Monday, February 9, 2015

Maggie Chamberlain, Chapter 7, Question 6

A passage that stuck out to me as really interesting was the part in which Wheelan compared the stock market to grocery store checkout lines. The stock market has always been somewhat confusing to me, but the analogy he used helped me to understand it's unpredictability. When people are watching stocks, they all have the same information, so they all know to look out for the man with more than one shopping cart or the lady with a handful of coupons, but then everyone is just pushed to the same line without those people in it and the process doesn't move any faster. Similarly, we can watch for predictable signs, like a lady with a handful of coupons, but we can't predict a man who forgot to weigh his avocados. A stock may look good one day, but fail the next. The market is unpredictable because of the signs we can't see.

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