What if Irving Fisher the most famous economist of his time had known the persistency law (see http://www.elitetrader.com/vb/showthread.php?s=&postid=392645#post392645) since Levy discovered and demonstrated the law in 1939 only ? Would he had declared that "stock prices were not overinflated but, rather, had achieved a new, permanent plateau." http://cepa.newschool.edu/het/profiles/fisher.htm "This Yale economist was an eccentric and colorful figure. When Irving Fisher wrote his 1892 dissertation, he constructed a remarkable machine equipped with pumps, wheels, levers and pipes in order to illustrate his price theory - see here for pictures of his draft and his first and second prototypes. Socially, he was an avid advocate of eugenics and health food diets. He made a fortune with his visible index card system - known today as the rolodex - and advocated the establishment of an 100% reserve requirement banking system His fortune was lost and his reputation was severely marred by the 1929 Wall Street Crash, when just days before the crash, he was reassuring investors that stock prices were not overinflated but, rather, had achieved a new, permanent plateau."
Im getting really good. The last six times in a row ive seen a new thread and said, "thats harrytrader" by the looking at the title.
Kenneth Galbraith like to refer to Fisher's prediction as his "immortal estimate" . It's all the more funny that Fisher has created with 2 others the so-called Cowles Commission (see its history http://cowles.econ.yale.edu/reports/20yr/his_1.htm) which is at the very origin of the RMH (Random Market Hypothesis). In 1933 they published an article untitled "Can Stock Market Forecasters forecast ?" their conclusion is that it is doubtful. Notably the Cowles commission has attacked Hamilton father of so-called Dow Theory - Hamilton who has formalised Dow's idea - saying that his forecast results was no more or less good than if it was due to chance .