Niederhoffer: thoughts on the times

Discussion in 'Economics' started by marketsurfer, Feb 28, 2009.


    1. A visit to the bookstores these day is reminiscent of those in 2003. At that time, all the books were about the coming bear market, and the only offset were the tons of worthless tomes with the sanctimonious bearish always, no one can do what I do, channeling of the Sage. Now the books are all about the coming financial panic, how things are going to get much worse, and how the only solution to our problems is to turn everything over to the commanders. I posit that the books these days will turn out to be as wrong in the aggregate as those of 2003. January is usually an up month, having risen 32 of the last 50 years. I hypothesize that there is a tendency for the Januarys that are down to be succeeded by a rally that brings the month-end close to a higher level than the previous year end December, i.e. one month ago. Such a hypothesis would have to take into account a year like 1974 when the market declined 30% from its January close without ever breaking the previous year-end level, and 2008 itself where the market declined some 35% from its January level without a break. Indeed of the 18 years in question, seven of them never achieved a rise above the December level. A strategy of holding to the first break of the previous December level or to the end of the year would have lost on average 4% on the 18 occasions it was triggered.

    2. Yet another example of the theory of least effort comes from

  2. The SPX dropped 150 points since that article was written Feb 9, 2009. :D What is that, about a 16% drop in 12 trading days or so?
  3. just21


    His site must be the only blog in the world without an rss/atom feed.
  4. Pekelo


    I am kind of slow. Can someone summarize it, did he say UP or DOWN?
  5. gaj


    hey, vic beat the rush...blew up again long before it was fashionable!
  6. Daal


    You just got to love how he ignore the fundamentals(reality) to cling into silly contrarian ideologies that have gotten people broke in the last 15 months