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So all the popular places are talking about Gamestop, so shouldn't we?
I sorta think we don't need to talk about if we bought it and if we did, when, but rather... what does this mean for the efficient-market hypothesis? And what does this mean for the stock market's relation to the economy?
And I guess, is the rest of the market going down because GME is going up?
I have long been suspicious of the efficient-market hypothesis, but I do admit that I had bias. It does seem though that there are many many cases of long term market inefficiencies, and in some cases they arguably become permanent (Tesla?). I think that this might encourage people in the Biden administration (or left leaning congress persons) to push to increase regulation of the finance sector which they might otherwise ignore to focus on more interesting things.
I also have recently started to think that the economy doing bad can cause stocks to go up. This is in part to explain the last year, not just GME. The people who were hurting were not really part of the stock market, and the people who weren't hurting were no longer spending money going to games or shows or vacations or starting businesses, rather they were staying at home... with excess money... so might as well invest in equities... which always go up if you hold long enough. Even businesses and the rich, in many areas, would want to wait for non-equity investments until they saw the wind blowing before making non-stock market investments. All this, and the need-blind support of governments, caused the market to go up while real suffering went up.
Maybe I haven't put enough hooks, or trolled enough, to start a conversation. I don't really want to say that someone's career is doesn't provide value or anything just to troll though.
JM
I sorta think we don't need to talk about if we bought it and if we did, when, but rather... what does this mean for the efficient-market hypothesis? And what does this mean for the stock market's relation to the economy?
And I guess, is the rest of the market going down because GME is going up?
I have long been suspicious of the efficient-market hypothesis, but I do admit that I had bias. It does seem though that there are many many cases of long term market inefficiencies, and in some cases they arguably become permanent (Tesla?). I think that this might encourage people in the Biden administration (or left leaning congress persons) to push to increase regulation of the finance sector which they might otherwise ignore to focus on more interesting things.
I also have recently started to think that the economy doing bad can cause stocks to go up. This is in part to explain the last year, not just GME. The people who were hurting were not really part of the stock market, and the people who weren't hurting were no longer spending money going to games or shows or vacations or starting businesses, rather they were staying at home... with excess money... so might as well invest in equities... which always go up if you hold long enough. Even businesses and the rich, in many areas, would want to wait for non-equity investments until they saw the wind blowing before making non-stock market investments. All this, and the need-blind support of governments, caused the market to go up while real suffering went up.
Maybe I haven't put enough hooks, or trolled enough, to start a conversation. I don't really want to say that someone's career is doesn't provide value or anything just to troll though.
JM
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