Barry Ritholtz: Markets, Lies And Garbage

Ted

FYI: The quality of our discourse is decaying. This was once a standard complaint about the tone and depth of our national political debate. Now it has spilled into the financial realm.

Shall we blame Twitter, trolls or bloggers? I am unsure of the underlying reason. But as we have seen far too, financial discussions seem to entail people arguing at cross-purposes. Bull-bear debates devolve into winning the argument at any cost. Previously, we had a true competition of ideas in the marketplace. Now, we have discussions that range between disingenuous and useless.
The hunt for the truth has been replaced by the search for bragging rights
Regards,
Ted
http://www.bloombergview.com/articles/2014-11-25/markets-lies-and-garbage

MaxBialystock

...I didn't yet read uncle Barry's thing which you linked to, above. But I don't need to do so, in order to agree with those words you offer. An anecdotal little illustration: A bunch of us were sitting in a Speech class, back in the 1980s. It was discovered by the prof. that one of us was on the debate team. He asked for a little sample from that guy. He took a moment to collect his thoughts, then started into what can only be described as a diatribe, deliberately manufactured to keep up the chatter--- loudly--- so as not to let anyone else get a word in. He went on for a couple of minutes, then drew the obligatory applause.

I asked myself: "THIS is what passes for "debate" these days? That's not a show of debating skill, it's a demonstration of how to crowd-out the other guy, so only YOU yourself can be heard." It wasn't an exercise in debate, it was a demonstration of insufferable childishness--- sanctioned and taught as the thing to do! The casualty, of course, is anything resembling the truth.

davidrmoran

I agree totally about all progressivism-rebuttal debate, shouting down with hatred, but the below does not seem anything like what BR claims, dishonest seriously>? --- just maladroitly put and sequenced yet easy to fix by a competent editor:

Stock jockeys can be just as intellectually dishonest as the gold bugs. Carlson again:

Over the last 3 years the S&P 500 is up over 21% per year, while the 5 year returns are almost 16% annually. It’s been on fire. But if you go back 15 years to include both the tech bubble and the Great Recession, the S&P is only up around 4.3% a year. Extend your time horizon to 1980 and the performance is almost 12% per year. From 1928 to 1979, annual returns were much smaller, at around 8% per year. [Starting after the Great Depression] improves annual performance to 10.7% a year from 1933-1979.

just rewrite it to point out the modulations. However good BR he is, he is fundamentally a lazy writer and thinker, 'don't you dare make me work to get to usable conclusions', like most everyone in finance.

The last 3 years, the S&P 500 has been on fire, up over 20% per year, and the 5-year returns are >15% annually. But if you go back 15 years and include both the tech bubble and the Great Recession, it's a bit over 4% a year, only. Now, from 1980, it's almost 12% per year, and starting the year before, 1979, back to 1928, annual returns were around 8%; and moreover if you start *after* the Great Depression, the period 1933-1979, it improves to a bit under 11% annually. So the point is that generally SP500 does a good job and gives good returns regardless, but hits like the tech bubble and the 08-09 crisis make a significant different that takes a while to come out of. yada yada

original is much less helpful, if not foolish

Old_Joe

The last 3 years the S&P 500 has been on fire, up over 20% per year; and the 5-year returns are >15% annually. But if you go back 15 years and include both the tech bubble and the Great Recession, it's a only a bit over 4% a year. To illustrate the difference the selected period will make to the outcome, starting from 1980 it's almost 12% per year, but from 1928 to 1979 it's around 8%, while from 1933 ("after" the Great Depression) to 1979 it improves to almost 11% annually.

I have no doubt that someone else can improve on that, too.

davidrmoran

Nice!