tag:blogger.com,1999:blog-5908830827135060852.post4817809882369994531..comments2024-03-01T02:40:14.946-05:00Comments on Bond Economics: Defining Market Efficiency ProperlyBrian Romanchukhttp://www.blogger.com/profile/02699198289421951151noreply@blogger.comBlogger6125tag:blogger.com,1999:blog-5908830827135060852.post-26226423993177436462020-10-20T07:41:12.732-04:002020-10-20T07:41:12.732-04:00This comment has been removed by a blog administrator.abbasihttps://www.blogger.com/profile/03433108265543435739noreply@blogger.comtag:blogger.com,1999:blog-5908830827135060852.post-37723928769069973972018-01-12T04:43:17.038-05:002018-01-12T04:43:17.038-05:00This comment has been removed by a blog administrator.Anonymoushttps://www.blogger.com/profile/00479194546474398617noreply@blogger.comtag:blogger.com,1999:blog-5908830827135060852.post-87530578459632227702017-12-26T02:29:32.206-05:002017-12-26T02:29:32.206-05:00This comment has been removed by a blog administrator.Bloggerhttps://www.blogger.com/profile/07287821785570247118noreply@blogger.comtag:blogger.com,1999:blog-5908830827135060852.post-86698183108664466612017-11-09T12:32:25.775-05:002017-11-09T12:32:25.775-05:00Do a keyword search "Fama video efficient mar...Do a keyword search "Fama video efficient market hypothesis" for some links to videos discussing this theory which seems to be related to your thoughts in this post.<br /><br />The link below contains several definitions taken from literature:<br /><br />http://www.e-m-h.org/definition.html<br /><br />Fama (Sep.–Oct. 1965: ‘Random walks in stock market prices’):<br />‘An “efficient” market is defined as a market where there are large numbers of rational, profit-maximizers actively competing, with each trying to predict future market values of individual securities, and where important current information is almost freely available to all participants.’<br /><br />Two recognized criticisms are joint hypothesis and impossibility:<br /><br />http://www.e-m-h.org/joint.html<br /><br />http://www.e-m-h.org/impossible.html<br /><br />Steven W. Smith provides a coherent model of cognition called the Information-Limited Subreality where the mind (or body-mind if one agrees with the teachings attributed to Buddha) is a Subreality Generating Machine:<br /><br />http://www.dspguide.com/InnerLightTheory/Main.htm<br /><br />Each investor acts with uncertainty from cognitive models that can be characterized as an information-limited subreality. Some investors have access to superior information and have developed superior models of the social dynamics compared to other investors and have developed superior abilities to act on an effective profit strategy. In aggregate there are profits which some attribute to inefficient markets but Karl Marx and other smart guys recognized the expansion of finance makes profits flow onto aggregate balance sheets via the income statement. In other words the expansion of debt generates profits and inflates assets and equity values.Joe Leotehttps://www.blogger.com/profile/01292763300917387201noreply@blogger.comtag:blogger.com,1999:blog-5908830827135060852.post-70407899819402789902017-11-09T05:22:51.217-05:002017-11-09T05:22:51.217-05:00thnkuthnkujohnnoreply@blogger.comtag:blogger.com,1999:blog-5908830827135060852.post-23440362478333256122017-11-08T13:36:15.753-05:002017-11-08T13:36:15.753-05:00In Thermodynamics the products of a process (that ...In Thermodynamics the products of a process (that consumes a scarce energy resource or that convert natural power flows to human ends) are recognized as heat and work. Heat is sometimes valuable and work is always valuable so the concept of efficiency relates to how much heat is wasted or dissipated to the environment as an unwanted by-product. This does not encompass the human value judgments concerning what activities are a proper or valid use of energy, conversion of power, and heat dissipation compared to a different disposition of the same scarce resources. Ownership is the legal right to dispose of resources without answering to society (i.e., you don't need to ask anyone for permission or its better to ask forgiveness then ask permission).<br /><br />The efficient market hypothesis (EMH) in Modern Finance Theory seems to be different from the concepts of efficiency developed in law and economics. The EMH is usually used to argue that one cannot outperform the market in the long run in a competitive or highly efficient market so it is better to index-invest or develop a strategy that more or less accepts the market rate of return. In law and economics efficiency means an effort to optimize individual preferences in a social context.Joe Leotehttps://www.blogger.com/profile/01292763300917387201noreply@blogger.com