[extropy-chat] Peak Oil news

Robin Hanson rhanson at gmu.edu
Tue Mar 7 22:20:11 UTC 2006

>On Mar 7, 2006, at 12:31 PM, Hal Finney wrote:
>Yes, the markets are the worst predictors around.  Except for everything
>else. :-)
>The reason markets are a good source of information is so obvious that it
>never seems to be written down.  Unlike other opinions, market opinions
>are backed up by the hard-earned cash of the people asserting them.

Samantha Atkins replied:
>Yes obviously but also No.   Markets are full of speculations not 
>only about the underlying but about the actions and opinions of 
>other persons and entities in the market.  It is a dynamic attempt 
>to model the likely future behavior of the other players as much as 
>the actual merits of the underlying commodity.  Speculation is 
>rampant across multiple dimensions.

Bill K replied:
>You do realise that what you are claiming for markets requires a
>degree of faith that is difficult to defend in the real world? ...
>Markets in the real world are corrupt gambling vehicles for a few rich
>people to make a lot of money while ordinary folks lose their savings.
>They are manipulated by speculators, subject to speculative bubbles
>and crashes, fraudulent businesses, selective monopolies, distorted by
>taxation and get-rich-quick schemes.

The claims you both make could all be true, and yet Hal could still be right.
If you dispute the claim that speculative markets are the best predictors
available, please point to another available predictor you think does better.
We have many years of data on speculative markets to evaluate their accuracy.
How many years of data do we have evaluating your favored predictor?

Robin Hanson  rhanson at gmu.edu  http://hanson.gmu.edu
Associate Professor of Economics, George Mason University
MSN 1D3, Carow Hall, Fairfax VA 22030-4444
703-993-2326  FAX: 703-993-2323 

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