. .. and can we hear from someone who had bought Google at around the IPO price, a true new market wizard?
Your question shows a fundamental misunderstanding of the issue with quantitative analysis, and the current scientification of financial education. Quants are not employed to make predictions. That is a myth. Most are just well paid glorified IT guys, What quants & their ilk are guilty of is formulating risk models that can't withstand outlying events. This is the reason that mild events cause such huge ripples in the market.
You're just being silly again, pedro... You can't abdicate responsibility for your decisions by saying that you relied on some smart guy's opinion. Personally, my risk is everywhere and always my personal responsibility, nobody else's. A model is a model. It never promises to be a perfect representation of a very complicated, messy reality. Again, it's nobody's fault but yours for not realizing that. That is EXACTLY the point. The CHOICE IS YOURS. It's up to you to choose to withstand 'suffering at the hands of smart idiots' or 'go to the corner shop guy'. Either one might prove to be wrong, but guess who bears the ultimate responsibility? It's neither the 'smart idiot', nor is it the 'corner shop guy'. It's the person who makes the decision.
Before making wild assumptions about what caused the crash of 1987, you need to have a basic grasp of economics. As I recall, interest rates were doing wild things that year prior to the crash, that precipitated it. I don't have the 87 bond or index charts up, but I believe that was the year that happened. It was not a surprise at all, and had little to do with quants or mathematicians. I made $5K that day, by loading up on mutual funds at EOD prices. I figured it was a serious overreaction, and I cashed in. But your analysis is seriously weak. As I said before, unsupported opinions are fertilizer.
Do you realise that newbie posters are responsible for a lot of poor thought and many garbage opinions brought into ET, yours especially included?
That last statement is not true. The Value at Risk at Bear Stearns was just over $60M the day before the value of Bear Stears was wiped out to the tune of $8bn. How is it my choice that people in huge financial institutions rely on flawed mathematical concepts to take huge risk ?