Home > Uncategorized > “If you take away the skill that Buffett has Buffett has no skill” is a bullshit thesis.

“If you take away the skill that Buffett has Buffett has no skill” is a bullshit thesis.

25iq

Blogger cites an older (misinformed ) Economist article citing an academic study (rubbish) as support for Efficient Market Hypothesis (EMH) here:  http://www.themoneyillusion.com/?p=19209.

If the blogger is trying to get nearly all people to buy index funds, well say so. But don’t use that to argue that markets are *always* efficient. Or that EMH supports deeply broken economic theories like dynamic stochastic general equilibrium (DSGE).

The academic thesis in the case of the paper cited by the Economist is essentially as follows:  If you take away the skill that Buffett has Buffett has no skill.  It’s a bullshit thesis.

Like most academics their desire is to reduce investing to mathematics since without math there is no hope of getting tenure.  That the thesis is not properly tied to reality is not a concern in the academy when it comes to academic finance. What is critical is that the math is pretty, adopting things like…

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