Thanks Jack. I always appreciate eloquently worded and cogent responses, which you achieved in spades.
Pabst - I do believe you are correct. This is why Graham's sage wisdom has stood the test of time, through all kinds of market cycles.
Because nobody can tell you with a 100% certainty what the next flip of a coin will be... but I can tell you what the next 100 coin tosses will be... that's probability... that's the successful trader
Bingo ! Same as the casino. Casinos have a tiny but sure edge and they make money on the high number of bets/transactions. Same in trading. My best system which is up 48% fot the year is only 56% right (profits) and profits/losses ratio is just 1.17. But the combination of the two makes it a successful system (So far!).
So many try because so many do not know a thing about probability and statistics. My guess is even if you were able to communicate clearly to these people how efficient the market really is they still would not pay it any heed because of ego and greed. One other thing: the majority of money made through market activity is through broker fees not trading.
The guy who wrote a book about value investing and security analysis s quoted as saying that people cannot predict the markets? You sure you are quoting him correctly? Besides good investors do not try and predict, the interpret what is going on in the market and invest with the trend, be it intraday, short-term or long-term.
investing and trading are two different thing. most trade system is trying to find the odds in favor of it while investing involves looking for value (Later on Peter Lynch expand this idea to "growth" as well) In early days, without help of computers and instant information, trading is really difficult to do. Modern technologies provides necessary tools for people go from investing to trading. This is why people is "predicting" direction of market. (If they are right more than 50% of time, they can make money)
Graham was wrong. In fact there are many of you ET forum guys that are constantly predicting that this or that is going to happen. In fact, to prove to you that we all have the ability to predict events in the future with high accuracy, i'm going to make not one, but two predictions, right here and now. And not only that, i will personally guarantee these predictions to be one-hundred percent accurate: 1. The market will crash; 2. You are going to die. Oh, and Graham was the inventor of the "Graham" cracker of course.
You are forgetting 3. everything will change and 4. the rate of change is increasing over time. Merry Christmas an best wishes to everyone for 2007. Maria.