The market is not efficient or inefficient at all times. The trick is to find buying opportunities at the inefficient moment and sell when Mr. Efficient Market rules the day for a fleeting moment.
Thursday, December 1, 2011
Still confusing liquidity with solvency
Here the Fed goes again! Flood the world with money. We will take it as it comes, who doesn't love a Santa rally? But the root cause of all ills in the financial system is solvency, no liquidity is going to eliminate it. Besides, when the market finally disciplines the bad decisions made in the past, the Fed can't trust the market anymore. Think about it for a minute, a group of unelected technocrats hiding behind a facade of "central bank independence" repeatedly postpones and disables the reckoning of market, while the riots are starting to build in the street. What bigger enemy do we need to destroy our democracy?
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