignity. If it's over 1500 I'll be calling you out for a virtual $100 and your dignity. Shake on it... :-)
^
The idiot wrote:
Igy if you read back the tape, on page 1780 I think, I didn’t pin you to a time, you offered one and I made a wager around your words. Tick tock... ?
^You previous page:
“Time will tell whether my position is "more right" than yours. My projections have been far more accurate since last March than yours (I projected 3103, you were calling for 1000 or something in that vicinity); yours may well be (and I again contend, with extremely low probability) better than mine for expectations a year from now. Time will be the ultimate judge... :-)
Again, though, I would put good money against the chance of the market being at 1100 by 2021. I would put up $1000 against $100 without thinking twice.”